Intermediaries, go-betweens, brokers, and middlemen:
Avert your eyes.
You’re not going to like what you’re about to read.
Direct to consumer sales, or D2C sales, in the U.S. rose from $6.85 billion in 2017 to $17.75 billion in 2020.
Here’s why:
More than half of shoppers, according to Astound Commerce Insight, prefer to shop with manufacturers than retailers.
More than half of online shoppers want to cut the middleman out.
That’s why so many B2B businesses (see what is a B2B company) are integrating D2C into their sales strategy. A merchandiser that sells directly to consumers is a company with a huge competitive advantage.
Here’s what you need to know about it.
What Is D2C? Direct to Consumer Definition
Direct to consumer sales, also known as direct to consumer eCommerce (see: what is e commerce), is a sales strategy where a business sells directly to customers.
That’s opposed to what B2B businesses usually do: sell to vendors, retailers, and resellers.
But when a wholesaler (see what is wholesale), manufacturer, or producer transacts with individual end consumers through a headless eCommerce website, that’s the meaning of D2C.
Because when anyone speaks of the direct to consumer meaning, it’s assumed that the context is of a B2B business expanding its sales strategy.
Benefits of Direct to Consumer Sales
Directo to consumer sales can be embraced by any pre-retail part of the supply chain in many ways. In the traditional retail model, the pre-retail parts of the supply chain all deal with bulk purchases and bulk shipping. In fact, manufacturers, wholesalers, and distributors are all built around operating in bulk.
That’s why it can be difficult for many B2B businesses to pivot to a D2C strategy on their own.
But if they can, there are a lot of benefits.
This is what a B2B company can expect if they integrate D2C ecommerce:
- Control over brand engagement and reputation. Manufacturers and producers don’t have much control over how and when their products are sold by retailers. A retailer may have salespeople with little knowledge of the product. The display may not be branded properly. There are numerous ways first impressions and engagement with end users can harm your brand. But if you’re in total control of that, you can deliver a stellar customer experience directly from who knows your product best: you.
- Consistent omnichannel DTC marketing. Omniwhat?? Channel. Check it out: omnichannel marketing means marketing through numerous channels. That's not the norm for B2B marketing. When your business controls everything from manufacturing to sales, you control every customer touchpoint. That means that whatever channel you choose to market in—SEO, physical packaging, social media, print media, etc.—your marketing will be consistent. Ask any brand marketing professional what the most important part of branding is and they’ll say consistency.
- Deep user research. When you interact directly with your end users, you don’t get to know them. But when you’re digitally transacting with them, you can gather data. User behavior data like browsing habits, bounce rates, and cart abandonment. Or market research data by communicating directly with customers about their likes, dislikes, and expectations. That type of stuff is invaluable when it comes to delivering industry-leading customer experiences and, thereby, growing your business.
- Alignment with modern consumer expectations. 59% of online shoppers do research at the manufacturer’s website before purchase. And around that number prefer to make the purchase at the manufacturer’s website. Consumers aren’t satisfied with hearsay about their purchases; they want information straight from the source. By going D2C, you deliver on those expectations.
D2C Distribution
One benefit the direct to consumer business model offers is the ability to experiment with D2C distribution. Direct to consumer brands in total control of their supply chains, marketing, and customer experience need not rely on retail outlets as in times past.
D2C distribution options include:
- Direct sales online through a website or online marketplace. This is the most common and cost effective D2C distribution strategy. And the one that most firmly leverages the benefits and agility of direct to consumer sales.
- Partnerships with physical retailers. Traditional third-party retail need not be totally shunned. In August 2020, for example, Casper announced retail partnerships with Sam's Club, Ashley HomeStore, Denver Mattress, and Mathis Brothers.
- Pop-up shops like Neighborhood Goods, which feature an ever-changing assortment of brands (both D2C and not) in a trendy, community-based department store.
The ability to experiment and hone in on what works is a big part of what makes selling direct to customers so appealing.
Business to Consumer Examples
Here are some examples of successful D2C operations out in the wild that are great at following direct to consumer trends.
Subscription-Based
Subscription-based businesses are classic and reliable examples of D2C sales in action. B2B businesses use kitting and construct mail order boxes to send directly to customers. A coffee of the month club is a good example of this. So is a business like BarkBox. They manufacture dog toys, treats, and accessories, and send boxes of it straight to consumers every month. For a subscription fee.
No more going to Petco.
You go straight to the manufacturer’s website and they ship directly to you. BespokePost, Dollar Shave Club, and Blue Apron are other examples of D2C subscription model success stories.
Marketplace-Based
On the other end of the spectrum are third-party marketplaces. Etsy is a good example. They act as an intermediary between craft producers and buyers. They don’t charge a subscription fee, but they take a small commission of items sold.
Third party marketplaces are convenient because they supply the entirety of the ecommerce software and functionality needed to connect directly with consumers.
And the good ones have best-in-class digital catalogs that are designed for web and mobile and optimized for discovery.
B2B businesses plug right into the marketplace and start selling.
Frequently Asked Questions About D2C Meaning
What Is D2C Business?
D2C stands for Direct to Consumer and it's a sales strategy that involves businesses selling products or services directly to consumers. The DTC marketing definition can vary from B2B based on who the business is selling to.
What Is B2B vs D2C?
B2B is Business-to-Business selling whereas D2C is Direct-to-Consumer selling. Businesses can sell either directly to consumers (D2C) or to other businesses such as vendors, retailers, and more (B2B).
What Is an Example of D2C?
An example of D2C includes brands like GymShark, Warby Parker, Dollar Shave Club, and more.
D2C: Try It
Any B2B business can immediately take advantage of D2C revenue with a third party marketplace. All the overhead and tech is taken care of. All a B2B business has to do is list their product and they’re off to the races.
BlueCart Digital Storefront is one of the most effective ways for B2B hospitality businesses to connect with individual consumers. You don’t have to invest in launching and maintaining an entire ecommerce platform. It’s a sharable, all-in-once solution that BlueCart does for you.
All you have to do is list your goods and the frictionless selling begins.