Is DTC Marketing Right for Your Brand? Examples, Tips & Strategies to Get You Started
Have you ever heard the term “DTC marketing,” but didn’t quite know what it meant? Are you curious whether it’s something that your brand could benefit from? If you’ve ever marveled at the success of brands like Dollar Shave Club, Barkbox, Warby Parker, and others, then you already know how valuable a DTC marketing strategy can be.
The pandemic and its resulting economic uncertainty have caused many business-to-consumer (B2C) companies to adopt the direct-to-consumer (DTC) model to survive.
However, this forced evolution has been the saving grace of many different consumer brands, allowing them to find newer, more creative ways to connect with their audiences and transform them into loyal customers.
So let’s dive into what DTC marketing is and some tips, strategies, and actionable advice your brand can use to build its DTC marketing strategy.
What Is DTC Marketing?
Direct-to-consumer (DTC) marketing is a fast-growing business model in which brands advertise and sell their products directly to the customers rather than using an intermediary or third party.
With so many companies vying for customers’ attention—and their money!—DTC marketing is a way to cut through the crowd and gain more control over advertising techniques and each customer’s journey through the sales funnel. DTC models allow for greater flexibility, innovation, and creativity when reaching your target audience.
DTC vs. B2C
So what’s the difference between DTC and B2C? We’ll break it down for you right now.
- DTC: DTC is when businesses sell directly to the end user.
- B2C: The business-to-consumer model represents brands that use an intermediary to sell goods to customers. For example, Pepsi sells its products to wholesalers or smaller retailers, who then sell Pepsi’s products to the end users.
11 DTC Marketing Strategies To Consider
Now that we’ve defined the term “DTC,” we’ll dive even deeper into the mechanics of building a DTC brand. Read on as we explore eleven DTC marketing efforts and actionable advice for brands.
1. Influencer Marketing
Have you ever tried a product just because your favorite celebrity endorsed it? Since 2019, influencer marketing has more than doubled globally, reaching $13.8 billion in 2021.
One such method to promote your brand is by collaborating with influencers. For example, a make-up brand may want to collaborate with young, fun make-up artists who post daily GRWM (get ready with me) videos and rave about the products as they’re applying them.
2. Email Marketing
Email providers now offer two inboxes for customers: primary and secondary—and let’s not forget that spam folder. So, with a barrage of emails pouring into customers’ inboxes daily, how can you create a DTC marketing strategy that will get people to convert?
Start by categorizing your consumer audience and designing a custom, personalized email for each segment that addresses individual pain points and needs. If you’re short on time, consider using personalization software to make the process fast, scalable, and automated.
3. Personalized Experience
Consumers enjoy feeling as if they’re one-of-a-kind and not just an order number. Personalization builds brand loyalty and boosts customer connections by honing in on each customer. By catering to each buyer’s unique wants and needs, the company can provide personalized products that are more likely to catch their eye.
The company WeWood, which sells wooden watches, is the perfect example of using activism to generate revenue. For every timepiece a customer purchases, WeWood plants a tree and has planted over 420,000 since 2011.
By weaving in the fundamentals of activism, charity, or commitment to worthy causes, you can reach the younger generation’s hearts (and wallets!). That “feel good” sensation helps the consumer justify spending money on your product.
5. Social Media Marketing
Social media marketing is a particularly effective advertising method for DTC brands, allowing you to nurture genuine relationships. Avoid spamming your followers and instead post engaging, informative content that provides some value (i.e., how-to videos).
A strong, regular social media presence also gives you another bonus: user-generated content (UGC), another way to strengthen your digital brand presence.
6. Memorable Brand Personalities
Consumers appreciate brands that are unique, innovative, and memorable. Always use details that create consistency for your brand, including name, logo, colors, etc. Consumers resonate with brands that stay true to themselves and their goals. Staying genuine with customers is how brands make real connections and loyal customers.
7. A Focus on Current Customer Experiences
Overall experience is a critical factor if you want to retain customers. According to Qualtrics, brands lose about 9.5% of their revenue due to bad customer experiences. That’s a huge loss!
To create a highly personalized customer experience, focus on UGC. For example, the U.K.-based skincare company Dr. Botanicals often lets customers try its products (for free or at a discount) in exchange for posting reviews on social media platforms.
8. Direct Mail
It’s a common myth that direct mail marketing is obsolete. Direct mail can provide a higher return on investment (ROI) than expected. Brands can target qualified leads with a highly detailed and personalized advertising strategy. Example: a car dealership sending out a flyer with a scratch-off that reveals a custom discount or promotion.
9. Online Ads
Brand awareness and your company’s presence across digital channels are the cornerstones of success in today’s hyper-digital age. Your brand should leverage every possible viral ad strategy, including pay-per-click (PPC) marketing like Google Ads, Facebook Ads, and others. However, the process is both dynamic and never-ending.
Be sure to take full advantage of display and paid search ads to increase awareness of your brand. Adopting an omnichannel strategy that caters to your target audience will help you generate qualified leads, drive more conversions, and strengthen your brand’s visibility.
10. Take Advantage of Offline Marketing
While there’s no denying the results that online marketing can bring to your brand, offline marketing can be just as lucrative. How often do you drive by a billboard on your way to work? Popular methods of offline marketing include:
- Radio ads
- Television ads
- Subway ads
- Pamphlets and flyers
- Business cards
- QR code marketing
When you combine offline advertising with your online tactics, you can create a comprehensive marketing strategy that speaks to the consumer and provides consistency.
11. Consumer Feedback
Consumer feedback is an invaluable source of data. Remember, the key to DTC marketing is to develop a close and genuine relationship with your consumers. These same consumers can provide critical insights regarding your product and pinpoint vulnerable areas where improvement is necessary. In addition, asking for this feedback and then acting on it builds trust, credibility, and loyalty among your customer base.
Ways To Make The Most Of Your DTC Marketing Strategies
Developing the perfect DTC marketing strategy is only the first step of the process. After you implement your initial strategies, the next step is to identify the weak or underperforming areas and improve them to boost ROI and squeeze every drop of profits out of your advertising budget.
Stick with us as we discuss the best ways to refine and improve your DTC marketing tactics to keep your brand on track for growth and expansion.
Analyze Your Data
An in-depth analysis of high-quality consumer data can provide valuable business insights and patterns to help you connect with your consumers. Try to work directly with media vendors and digital marketing platforms to collect crucial consumer information and leverage performance measurement tools–like software–to organize all the pieces into easily understandable data chunks.
Be Authentic with Your Customers
Is anything worse than a business that isn’t genuine with its customers? Avoid deceptive marketing tactics and be sincere with your consumers. It establishes brand credibility and fosters an authentic connection with your consumer base. State a clear mission, stick to it and see it out.
Appeal to Lost Customers
Every e-commerce brand deals with the lost profits of abandoned shopping carts: a massive source of revenue loss for many brands. Fortunately, many ways exist to increase your DTC marketing strategies to appeal to regain those lost customers.
Targeting outreach to lost consumers by highlighting the products they almost purchased, combined with an offer for free shipping or a free sample, is an excellent tactic for drawing them back in. Not only do they save money on shipping or gain a new product they could potentially fall in love with, but you gain a customer back and boost your revenue.
Foster Customer Loyalty
According to the Harvard Business Review, businesses spend five to 25 times more money acquiring a new customer than retaining an old one. Although your DTC marketing strategy should focus on gaining new customers, it should also focus on fostering loyalty and improving retention rates. After all, it’s far easier to sell to a customer who has already purchased from you than to convert a brand-new customer.
DTC Measurable Metrics
DTC marketing isn’t only about flashy banners and catchy videos; without tangible measures, your company could spend thousands of dollars on advertising without seeing a penny returned. We’ll discuss the various measurable DTC metrics you can leverage to measure, manage, and improve your brand’s performance.
Customer Lifetime Value
Definition: Customer lifetime value, or LTV, estimates the total lifetime value that a customer will generate for your brand.
How to Use It: You can use the LTV metric by measuring when you acquire each customer and then tracking their growth year over year. Every customer’s LTV should be growing over time. If not, find the root cause and adjust your marketing strategy accordingly.
Definition: Conversions are how many visitors turn into customers—for example, those who click on your advertisement and purchase several items.
How to Use It: Conversion rates are critical for determining the success rate of each ad channel you employ within your marketing budget. You can find this percentage by taking the total number of conversions and dividing it by the audience, then converting the answer into a percentage.
Definition: Your churn rate is the number of customers that leave a product over a certain period. It’s a critical metric, particularly for companies that use a subscription model.
How to Use It: In addition to the overall health of your brand, your churn rate directly affects additional DTC metrics, including LTV, CAC, and monthly recurring revenue. Use it to determine why you’re losing customers: what do they have in common, and how can you fix it?
Customer Acquisition Costs
Definition: Customer acquisition costs (CAC) measure how much of an investment is necessary to gain a customer through your marketing channels, including television, Google Ads, Facebook Ads, YouTube, etc.
How to Use It: Use this metric to strike the perfect balance between how much you spend on each advertising channel and your return. It’s also valuable for pinpointing which media sources reach the heart of your target consumer.
Monthly Recurring Revenue
Definition: Monthly recurring revenue, or MRR, measures the total predicted revenue your brand can count on each month. If you’re not calculating MRR (particularly for DTC subscriptions), you could be miscalculating your brand’s growth.
How to Use It: MRR helps your brand measure its overall growth and momentum. Use this metric as a primary way to set goals, understand your business model, and learn how to reach those goals.
Definition: To find your brand’s product margin, take the cost of goods sold (COGS) and divide it by the gross sale price.
How to Use It: Your brand’s product margin excludes discounts, shipping, and handling expenses. Essentially, it allows you to understand how much your company makes and the maximum revenue you can generate overall. Use your insights to structure your daily operations and business model accordingly.
Net Revenue Retention
Definition: Net revenue retention is the final amount of revenue remaining after subtracting every allowance, credit, and discount.
How to Use It: Your net revenue retention measures the consumer’s continued usage of your product or service. This metric isn’t as applicable for one-time purchases as for subscription models. However, net revenue retention is also essential for tracking the return rate of customers and how frequently they purchase from you.
Examples of Successful DTC Brands
We’ve gathered some highly successful DTC brands so you can gain some guidance and inspiration to help your brand. Let’s go!
Everlane is a DTC clothing vendor featuring simple yet timeless designs and an outspoken commitment to ethical practices, sustainability, and transparency throughout the supply chain. In addition, the company has publicly promised to stop using new plastics and attain net-zero emissions by 2050.
Everlane’s core values and pledges have given this brand access to a unique and loyal niche market of consumers and helped the brand develop a strong brand image.
Warby Parker offers affordable sunglasses and eyeglasses with an efficient buying process that makes purchasing glasses fast and convenient. The company runs a “Buy a Pair, Give a Pair” campaign and has donated over 10 million pairs of glasses to those in need. That “doing something good” feeling speaks to the heart of consumers and drives success for the brand.
Dollar Shave Club
Dollar Shave Club is a beautiful example of a DTC business model’s success. By offering customers the convenient option of a recurring subscription of razor blades on a custom-set schedule, DSC eliminates the hassle and extra expense of returning to a physical retail location whenever they need new blades. Check out its viral YouTube video for an example of its exceptional DTC marketing strategy.
Barkbox is a subscription service catering to dogs and their humans who adore them by offering a monthly box of curated toys, treats, and other products to pamper your furry children. The most impressive part? Barkbox started in 2011 when DTC marketing was still relatively new.
As a result, Barkbox primarily used word-of-mouth to grow the brand, which has now shipped over 10 million boxes. It’s an extraordinary example of how DTC marketing can help a small start-up grow and transform into a household name and successful brand.
Glossier sells fragrances, skincare, and makeup products via the company website. Its founder Emily Weiss used a DTC business model to leverage an omnichannel marketing strategy focusing on influencer and social media marketing. Her approach allowed her to reach Glossier’s target audience of young women with great success.
Bombas played on consumers’ willingness to pay premium prices for a high-quality product. The socks’ price point of nearly $20 per pair isn’t a deterrent for consumers who love the product’s support, comfort, and strength. Plus, Bombas appeals to socially-conscious shoppers as another way of justifying the higher price point, an excellent example of DTC marketing.
Final Thoughts on DTC Marketing
DTC marketing is a dynamic process and one that your brand should consistently improve. At The Remnant Agency, we provide your brand with a successful and cost-effective method to reach the heart of your target audience and drive sales.