For retailers, Christmas looks very different this year. With lockdown forcing physical store closures across England, brands that have traditionally sold their products in store are suddenly depending on ecommerce for some of the most critical weeks of the retail calendar.
Faced with the need to reach consumers through digital channels this winter, many brands may choose to flip to a direct-to-consumer (D2C) sales model, skipping over their traditional retail partners to reach consumers directly through social media and their own websites.
Though D2C selling has helped to boost the recent fortunes of megabrands like Adidas and Nike, the strategy requires a solid technical foundation and strong underlying data.
The D2C revolution
D2C is a proven model that’s rapidly grown in popularity. That’s partly because it cuts some of the costs associated with more traditional retail business models, but also because, in an increasingly ‘samey’ online universe, D2C gives consumers a differentiated, personalized and memorable online shopping experience.
The result is greater loyalty and stronger sales figures. And in a pandemic where high streets have been shuttered and footfall has disappeared, that’s a crucial competitive advantage.
Using customer data to build a strong D2C offer
The D2C model gives brands an opportunity to build deep customer relationships that can, in turn, fuel unparalleled insights into consumer behavior and trends.
When used correctly, this goldmine of data can be used to reveal a detailed picture of your customers, how they behave and what they want - exactly the information you need to be able to deliver a high-quality shopping experience, create impactful marketing campaigns, and build a winning D2C business.
For retail businesses moving with the times and pivoting to an online model, that can be easier said than done. Here are some tips for getting started:
Start with the basics, and think big picture
Before you get anywhere near a customer analytics tool or try to switch on data-driven marketing, you first need to make sure that the raw data you plan to use is clean, accurate and reliable. If you don’t, even the best tool is just a useless bit of tech.
Take stock of your company’s data foundation. Do you have an overview of the whole customer journey, from start to finish? Is customer data being held in silos, and if so, are you sure you can trust it?
How is your infrastructure coping with the increased volume of data that’s now coming in from different digital channels? And at a practical level, how much time is your engineering team spending each week on keeping it maintained?
If these questions make you wince your first step is obvious: strip out the complexity and rebuild your data foundation.
Customer data platforms (CDPs) are one of the best options for D2C companies dealing with huge volumes of customer data. CDPs centralize, clean and consolidate data that’s flowing in from multiple customer touch points, meaning you can easily integrate the tools you want to use and avoid data silos, duplications and blind spots. Fragmented data really is no fun, so this way, you can save the puzzles for Christmas day.
Implementing a ready-made solution can also save precious time and help focus your resources where they’re most needed in the countdown to Christmas.
Choose focused, flexible tools to keep up with changing demands
Once you’ve got a strong data foundation in place, you can start building the architecture around it. You’ll likely need a range of tools to help you tackle various parts of the customer journey, but if you really want to make an impact, you need to be focused in your approach.
Think about the questions you need to prioritize in the run-up to Christmas. Shopping habits change at this time of year, so what you want to track this December might be different to what you typically look out for.
Where is most of your traffic coming from? At what point are customers dropping out of the purchasing journey? Once you’ve identified your key questions, you’ll be better able to choose an analytics tool that'll help you answer them.
Remember to build flexibility into your process: don’t lock yourself into a long contract with a tool that sounds great today, but might not be valuable in the long run. Look for tools that are flexible and adaptive, and be careful to avoid vendor lock-in - you should be able to freely interchange data-driven tools as your business and its needs evolve.
Get your team onboard, so that insights become action
Once your customer insights are in place, you need to mobilize your team. And with such a small window for seasonal sales, there really is no time to waste.
A real-time dashboard of key metrics is a great way to keep your team up to date on the latest insights, as well as sharing your progress against shared targets. It’s a simple, quick and easy way to monitor how customers are interacting with your website and product in real-time. That’ll put you on the front foot to fix any bumps in the customer journey as you go.
These dashboards are easy to read and access, and are automatically updated in real time, meaning every member of your team will be empowered to make changes that optimize sales at this crucial time of year.
Data is for life, not just for Christmas
The D2C trend is only going to grow as the economy continues to shift online - this Christmas is only the start.
If you reel in a whole bunch of new customers for Christmas, don’t think you can just breathe a sigh of relief on January 1st - the next challenge will be to keep them coming back throughout the year. The insights you’re gathering today will help you to reflect on what’s working and what isn’t, so you can continue to improve your offer and transform your new customer base into a dedicated community.
As more retailers take the D2C route, the companies that stand out will be those that can build the most compelling brand experiences and foster the deepest customer connections. And to achieve that? They need good data.
Tido Carriero, Chief Product Development Officer, Twilio Segment