How to Create a Successful Direct-to-Consumer Strategy

E-commerce retailers, from furniture and other big and bulky items to small household goods, are continuously striving and competing to create the most efficient customer experience possible. As fast shipping and a seamless mobile shopping experience are now in high demand, retailers must have the fulfillment strategy and technology in place to meet these needs.

Given a staggering 91 per cent of shoppers will look up a brand online before visiting its brick-and-mortar business in person for the first time, according to a Digital.com survey, building a streamlined mobile shopping experience is now critical to winning new customers and driving growth. In this rapidly changing environment, adopting a direct-to-consumer (DTC) strategy will be critical to power success. It allows retailers to cut unnecessary touchpoints out of their supply chain to speed up shipping, reduce risk and lower costs.

With traditional e-commerce retailing models, merchandise must travel through a myriad of touchpoints, from manufacturer to export agent, showroom, the retail store and multiple warehouses before finally reaching the consumer. By adopting a DTC retail model, merchandise can travel from the manufacturer to an in-market/country warehouse used by the manufacturer, then to the end-customer — reducing touchpoints and risk of damages, improving supply chain logistics (less need for warehouses, delivery trucks, labour and space) and speeding up shipping. Establishing a DTC model is a valuable addition to established brick-and-mortar retailers and growing mobile brands. Here are three tips to create a successful strategy.

Build a Curated Catalog of Products
Today’s consumers like to visit a brand’s website and discover a vast variety of products — acting as the ‘store window’ to drive traffic. Displaying the entire product lineup in an endless aisle can help convert shoppers, presenting them with every product choice at their fingertips. To avoid offering merchandise in a disorganized or overwhelming manner, retailers must ensure they build a highly curated catalog of products, including a large array of filters so customers can easily find what they need, and only show items that are in stock to eliminate common pain points associated with online shopping.

Retailers can employ e-commerce automation solutions — designed to streamline repetitive tasks like manually/individually removing discontinued products — to save time and build a more cohesive catalog. As a smooth e-commerce experience is critical to winning customers, automating the curation and maintenance of the product catalog is a crucial first step in building a smooth DTC strategy.

Closely Track Fulfillment Metrics from the Start
To guarantee DTC retailing is generating returns, it’s important to track success metrics at every stage in the supply chain. This includes tracking key performance indicators, or KPIs, including time to fulfillment, customer ratings and feedback, shipping costs, profit margins and order accuracy. The practice should be established early in the DTC planning process to ensure it is powering growth, to identify potential pain points and to inform ongoing strategy. In the furniture industry, specifically, supply chain factors like fuel and shipping costs for big and bulky items can change rapidly. Staying on top of these changing factors allows retailers to pivot accordingly to ensure customer satisfaction and maximize profit.

Choose the Right Supplier
Furniture retailers looking to implement DTC fulfillment must confirm their supplier matches their targeted consumer’s needs. Choose product manufacturers that can offer premium quality and competitively fast shipping capabilities since 48 per cent of consumers now expect packages to arrive within two days using standard shipping, according to voice and analytic supply chains solutions provider Voxware. A successful DTC model also eliminates the need for minimum order quantities — the least amount of product units a manufacturer is able to sell to a retailer at once — which are a big hurdle for retailers.

DTC retailing will continue to transform supply chain operations across the furniture and big and bulky sectors. Although it comes with its own set of challenges — sometimes leading to differing product costs and specifications, as well as new considerations when scaling operations — this method of retailing will generate higher profit in the long run. With this, furniture retailers and e-commerce businesses across all sectors should prioritize implementing DTC retailing (as at least part of their business) to fuel growth.

Scott Chorna is vice-president of sales operations for GigaCloud Technology. He leads the implementation and growth of the Giga B2B Marketplace in the U.S., which is a technology-driven business-to-business platform coupled with a complete storage and fulfillment solution for the furniture industry and other big and bulky items. As CEO at Wondersign, Kaspar Fopp helps thousands of independent furniture retailers with cutting-edge catalog technology for in-store kiosks, tablet apps and e-commerce stores.