The direct to consumer business model (D2C) is disrupting the traditional supply chain. Rather than go through wholesalers, distributors, and retailers, many manufacturers now choose to sell their products directly to the consumer – cutting out any middlemen completely.
The benefits of this are plentiful. The most obvious upshot is that manufacturers get to boost profits by bypassing the 60% revenue cut that goes to retailers, but that’s not all. It also eliminates that barrier between manufacturer and consumer, which gives the brand greater control over its reputation, sales, and marketing strategy.
A few decades ago, a D2C strategy might not have been viable, as manufacturers just didn’t have the time or resources to run their own physical stores. Thanks to the growth of the internet, however, they no longer need to. Now, manufacturers can simply set up their own eCommerce website and invest in marketing to sell directly to the consumer online.
Still, it’s a big switch to make. The biggest challenge manufacturers switching to a D2C model face is in marketing. That’s why we’ve put together 4 tips for success to help.
1. Work With Your Retail Partners, Not Against Them
When you switch to a D2C business model, you essentially become a direct competitor to your existing retail partners that are selling your products. This isn’t a great way to launch your new business model; you don’t want to start stealing business from your previous B2B customers and alienating them completely.
That’s why a good idea is to work with them to find a mutually-beneficial way to move forward. You might, for example, leave existing product lines open exclusively to your retail partners, and sell other, different products yourself directly to the consumer.
This ‘hybrid’ model means you can keep up those important relationships with retailers without missing out on an opportunity to boost profits.
2. Win on Price
One way manufacturers can get the upper-hand when it comes to marketing is to make products more affordable. Your retail competitors have more overheads than you; they have to mark up their products to still make a profit on what they paid to their distributors.
You’re manufacturing your own products, so you don’t have to worry about this. You can potentially price your competitors right out of the market. D2C brand Dollar Shave Club did exactly this to great success.
3. Put Content First
When it comes to digital marketing in 2019, content marketing is king. To establish a relationship with your customers and bring them into your sales funnel, you have to provide them with free, useful content. This might mean publishing regular blog posts as part of your search marketing efforts, or publishing videos to YouTube.
4. Leverage Influencer Marketing
If you haven’t heard of influencer marketing yet, now’s the time to learn about it. It’s one of the most important marketing strategies in 2019 and can help you to launch your D2C business and get it off the ground quickly.
Influencer marketing involves working with influencers, such as Instagrammers, YouTubers, celebrities, or Twitch stars to promote your products. There are lots of ways to go about this, some brands choose to run paid promotional campaigns, or adopt an affiliate structure. It’s up to you.