Written by Sven Van Hoorebeeck
Ultimate convenience is a future commodity. A growing consumer trend, enhanced by technology, is the zero-effort purchase[1]. Consumer purchasing behavior goes towards solutions that require the minimal effort possible to receive value.
Online purchases and direct-to-consumer (D2C) channels answer the zero-effort purchase trend with convenience: Consumers buy from remote digital touchpoints, get deliveries at home, and communicate directly with the seller. Consumers love it, resulting in D2C sales tripled between 2017 and 2020[2].
Consumers are not the only ones benefiting from a D2C channel; manufacturers can also reap value from D2C. There are four key opportunities for manufacturers to capitalize on D2C activities:
1) Unlocking higher margins and a higher volume of sales
For manufacturers, the direct-to-consumer channel represents a higher margin of 5% to 15% [3] compared to other B2B/ B2C distribution channels.
In a direct-to-consumer channel, companies reduce the number of intermediaries between production and customers, internalizing the margins that went to intermediaries in the past.
Illustration from BrightWolves: Direct-to-consumer channel reduces the number of intermediaries to reach the consumer
An increase in margins is also coupled with an increase in sales volumes.