As direct-to-consumer brands continue to change the way consumers shop, data from Scalefast’s “2020 DTC Hype Report” identified the top consumer desires for DTC brands and revealed consumer sentiment toward the retail model. The goal of the research is to identify what DTC brands can do to remain competitive in retail and how to be successful in obtaining consumers.
According to the report, 19 percent of consumers believe DTC brands are more customer-centric than traditional retailers and 19 percent said they believe DTC brands are “more likely to be ahead-of or on-trend. Another 14 percent of consumers replied they believe that DTC companies are more tech-forward.
Additionally, almost 15 percent of consumers reported they believe they have a better user experience and receive higher-quality products when shopping with DTC brands.
“The retail landscape is rebuilding after a tumultuous decade of declining sales and store closures,” said Olivier Schott, founder and chief marketing officer at Scalefast. “As a result, DTC companies have emerged as a new category of e-commerce that’s changing the way brands and consumers interact.”
Though not all consumer sentiment toward DTC brands is positive. Nearly 16 percent of consumers said they believe it is “riskier” to make purchases from a DTC brand in comparison to a traditional retailer.
Concurrently, the report’s authors said DTC companies must remain steadfast in the ability to deliver on consumer needs for quality products and experience, despite missions or gimmicks that may be driving the brand. Additionally, the report notes that these are areas in which consumers find Amazon outshines other companies, with 43 percent of consumers reporting they would choose to make a purchase through Amazon over a DTC brand due to more price friendly, or free, shipping options.
“Our research showed that while some consumers know of and buy from DTCs, this new retail category is a blurred line in the minds of most consumers,” Schott said. “If DTC brands want to become the new normal in retail, they need to learn from traditional retail mistakes, decide if Amazon is worth the risk and adapt to a changing customer that is more sensitive to concerns like their payment security to where a product is made than ever before.”
Outside of convenience factors, Scalefast’s data showed opportunities to attract consumers by appealing to a customer’s humanity. While nearly 19 percent of consumers said they are more likely to make a purchase from a DTC brand if the company had a cause-oriented mission, 30 percent said they are more likely to make a purchase from DTC brands if the product is sustainably made.
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