Direct-to-Consumer Brands – What are They Doing Right?
Direct-to-Consumer Brands have an individual customer relationship, and most are online and digital-first.
By: Chase Altenbern, Sales Director, Zeta Global
Today we are living in a “Direct Brand Economy” where consumers are engaging directly with the brands they know and trust. Is your brand one of these trailblazers, or are you faced with navigating this market disruption? I recently attended the Interactive Advertising Bureau (IAB) Annual Leadership Meeting to learn more about this new “direct brand” landscape consumers are embracing.
At the IAB annual meeting, the IAB released its new list of 250 Top Direct Brands to Watch. From total funding and revenue to social velocity, these are the companies to watch who are leading the direct brand charge.
What are the Characteristics of the Top 250 DTC Brands?
- 78 of the 250 brands have a subscription model
- 5% of Fortune 500 CEOs are women, while 25% of IAB 250 Direct Brands are founded by women
- Millennials have a growing affinity for disruptive brands (eMarketer thinks so too!)
- 2-day delivery is prompting all retailers to acquire/partner with these DTC brands to compete
Direct-to-Consumer (DTC) Brands Have an Intense Customer Focus
DTC brands center themselves around the individual consumer relationship, and most are online and digital first. These companies are also highly data-driven—they know who their customer is and where to find them and leverage their relationship to drive loyalty and growth.
These brands are “Maniacally Focused” on the consumer experience. They are very quick and responsive with customer service and always put the customer first. They are social and have a significant social media presence and correspondence with customers via text or DM is a routine practice.
DTC brands tend to use content as a differentiator as well. They advertise not just about the products or services, but on the lifestyle and emotional connection a consumer feels with the brand and their products. Because of their intimate relationship with consumers, DTC brands tend to have extremely loyal customers.
Part of how DTC brands build their story is through a corporate mission. This mission is often central to their story and purpose. They feel they are changing the world for the better and creating needed answers to long-unsolved problems. And along with their success, they give back. Most DTC brands have some aspect of a charitable cause in their mission, helping consumers feel they are giving back to the community while they spend.
DTC vs. Blue Chip Brands
DTC brands are quickly gaining on blue-chip brands from Fortune 500 companies due to their extremely loyal and growing customer bases. Disruptive examples currently in the market include:
- Hanging up your trips to the grocery store and endless meal planning in exchange for home meal kit delivery
- Blue Apron, Plated, Hello Fresh, Home Chef
- A shift from tired, old mattress brands to digital delivery disrupters
- Casper, Helix, Parachute
- Popping into the local liquor store to enjoying your favorite spirits delivered directly to your home
- Winc, Flaviar, Bright Cellars, Drizly
- Searching endless aisles of beauty products in store vs. online subscriptions delivered to your door
- Quip, Harry’s, Hubble, Kopari
How Can Marketers Embrace the DTC Impact That is Occurring?
- Know your customers. Deploying massive reach is no longer enough. You need to understand your customers and build a personal relationship that makes them a brand loyalist for years to come.
- Zeta’s Private Data Cloud can match against a customer file, offering a glimpse into our trove of proprietary data linked to PII, to give insight into what your consumer does after they purchase or leave your site and show you what they are passionate about.
- Focus on Acquisition. DTC brands are experts in acquisition and know how to leverage various mediums — and the best way to communicate within each.
- Zeta’s Audience Activation leverages this multichannel approach to acquire new customers via display, social, and email.
- Sell your brand. Tell your story to customers to strengthen your relationship and keep them passionate about the brand. Keep them coming back for more.
- Zeta’s Platform links these narratives through seamless sequencing to market to your customers as they develop their experience with your brand.
For more on how Zeta’s platform can help you implement some of these ideas above, please visit: https://zetaglobal.com/blog/how-to-activate-high-value-customers-leveraging-natural-language-processing-and-machine-learning/