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From the TheGenieLab US - TheGenieLab Blog blog
While most everyone understands what B2C, B2B and even C2C, the evolution of branding, lifestyle, social media, apps and omnichannel merging together has given birth to D2C. Of course at the center of it all is the enablement of this marketing strategy is the Internet. D2C is a form of B2C in a streamlined way and has redefined its ability for deployment. However, be prepared to see a new dominant, effective and profitable marketing method employed by key brands in 2020.
D2C origins
The birth of D2C came from direct marketing that utilized large direct-mail catalog type magazines. Officially called Catalogue/Direct marketing, the Internet formulated a digital version of its evolution. Sears (Roebuck), Mongomery Ward and shortly thereafter Dell Computers all started in this space in the early 1990s. As the Internet speeds, penetration increases, and computing devices have evolved, so has the need to bring efficiency to this marketing method. Today Direct marketing is no longer an outward push to the consumer base, it is an interactive social phenomenon, where companies partake in the social lifestyle of their products, the culture influencers that drive them, and support organizations that bring success stories around your brand.
Who would employ D2C
Manufacturers and major brands that are willing to bypass retail, resellers and supply chain based organizations. This is a bold move as they are now competing with their own partners. One could say that the likes of Amazon, Walmart, eBay, and several dominant outlets/channels are so powerful, that they weaken the product’s brand equity. Therefore the tools employed by these outlets/channels are fair game to be employed by the Brands and it's working.
What type of business is most likely to explore D2C
With barriers being so low to enter D2C, almost any business can enter the space. However, to make it effective – a good following are key starting points to have. Companies like Away, a luggage retailer used D2C to penetrate in a commodity-based market. Forging a direct relationship with the customer is nothing new. Dell Inc. being a pioneer in their direct model in the PC space reached No. 1 in sales using this business model. Success does however very much depend on customer experience, quality, ease of use, and good customer service.
The type of products that make D2C easy
Commodity based products lend themselves to be easy going products, where price and customized choices are easy to offer. If the products are not straightforward to operate/configure or deliver and have a dependency on the retail channel to deploy/sell/support – then D2C may not be the channel/marketing method for you.
Today’s D2C architecture
Being part of the “conversation” is the centerpiece of the D2C’s marketing. What does that mean you might ask? When your product is being discussed, its part of the lifestyle of consumers and business people, it is then funneled back into an App, a website to which it makes it easy to obtain/deliver that particular product.
The mindshare of your brand/product is a key component, thus the effort of cultivating/nurturing groups and influencers on social media is key to attract followers. Creating “trendiness” is difficult, but when achieved, it delivers massive rewards. When Dell Inc. used “Dude, you’re getting a Dell!” (2002) with the “Dell Dude” Ben Curtis as Steve, sales increased 4x and orders went through the roof. A goofy, trendy teen making technology hip had his own web-portal, his own favorite peripherals and kids would ask their parents for a Dell Dude computer. That was done without social media and was managed by a very successful DDB Advertising Agency, a firm that did the famous Budweiser Frogs (1999-2002).
Nike is now using its Brand to deliver directly to its customers via the Nike App. Between its social media, curation, retail stores, events, sponsorships, and omnichannel outlets – their D2C is becoming their strongest weapon against counterfeiters and growing their brand equity at the same time.