DTC: What is it, and how can it benefit your brand!
Direct-to-Consumer has changed the market purchasing and establishes strong relationships with the consumers directly. The best of DTC is that it helps gain customer experience and attracts the mindset of the consumers. DTC makes a massive revenue from its sales strategy.
It’s pretty challenging to set up a DTC brand. Around $100 is the expenditure for starting a Direct-To-Consumer business, like buying the domain and getting a subscription to access the website and its functions. Even they look into the tools used by the brand owners and go for SMS or email marketing.
DTC and its advantages
When the individual sells their product directly to the end-users without any middlemen, wholesalers, or retailers is defined as DTC. They deal with the customers through digital platforms through mobile applications or websites at a reasonable price.
Advantages of DTC
As DTC sells directly to the customer, it has a complete idea about its purchasing skills and reaction to specific products. They are in direct connection with the consumers and help them grow their interest in satisfying their desires.
The first and foremost thing that DTC looks into is the quality of the products that need to be rendered digitally. Even the DTC makes it easy to understand the worth of the products and their value. The main focus of the DTC is to get rid of middlemen glitches and maintain transparency with the customers.
DTC keeps on updating its website or applications with all sorts of information to make consumers’ purchasing more accessible and reliable. As of now, many other brands provide restricted information to their consumers, but DTC works utterly opposite of it and keeps transparency with their buyers. Even it maintains a good bond with the seller and the buyer to attract the brands’ purchasing.
DTC maintains loyalty and trust and never disappoints the customer on such grounds. They keep on displaying the discounts and updating the points to redeem on time and get all the benefits out of it.
Limitations of DTC
It becomes a little challenging to get your first customer without any third-party bits of help makes the work strenuous. But it does happen, and DTC gets its first customer with all its effort and attracts more customers slowly.
To make people aware of the brand, paid advertising is done, and customer acquisition costs are also higher to maintain the brand value and dignity. DTC takes the sole authority to deal with the customers from purchasing to shipping the products at the correct address within a few days. They provide:
- Services like taking orders.
- Delivery of the products.
- Exchange of the consequences if needed.
- Communicating the customer service if and when required to solve the query or resolve the issues.
As DTC takes all the responsibility and is concerned about the traffic on their website. This may sometimes delay the work, but its quality is maintained without any second thought.
Why third-party was in tradition for business model
With time every business model has its benefits. Down the lane, somewhere third-party involvement in the business model also has a lot of advantages while launching a brand product.
- The third party, through their connection, will give great exposure to the brand.
- They use campaigns or advertisements to attract people to the store. That’s how trafficking was done in traditional days.
- The involvement of third-party customers is stress-free if they don’t like the product, it can be returned or exchanged within a few days.
- The intermediary or middleman gets their payment with every sale. If they do not sell anything, they will not be paid for the work or effort they put in.
- The middlemen can also provide other services like delivery of the products or product management, but these are time-consuming and can charge high rates for the same.
These are some reasons why the business model is evolving and getting tilted towards DTC business models to get all sorts of benefits.
DTC brand and its business models examples
Some of the examples of direct-to-consumer are Casper, Away, Beardbrand, and Warby Parker.
Casper has adopted the DTC model to sell mattresses online. Conventionally, the customers have to pay extra to get the bed delivered at home. But Casper has changed the pattern and started providing the mattress at your doorstep free of cost. They do not charge for the delivery of the products. Casper provides a ten years warranty and a 100-night free trial to their customer to purchase without any risk. If the customer is not satisfied with the quality of service, they can return the product, and the total amount is refundable. It’s pretty straightforward to deal with the Casper brand.
Warby Parker deals in sending the pair of glasses to the customer, and the customer returns the drinks they do not like. They believe the consumer should not go out of style and order the mirrors according to need and affordability. They are the best example of the DTC business model and are still trending among the audience.
Away is positioned as a travel company rather than a Luggage company. They have engaged the customer through social media sites like Instagram. Away followed the concept of DTC and removed the presence of intermediaries to reduce the cost at an affordable rate as compared to earlier luggage companies which charge high for the service.
The DTC model is so effective that around 81% of the customers expect to have at least one purchase in DTC in the coming years. Even the audience is responding in a great way to make the market more attractive and efficient. The DTC model is one of the best business plans to mesmerize customers purchasing their desired products. It also deals in personalized purchasing and looks into the experience of the consumers for further businesses.
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