This trend appears to be an effect of a noticeable jump in the use of e-commerce channels since the beginning of COVID-19, as many either have not been able to or have chosen not to visit physical stores (Reference).
However, DTC sales can be a complex puzzle containing variables such as logistics, return policies and contactless deliveries1. This raises the question on how best to respond to this trend, what is the most favourable platform and how will people interact with brands going forward?
Some would argue, many expect websites to work flawlessly whilst being more patient with apps. This boils down to our perception of what these represent. Many argue that websites are a more static representation of a brand’s offering whilst an app is considered more fluid in its development; brands test and tweak, albeit still perform to an acceptable standard.
The Direct-to-Consumer trend also raises the question around business models: are value chains changing? If so, not only distribution models but also business models need to be addressed to successfully respond to the DTC trend.
What about the perception of sustainability related to DTC? Will DTC be perceived as a more local service and hence better from a sustainability perspective? Would this then boost sales further and ultimately align neatly with the sustainability agenda once this becomes top of mind again?
What this all boils down to is that DTC will allow brands to gather large volumes of data directly from their consumers, through the one-on-one interaction enabled by DTC. For many brands this will likely be new data, which has the potential of offering great insights into the consumer journey and thus allow optimization of the customer experience, product discovery and hence brand image.
Ultimately, DTC will result in large volumes of data that fill gaps in individuals’ consumer journeys and bring brands and consumers closer together; offering the prototype for a new and improved business model.
This leads us onto our final and potentially most important questions:
Johanna Wind, KPMG Sweden Insights Center Manager, +46 723 94 64 79, firstname.lastname@example.org