The D2C State-of-Play in 2022
Why D2C is an ethos that affects everything
By Sonal Gandhi
Chief Content Officer at The Lead
The Direct 60 list is back! In the list’s second year, we will feature a fresh lineup of changemakers and risk takers — folks that are shouldering the responsibility of success for their brands in this changed environment. By highlighting these incredible individuals and the bets they are making, we hope to uncover the future of the fashion, retail, and consumer industry and help you benchmark your strategies.
For the past few months, we have had dozens of conversations with the list’s nominees on their journeys and their vision. These interviews help us paint a broad picture of what D2C means for traditional incumbent brands today. The pandemic-induced D2C pivot is well underway and the investments of the last few years have begun to show results. Here are some of the trends that we observed.
D2C Affects Everything
Running a successful D2C business has consequences that affect all aspects of running a brand — from supply chain to customer experience. The effects are also seen in wholesale relationships. The Direct 60 are —
- Incorporating customer feedback from D2C channels to improve products and testing new products/styles in D2C before rolling them out to other partners.
- Sharing lessons on customer preference and journey with wholesale partners and forging more productive relationships.
- Digitally transforming all aspects of their operations to support a robust D2C strategy which also serves the wholesale business.
D2C Is Data
One of the biggest themes emerging from our interviews has been the investment in data in the last few years. Technology, marketing, and e-commerce leaders from traditional brands are extremely focused on building their data arsenals to compete successfully. Data trends emerging from our Direct 60 interviews are
- Many brands have been building out their CDPs, as the role of first-party data has become even more crucial since the IOS 14 privacy update. Brands are also investing in new CRMs, analytics, and attribution tools.
- Educating the rest of the organization on how to use data effectively also falls on the folks driving D2C. Many are helping to build a data-driven culture throughout the organization.
D2C Is Experience
Direct 60 leaders know that D2C channels bear the responsibility and opportunity of showcasing the brand in the best possible way. If the consumer has a negative experience with the brand in a direct channel, they may never come back to the brand at all. Here are a few things Direct 60 leaders are investing in when it comes to experience.
- While an overused term, personalization is still an underutilized tool. More personalized experiences are still the holy grail of an optimized digital experience. Direct 60 executives are focused on personalization and story-telling to continue to enhance customer experiences.
- Many brands are expanding their store footprint and many D60 executives acknowledged the store experience has to change to keep up with the consumer. While BOPIS is becoming commonplace, technology infusion in stores is still a moving target. Associate training and tools, QR codes to capture email addresses, and in-store analytics continue to see investments
- The role of D2C executives is expanding to ensure they are in charge of the customer experience end-to-end.
The last few years have been about laying the groundwork for a successful transition to D2C while running to catch up. According to Michael Levitz from Reaktor (a member of the Direct 60 selection committee), “There is a lot of pressure on Direct 60 executives to build baseline technology, establish feature parity with competitors, create new innovations, and do it all flawlessly. When you’re creating digital products and experiences, taking on everything at once leads to disappointment. In order to achieve success, Direct 60 executives establish a sharp focus on a small number of initiatives that will move their business forward, iterate on them until they produce results, and let customers participate in the process.”
Reaktor is a creative technology partner for forward-thinking organizations. We create digital products, services, and strategies built on exceptional technological competence.