The Future Of Direct-To-Consumer Strategy And The Role Of Data

With D2C becoming more of a force in 2021, brands need to look towards more data-driven strategies in order to succeed.

The world in 2021 looks a lot different to how things were at the beginning of 2020. Some things have been completely uprooted thanks to the COVID-19 pandemic, but in other cases the virus simply sped up trends that were already in effect. This is very much the case with the growth of direct-to-consumer (D2C) business.

What is direct-to-consumer strategy?

D2C brands sell their products straight to their customers, without relying on third parties. This is a higher-risk, higher-reward strategy. This can be extremely lucrative, but usually means a brand has to insert itself directly into a market rather than being able to utilise the success of an established third-party seller. However, it seems to be the way the market is heading, with even major brands like Adidas pivoting to this model.

What is the opportunity with D2C marketing?

The D2C market is projected to grow by 19.2% in 2021, and already more than half of consumers prefer buying from a brand directly. For the vast majority of customers this is due to a combination of convenience and ease of use, and the pandemic has accelerated this, with more people shopping online and being able to easily go directly to the brands they like. So what does that mean for retailers?

“More than half of consumers prefer buying from a brand directly.”

The challenge of customer data

While D2C is a risk, it is also a major opportunity for brands. By allowing consumers to purchase directly from you, you can use tools like Google Analytics to measure their behaviour, demographics and more. This opens up whole new avenues for you when it comes to marketing.

The information that you collect yourself is known as first-party data, and it is an extremely useful tool. In fact, 92% of marketers believe using it to understand what your customers want is critical to growth. It’s also something your customers will expect, with 61% expecting you to tailor their experiences based on their preferences. Furthermore, 90% of marketers agree that this approach significantly contributes to profitability.

You can also use the same first-party data to understand how best to market to your customers. For example, if you find that most of the people visiting your site come from social media, that’s a sign that an investment in Facebook or Instagram ads could be worthwhile.

Data strategy and loyalty

The data that direct-to-consumer strategy provides doesn’t just let you find new audiences; it’s also essential to retaining your current customers and boosting your loyalty programs. An easy win, for example, is to use a customer’s data to suggest other items they might enjoy. More importantly, having first-party customer data in your loyalty program helps you provide personalised offers and improve your ROI.

This is something we have a lot of experience with, as our loyalty offering is entirely data-driven. With our platform, you can not only collect 1st party data from customers but turn this into actionable insights. This means you can supercharge your marketing campaigns and start using real data instead of guesswork.

All this information is easily accessible through our Loyalty Console dashboard. This allows complete visibility over what customers are doing and when, providing all the information to effectively market to them.

If you want to power your direct-to-consumer strategy whilst improving your customer retention and loyalty, don’t hesitate to get in touch!