In the past few years, a new generation of disruptive startups has emerged, and they are forcing traditional brands to re-think how they build, market, and sell products.
These direct-to-consumer (D2C) players utilize an innovative marketing strategy that enables them to enter the market directly, without relying on middlemen or third-party suppliers. This eliminates the barrier between producer and consumer, giving these businesses greater control over their brand, reputation, marketing and sales tactics.
From Made.com to Patch Plants to Glossier, D2C players have capitalized on greater levels of data retention and consumer insights which in turn allows for smarter decision-making. Given this success, the D2C market is projected to grow by a staggering 19.2% in 2021 alone.
Fuelling these shifts lies a change in shopper behavior and psychology. New research shows that 55% of consumers prefer to buy from brands directly, while a further 40% of shoppers say they will purchase from a D2C brand in the next five years.
While the direct model has gained significant traction across sectors, studies suggest there is still considerable room for growth. From our own proprietary research, we discovered that 82% of consumers currently have between zero and four D2C relationships. This finding shows that the market is still in its relative infancy.
For legacy brands, there is now a massive opportunity to disrupt the status quo with a D2C offering that delivers on the expectations, values and desired experiences of modern consumers.
As Karen Ehrlich, marketing and consumer engagement director, UK and Ireland at Clinique, said: “D2C is clearly a win-win for brands and consumers.”
Let’s uncover why.