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Future-Proof Your Ecommerce Business with an Optimized D2C Channel

By: Ted Rogers
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The last few years feel like they have been defined by disruption and change, not all of it bad. The pandemic has accelerated the growth of ecommerce around the world, creating new opportunities for brands to reach new customers. Total global ecommerce sales are now projected to hit $5 trillion this year and grow to reach $6 trillion by 2024.

To capture market share and give customers the best possible experience, many brands are focusing on building out direct-to-consumer (D2C) channels. By working to fully optimize your D2C channel, you can help future-proof your ecommerce business and position your organization for long-term success.

Why go D2C?

If your organization does not yet have a robust D2C channel or leadership is wary about investing in upgrades, now is the time to shake off those hesitations. Selling directly to your customers can be extremely valuable, allowing your brand to:

  • Own the customer experience at all touchpoints, including fulfillment
  • Own customer data to gain critical insights
  • Defend against disruption in other channels, particularly brick-and-mortar
  • Strengthen relationships with customers and build brand loyalty
  • Focus on your brand’s strengths and core competencies

Going direct essentially gives brands the ability to control their own destiny. To put your organization in the best position for future success, here are some ways you can optimize your D2C channel.

Localize marketing and customer acquisition strategies

There are fewer barriers to entering the ecommerce space than ever before. That means more online retailers, more D2C competition and rising consumer expectations. At the same time, rising customer acquisition costs, skyrocketing advertising rates and changes to third-party cookies and privacy laws have made it more difficult to forge meaningful relationships with consumers. This is why it’s so important to optimize marketing techniques and customer acquisition strategies that align with your new D2C approach.

For starters, all marketing and sales content needs to be updated for the local language and cultural considerations. This may involve developing all new creative assets or partnering with local organizations to better understand cultural nuances so you can look and feel as much like a local business as possible.

Make sure you also have the right technology in place to effectively organize and analyze customer data. Develop a strategy for how to best use all the new data collected in your D2C channel to segment your customers and optimize marketing and acquisition strategies for each channel and audience segment.

Get payments right

Countless studies have shown that when consumers aren’t given the option to pay with their preferred method, they will shop elsewhere. This is why it’s critical to optimize your payments strategy for every new market you operate in.

The most important thing is to offer pricing in the local currency and make sure you can accept the payment methods preferred by customers in that country. Adoption of digital wallets and other emerging payments technologies varies around the world. So, make sure you are continuously monitoring consumer trends to ensure your payment experience matches up with evolving customer expectations.

Brands should also spend time optimizing the back end of payments systems to improve authorization rates, minimize false declines and ultimately drive more sales. This often involves using dynamic routing and advanced retry logic and working with partners who offer local acquiring and preferred payment methods to boost conversions. Brands that want simplicity and speed to market should consider partnering with an experienced payments expert who can manage payments and reduce financial complexity with merchant of record services.

Account for compliance and taxes

Perhaps the best way to future-proof your ecommerce business is to make sure your D2C offering is built on a strong foundation. This means optimizing back-office operations for things like taxes, compliance, and regulatory concerns. But that’s easier said than done. Regulations vary from country to country and even certain U.S. states have their own unique restrictions. Penalties can be extremely costly and embarrassing incidents can harm brand reputation and customer confidence. So, it’s critical ecommerce brands have a way to cut through the complexity and remain in compliance.

Because of the sheer scale and complexity of these issues, many brands choose to partner with a third-party organization like Digital River that specializes in tax management and global compliance. Partners continually monitor for updates in laws and regulations and have the infrastructure and relationships in place to reduce the burden on your compliance internal team. This not only makes it easier to enter new markets, but also to future-proof your organization against any potential changes that could impact your business.

Setting the stage for success

While no one can predict the future, all indications are that D2C channels will only become more important for ecommerce brands going forward. By making efforts to optimize your D2C channel now, you will not only increase market share and reach new customers in the short-term, but also future-proof your organization against the uncertainty of what lies ahead.

Download our Complete Checklist to Optimize Your D2C Channel for more tips and insights on how to take your D2C strategy to the next level.

For more information about how you can future-proof your ecommerce business, connect with Digital River today.