June 25, 2024

The D2C Disconnect

Shannon Osborne
Growth Marketing

How do brands bridge the disconnect between their omnichannel marketing efforts?

It’s no surprise that the introduction and complexity of consumer shopping behaviours have brands in a measurement race to understand where they should allocate their marketing budgets. A recent report by Drapers shared that “after years of preferring online channels, stores were ranked number one this year, as 53% of Gen Z and millennials chose them as their preferred shopping channel – despite the fact that 92% also now report shopping on mobile apps, demonstrating their truly omnichannel approach to shopping for fashion now.”

It begs the question, how should brands prioritise spend and how can effective attribution win over new audiences?

Over to Shannon, Growth Manager, as she reveals how brands should be measuring the relationship between D2C, marketplaces, and online stores to drive customers to their purchase destinations.

Measuring the relationship between investing in online retailers, such as Amazon, Look Fantastic, and Sephora, and a brand’s D2C website is key in understanding whether online retailers provide a halo effect, in that they expand customer reach and awareness, or they cannibalise consumers into purchasing from large retailers as a preference to D2C.

What is the discord?

A short-termist focus on quick sales through a retailer can cannibalise your success in building a loyal customer base through owned channels and directing consumers to your D2C site.

Comparing ads that drive consumers to a retailer and ads that drive consumers to your D2C site can vary, but both are important. Understanding the nuances in both, and pivoting your marketing accordingly will improve the performance and continue to drive consumers to buy and raise brand awareness.

Ignoring channels where your invested audience live, and reducing spend on these platforms, means a missed opportunity in creating an optimised journey for consumers with a strong intent to buy from your D2C site.

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How should brands prioritise spend to win new audiences?

What is success through effective measurement?

Enter COmpass.

COmpass is our data marketing suite and proprietary tool, born out of the need for effective measurement for brands across all of their marketing and ad channels. In-platform metrics are doing you a disservice and COmpass allows you to measure your full content ecosystem and understand what channels are driving customers to your brand, that goes beyond last-click measurement. If we recall at the start of our article, we discussed the disjointed and complex nature of millennial and Gen Z consumer journeys. COmpass fixes that complexity, by accounting for every touchpoint that has driven your customer, not just the last one.

The proof is in the pudding, as they say…

By investing in Sephora for brand A, it increased revenue by an additional $700k within one quarter to the D2C website on top of a positive performance of retailer sales.

Brand B found that 20% of paid advertising increased the revenue on Amazon considerably when the brand expanded into the US. Compromising strategic focus and vital result analysis.

For brand C, running Amazon sponsored ads saw an additional 4.1k of customers which was an increase of 5%, which increased the consumers to the D2C site through brand discovery on Amazon.

What can you do to ensure a connected synergy between your D2C and retailer marketing strategy?

Differentiate Marketing Strategies: Tailor your marketing efforts to highlight the unique benefits of each channel. Using methods such as emphasising exclusive offers or personalised experiences on your D2C site, whilst promoting convenience and availability through retail partners, will allow you to target a wider audience at different stages of their buying journey.

Monitor and Adjust Pricing Strategies: Regularly review and adjust your pricing strategies, ensuring competitiveness across all channels without undercutting your D2C efforts.

Enhance Customer Experience Across Channels: Strive to offer a consistent and high-quality customer experience whether the purchase is made directly or through a retailer, maintaining brand integrity and customer loyalty.

Leverage Cross-Channel Promotions: Use cross-channel promotions to drive traffic between channels. Including incentives in retail packaging that encourage customers to visit your D2C site for future purchases can drive and create new loyal audiences for your D2C site.

Implement Robust Analytics Tools: Utilise comprehensive analytics tools. COmpass allows you to track sales drivers across all channels, so you are closer to the truth than ever before on the impact of your marketing efforts across both D2C and retail and you can allocate marketing spend for sustainable growth.

Navigating the complex landscape of omnicommerce requires a necessity in the ability to bridge the gap between retailers and D2C channels. If you need a partner in growth to deliver results then drop us a line to learn about what COmpass can do for your brand.

Shannon Osborne
Growth Marketing
charlie oscar