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Why Direct-to-Consumer Sales Are Important For Manufacturers

Posted by Avery Walts on Sep 1, 2016
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manufacterer direct to consumer

It's no longer an option to avoid selling your goods online. That is, if you want to stay current and successful. Manufacturers are used to using retailers as their one-way ticket to consumers, but times have changed. Direct-to-consumer sales is the way of the eCommerce now and future. 

In this article, I am going to detail the benefits of direct to consumer sales

Direct-to-Consumer Sales- What's the Hiccup?

Brand manufacturers have been reluctant to give in to the direct-to-consumer sales trend that has completely changed the face of commerce, specifically, eCommerce. Their business model of selling through retail channels has served them well from the beginning, so why change?

Because if they don't they will get left in the dark ages.

Manufacturers are afraid of the costs to support brick-and-mortar stores, but with the increase in digital marketplaces, the idea of selling direct to consumers is less daunting. Additionally, manufacturers still fret over the impact direct-to-consumer sales will have on their retail partners. The good news is both can live in harmony, and I'm going to explain the benefits of selling direct-to-consumer in addition to retail.

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Why Branded Manufacturers Should Sell Direct-to-Consumer

  • Brand Bonding. Retail stores don't have time to focus on one brand over the rest. But when a manufacturer focuses on one brand alone, that brand's image reaps the benefits. By selling direct-to-consumer, one brand doesn't have to compete with other promotional offers or sales or risk other products stealing customers. As a result brand manufacturers have control of the entire purchasing process which allows them to give further detail on how to use the product and other basic product information.
  • Retailers & eCommerce Sites Win. Selling direct-to-consumer doesn't completely take away sales from retailers. Actually, it can greatly enhance their revenue. Customers often look up product information on a brand's website before visiting the physical store to make a better purchase. The website gains traffic and the brand's store makes  a profit. Win, win.
  • Controlled Pricing. Direct-to-consumer brands are in control of price points and communicate with customers about those price points on a more intimate level, rather than a retailer doing it for them. They can also list their full product line on their website, offering more selection and the chance to cultivate loyalty with customers by showing them everything they have to offer.
  • Customer Data. Because an eCommerce site takes less percentage of sales, brands gain a richer look into customer data such as product performance. Brands save money on things like promotions and advertising they wouldn’t otherwise have with high retailer fees.
  • Promos! Promos! Promos! With a million brands begging for the attention of retailers, their chances of gaining a promotional spotlight is limited. With direct-to-consumer sales, brands have the opportunity to offer limitless promotions, from coupon codes to on-site promotions, whenever their heart desires. And the best part? They don’t have to seek approval from anyone.
  • Longer Shelf Life. Products are competing for attention on a store’s shelf space. Even if a product sells well it may not be the shining star in a retailer’s eye. But if brands sell products online there is no time limit. Online shoppers will appreciate the ease in purchasing a beloved product that got knocked off the shelves, and will love it even more if they can always come back to purchase.

Key Takeaway

Manufacturers would be remiss if they didn’t sell direct-to-consumer. Shopping online is the way of now and the way of the future, and strictly following an aging model of selling products will only leave them in the dust. Selling to retailers and selling direct can live together peacefully, but understand the importance of opening the floodgates to a wider audience. Selling online leads to things like greater customer personalization, loyalty, and expansion for product storytelling and availability

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Topics: eCommerce, eCommerce Businesses, manufacturers