Overcoming Direct to Consumer E-Commerce Challenges: 5 Ways to Achieve Success

Earlier this year I discussed what to know about the Direct to Consumer e-commerce market going into 2019. This article offers insight on why direct to consumer channel should not be ignored by manufactures and as how it is imperative to have a strategy around it to be future-ready. Being future-ready is the difference between good and great companies. The ones that are constantly confronting the reality of the market and consistently evolving will have staying power, while those that are not are will be pushed out by others that are- quicker than we anticipated. One avenue to explore for the manufacture is going direct to consumer (DTC). Direct to consumer e-commerce can be extremely intimidating and complex for the manufacture because it opens up a whole world of challenges from foundational to operational.

At Echidna, we have helped our B2B clients overcome numerous challenges when it comes to being future ready, specifically building a DTC strategy and executing on their DTC e-commerce operations. Five challenges in particular continually come up with our clients as they look to build and improve upon their DTC business. Here are tips on how to help you compete and expand in this space while overcoming these common challenges.

Challenge One: To provide meaningful, emotional value to your consumers- more than just a convenience.

• First, consider your back-end systems, if your infrastructure and logistics are not equipped to handle the direct channel, the meaningful customer experience will suffer, which will in turn negatively impact brand equity. Ask yourself, does your existing technology solutions fulfill your requirements to create a successful, functioning DTC business? 
• When it comes to user experience, change your mindset to start thinking as if you were a retailer and aligning your marketing engagements with DTC methods to help provide meaningful engagements with your customers. Start with creating customer journey maps to show how mobile, social media and the web will dictate customer behavior. No two customers journey will be alike (one might be looking to replace a broken product, while the other is throwing a party in a few weeks). This will guide how the entire organization should adapt and consider the user’s feelings, questions and needs.
• Make your experiences data-driven to gain as much insight as possible on who your consumers are
• Customize products that consumers can only get by going direct to consumer. For example, look at how Coca-Cola ran a hugely successful campaign around personalized bottles via their website, direct to consumer.
• Gather all your brand advocates (aka your top consumers) together in one place to share experiences with your brand and form a true connection with your brand.

Challenge Two: Showcasing innovation with new products and services only DTC can offer.

• Show the breadth of your brand. Many retailers are stopping short, not offering a brands full product line. Focus on the user experience and how to offer this on your site with ease so the consumer isn’t over whelmed. Ask yourself, what has the consumer been missing out on that aligns with what they love in store?
• Redefine the experience your brand provides by offering value add-ons. It is helpful to consider the long term relationship your consumer is having with your brand- be innovative!

Challenge Three: Channel conflict with retailers and distributors

As a manufacture, you have already built solid relationships with distributors and retailers to sell your brand. You will want to work with your sales channels openly to communicate strategies to benefit all parties involved. Numerous strategies exist on how to overcome this challenge, but a couple of the most successful include: Ship to Store via your online checkout and consistent online pricing to not undercut retailers.

Challenge Four: Having the right team in place.

Creating a DTC business means you need to review your internal teams. Taking on consumers means a single orders, returns, and upped customer service calls. Marketing processes will differ and logistics are changed compared to that of a manufacture. You might need to change job descriptions, onboard new team members, or partner with an outside agency to provide the development and design expertise that is required for their online experience.

Challenge Five: To offer subscription or not?

Subscription services shouldn’t be overlooked. They are still heavily used and popular, a great option when going DTC for brand loyalty and harnessing important customer data to further offer personalized experiences. Subscribers to your products are great prospects for up-sells and you have their consistent renewals. Just remember it is not a perfect science, allow yourself time to test and iterate with pricing, offers and promotions to find what works best for your consumers.

Final Thoughts

The Direct to Consumer market will require a customer centric approach organizationally and foundational and operational change will need to happen in order to meet the modern consumer requirements. By overcoming the challenges of DTC, you will be able to create new revenue streams, increase margin, brand loyalty and gaining more control of the brand itself. Ultimately, having a DTC channel you will be able to further compete against your competitors, including Amazon who is quickly executing on Amazon Business- a B2B marketplace (more on that in an upcoming article, stay tuned).

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This article was written by Kali Kasprzyk and originally posted on Echidna's website here.