The Importance of Digital Marketing In Direct to-Consumer (DTC)15 May, 20235 min
Over recent years we have seen a significant shift in how businesses interact with their cus...
Over recent years we have seen a significant shift in how businesses interact with their customer base and target new audiences to grow their company. The rise of the internet has predominantly led to this shift.
Traditionally, many businesses heavily relied on 'middlemen' such as wholesalers to supply their customers with products. However, it has become increasingly common for companies to want to cut out the 'middleman', set up online, and set up distribution channels to deliver their products directly to the consumer. With the global eCommerce market worth over $5 trillion in 2022, the focus on online business is only going to increase.
One model that has become highly prominent in the growing online strategy is 'direct-to-consumer'. This guide will explore what direct-to-consumer is, how digital marketing is used within DTC and its benefits, and how DTC businesses can attract the right talent.
What is Direct-to-Consumer (DTC)?
Direct-to-consumer (DTC) is a retail model in which a business sells its services or products directly to the consumer. It allows companies to bypass traditional channels and 'middlemen' such as distributors, wholesalers, and brick-and-mortar stores.
It rose to prominence in the late 2000s/early 2010s when upstart brands such as Everlane, Bonobos, and Warby Parker appeared online to take advantage of the unprecedented access to customers that the internet allowed them to have.
Previously, these types of businesses sold their products through department stores. This traditional model meant that the department stores had a relationship with the consumer, not the brand. However, once brands established their own eCommerce sites and built their customer bases through digital marketing, such as social media advertisements, they lost the need for middlemen.
One of the significant benefits of DTC to many businesses is that it enables them to control the entire customer experience. DTC brands keep their own products in stock, and when a customer places an order, they also have complete control of sorting, packaging, and shipping the product. It also allows them to communicate directly with the client and provide after-sales support.
The direct-to-consumer model removes several stages of the buying experience to provide a quick and seamless experience. Below we see the stages of the tradition and DTC models:
Traditional Retail Model Stages:
- End Consumer
- End Consumer
The direct-to-consumer model has grown in popularity over recent years with the rise of social media and e-commerce, as it allows several advantages, including:
- Enables businesses to have a closer relationship with their customers and increase consumer loyalty
- Collect more insight and data about their customer base
- Potential to offer more tailored services and products
- Reduced costs by cutting out the middlemen such as retailers and wholesalers
How Does DTC Digital Marketing Work?
Its rise in popularity alongside social media and eCommerce has meant that DTC digital marketing has become vital to company growth. Digital marketing allows businesses to reach, engage, and retain their target audience in a direct and cost-effective way.
Key DTC Digital Marketing Methods
Here are key direct-to-consumer marketing methods used to reach their target audience:
- Social media marketing - Social media platforms like Twitter, Instagram, and Facebook are vital for direct-to-consumer companies to build brand awareness, engage with their customer base, and drive traffic to their website. Social media sites also allow DTC businesses to use paid advertising to target particular audiences based on behaviours, interests, and demographics.
- Website optimisation - DTC businesses need to have a strong online presence, and therefore their websites need to be optimised for user experience and search engines. Optimisation involves creating high-quality content, using relevant keywords, and having a site that is easy to navigate.
- Email Marketing - This allows DTC businesses to develop customer relationships and drive repeat purchases and use of services. Email can be used to send tailored messages to customers, product recommendations, and news of sales and special offers to subscribers.
- Data Analytics - During and after digital marketing campaigns, direct-to-consumer businesses need to analyse and track the results to measure the effectiveness of their strategies. Tools such as Google Analytics, CRM software, and social media analytics can collect and analyse data such as website traffic, consumer behaviour, and conversion rates.
Five Key Benefits of DTC Digital Marketing
Now we have seen the direct-to-consumer marketing methods companies use, what are the advantages of using the practices? Here are five key benefits of DTC digital marketing:
1. Increase Customer Reach and Visibility
Digital marketing allows businesses to reach much wider audiences than traditional marketing methods. DTC companies can now build a global customer base with the extraordinary rise of tools such as social media and search engines.
Compared to traditional marketing methods, digital marketing is often far more cost-effective. For example, businesses can pay much less for a social media advertising campaign instead of paying high prices for television and newspaper campaigns, often reaching a much wider audience.
3. Allows for the Measurement and Analysis of Results
It allows businesses to keep track of and measure their campaigns' results more accurately than possible with the more traditional methods. For example, tools such as Google Analytics allow DTC companies to see website traffic, where their customers are located, and their behaviours.
4. Increased Engagement
Digital marketing allows DTC companies to engage with their audiences more creatively and meaningfully. For example, with a social media campaign, they can answer customer questions, respond to feedback, and build a more personal relationship with their audience. This level of engagement can, in turn, increase consumer loyalty and repeat business.
5. Improved Targeting
It allows businesses to target specific audiences more likely to be interested in their products or services. This targeting can be based on location, behaviours, or nationality. Precise targeting can drive the right traffic to a website and increase the purchase of products and services.
Five Tips for How to Recruit in Direct-to-Consumer
Recruitment for a direct-to-consumer business can be challenging as it often requires attracting candidates with particular technical and soft skills. However, to remain innovative and drive areas such digital marketing, DTC businesses must attract exceptional talent. To support the recruitment process, we have provided five key tips.
1. Emphasis on the Importance of Innovation
DTC companies must be at the forefront of technology and innovation to keep reaching their required audiences and remain competitive. Candidates should demonstrate creativity, be open to new ideas, and be adaptable. To target these types of candidates, businesses should mention their innovation and use of technology in their job advertisements. Examples of this include how data is analysed to optimise operations and how technology is used to elevate the customer experience.
It is a good idea to ask candidates to provide examples and evidence of how they have contributed to innovation in their previous roles.
2. Focus on Data-driven Skills
As seen in digital marketing, DTC companies heavily rely on data to make decisions, increase profits, and enhance the customer experience. Therefore to optimise the use of data, candidates are needed who are skilled in working with data, analysing it, and using it to make informed strategic decisions. Again, the requirement for these skills can be added to the job advertisement, but skills assessments and case studies can be used to evaluate candidates' skills and experience around data.
3. Use Social Media as a Recruiting Tool
Successful direct-to-consumer companies often have a strong social media presence. It makes sense to use this presence as a tool to identify and attract exceptional talent. Post job listings on platforms such as Twitter and Linkedin, along with insights into company culture and values to help attract candidates. Many potential candidates may follow a business due to a passion for the services and products they offer, so targeting them for recruitment will support the process.
4. Attend Industry Events
Events and conferences are excellent opportunities to learn current trends and best practices from within the industry and network with potential candidates. In addition, it provides a chance to ask about their experiences, qualifications, and career ambitions and understand if they would be open to moving jobs. These events and conferences also provide an opportunity to showcase business successes, culture, and innovation which will also help to attract candidates.
5. Seek Referrals from Current Employees
Who knows a business's needs, culture, and values better than those who work there? Therefore, direct-to-consumer companies should utilise their current staff to seek recommendations and referrals from people they know who have the skills and experience necessary to help drive success in the company. These can be people from an employee's friendship circle, family, and professional network. Rewards and incentives for referrals are effective ways to encourage this method.
Seeking Exceptional Talent for your Direct-to-Consumer Business?
Our award-winning recruitment team are here to provide expert support to identify and place high-quality talent in your DTC company. We are passionate about building long-lasting relationships with clients to understand goals, culture, and values. Using this information, our dedicated team can support you with a range of bespoke recruitment services to suit your needs, and we'll work alongside you to build a team of exceptional professionals. For more information, visit our dedicated recruitment services page.