Are the D2C companies the New Frontier in the post-COVID scenario by leveraging on Data? 

D2C companies
D2C companies - Covid-19 Pandemic

The Hard Reset   

The Covid-19 pandemic has altered consumer attitudes and behaviours. We are adapting to our ‘at home’ lifestyle. Consumers are embracing digital experiences in contrast to an in-person experience earlier. Some of these newly formed habits may become the new normal – even after the crisis ends!  

Hence, “Millennial-friendly” organizations around the world are facing two major challenges:   

a. There is currently an increased demand for servicing customers and providing exceptional experiences. People are stressed, concerned, and can be emotional – thereby driving increased volumes. They expect their favourite brands to be more empathetic rather than opportunistic.   

b. Public spaces are no-go zones across much of the world. Ordering online, a norm nowadays might seem like good news for many D2C brands. However, with this paradigm shift and a global recession on the horizon – D2C brands may have a new challenge! Major retailers like Nestlé may limit their focus on traditional advertising. Their budgets will likely pour into online channels – until now enjoyed primarily by D2C companies. Hannibal at the Gates! 



How Data can help?   

D2C companies

1. Omnichannel personalization 

A 2019 personalization reportsays – “only 18% of marketers were confident of their personalization strategy”. Thus, even with the right technology, marketers are yet to optimally use their data to deliver a personalized customer experience. D2C companies have a competitive advantage - access to first-party data. They can leverage it to create ideal customer profiles. Customer Data from CRM, demographics, campaign response rates, etc. can activate personalization. Such actionable insights help you to proactively engage, upsell, cross-sell, and retain customers. Companies like Kopari employ first-party customer data to ensure its messaging is bang-on target viz. “Get in my bag” rather than the more plain vanilla “Add to cart”.   

New Product Launch

2. Launch new and premium products

The pandemic has highlighted the potential for D2C brands to grow and the limitations of traditional sales networks., the Bengaluru-based D2C sleep and home solutions brand is one such company. From selling just mattresses, they have expanded their portfolio to a wide range of sleep-related and un-related products. This has led to the firm’s 3x rise in its annual revenue since its inception. This surge in unrelated products can be attributed to insights derived from customer feedback data and product innovation. Thus, using data to tailor their marketing and product offerings. 

focus and optimized market spend.

3. Razor-sharp focus and optimized market spend.   

New D2C brands do not have the luxury of being inefficient due to their limited spending, unlike the traditional behemoths. Market attribution is the key to success here. By creating a robust data model using first-party data, marketers can test out a variety of models. A customized attribution model can thus be created. Focused on touchpoints that are more important for driving marketing ROI. 

4. Intelligent supply chain.  

One of the biggest challenges for D2C companies is sourcing, logistics, packaging, warehousing, and distribution. This means a lot of coordination between verticals. Data-based decision-making around demand sensing and forecasting can solve major Supply Chain hurdles.

Key Takeaway  

The modern consumer wants to be acknowledged as a unique individual rather than a nameless field cell. Nik Sharma, CEO of Sharma Brands, says “a more accountable and honest relationship between buyer and seller enables D2C companies to present themselves as being on the consumer’s side”. D2C can address this need by leveraging data to unravel customer insights. This not only drives revenue but also builds trust & creates a sense of safety for the community at large.