Last editedMay 20222 min read
In the not-too-distant past, small retailers had to work with distributors to get their product to consumers. With the rise of ecommerce, it’s now possible to handle distribution and shipping yourself for a D2C, or direct to consumer, business model. There are numerous benefits to considering a D2C ecommerce model, which we’ll cover in this guide.
D2C meaning: What is D2C ecommerce?
D2C stands for ‘direct to consumer’, and as the name suggests it describes any company that produces, distributes, and ships its own products. To enable direct sales, a retail company might utilise multiple channels including social media, retail stores, and an ecommerce website. For example, imagine a winery that produces and bottles its own bottles onsite. It then sells them directly to customers within its retail shop as well as online.
No matter the channels used, the basic D2C meaning simply refers to a business that cuts out any third-party retailers or distributors.
D2C vs B2B vs B2C ecommerce
There are several acronyms used to describe business models.
D2C means direct to consumer, as described above.
B2B describes a business-to-business sales model.
B2C describes a business-to-consumer sales model.
How does B2C differ from D2C? While D2C is always direct, B2C might involve a series of steps starting with the manufacturer and moving on to a wholesaler, distributor, retailer, and consumer. Another common difference between D2C and these other models is that B2B and B2C often deal with bulk sales to smaller retailers, rather than individual direct sales.
D2C ecommerce examples
There are numerous businesses both within the UK and abroad that are using the D2C model. Here are a few key D2C ecommerce examples and success stories:
Warby Parker – This eyewear brand allows consumers to purchase its glasses directly from the company online, rather than going through a third-party like Specsavers or Vision Express.
Dollar Shave Club – This company sends basic shaving kits on a one-off or subscription basis, offering custom products directly from the retailer.
Reformation – This trendy clothing brand maintains full control of its manufacturing, packaging and shipping process. Products are made from recycled materials and shipped using sustainable packaging.
What are the benefits of D2C ecommerce?
Could a D2C ecommerce strategy work for your business? Here are two prime reasons to consider it.
Omnichannel sales experience: Consumers see your brand from beginning to end across multiple channels. They might first interact with your brand over social media, before moving on to make a purchase online or in-person. The brand retains full control over packaging for a seamless identity across all channels.
Customer relationship management: This type of business model naturally encourages deeper customer interactions. You’ll be communicating with consumers directly, building stronger relationships and improving brand loyalty through positive interaction. Using a combination of social media and shopping platforms, the company controls the customer experience from development to purchase.
How to create a D2C sales strategy
If you’re thinking of using the D2C business model, you’ll have some logistics to work out. Rather than sourcing a distributor who takes care of shipping on your behalf, you’ll need to figure out how to package, brand, and ship products directly to your customers. One of the key factors to think about is your brand identity and the customer experience.
Analyse the customer journey using data and pain points to create a more effective, seamless buying experience. A/B testing, data testing and a good D2C ecommerce trend forecast should guide your strategy. Technology plays a fundamental role in a modern D2C ecommerce model, with ecommerce platforms like Shopify and Magento providing a user-friendly checkout experience.
Think carefully about your payment methods as well. GoCardless integrates with over 300 partners for a joined-up customer journey and workflow. Pull-based direct debit payments put the retailer in control of payment timings, reducing delays and improving customer satisfaction. It’s both easy and cost-effective for small businesses to get started, taking all the guesswork out of the payment aspect of a D2C ecommerce model.
We can help
GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.
