Direct-to-consumer and D2C: Why Shopify is the perfect tool for direct-to-consumer strategy

Tupperware, Thermomix or Avon - for brands like these, one sales strategy has played a decisive role for decades: direct sales. For some years now, young, innovative companies have been shaking up this model and adding a fresh online touch. The magic word here is D2C. In this blog post, we'll explain what D2C brands are all about, what's important in D2C marketing, and why Shopify is the perfect platform.

D2C definition

Let's start by unraveling the acronym, because that explains some of it itself. D2C, sometimes also DTC, stands for Direct-to-Consumer and refers to a sales strategy in which middlemen in the trade are cut out and companies do business directly with their customers. The common method of selling products through retailers and resellers is largely eliminated, with D2C brands relying instead on e-commerce and their own online stores. Design processes, manufacturing and sales are managed from a single source.

Another characteristic of D2C brands is that they have a rather small product range, but have chosen a specific niche and serve it perfectly. We'll explain what it takes in the course of this article, but for now let's get back to Tupperware and Co.

Take advantage of the Shopify free trial period

Shopify has already proven several times that it is neither a cliché nor an empty promise to make retail better for everyone. Anyone who needs their own online store can now test Shopify for 3 days free of charge and for €1 in the first month and thus sell via their own online store.

You can launch your new online store on this page and sell your store products through it.

The difference between direct-to-consumer and direct sales

Vacuum cleaner salesmen, agent sales and home demonstrations - you too may have all this in mind when you think of direct sales. Direct selling is probably the oldest sales method in the world. This involves the personal sale of products (or services) - often within the consumer's own four walls. At least that's how the Bundesverband Direktvertrieb Deutschland e.V. (BDD) sees it: "Direct selling is generally understood to mean the personal sale of goods and services to consumers in their homes or workplaces, in environments close to or similar to their homes." Online sales - with the exception of online parties - have not yet been mentioned in this sales context.

Elsewhere, the view is different. Some definitions (including Wikipedia's) see direct selling as including the sale of goods via e-commerce.
Direct-to-consumer can therefore be seen as a sub-form of direct sales, even if the salesroom here looks somewhat different than it did a few years ago - what matters is close customer loyalty, and this can be built up just as strongly here.

Advantages and disadvantages of D2C

The D2C strategy is powerful and brings incredible benefits to companies and their brands. All sales activities are self-directed, so companies can maintain full control at all times and define their own sales channels.

Another advantage is that there are no costs for intermediary dealers and the sales proceeds remain entirely with the company. However, exceptions prove the rule here. Many D2C brands decide to also sell on Amazon, Avocadostore or other marketplaces, or to offer their products in supermarkets - because that is precisely part of their customer approach and philosophy. They want to be where their customers are and get in touch with them at every point.

Personal communication and direct customer contact are top priorities in the direct-to-consumer strategy. And that's exactly what goes down well. Customer wishes can be quickly recorded so that they can be incorporated into new product creations and satisfy consumer needs. This ensures that customers feel a much stronger connection with a brand and the percentage of repeat buyers grows. Often, this even creates fixed communities that actively talk about and interact with a brand on social media channels.

Another big advantage is also that a large amount of data can be collected, which in turn can be used again to improve the customer experience and personalize communication.

Disadvantages

There's no question that the D2C strategy is not the easiest of undertakings, because it is labor-intensive. Companies have to take care of all sales activities themselves. It takes know-how, experience and qualified employees to set up the necessary sales structures to fully exploit market potential. This means that companies incur fixed costs for personnel, marketing and setting up the right infrastructure. A switch to D2C sales may also require adjustments to fulfillment processing (including inventory monitoring, returns or exchange processes), which can take up a considerable amount of time.

What is important in D2C marketing?

The user experience is the most important point in direct-to-consumer and is pushed by many tricks, especially in marketing. This is because all the data that can be collected through this strategy can be used in communication and the personalization of approaches and offers. This includes not only demographic data such as age, gender or location, but also purchasing preferences such as colors or styles. Customers feel particularly comfortable with D2C brands as a result of a personalized experience, which leads to high customer lifetime value.

But how is this achieved? Social media is the key. Of course, many other marketing tools play into it, too, e.g.:

• Personalized emails and newsletters

• Live chats in the online shop

• Easy tracking and returns of orders

• Virtual and augmented reality in the store

But social networks such as Instagram, Facebook, Snapchat or TikTok in particular can be used to take the brand experience to a new level and perfect storytelling.

Brands like Shape Republic, which put a lot of emphasis on D2C sales, are leading the way.

They have mastered the game of Facebook and especially Instagram perfectly and are omnipresent on these channels. Through their work, they reach a dedicated and loyal clientele that engages with the brand. The following can be learned from D2C brands, or brands that take this approach to great lengths, like Shape Republic:

• They use fantastic images and emotional storytelling.

• They engage their customers. (e.g. through polls in Instagram Stories)

• They use prominent influencers.

• They call on their followers to spread their own brand message. (e.g. by using certain hashtags, tell-a-friend actions or calling for user-generated content)

• You use video content to create a more virtual experience.

• You give followers the feeling of being part of a community. (e.g., through Facebook group, exclusive offers for customers with customer accounts, a community name

You want to use direct-to-consumer marketing for yourself? Then make your brand tangible, get in direct contact with your target group, ask for opinions, answer questions, give your followers a space for lively exchange and be present!

Branding in D2C commerce

Branding and positioning in D2C commerce play a decisive role in the success of a brand, but can also be accompanied by challenges.

Aspects of branding

Target group analysis and segmentation

A thorough analysis of the target group is the starting point for branding in the D2C sector. By identifying the demographic characteristics, behaviors and needs of the target group, the brand can be positioned in a targeted manner and relevant messages can be communicated.

Storytelling

Strong branding in the D2C sector is often based on a compelling brand story (storytelling) that conveys the identity and values of the brand. By telling authentic stories and creating emotional connections, brands can build a deeper connection with their customers.

Brand presence

A consistent brand presence across all channels is essential for a clear positioning in the market. This includes the design and style of communication, the use of colors and fonts as well as the design of product packaging and the online presence.

Brand experience and customer interaction

Interaction with customers is an essential part of brand building in the D2C sector. A positive brand experience through intuitive user experiences on the website, fast delivery, personalized customer service and the use of feedback for continuous improvement strengthen the brand image and customer loyalty.

Flexibility and adaptability

Due to rapid changes in the market and customer needs, it is important that D2C brands are flexible and can adapt their positioning when necessary. The ability to recognize trends at an early stage and react to changes in the market environment is crucial for long-term success.

Challenges

• Brand awareness and visibility: One of the first challenges is to make the brand known and increase its visibility. Without going through intermediaries, D2C brands need to reach their target audience directly and draw attention to themselves, which can be achieved through targeted marketing strategies and investment in advertising and influencer marketing.

• Building a loyal customer base: Customer loyalty is crucial to the long-term success of a D2C brand. It takes time and commitment to build a loyal customer base that regularly purchases from the brand and recommends it to others.

• Logistics and shipping: Logistics and shipping management are critical to success in direct selling. Efficient order processing, fast delivery times and reliable returns handling are of great importance to customers and require a well-thought-out logistics strategy.

• Pricing and competition: In direct selling, brands often compete directly with each other for the customer's attention and budget. Smart pricing that reflects the value of the products while remaining competitive is therefore crucial.

• Scalability and resource management: Building a D2C brand often requires significant investment in resources such as marketing, technology and personnel.

D2C with Shopify

Platforms like Shopify are streamlined, easy to manage, and mobile friendly. In addition, they offer access to global suppliers and are therefore perfect for a direct-to-consumer strategy. New products can be quickly tested here and fed directly into the Instagram feeds of the target group.
Shopify's many themes and app options allow for optimal storytelling, not only through plenty of space for good images, but also through the possibility of integrating videos or augmented reality features. Shopify's app store has it all, whether apps for inventory management, tracking new products, or marketing tricks.

Shopify offers all the important features without complicating normal day-to-day business. Especially for a quick start in e-commerce, Shopify offers all the technically necessary features. If you need a little more functionality, that's no problem. So far, every requirement could be solved with Shopify. By the way, we are happy to be your contact partner!

If you want to build a D2C brand with a matching online store, some elements should definitely be covered - and yes, all of the following can be mapped through Shopify:

• Strong brand representation

• Clean, mobile-friendly design that is easy to navigate

• Advanced search options

• High-quality product illustrations - through images and videos

• Accurate product information and integration of customer reviews

• Strong call-to-action

• A cohesive, structured checkout

• The ability to get in touch (through chats, social media links, contact options)

Shopify also offers some concrete marketing tools to improve and personalize direct customer engagement, such as Shopify Email. This allows merchants and retailers to launch email marketing campaigns directly from the Shopify backend, drawing on the store's existing design to deliver the perfect brand experience. Emails with new product offers and release news thus travel directly from your central Shopify administration to your customers' inboxes and encourage repeat purchases.

Shopify also makes selling via Facebook and Instagram incomparably easy. The Facebook Pixel can be easily added to Shopify, so tracking your customers is integrated quickly and easily. Also, Facebook and Instagram can be added as sales channels, so you can have a store with your products directly on Facebook and Instagram and tag them accordingly in their posts.

Do you want to run social media ads? Then ask Kit for help! Kit is a virtual assistant directly from Shopify that helps Shopify merchants create campaigns step by step.

Do you want to elevate your brand experience and contact with your customers to the maximum? Then Shopify POS could also be the right solution for you. In your retail store, you meet your target audience face to face and, thanks to the Shopify POS system, you can pick them up with personalized offers even after the purchase, covering multiple touchpoints.

Conclusion

Let's face it - we could continue this list indefinitely, but we probably got our point across. Shopify, as an omni-channel store system, is an ideal companion for your D2C strategy!