As businesses seek new ways of attracting customers and consumers pursue cost-effective, direct transactions, direct-to-consumer models (D2C) are becoming the norm. Particularly in today's highly digital world, eCommerce and direct-to-consumer sales are skyrocketing. Consumers and businesses alike are realizing they can save time and money by cutting out third-party retailers.
Post-COVID online sales trends are also favoring direct-to-consumer models. In 2020, the market reached $111.5 billion U.S., and “2021 sales are projected to surpass 129 billion U.S. dollars.”
How D2C Marketing Works
So, what exactly is the direct-to-consumer marketing model and how does it function?
In the past, businesses only had word of mouth to rely on as advertising. Today, advertising has become a multimillion-dollar industry, and the lead generation techniques are endless, ranging from email marketing to social media marketing to even reinventing word of mouth.
When your business cuts out the middleman, you'll have to rely more heavily on lead generation to find potential clients. B2B lead generation can help businesses identify their target market and engage with interested customers. The most efficient kinds of lead generation will depend on your industry and goals.
Let's dive into some of the top lead generation techniques that can increase brand awareness and lead you to a positive return on investment (ROI).
Following the outbreak of COVID-19, trust between businesses and consumers is now more important than ever before. Building mutually beneficial relationships with your customers is key to ensuring a steady revenue stream and growing your company.
Loyalty programs can be overlooked when it comes to the customer experience, but they're an essential component in building and maintaining relationships with your customers. As of 2020, there are 3.3 billion loyalty memberships in America alone. In fact, 71% of consumers say “loyalty programs are a meaningful part of their brand relationships.” Loyalty program members are far more likely to become involved with your brand and recommend it to friends and family.
Incentives are important motivators when it comes to eCommerce and sales in general. There are tons of reward styles to choose from, which come in the form of discounts, redeemable points, and even cash gifts.
Figure out how to differentiate yourself from your competitors by analyzing campaign data, taking into account customer feedback, and adopting referral programs that reflect your company's mission. For example, many airline and car rental companies make use of a mileage-based point system. If your product or service is environmentally friendly, you could consider offering charitable donations to environmental protection organizations.
The sky's the limit when it comes to referral rewards, and your customers will be sure to spread the word once they know they can reap the benefits.
Word of Mouth
You may have heard of word of mouth, but have you heard of word of mouth marketing? Competition can be stiff in the B2B industry, meaning it’s essential for B2B companies to pursue innovative marketing strategies to grow their brands.
One way to do so is by reinventing the classic word of mouth. In the past, word of mouth was limited to a person's close circle of friends and family. And with good reason — around “92% of people trust recommendations from friends and family over any other type of advertising.”
The modernity of the 21st century, however, has ushered in a new phase for word-of-mouth marketing. Now, celebrities can display a product across their Instagram feeds and it will sell out immediately. Everyone’s social circles have expanded as our world grows increasingly connected by social media and instant messaging platforms. As a result, more than half of all purchasing decisions are spurred on by word-of-mouth marketing, making it a worthwhile investment for your B2B business.
The world is becoming increasingly digital, but there's still a unique value to having a brick-and-mortar store. All it takes is a few business innovation tactics to keep your physical business relevant in a digital world.
For starters, not all consumers are tech-savvy. If your target market is senior citizens, it might be a good idea to consider opening a retail store to build brand recognition and introduce new customers to your products. Customers will be able to see from how well your store is kept that you're up-to-date on industry trends and have excellent customer service.
That by no means implies that you should eliminate your online presence, but it does increase your likelihood of engaging relevant customers through in-store events and customer loyalty programs. At the same time, your online storefronts and services will offer your customers flexibility and options, two very important things for today’s demanding consumers.
Subscription Pricing Model
More and more software is put out each year, and as a result, subscription services have begun to revolutionize commerce. Subscription services aren't just for SaaS companies, however. They’re an excellent way to handle decentralized production processes, business, and even entertainment, from online contract signing services to video streaming platforms like Netflix.
In recent years, the subscription pricing model has also been adopted by companies that have a physical product to sell. For instance, some companies will deliver a monthly selection of herbal teas to your doorstep, while endeavors like Dollar Shave Club make it easier than ever before to obtain hygiene essentials without the hassle. When proper marketing protocols are followed, D2C businesses can benefit greatly from subscription services.
Take Full Advantage of D2C Using These Lead-Generating Strategies
If your company needs high-quality, relevant customer leads, consider what you can do to build up the client-business relationship. Today's consumers are quickly realizing that companies that don't value them aren't worth their business. Likewise, as a business, you want to invest your time and energy into those customers who can truly benefit from your product and who align with your values.
Lead generating strategies like adopting a subscription pricing model and revolutionizing word of mouth marketing can help attract the kind of clients you are after, all without the help of third-party retailers. D2C models are quickly gaining in popularity and promise to be the way of the future. It’s essential to adopt a customized, modern D2C marketing model to get ahead of the curve and secure a solid ROI while regaining control over all of your business processes.