Even though retail marketing is still very popular, direct-to-consumer (DTC) marketing is becoming a better and more appealing alternative. This is because direct-to-consumer products do better on the open internet market than on a crowded store shelf next to competing products.
If direct-to-consumer marketing is going to work, though, it will need new marketing skills that can match or even beat the power of merchants. Let’s talk about many things you should know about marketing directly to consumers (DTC).
What is Direct to Consumer Marketing (DTC)?
Direct-to-consumer (DTC) marketing is when a company or manufacturer sells goods directly to the consumer. The DTC retail idea is to sell things without going through wholesalers or other retailers.
- Direct-to-consumer marketing is marketing that goes straight to the customer, even when an intermediary seller may be needed.
- DTC marketing used to be a way for financial companies and companies that sell prescription drugs to reach their customers.
- DTC marketing often uses ads that ask for help, remind people, or make claims about the product.
- The DTC retail model is becoming more and more popular because it brings companies and customers closer together. DTC brands interact directly with customers, which helps build relationships. Going direct-to-consumer also helps companies find out who buys their products and why.
DTC makes things easier for clients and cuts out several steps in the buying process. In fact, in 2021, 66% of internet shoppers bought directly from businesses. The eMarketer forecast says that US direct-to-consumer (DTC) eCommerce sales will rise by 16.9% from 2021 to 2022, reaching $151.2 billion.
How Direct-to-Consumer (DTC) Marketing Works
In 1981, Reader’s Digest put out the first direct-to-consumer print ad in the United States. Then, DTC advertising was made legal in New Zealand in 1981, Hong Kong in 1953, and Brazil in 2008.
The following describe how DTC marketing works:
- DTC companies keep track of how much of each product they have on hand.
- When a customer places an order, the brand is in charge of sorting, packing, and sending out the goods.
- Not having to depend on other people to find or deliver the items.
- Direct-to-consumer (DTC) brands talk to their customers directly and are in charge of the fulfillment process.
- These kinds of marketing strategies could work well to bring in customers in the middle market, who are often not well served by traditional distribution channels. When combined with fiduciary advice, this kind of advertising may help people save more, plan for retirement, and make other financial plans.
DTC marketing has many advantages
Your unique position as a direct-to-consumer (DTC) brand will let you take advantage of all the benefits that traditional brands can’t quite match. As an example:
Better control: Direct-to-consumer (DTC) brands have full control over how they market, brand, and sell their products. You decide where your product goes, so you don’t have to worry about it being next to a competitor’s product at your local superstore.
More insight into what the customer wants: Keep information about your customers from getting into the hands of a merchant. This will help you learn more about your customers. As a direct-to-consumer marketer, you should check the quality of the first-party data you have before you use it.
Faster time to market: CPG companies sometimes hesitate to bring new ideas to market quickly because they have to please internal stakeholders, customers, and retailers. If a DTC brand wants to try out a new product, they only need to think about their brand and their customers.
Higher margins: If you don’t have to sell your products to retailers at a loss, you can keep the extra money and use it to improve your products or your marketing.
Wholesale vs. Direct to Consumer (DTC)
DTC basically means selling your own product directly to customers instead of through an online marketplace like AliExpress or Amazon.
A wholesale model is when a manufacturer sells a large amount of a product to a retailer. The store will then advertise and sell these items to customers, acting as a middleman.
The DTC model aims to cut costs and bring in more money by giving merchants lower sales commissions and lowering the cost of display space.
Most of the time, direct-to-consumer marketing uses a more targeted message to reach the people who are most likely to be interested in the product. DTC often keeps track of how clients’ tastes change over time so that it can reach a more focused group of customers.
Wholesale and direct-to-consumer (DTC) retail models are different in these ways:
DTC model: Maker > Advertising/Website > Customer.
Wholesale model: Maker > Distributor > Wholesaler > Retailer > Customer.
Top Direct-to-Consumer (DTC) Marketing Strategies You Should Know
DTC brands depend more on the power of marketing than other brands do. Branding efforts at the top of the funnel are important to help them get their product out there. After that, they keep getting bigger. Here are eight direct-to-consumer (DTC) marketing strategies that the best direct-to-consumer (DTC) companies use to make their marketing work better.
Do Marketing Data Analysis
DTC brands need to know who they’re trying to reach because they have to build stronger relationships with customers than CPG brands. So, it’s important to collect and analyze high-quality data from your customers whenever you can.
Make a name for your brand
Brand identity is one of the most important things for businesses that sell directly to customers. When a lead needs one of your products again, the first thing they will remember about you is your unique brand image.
Creating a unique brand identity takes time and needs to happen in many ways. Larger teams should think about making style guides and standardized graphics so that their work looks the same on all platforms.
Make the customers’ experience unique
Personalization helps direct-to-consumer (DTC) companies build stronger relationships with their customers by making it easier for them to fit their products and marketing to their needs. DTC companies mostly do business online, so they need to focus on personalization to stand out from the competition and make their products seem like the best choice.
Social media marketing isn’t just for direct-to-consumer (DTC) companies, but it works very well for those that rely on close relationships with their customers. You can get more people to follow you on social media and keep them interested in your business if you regularly post original, useful content.
If you have a strong social media presence, you’ll also be able to see content made by your followers. You could, for example, ask people to post pictures of themselves using your products along with a hashtag that is related to your business.
While running a contest, remind people to tell their friends or followers about it. If you give people a second entry for sharing your content on their profiles, you will get more word-of-mouth advertising.
Influencer marketing is worth the money.
Even though it can be hard to build a strong brand image, authenticity is a key part of branding. By using influencer marketing, firms that sell directly to consumers can take advantage of an influencer’s already-established reputation.
DTC vendors must find influencers whose image fits with that of their brand and who can make the right impression on their audience. Also, make sure their target market is similar to the customers you usually work with in terms of age, gender, and location.
One of the best things about influencer marketing is that you only pay for results, not impressions. If a connection with an influencer doesn’t lead to many conversions, you can easily end it without losing a lot of money.
Offline Marketing Channel: Don’t Miss It
Online, direct-to-consumer (DTC) businesses are successful, but if you want to grow, you might need to find customers outside of your digital cocoon. Offline marketing gives you the best chance to do this. Putting up posters at a bus stop or having brand ambassadors talk to people on the street are two ways to make potential new customers more aware of your brand.
Keep in mind that it might be hard to connect offline marketing, especially strategies for building brand awareness, to your total number of sales. Offline marketing is something that many companies spend money on in the hopes that it will make more people aware of their products. If your team needs real results, you could buy a brand optimization tool to measure and predict how offline and online actions will affect sales.
Email marketing should be used.
DTC businesses often use digital channels, even though many of them are “walled gardens.” This means that you have to rely on the platform to get your message out, can’t check the accuracy of your data on your own, and can’t be as specific.
But email marketing can be fully controlled by DTC marketers. If you have a client’s email address, you can get in touch with them directly and find out how they responded to your outreach. Then, no matter what channel your clients choose, you can add that information to your tool for tracking marketing performance to help drive future campaigns.
Make your products unique.
Even though some direct-to-consumer companies only sell ready-made products, custom products are sometimes the best way to meet the tastes of each customer. As more people want customized products, the market for all kinds of unique items is growing.
Direct-to-consumer (DTC) marketing isn’t new, but in the last ten or twenty years, it’s become a more realistic option. For DTC brand development to go well, you need to know a lot about marketing data.
Because most of your business will be done online, you need a marketing performance measurement system that can collect and analyze marketing data from all of your channels. At dropship-empire Blog, you can find more useful marketing tips.