How to build a multi-million pound kick-ass DTC eCommerce brand: Part 1
Part 1: The COVID catalyst for Direct-To-Consumer acceleration
In this 5-part series, we’ll be giving you some actionable insights for building a kick-ass DTC eCommerce brand.
- Why DTC is accelerating at a rapid pace
- Some clear advantages of adopting DTC
- How to brilliantly execute a DTC model
- Key insights and considerations you’ll need to make
- How to clearly define your DTC strategy
Think of it as your bite-size, sectioned handbook. One you can put into action. And it’s all yours. For free.
Without doubt, COVID-19 (yes, I said it, I’m sorry), acted as a major catalyst for speeding up innovation within commerce. Last year, CEO of Microsoft, Satya Nadella stated that they’d seen “two years’ worth of digital transformation in two months” and it’s clear that this has only accelerated since then. Statista delivered some pretty impressive findings on the shift in online eCommerce purchases for products that were typically bought in store (as a result of the pandemic).
This shift to online shopping and the explosion in eCommerce has meant that not only do brands need to innovate at pace and ‘up their game’ so to speak, the importance for such brands to have a direct relationship with their customers, is now more prevalent than ever. Those brands already adopting a DTC model, enjoyed a head start when we entered the unprecedented (everyone’s new favourite word) global pandemic and have experienced huge success, whilst those without a DTC offering either had to act quickly or get left behind. Brands that had heavily relied on in-store retail sales, suddenly had to adopt an eCommerce and digital-first mindset, rapidly upgrading websites above simple brand awareness to support customer engagement and frictionless online transactions, at scale. Many shifted to selling direct and for some, for the first time.
Sea changes emerged with brands that had never before sold DTC. For example, Heinz (established back in 1869), launched its first ever DTC channel in just seven days. Heinz UK Head of eCommerce, Jean-Phillipe Nier stating: “In the future, this DTC channel will be incredibly powerful to get closer to our consumers, get insight, and take learnings to the rest of our business”.
Huge players such as Nike, whose sales operations run through both its own, and franchised stores, announced that it has future plans to generate 50% of its sales from DTC through its own online store and eCommerce platform, citing the need for a greater connection with customers, more transparent operations and greater control over distribution.
In no time at all, those in-store, retail-only businesses that led the way with the shift to a DTC model, found themselves on the cutting-edge with the ability to offer digital discounts, improved targeted campaigns and more tailored services. Of course, as well as being able to automate workflows to improve their customer experience. Despite the world being in meltdown with border closures, mass lockdowns and disruptions to supply chains, those brands with a DTC offering were able to attract exceptional levels of online traffic (think Black Friday levels).
If you’re a brand not currently selling DTC online, you may be limiting the ways in which you can sell at all if a future crisis of this nature occurs, one which results in similar lockdowns, border closures, and further contributes to the decimation of high street retail. Digital strategy is no longer separate to business strategy. Your digital transformation strategy is central to the successful operation of your business, growth, and for future-proofing your brand.
Whilst retail sales continued to fall last year – partly as a result of the pandemic, but mainly as a result of the continued trajectory of decline for traditional high street retail – eCommerce sales grew by a whopping 46% in 2020.
In 2020 alone, as high as 87% of UK households made online purchases within the preceding 12 months, making it the highest online purchase acceleration rate here in the past 11 years.
It’s without question that there has been a sharp acceleration in DTC. The pace of change is rapid and here to stay and in our next edition in the series, we’ll cover some of the reasons why DTC brands are thriving and the core advantages that adopting a DTC model can bring for your brand in the ever-changing digital landscape.
Please feel free to share your thoughts in the comments section below on part 1 of this 5-part series on building a kick-ass DTC eCommerce brand.
Hope you enjoyed and see you all on the next one.