Direct-to-Consumer: Complicated but Worth It
By: Elke Janssen
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Being everywhere, constantly
This was originally published on LinkedIn.
Companies seeking to expand their ecommerce presence globally through the Direct-to-Consumer (D2C) channel face many cultural, regulatory, logistical and linguistic complexities. The technologies you use, the customer touchpoints driving your customer engagement, and your business culture and practices will need to be realigned to a certain extent to deal with these complexities.
Brands face two primary challenges when building a D2C channel: allocation of resources and choice of technology. On the resource side, brands must align all business units that deal directly or indirectly with the ecommerce solution – IT, sales, marketing, accounting and logistics, for example.
The online store cannot be treated simply as an extension of your website. It’s a new entity that must address the needs of shoppers in different ways, while remaining consistent with your brand presence in the marketplace.
On the technology side, companies don’t always have the in-house technical capabilities required to sell direct, especially when supporting a transaction process for new currencies and payment methods. Most companies need external expertise to develop robust ecommerce capabilities and minimise risks.
The idea of setting out with internal resources and skills to address a range of issues of which the company has no, or limited, experience, is not a reliable strategy. It will take longer and end up costing more than it should. I’d like to cover some of the considerations involved to help you decide the best route for your business.
Ecommerce platform options
The essential first step in going direct is choosing your ecommerce platform. When comparing an on-premises solution to a cloud-based SaaS platform, it’s important not to underestimate the internal resources needed to build, maintain and constantly improve upon your global ecommerce operations.
You’ll also need to consider exactly how you are going to support personalisation, order management and logistics across geographies. My colleague, Tim Haycocks, offers useful advice around understanding and acting upon customers’ emotional responses to your brand to develop meaningful customer experiences.
Customising an ecommerce platform for multiple locales is a complex task. A strategic partner can help you avoid mistakes along the way. The right partner can help in areas such as international tax management, fraud prevention, regulatory compliance and payments to ensure you are optimising conversions. These topics are also covered further in my colleague, Tara Allison’s blog: 4 Principles for Global Ecommerce Expansion.
Understanding the customer journey
With your technology, infrastructure and logistics in place, everything you do must be consumer-focused. This focus depends on understanding the customer journey from A to Z. Consumer behaviours are very different today than they were in the pre- or even early digital age. Consumers flip between access points and gather information from a wide variety of influencers and sources. By leveraging the data to track these journeys, marketers can improve targeting abilities and drive more efficiency.
Reliable, trustworthy consumer data
When customers make the purchase decision they might buy at a bricks and mortar store, through a third-party ecommerce site, or through your own branded ecommerce channel.
Brands in industries as diverse as consumer electronics, housewares and appliances, sporting goods, and software vendors are discovering that their owned channel and retail channels can co-exist harmoniously; each channel has its own advantages.
Manage your portfolio
Logically, ensuring a presence in a wide range of channels will bring greater benefits. In a robust multi-channel strategy, the best approach to ensuring the right mix across your portfolio is to diversify your distribution and your channel strategy to achieve the most for your brand. However, each channel has unique operational characteristics that can pose challenges.
Once your systems are ready to adapt to an extensive range of channel-specific requirements (offline and online, your own site and third party ecommerce sites), you’ll have a robust platform ready for expansion into new markets.
New challenges also await, but with the help of a third-party advisor, you can meet them faster and in a more informed fashion. With the confidence that a trusted partner will bring best practice approaches to bear, gained from extensive cross-industry experience with other clients and practical insights into driving success in the ecommerce environment.
Are you finding a balance between your direct and retail ecommerce channels? Let’s discuss.