The “It” Factor: What Successful D2C Companies Can Teach Brands in 2020

Posted by Shaina Kaye on August 20, 2020 at 11:38 AM

In the early 2010s, companies like Everlane and Warby Parker paved the way for the first generation of Direct to Consumer (D2C) brands, offering consumers a fully digital brand experience and new companies a relatively easy, innovative and scalable way to sell products and services. A storefront was not necessary, but a strong brand story was. A brick and mortar storefront was no longer an operational requirement for brands - all you needed was an online shop and a creative social media presence.

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Fast forward to 2020, and as we all know, a lot has changed. From consumer purchasing behavior to social media newsfeeds to the most resonant online brand marketing, the D2C landscape has evolved considerably. The most relevant change: in light of the coronavirus pandemic, consumers have spent more time at home, shopping online for both basic necessities and “nice-to-haves” at a steady frequency. 

With the pandemic going strong in the majority of the country, many consumers remain hesitant to shop at brick and mortar stores, despite the health and safety precautions that many brands with physical storefronts have taken. Adobe Analytics found that online sales were up a whopping 76 percent in June 2020 in a year-over-year comparison with June 2019. While there are still several months of the year left to go, Adobe anticipates that online sales in 2020 will surpass the total number of online sales in 2019 by October 5th of this year, well before the holiday shopping season kicks off. 

The rise in online sales has been both advantageous for D2C companies accustomed to fully online storefronts and a wake-up call for brands that have lagged behind on optimizing their online presence and shopping experiences. As brands face a future that could potentially place an even more prominent spotlight on the transition to a primarily digital consumer marketplace across a number of industries, products and services, it is worth taking a look at what can be uncovered from brands that are veterans of the D2C space. 

By leaning into just a few of the most successful aspects of D2C brands, companies of all shapes and sizes can holistically plan for - and better understand - their customers today while planning for a constantly evolving future. 

Personalization, customization and flexibility

In addition to providing the feeling of a “safer” shopping experience in the age of COVID-19, D2C brands also tend to offer a more personal one. Customizable products and flexible subscription services are just a few of the most common ways in which some of the most successful D2C companies are making their customers’ shopping experience a more meaningful and engaging one. These differentiators were prevalent among entirely digital companies prior to the pandemic, but remain as important, if not more so, as consumers with less discretionary income refocus their budgets and spending priorities.

In doing so, customers will tend to allocate their money toward brands that provide a customer-first experience. Companies like Dollar Shave Club, for instance, provide a commodity (razors and skincare) in an entirely customizable, subscription-based format, offering customers a “personalized, top-shelf grooming routine as unique” as they are. The customer gets exactly what they want or need, and nothing more (or less) delivered right to their door at regular intervals that the customer can easily adjust to fit their schedule and frequency preferences. Care/of, a D2C vitamin company, provides customers with a quiz that helps them determine a completely personalized, unique-to-the-individual mix of daily vitamins.

By eliminating the brick-and-mortar storefront, D2C brands automatically rely on their relationship with customers as a way to successfully grow their business. Whether that is personalized email marketing, online chats with actual stylists, or nurturing an online community among loyal customers, the investment in the customer-brand relationship made by D2C brands like BarkBox, Birchbox and Wantable is a clear indicator that customers value brands that take the time to build relationships beyond one-time transactions.

Transparent social values

Removing a physical storefront - a place where customers can go and interact with team members face-to-face and touch, see or otherwise experience a product or service - inherently puts more focus and emphasis on a D2C brand’s story. The story highlights the brand’s mission and values and, in order to foster a true and trusting relationship with customers, must be highly visible and easily accessible. Many of today’s most successful D2C brands have integrated commitments outside of direct sales as a core component of what sets them apart. 

And with 75 percent of millennial consumers and more than two-thirds of Gen Z consumers committed to making more environmentally friendly purchases (according to a December 2018 Nielsen report) that transparency can make all the difference for brands that vocalize and integrate their values into their story versus brands that hesitate or avoid doing so altogether.

Sustainability, and a commitment to fight back against climate change is evident in just about every facet of a customer’s experience with the mission-driven D2C brand Allbirds. The company not only makes high-quality shoes out of recycled materials, it tracks the individual carbon footprints of each product made, doing everything possible from ideation to execution to limit carbon waste. The company zeroes out whatever carbon footprint is created with carbon offsets, making it a carbon-neutral company. All of that in and of itself is significant, but the key takeaway is that Allbirds makes that information easily accessible and a fundamental part of its messaging. Consumers know, and appreciate, exactly what they’re spending their money on when they make a purchase with the brand.

Ready to take a cue from D2C brands, strengthen your brand story and add value to your current customer-brand relationship? We can help. Reach out today and start a conversation.

Topics: Customer-Centric Marketing, Customer Engagement, customer experience, innovation, customer centric, B Corporation, Shopping Experience, climate change, brand value, sustainability, EnergyWire, D2C, customer trends, brand building, coronavirus

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