Mastering Brand-to-Consumer in 2023

By Sonal Gandhi
Chief Content Officer at The Lead

Incumbent Brands are Mastering D2C With a World-Class Tech Stack

A modern tech stack is the foundation for building a strong direct-to-consumer business, regardless of the size of the brand. Many traditional brands have been on the journey to digitize and update their underlying technology infrastructure to compete in today’s environment. This journey began for many brands before the pandemic, but has taken on a special urgency during these times. 

The modernization playbook is now well-defined and consists of the following: 

  • Replatforming the website 
  • Implementing or updating the ERP system (and moving it to the cloud)
  • Activating omnichannel capabilities through new OMS and PoS systems
  • Investing in a CDP for a reliable customer data foundation

A majority of the brands we spoke to in the process of creating the Direct 60 list of 2023 are nearing the end of the modernization journey. Having their baseline sorted has freed up these brands to move quickly into adopting new and innovative solutions in the market that allow them to better target, convert, and retain customers. 

A Customer Data Platform is Last Stop on the Digitization Journey

Many Direct 60 execs say that the information gathered from direct channels is sometimes even more valuable than the channel itself. And in order to truly activate those benefits, the brands we spoke to are now systematically enabling the various layers of functionality of their new CDPs, starting with:

Identity Resolution – making sure they are capturing all interactions with their customers including identifier, behavior, and preferences 

Insights and Analytics – gaining insight into who their customers are, and how and why they shop with the brand. Some are using these newly gained insights to create new customer profiles, and are focusing their attention and resources on a narrower target. They are also now starting to use insights from their customer data to inform their strategy in the wholesale and marketplace channels 

Activation – segmenting customers, identifying the right triggers, and using predictive intelligence to move through the funnel and ultimately increase LTV 

According to Fayaz Mohamood, CEO of Bluecore and a member of the Direct 60 selection committee, “The key to becoming a successful D2C retailer is having a strong data foundation that is anchored on 1) transparent identification – which incorporates the collection and combination of first party customer data, such as a shopper’s identifier, with shopper behavior and product data, and 2) data activation focused on customer movement –- the process of turning anonymous shoppers into known personas, and then moving them through the purchase funnel effectively from first purchase, to second, to third and so on.” 

“Last Black Friday/Cyber Monday, most brands were unable to identify 74% of their visitors. These folks came, browsed, and left – without buying anything – and now they are unreachable. Changing the trend is key to being able to capture shopper signals that allow you to move customers through the funnel effectively.“

Technology is only part of equation, data-driven decision-making requires a major cultural shift

It’s one thing to have access to all of your consumer data, but it’s another thing entirely to actually use that data to run your business effectively. This requires a dedicated effort from a team of data evangelists  within the organization. Two themes that bubbled up in our conversations with the Direct 60 executives who played that role within their organizations were – 

Change how you measure performance: Measuring performance down to the individual level–based on consumer metrics and not just revenue goals–is one way to get an organization to become consumer data driven.  According to Fayez, “Focusing more heavily on customer metrics breaks down channel silos and provides a structure to create customer value within the business. It moves teams away from attribution wars and towards complementary channel strategies that lead to more confident forecasting and overall revenue growth for the business”. Pooja Chandiramani at Coach also stated, “What gets measured gets managed. This cultural shift can only happen when using data to understand your consumers, measure your progress, and make informed decisions”

Be mindful of disruption caused by change: Change is hard. Brian Price of Tommy Hilfiger noted, “The most challenging part of implementing a data-driven business model within any organization is the short-term change management. You have to make sure you don’t impact what someone needs to do to keep the lights on, and that you don’t so overwhelm them with change that they can’t put it into practice. Plus if you’re just giving someone the same thing they already have but better and faster, they’re not going to  care. The huge win is if you could give them actionable insights that they didn’t have before.”

Bluecore is a retail marketing platform that enables marketers to turn shopper and product data into revenue-generating campaigns, in minutes. With data built directly into campaign workflows alongside point-and-click predictive models, retail marketers can bypass manual processes to trigger any communication and automate the who, what, when, where of every email, mobile, site, and paid media message for each individual shopper. Learn more at Bluecore.com

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