The smarter way to grow your direct-to-consumer sales channel: customization.
When you consider the $111.54B in direct to consumer ecommerce sales in 2021 in the U.S. alone, it’s no wonder brands are eager to explore new ways to grow their DTC channels.
Those who do stand to win big. Some experts predict DTC ecommerce sales will swell to nearly $175B by the end of 2023.
And that makes sense.
DTC channels are popular with end users delighted to be able to connect directly with brands. Especially when they have options not typically available through retail, like the ability to customize.
This huge opportunity is not without challenges, of course. C-suite conversations about growing DTC channels often get mired in several concerns:
• How to grow ecommerce without alienating your retailers.
• How to approach more of the DTC market in innovative, profitable ways.
• How to implement a strategy that complements your core business.
Brands must tackle these questions or risk missing out on the increased market share and higher profit margins DTC ecommerce growth represents.
And customization holds many of the answers.
Here’s why customization is key to direct-to-consumer sales growth.
For many brands that have kept their ecommerce business small, careful to avoid fishing too much in the same pond as their retailers, customization represents intriguingly uncharted water.
Consider these four facts about the unique niche customization provides, how it could impact the future of your brand, and why it’s more within reach than ever before.
1. You can grow your DTC sales without being in conflict with your retailers.
Product customization is typically not something retailers are prepared to offer consumers. Your interest in serving customizers does not represent direct competition.
Furthermore, offering customization does not need to signify a slowdown or pivot away from your core retail business in any way. The preferred approach is to supplement the mass production operations that supply your retailers with separate custom processes.
One place to start is by reaching out to your suppliers to determine their existing capabilities for fulfilling small-batch orders. You may need to reach out to new partners with custom order fulfillment experience.
From there, your next steps into customization will include:
• Assembling an R&D team to determine what embellishments you can offer using your existing equipment and material, e.g. printing capabilities with your substrate.*
• Investing in a configurator platform that allows customers to design products within guidelines you set and feeds orders into your OMS (order management system).
• Adding new production technologies, such as embroidery equipment, and/or new partners who can handle more advanced customizations.
Your primary retail channels will still be humming along all the while as you make incremental investments in DTC, track your return on investment, and justify next steps.
*PRO TIP: Brands often choose to outsource this process to JTB Custom.
2. Customization through your direct-to-consumer channel opens the door to increasing B2B sales, too.
It’s easier to justify a customization program when you can project the added profits of large-batch custom orders in addition to typical consumer sales.
For example, your customer could be a museum gift shop. They want to work with you as a trusted brand to offer unique souvenirs to guests and are willing to pay a premium to customize these products.
On a larger scale, you have the potential to partner directly with franchised chains, amusement parks, coffee shops, breweries, and other affinity-driven organizations with regional, national, or international reach.
Product customization allows you to delight these partners with on-demand embellishments such as:
• Seasonal designs
• Event marketing
• Regional images or symbols
• Multiple languages
• Religious iconography
• Whatever they can imagine and configure through your online customization tool
The key to creating these partnerships is to provide an automated custom order process that is as easy to use for businesses as it is for individual consumers.
3. Customization via your DTC channel can also be a research tool to improve your core business.
At its most basic, a direct to consumer sales channel brings end-user feedback about your products to your front door. The potential for data collection is even greater with customization.
Questionnaires, surveys, and customer service interactions are all powerful sources of useful data – with insights that are applicable to all sales channels.
Consider how much more responsive you could be to shifts in consumer trends if you could pull from your own sample group in real time? Your DTC channel is like a petri dish telling you exactly what customers think about the variety, appearance, and quality of your products.
Add product customization, and your petri dish becomes more like a crystal ball.
A lot of research goes into decisions guiding the mass production of your product lines, but trying to predict what will be trendy in 12-18 months is still essentially guesswork.
The part of your DTC customer base that will give you a much clearer picture of emerging trends are the decorators and customizers. These are the creatives, the brand mavens who are leading trend shifts within their communities.
Give them the tools to make your products their own through virtual merchandising, watch for patterns, and you’ve got an early detection system for the next wave in fashion.
So, in addition to the added profits from the premium pricing you can charge for customized products, customization through DTC channels can also help make your core business more profitable.
4. You don’t have to figure out how to grow your direct-to-consumer sales channel on your own.
There are many facets to growing DTC with product customization. But whatever the obstacles you face, JTB Custom has the expertise and tools to help you overcome them.
We work with brands across the spectrum. Whatever your level of experience with ecommerce sales, JTB Custom can help. We offer strategy and management consulting to help you plan and execute your customization strategy.
In addition, Silhouette™, our virtual merchandising software with integrated order management system, works with a variety of ecommerce platforms and factory routing software to help make whatever your end users imagine a reality.
All it takes to get started is for you to take the initiative.
Ready? Talk to an expert today.