Snippet: Do you want to know how adopting D2C eCommerce development can make your brand successful? If yes, this blog is for you.
These days, the D2C eCommerce business model is gaining so much popularity globally in the manufacturing sector. Most manufacturers are using it as an elaborate distribution network to reach their consumers. Various global brands like Nike.com, Apple.com, and YouTube.com has already adopted this model. However, if you still not understanding the concept of the D2C eCommerce development model, read on.
This blog will shed light on why D2C companies are booming in the industry, what the D2C business model is, and how this model works.
So, without further ado, let us get started.
What is D2C Business Model?
D2C eCommerce business model stands for direct-to-consumer. In this model, brands will have complete control over how their products will be produced and marketed without relying on any third-party retailers, wholesalers, marketers, etc.
In short, the D2C business model is a customer-oriented sales model that will bypass mediators such as wholesalers, distributors, and retailers. When the middlemen are eliminated from the supply chain, prices will be lowered for the consumer. Businesses can use this business model to reach out to a wider audience in markets that are challenging to enter.
For example, some business owners choose to offer services or products directly to consumers on their own websites via the D2C business model.
How Does the D2C Business Model Work And How is it Different From The Other Business Models?
The D2C model is a business model that is a hybrid combination of traditional B2C and eCommerce. You can consider it a traditional shop. However, in a traditional shop customer goes to the shop, but in the D2C business model, the shop comes to the consumers in the form of an eCommerce website or application.
In the traditional business model, there are four parties involved – a manufacturer, a wholesaler, a retailer, and the consumer. Generally, a manufacturer offers its services or products to wholesalers. After that, a wholesaler sells the same offerings to retailers, who eventually sell the same to the final consumer at a premium price.
The drawback of this model is that it involves heavy negotiations at each production and delivery stage. That’s why the prices and delivery time both increase. Besides, the customers will never get a chance to interact with the brand directly.
On the other hand, in the D2C model, brands will connect directly with the consumers, take their orders, pack it, distribute it, and ship products directly to consumers’ homes. The brand usually partners with several packaging, delivery, and logistics handling companies that will assist brands in delivering products to consumers on time.
What are the Benefits of the D2C Business Model?
The D2C business model provides a lot of benefits to the brand. Let us check out a few of them in brief here.
1]. Improved business agility
This business model enhances business agility and improves the ability to react and change the environment, requirements, and trends better.
2]. Increased brand profitability
In the D2C business model, there are no middlemen involved, which means businesses can lower costs and increase margins.
3]. Better control of the sales funnels
As there are no middlemen involved in this business model, businesses can get more control over the sales to funnel so they can select what is perfect for their consumers’ needs.
4]. Maintaining brand reputation
The owner gets control over customer information, product, pricing, messages, products, and brand. This gives you an ease to focus on the touchpoint of business and maintain a stronger brand reputation.
5]. A Better understanding of consumers
When businesses hire an eCommerce development services provider to build a D2C business model, they can easily interact with the customers who have purchased their services or products. Therefore, they will get more chances to understand their consumers. They don’t need to do market research to understand their consumers’ likes and dislikes.
Challenges Of the D2C eCommerce Business Model
Of course, the D2C business model offers various benefits to brands, but besides it, there are a few challenges that brands have to face when they opt for this business model. Let us try to understand it in brief here.
1]. Competing With Existing Retailer Giants
The biggest challenge that the D2C eCommerce development business model face is the brands has to compete with other retailer giants that already have a substantial market share.
2]. Order Fulfilment
When a business opts for the D2C business model, they need to handle packaging, delivery, and order fulfillment own instead of relying on the wholesaler and retailers for the same.
3]. Marketing, Sales, and Consumer Service
In the D2C eCommerce business model, the manufacturers need to take care of marketing strategies and sales strategies along with consumer service. It often requires hiring a new team. In short, in the D2C model, the brand has to take care of marketing before, during, and after the sale of its services and products.
4]. Brands That Have Adopted D2C Business Model
There are thousands of brands that have hired an eCommerce development company to build their D2C model, which ranges from garment stores, and restaurants, to spas. Here are some popular brands that you should know of.
- Ginger
- Glassdoor
- Lenskart
- Country Delight
- Grind
- Ugly
Final Thoughts
In summary, D2C brands are on the rise these days. This digital brand model is widely accepted and preferred because it involves low costs and attracts consumers quickly. Although the D2C eCommerce development model and its market come with their own set of challenges and risks, if your brand performs well, it will achieve success in the coming years.
So, hire the best eCommerce development company or hire eCommerce developers that can help you build your eCommerce website that will increase your business ROI.
If you feel we have missed something, you can tell us what you think of this article on the D2C eCommerce business model in the comment section below. Besides, if you have any queries regarding this article, you can share them with us in the comment box below. We will try to resolve it as soon as possible.
