Your business strategy as a B2B manufacturer has always been straightforward: supply products to retailers, who then mark them up and sell them to end customers. But as we go into a time when many retailers have closed their doors due to the pandemic and accelerating commerce growth, does that model still make sense?
When managing individual customer relationships was a challenging endeavor, the wholesale/distributor model was helpful. But technology like Adobe Commerce, has completely streamlined the order management workflows for B2B to D2C eCommerce. As a result, more and more businesses are following Nike’s strategy of selling directly to customers (DTC).
Direct-to-customer (DTC or D2C) isn’t a new eCommerce trend. It has been existing for quite some time; however, with disruptor brands, evolving customer shopping habits, unstable market dynamics, and the uncertainty of what lies ahead has accelerated its adoption.
What is the D2C eCommerce business model?
The term “direct-to-consumer” (also known as “D2C” or “DTC”) has gained popularity in recent years in the marketing and business worlds. It refers to companies that sell products and services directly to consumers without any middleman (i.e., the consumer doesn’t need to go through a retailer or a third-party). A D2C business model has the following features:
- No middlemen: DTC businesses don’t manage their products through wholesalers or retail stores.
- Manage the end-to-end process: D2C companies manufacture, market, sell, and ship their products themselves which allows them to know their end consumers in a better way.
- Direct customer relationships: You can interact with the people who purchase your product if you have a direct customer relationship. You can ask them for comments on your items and utilize that input to help you decide how to make them better.
- Customer journey insight: DTC business gets complete control over the customers’ journey from research to purchase phase.
- Platform-based: Many D2C businesses use online platforms like Instagram, Facebook, Amazon and Google to sell their products directly to consumers.
How to turn B2B business challenges into D2C eCommerce opportunities
When moving from B2B to D2C, it is expected to experience roadblocks along the way. Here we talk of the potential challenges you might encounter when transitioning from B2B to D2C and how to effectively tackle them.
Challenge #1: Potential conflict with partner retailers
Till the time you were a B2B manufacturer working with retailers, everything was simple and easy. However, now when you’re ready to sell direct to consumers in the same market, it might create conflict with your retail partners. One of the biggest barriers brands face is the fear that this B2B to D2C eCommerce transition will jeopardise relationships with their channel retailers. Will partners see this DTC shift as a threat and consider the evolving B2B brands as competition, eventually dropping them as product source altogether?
Keeping your partners happy while carrying out this huge undertaking can be a daunting process. However, manufacturers need to brainstorm ways to resolve this channel conflict and conclude that direct-to-consumer channel leads to greater sales and brand awareness for all partners. In B2B vs D2C, you can realign your value chains around your customers and share the accumulated real-time data to offer irresistible consumer experiences.
Solution 1: Offer innovative products on your eCommerce site
Not every product you manufacture ends up at the retail store. Similarly, it doesn’t have to end up on your website either. Build a product strategy that keeps things smooth with your channel partners and adds innovation to your web store. Or, you can rebrand your existing B2B products to give it a more personalized D2C touch that your retailers miss. Bring together products in a custom package that only you offer. Build better offers catered to your customers and give them amazing discounts. You can even create custom products for your D2C website- one that your retailers don’t have.
Solution 2: Don’t forget to promote your B2B retailers’ business
Because you want to keep doing business with your channel retailers, a way to get into their good books is via promoting their brick-and-mortar stores. So, when a customer searches for a product online but wants to buy it in store, you can direct them to a local retailer. This way you can get a sale, keep your partners happy, and increase visibility on your website. You need to remember even with all the potential risks and challenges, your competitors will sooner or later start selling directly to consumers, even if you don’t.
Challenge #2: Finding the right D2C eCommerce platform for your operations
For a D2C eCommerce website, you need a technology platform that facilitates selling to customers. Additionally, you might want to integrate these new systems with your existing technology stack. When entering the D2C arenas, you need to complete the eCommerce puzzle with every related technology like the PIM, ERP, tax rates, shipping, tracking etc. B2B brands need to evaluate their current business operations while onboarding a new one, without resulting in any setbacks for both business 2 business and direct to consumer channels.
Solution 1: Select an eCommerce platform that supports your B2B and D2C goals
If your B2B brand functions offline, you need an eCommerce platform to start selling online. Of course you can consider other marketplaces like Amazon, eBay, or Rakuten, but in reality, you will just replace one brand with the other, one with far more control over your products than your partner retailers. Furthermore, you wouldn’t gain any market insights that your own D2C eCommerce platform will provide.
So, select an eCommerce platform that supports both your B2B and D2C ordeals. You can choose from Adobe Commerce, Salesforce Commerce Cloud, Shopify Plus, and commercetools to design websites for two different business models.
Solution 2: Find an renowned platform partner for integrations
An experienced eCommerce agency partner like Ranosys can help you pick the right platform that fits your business needs. Additionally, they can help to integrate your D2C eCommerce platform with your existing systems.
One key aspect to consider is- use tools for their specific purposes only. For example, an ERP software is perfect for product specifications and operational information. But you can’t use it to collect user data to enrich customer experience.
Challenge #3: Attracting the right customers to the D2C eCommerce website
Traditionally, B2B brands aren’t responsible for attending to customers’ needs or sparking their interest in the products. You can constitute it as a merit and a demerit at the same time.
Merit- since your partner retailers and distributors handle all the marketing activities, all you need to do is focus on building the product as per the retailers’ needs and getting them on their shelves.
Demerit- since you have no relationship with the end customers and don’t know what they like or dislike, creating personalized experiences becomes a far-fetched dream. However, D2C eCommerce tends to change all of that.
When you move to a D2C eCommerce channel, you’ll become responsible for getting customers to your online store and persuading them to complete their purchases. And this is where most B2B brands have a chill down their spine. Manufacturing for customers is one thing but selling it to them is a whole new level. Product personalization, localized experiences, multiple payment solutions, data-driven drive, SEO and marketing capabilities, and omnichannel strategies become imperative to extending impressive customer experiences when you shift from B2B to D2C.
Solution 1: Tell your D2C brand story
Moving to D2C eCommerce is not just about recovering sales, revenues or ROIs lost during the pandemic, it is also about facilitating a strong connection with your customers so that you become a successful D2C brand. It is why it is significant that you tell your brand’s unique story. Let your customers know why you did what you did and how you’re different from your competitors, especially those retailers who used to source products from you.
Solution 2: Create own-brand D2C products
While there might be a product portfolio you share with your retailers and wholesalers, you can always forge personalized relationships with your customers via a unique product segment. Having your own brand online channels with D2C cater to customers while alternatively selling to retailers will lead to less complex operations and more streamlined online and offline selling.
Solution 3: Create product content that educates your customers
Retailers have always faced the conundrum of representing products in an understandable and customizable manner. Customers don’t like complex product pages, especially in today’s fast-paced digital era.
- By adding product specifications to your product representation, you unlock the treasure trove of innovative products that lead to incredible D2C eCommerce experiences
- Focus on data-driven design format to add intuitiveness and authenticity to your D2C eCommerce website
- Includes videos, blogs, and social postings to showcase your products in action, boost its selling quotient, and help customers identify a need for the product in their lives
- Real-life examples always boost customer engagement and persuade them to complete their purchases
Solution 4: Do not forget setting up a social store
Every omnichannel marketing strategy must include the power of social media. Managing a social store along your physical outlet (omnichannel experience) is an excellent long-term solution to market your comprehensive D2C eCommerce business. D2C merchants can easily connect their eCommerce storefronts to Instagram, which gives them the ability to buy products right from the app-rather than exploring the products on the website.
Challenge #4: Order fulfillment system for a new consumer-facing interface
When you make the DTC pivot, you will move from large orders to smaller ones. Logistics will play a key role- seamless, on-time, trackable deliveries will impact customer experiences. As a D2C eCommerce brand, if you’re not able to get an order delivered as expected, they will most likely not return back to your site. Similarly, if a customer experiences an issue with your delivery, you need to make it easy for them to reach you out and get it resolved as quickly as possible. Make products return easy and breezy. However, to do so, you need an automated approach, one that uses the right tools, people, features, and capabilities and provides the right results.
Solution 1: Automate inventory management and order fulfillment
When you start your D2C business, you don’t really have the infrastructure to meet the Amazon-set shipping and delivery standards. Needless to say, you will suffer space and inventory related constraints. From receiving inventory, storing it in their warehouse, packing and shopping orders, processing returns, and customer support, practicing order fulfillment can be challenging, especially if you’re launching your D2C eCommerce platform in different regions. Therefore, you must invest in technology to automate inventory management and every BUY button on your website.
Solution 2: Ensure fast and flexible shipping
To put things into perspective:
- Over 87% of consumers say that they judge a merchant’s capabilities and if they will shop again as per their shipping and delivery experience
- 63% of consumers say they constitute fast and seamless shipping as a positive experience
- 66% of customers say they want shipping to be a free option to have a positive experience
See where we’re going with this?
To make D2C work, you need multiple shipping options but without overwhelming your employees. Shipping forms an imperative part of your direct-to-consumers approach. Without offering a seamless, fast, and reliable shipping experience to your customers, they won’t shop again with you.
It is why you integrate your D2C eCommerce store with a shipping software to consolidate orders from multiple selling channels, automate shipping, allow users to track their orders at each point, send them notifications about order status, ensure on-time delivery, and share contact information of the delivery personnel. Post delivering the shipment, you can also send emails requesting satisfaction and recommendation scores.
How Adobe Commerce supports your B2B to D2C migration
Adobe Commerce is known for its flexibility, scalability, and world-class experiences delivered by its implementation partners across the globe. Along with its extensive marketplace of extensions and third-party integrations, Adobe Commerce empowers you to personalize your stores as per your business needs. Here is a brief how Adobe Commerce supports your D2C eCommerce objectives:
#1: Run your B2B and D2C business from one platform
As said before, when you opt for a D2C eCommerce business model, it doesn’t mean you are closing your B2B business. Therefore, you need a D2C eCommerce platform that supports both business models (B2B and D2C), manages all your brands, and serves all your customers.
Adobe Commerce supports your business 2 business goals with features like one-click recording, order by SKU, rule-based fulfillment, tiered account with buyers with varied permissions, self-service customer portals, customized catalogs and pricing. Furthermore, Adobe Commerce and its page builder, live search, PWA studio, customer account management, real-time inventory management, sell and fulfill from anywhere features promises superior D2C growth.
#2: Personalize experiences for all customer segments
Additionally, Magento 2 supports many languages, making it perfect for companies that sell their products internationally. This makes it possible for you to design a store that is accessible in a variety of languages, making it easy for clients from around the globe to shop at your store.
With Adobe Commerce, you get to study the requirements and behaviors of a D2C audience from your website, app, social channels, and every other platform where you ask for user information, create buyer personas, and use them to boost CX. The AI tool, Adobe Sensei and its live search and product recommendation capabilities allows you to personalize experiences based on their purchase history and behaviors. The best part, you can then extend personalization to all your touchpoints- social, email, SMS campaigns, web apps, apps, and eCommerce websites.
#3: Custom UI/UX themes
Regardless of how many D2C eCommerce brands are out there, every brand is unique in terms of their products and brand story. With Adobe Commerce, you can lay the foundation of your exclusive brand story and develop a custom theme from scratch to reflect it on your D2C eCommerce site. In fact, you can develop personalized storefronts for all your sales channels, creating a truly distinctive and omnichannel experience for your customers.
#4: Product catalogs
As a comprehensive D2C eCommerce ecosystem, Adobe Commerce has no limits on the number of products you can add to your D2C eCommerce store. With Adobe Commerce Page Builder, you can edit and manage product content, videos, images, and 3D visualizations without developer indulgence. Its drag-and-drop functionality empowers you to undergo multiple content updates in hours rather than months. Even so, Page Builder also allows you to perform customer segmentation to deliver relevant and tailored content to shoppers, driving cross-selling and upselling opportunities.
#5: Scale up as your business grows
With Adobe Commerce, you can easily scale as and when your business grows. Instead of deploying all D2C eCommerce features at once, you can deploy sophisticated ones when needed. From offering BNPL solutions to allowing BOPIS and standard shipping, Adobe Commerce allows you to innovate and scale without increasing technical overheads or compromising on security.
How Ranosys can help
The biggest challenge to building a D2C eCommerce solution is migrating from your existing one while making the process undetectable and seamless for users. Our certified Adobe Commerce experts help you build powerful D2C eCommerce solutions from scratch or replatform from another eCommerce system. Our team also assists with extending the capabilities of your D2C store by custom development and integrations. As you grow, our professionals ensure superior performance at all times with consistent managed services. Connect with our experts and know more about our D2C eCommerce services.