[{"@context":"http:\/\/schema.org","@type":"Article","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/04\/13\/direct-to-consumer-dtc-examples\/#Article","articleBody":"COVID-19 forced businesses to adapt, change, and innovate like never before. With the acceleration of e-commerce, direct-to-consumer (DTC) business models are taking center stage. And while they may\u2019ve been a mystery before the pandemic, now you can find DTC examples everywhere \u2013 often via the brands that are thriving the most.\nDirect-to-consumer business models allow brands to maintain control over the entire sales process and to build the direct, trusted, and value-driven relationships with customers they may not have had in the past.\n \nDirect to consumer brands and models that are killing it\n   Discover some of the best direct to consumer brands and how can you up your e-commerce game to compete in the digital landscape.  \nBy becoming customer-centric companies unburdened by an exclusive dependence on the channel, they can benefit from greater control over the margin of operations and gain better understanding of the end consumer. This allows them to personalize the entire buying journey for consumers and meet the individual needs of each one.\nDTC examples: Models that help brands shine\nLet\u2019s look at five DTC examples of business models that can be adopted by consumer brands developing a direct-to-consumer (D2C) strategy, and explore their differences and benefits:\nDirect sales\nD2C with redirection to the channel\nMarketplaces\nSocial commerce\nD2C with retailer support\nDirect to consumer business model: Direct sales\nThis is perhaps the most widespread D2C model worldwide. It\u2019s especially popular in Spain.\nOn one hand, the benefits of this DTC example are tangible: increased profit margins, access to consumer information, and the ability to optimize the brand experience for each customer.\nOn the other hand, it also introduces more complexity for brands that must develop direct demand-generation strategies, create supply channels, and an immediate delivery process, as well as manage returns and payment gateways. Nike is a top example of this D2C model.\n \nHow to build a DTC business for maximum profitability\n   Building a successful direct-to-consumer business requires more than just setting up an e-commerce shop. Make the most out of a DTC investment by taking a holistic view that includes fulfillment, storytelling, and more.  \nDTC model with redirection to the channel\nSome brands, however, want to avoid disrupting their existing distribution channels since it can significantly alter their business and operating mode and endanger their classic business posture and connection with customers.\nIn this direct-to-consumer business model, customer engagement is almost tangential. The business engages buyers in essentially the same way as the direct sales model but, in the final stages, hands off the lead to the traditional channel.\n \nDTC trends: Up your direct to consumer game with these killer moves\n   Don't ring the death knell for brick and mortar quite yet: Learn the DTC trends that are reviving retail and breaking barriers.  \nFor example, the Pikolin bedding brand conducts the entire sales process on its digital platform before referring customers to specific distributors predefined by the company to complete the sale. This way, the company can still build a relationship with the customer and gain deeper insights about them without disrupting its established partner and channel relationships.\nDirect sales through a marketplace\nMarketplaces continue to cement their function as search engines for consumer products. According to multiple studies, 66% of consumers now search for products on Amazon rather than Google. Marketplaces offer the advantage of allowing companies of virtually any size to establish a market presence and reach more customers than they can on their own.\nHowever, competition can be fierce and the marketplace platform, not the brand, controls the customer\u2019s journey and owns the relationship. Also, each marketplace has specific tools that must be understood and effectively employed. Profitability relies on often highly specialized techniques, and appropriate logistics must be defined. Finally, both paid and organic search must be continuously optimized in these sales channels.\nSocial commerce and live shopping\nSocial networks have become increasingly important in consumers\u2019 lives and they using them to shop. According to Kantar Media\u2019s e-commerce ON 2020 study, 18% of online purchases were made on Facebook, Instagram, and WhatsApp, particularly in the case of beauty, diaper, and fresh food categories.\n \nHere we are now, entertain us: The future of shopping\n   The future of shopping is entertainment. It's not enough to just have an online storefront. Brands have to do more. Consumers today are looking for novel, immersive, and entertaining shopping experiences.  \nAnother popular recent trend is live shopping: the creation of live broadcasts that use popular influencers or media streamers to showcase a company\u2019s products. This trend is especially emergent in China on platforms such as Taobao, Douyin or Kuaishou.\nD2C business model with retailer support\u00a0\nIn many cases, brands devote a significant part of their marketing budgets to support marketing and advertising for the distribution chain. Traditionally, these budgets were allocated to trade marketing or joint above-the-line (ATL) marketing spend.\nThe evolution and consolidation of retailers\u2019 e-commerce platforms has meant that some of the budget brands used to allocate to the channel are applied to supporting visibility of their brands on retailers\u2019 platforms.\nMaking the move\nThe decision to adopt a direct-to-consumer business model is not a simple one. Multiple factors that affect different parts of the business must be taken into account and the most effective model will depend on a brand\u2019s maturity in its category.\nBut time is of the essence for brands to remain relevant in this climate. Hundreds of digital native \u201cpure plays\u201d with a narrow vertical focus continue to challenge the hegemony of traditional brands in the marketplace by bypassing intermediary channels altogether and gaining increasingly larger share of market.\nAre you ready to evolve your business to meet this challenge?\nCreate online shopping experiences that keep customers coming back for more. Learn more HERE.","author":{"@type":"Person","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/04\/13\/direct-to-consumer-dtc-examples\/#Article_Person","image":{"@type":"ImageObject","@id":"https:\/\/www.the-future-of-commerce.com\/2021\/04\/13\/direct-to-consumer-dtc-examples\/#Article_Person_ImageObject","url":"https:\/\/23x6xj3o92m9361dbu2ij362-wpengine.netdna-ssl.com\/wp-content\/uploads\/2021\/04\/Daniel-Casal-1-150x150.jpg"},"name":"Daniel Casal","sameAs":"https:\/\/www.linkedin.com\/in\/danielcasal\/","url":"https:\/\/www.the-future-of-commerce.com\/contributor\/daniel-casal\/"},"dateModified":"2021-08-02T15:21:34+00:00","datePublished":"2021-04-13T05:06:04+00:00","description":"Direct to consumer strategies allow brands to build trusted, value-driven relationships. 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