The direct-to-consumer (DTC) business model has skyrocketed over the last three years, as customer habits and technology evolved during the COVID pandemic and beyond. According to Paddle, 81 percent of consumers will make at least one DTC purchase over the next five years. Let’s look at seven hot DTC trends and several brand examples that direct selling companies can glean from.

1/ Growth of livestream shopping

Live shopping experiences are replacing written reviews as the trusted source of product opinions. Live shopping sales could make up 20 percent of all ecommerce by 2026, according to Influencer Marketing Hub. But it takes more than just clicking the “Go Live” button. You must also build a connection.

“Your audience cares about having an authentic connection with influencers more than you’d expect,” shared a Forbes article. “If they’re producing clearly fake ads, it’ll likely show in your engagement rates. Select an influencer who actually aligns with your brand and trust their creative input as you strategize a livestream campaign.”

You also need to understand where your audience is interacting with your content and what they expect from the different platforms. Social shopping allows customers to purchase on social platforms without having to go to a different website and navigate a checkout process.

2/ Customers care about sustainability

Customers have an increasing number of options of where they can spend their money. It’s no longer as simple as going to a local store and choosing between whatever is on the shelf. Today’s customer expects more than just good products. Sustainability and social responsibility are more important than ever.

A Talkwalker report for 2023 shows 82 percent of shoppers want brands to embrace sustainable and “people-first” practices. A Business Wire survey found 75 percent of Gen Z shoppers felt sustainability was more important than brand names. Sustainability efforts can take on many forms, such as transportation, reusable packaging, a remote workforce and even being transparent about business practices.

Women’s apparel company Aviator Nation manufacturers clothes in the United States in factories owned and monitored by its founder and has a lifetime guarantee on its products. Superzero produces a line of shampoos, conditioners, hair serum and hand balm in bar form, eliminating the need for plastic bottles. Its motto is “Super performance, Zero waste.”

3/ Don’t sleep on a store front

Yes, one of the core aspects of a DTC business is avoiding a physical store front, but as the cost of digital ads rise, brands are embracing the traditional brick-and-mortar. It’s more than just a place to sell stuff—storefronts can provide a physical connection to customers, allowing a real-time multi-sensory experience. DTC companies still have full control of their brand instead of being buried on a shelf next to many competitors.

“The DTC transition to a brick-and-mortar storefront is the opportunity to create an immersive brand experience,” said CMS Wire. “With the right design, personnel and training, the in-store experience can humanize a brand and create an everlasting impression on consumers.”

Veteran-founded Black Rifle Coffee had opened 18 stores by the end of 2022 and plans to grow to 78 by the end of 2023. In addition to a menu of freshly made coffee, stores are full of the company’s popular merchandise and ground coffee bags. The stores are part of the company’s commitment to employ 10,000 U.S. veterans.

Pop-ups and “ghost retailers” are other popular options. Third-party companies can handle design and construction, and even some daily operations, for retail locations.

4/ A people-first message

Because DTC brands communicate directly to customers instead of relying on traditional media outlets, customers expect a more personalized experience and a more humanized marketing approach. Customer profile surveys help guide customers to products geared toward their needs. Customized packaging, discounts for first-time customers, free trials and even allowing customers to try products before they buy, reiterate and reinforce this trend. The experience replicates having a concierge guide customers to the right products.

“If you want to learn more about your target audience, don’t be afraid to ask,” says ExplodingTopics.com. “There’s a reason why we’re seeing an uptick in customer quizzes to help pick buyers’ brains and deliver personalized recommendations.”

5/ Influencers starting their own DTC brands

While DTC brands search for online influencers to promote their products, top online influencers are creating their own DTC brands. It’s a testament to the power of leveraging loyal followings. Plant-based nutrition company Truvani was launched by Derek Halpern and Vani Hari of Social Trigger. Kylie Jenner’s Kylie Cosmetics was reported to have topped a $1 billion valuation in March 2023.

“This shift was inevitable as creators were bound to leverage their personal brands to capture larger monetization opportunities via ecommerce brands,” explained an article by HashTagPaid.com. “The success of fashion and television celebs in this space paved the way for the next wave of influencers to attempt to replicate similar success. As the influencer industry evolves, it’ll create new and exciting avenues not just for creators, but for established DTC brands, too.”

6/ Subscription pricing and memberships 

Getting loyal customers to order every month on an automatic basis is an obvious goal. The good news is that customers are getting more used to it. Even Amazon is diving into the subscription option with its Subscribe & Save feature, automatically showing shoppers how much they can save.

Flexible subscriptions offer options to skip a delivery; pause the subscription; or easily modify it. Enrolling in a subscription often comes with free shipping—something customers have come to expect with online ordering. Some DTC companies even offer a surprise monthly package, which typically comes with significant discounts. These can include different product combinations and monthly flavors or themes.

Dollar Shave Club, Birchbox and Chewy have become well-known DTC companies thriving with a subscription model. Customers can build their own product combinations catered to their needs.

7/ Product categories are expanding

The market is seeing more DTC companies across different product categories. According to DTCetc, some of the fastest growing include food and beverage, apparel, beauty, home and garden and pet supplies. Grocery and restaurant delivery service skyrocketed during the COVID pandemic, reflecting rapidly evolving customer preferences. According to BlueCart, the top two food categories with the highest ecommerce conversion rates are wine (13 percent) and chocolate (10 percent).

Last Crumb is a cookie brand with a “drop model” notifying customers when the next flavor cookies will be available for purchase. There’s a countdown clock on the website, building anticipation and creating an undeniable feeling of FOMO. Daily Harvest provides ready-to-make smoothie ingredients and works directly with farmers to grow nutrient-dense fruits and vegetables. Peloton is one of the most popular fitness DTC brands. While the cost of its workout equipment tops four figures, the core of the business is the service subscription model.

From the June 2023 issue of Direct Selling News magazine.

The post 7 DTC Trends on the Rise first appeared on Direct Selling News.

Direct-to-consumer (DTC) companies succeed at the crossroads of agility, loyalty and authenticity. That’s why their content strategy focuses on building genuine relationships with customers who truly want to be part of the brand.

Today’s customers are used to buying directly from brands without the middleman of mass retail stores. The customer feels more catered to because they are. DTC companies can bypass the traditional PR firms and media gatekeepers and talk directly to customers. They turn push marketing into attraction marketing. They have complete control of telling their own story, and they can tell it many different ways through multiple channels.

“The benefits of DTC marketing are clear: through this direct relationship, these companies are creating strong relationships with their consumers, understanding them better and reaching a more specific, appropriate audience,” says Hubspot. “DTC brands eliminate the hassle of researching, browsing and choosing from hundreds of options, making shopping practically effortless.”

Building loyalty can require a multi-faceted content strategy focused on relationships, education and authenticity. Here are six effective approaches to glean from DTC brands.

1. Authentic Behind-the-Scenes Videos

Being genuine is the name of the game with behind-the-scenes (BTS) videos. These peel back the curtain and invite customers into intimate parts of the business, making them feel part of the brand. Successful BTS videos are more informal, personable and are often funny and humble—many often reveal some genuine struggles. These can include product manufacturing and teasing new releases; messages from founders and CEOs; casual in-office activities; live tours; and on-the-spot employee interviews. The raw nature of BTS videos creates a more authentic connection between DTC businesses and their customers.

Origin USA, co-founded by former Navy Seal and leadership trainer Jocko Willink, produces martial arts uniforms and durable workwear such as boots and jeans. Everything is sourced and made in America. Their motto is “Made in America. No compromise.” The company’s videos focus on accomplishments with sourcing and manufacturing high-quality products by American workers. They are often short, personable and to the point, showing the impact on local community and reactions to the quality of the products. Company executives and employees are featured in videos talking about the importance of revitalizing American manufacturing.

As a Marketing Revolution article pointed out, “You need to be authentic in what you promise customers. This means stating a clear mission, then following through on that mission. This will help customers feel like they’re not just buying a product but working toward a greater goal.” BTS videos are highly effective at communicating that message.

2. An Omnichannel Strategy

It’s never been easier to publish content in multiple forms to speak to different audiences. It just takes commitment to a strategy. Successful DTC companies often repurpose the same message or campaign for multiple platforms such as YouTube, Instagram, Facebook, Twitter and TikTok. Each channel has its unique way of attracting followers and encouraging interaction. Tagging products in Facebook and Instagram posts is still an effective approach for many DTC businesses, especially when the content is more natural and less “sales-y.” This strategy also helps companies focus on building the brand and connecting with customers instead of pushing products.

“An omnichannel presence ensures that when your target consumers choose to engage with branded messaging, your product or service is readily available in the moment; regardless of channel,” shared Marketing Revolution. “In addition to being available, marketers need to build connections with consumers through branding efforts that create lasting, loyal customers. This is why we have seen a shift in campaigns to emphasize brand over products.”

Another growing trend is being a guest or sponsor on podcasts. These typically have targeted, captivated and highly loyal audiences who trust the podcasters. It’s a great way for company founders and leaders to tell their story and attract customers. Many podcasters only allow sponsors from products and services they use themselves, increasing the authenticity of the relationship.

3. Be a Storyteller

One of the best ways to build a brand is the tried-and-true strategy of telling compelling stories. DTC companies have the flexibility to tell their own stories without going through the traditional public relations channels and media gatekeepers.

Away, a luxury luggage company, took preorders before launching and combined the strategy with the release of an inspirational book titled The Places We Return To. Founders Steph Korey and Jen Rubio interviewed more than 40 creatives for the book such as writers, artists and photographers about their travel experiences. It was sold along with a gift card redeemable for a suitcase. The initial product line was sold out before it released, and the company reached $12 million in sales in the first year.

“Storytelling is a central part of our marketing strategy,” Korey said in a Shopify blog. “We think about what stories we can feed to the press and to social media—things that make people take notice, things people want to share and talk about. You don’t push your product. You create things that are fun to talk about, to write about, to share.”

The company leverages social media to encourage travel or posting funny scenarios instead of directly promoting products. For example, asking followers to post a GIF of their favorite movie to watch on a flight, or a tweet explaining why you need 17 pairs of underwear for a four-day trip.

4. Short, Vertical Videos

Even with the growing trend of longform podcasts that can run for one to two hours or more, the most popular and engaging online videos are getting shorter and shorter. With the rise of TikTok and Instagram Reels, people are more used to watching vertically oriented videos on their mobile device. Behind-the-scenes, employee profiles, product demos and various user-generated content are some of the most effective for DTC companies. Combining videos with a short music clip or voiceover adds to the appeal.

Bombas is a social impact company that began selling socks and matching donations to the homeless and underprivileged communities. They have grown to include other essentials such as underwear and T-shirts. The company’s short social media videos include a “Three Good Things” monthly message focusing on accomplishments and the people positively impacted. Employee shoutouts highlight volunteer hours, and other videos even teach followers how to make their own “care kits” out of sandwich bags and travel-size personal hygiene products.

The mission is woven into the message of the content. Videos are authentic and unpolished, as if you took out your phone and started recording what you saw. They are in the moment, inviting and show their commitment to the mission.

5. Leverage Customer Content

No matter what business you’re in, your customers are online every day letting you know what they want by the posts they make and the content they engage with. Leveraging customer content takes the guesswork out of what you should create and builds stronger relationships with customers who are proud to represent your brand.

Popular customer content for DTC brands includes unboxing videos; product reviews; trying on products; encouraging hashtags to increase brand awareness; and sharing customer posts to continue the conversation.

“One of the tactics is to allow customers to test new products and then share their experience on social media before committing to a purchase,” according to an article by Profitwell.com.

Well-known DTC company Warby Parker noticed customers were taking pictures and videos of their eyewear, asking friends how they looked. The company started asking customers to post the content on social media with the hashtag #WarbyHomeTryon. Participating customers were paired with an online personal stylist. The company discovered that customers who shared content online were 50 percent more likely to purchase.

6. A Text Will Do Ya

According to Tech Jury, 75 percent of clients want to receive offers via SMS text, and Mobile Monkey says nine in 10 people open their text messages. Savvy DTC brands are utilizing texts more and more to send exclusive offers, welcome new customers or even send an impromptu thank you. Texts are often limited to 160 characters, so they’re simple to consume, and they make for a seamless mobile shopping experience. To enhance and entertain, consider adding images, GIFs or short video clips. Even restaurants are beginning to take orders via text.

Some DTC websites offer SMS as a lead-capture option, and customers are often sent a first-time purchase discount. The focus is on quick access to a discount or enrolling in a rewards club—no need to fill out a lot of forms asking for a bunch of personal information. Not all texts are offer-based. Some are personalized such as wishing customers happy birthday; thanking them for their recent order; and updating them on items they are interested in.

From the May 2023 issue of Direct Selling News magazine.

The post Magnetic Content first appeared on Direct Selling News.

If you’re over the age of 30, a Super Bowl commercial might have served as your first introduction to online marketplace Temu. But for millions of young people, Temu is an extremely popular shopping app. And now, thanks to a multi-billion-dollar ad campaign, if you spend anytime online, you are undoubtedly seeing some kind of marketing from Temu. Since launching in the U.S. in September, Temu has skyrocketed in popularity and recently overtook Shein as the most popular shopping app in the U.S. The companies currently sit in first and second place respectively, ahead of both Walmart and Amazon according to SimilarWeb.

The emergence of Temu has rivaled that of Shein, its closest competitor. Shein, the fast fashion juggernaut, has become one of the world’s most popular and visible clothing brands, reaching $100 billion in sales in 2022. If Shein was a country, it would outrank every other country in direct selling on the planet, except for the United States. And they don’t even sell in China. They have 6.4 million TikTok followers and add thousands of new items to their site every single day, utilizing artificial intelligence-based product development and a shockingly nimble supply chain.

The rapid rise of these two China-based companies has shaken up the way Americans shop online, as they have successfully challenged and ultimately overtaken behemoths like Amazon, eBay and Walmart. But with rising economic tensions between the U.S. and China, troubling environmental concerns and pending litigation between the two companies, the sustainability of their success isn’t a given.

Different Approaches. Similar Successes.

While the two companies are often compared to each other, distinct differences exist. Temu provides a platform to thousands of small businesses and microbrands selling across more than 250 product categories. Shein takes a different approach, contracting with hundreds of factories to produce clothing that it sells under its own label.

The companies have comparable shipping times and both offer products from manufacturers all over the world. Temu has a more comprehensive product offering with multiple categories ranging from beauty and fashion items to power tools. Shein is more focused on fashion, primarily for women. Their offering does include some household items, accessories and other fashion items as well as options for men and children.

Despite their differences, the two companies have one important thing in common. “Temu and Shein are disrupting the boring U.S. ecommerce market more than anyone else,” Juozas Kaziukenas, founder of the ecommerce research firm Marketplace Pulse, told The Washington Post.

Affiliate Programs

Another similarity that is of particular interest to direct selling companies are the successful affiliate programs each company runs. Temu’s affiliate program offers budding influencers up to $20,000 a month to promote its products and services. Influencers can provide their followers with discount and referral codes. Established influencers can also receive free items to review and promote via their social channels.

The Shein affiliate program also allows digital marketers, bloggers, influencers, reviewers and other content creators to make income by referring customers to the platform. The free-to-join program allows participants to promote Shein on their websites and social channels with a unique affiliate link. Affiliates can earn a generous 10-20 percent commission on sales.

Both companies have also relied heavily on celebrities to grow their brands. Shein has reported paying thousands of influencers, celebrities, fashion bloggers and reality show contestants around the world to endorse their products.

Game On!

Each brand also specifically targets Gen Z through gamification. This is a growing trend among DTC brands and something direct selling companies can look to in order to attract this key demographic into the fold. Gamification increases retention and engagement through fully immersive experiences and interactive elements, creating a fun and unique experience shoppers love.

Gamification is a relatively new concept, but an undeniable benefit is how this personalized approach turns online shopping into entertainment. Whether it’s mini fashion quizzes, spin-the-wheel discounts or even raising virtual fish, the fun in-app experiences found on Shein and Temu are as much a part of the addictive customer experience as browsing the fashions. And they generate rewards and discounts that keep customers coming back time and again.

Staying One Step Ahead

The ecommerce landscape is becoming increasingly crowded, with new platforms challenging traditional online marketplaces and retail outlets. Companies like Shein and Temu are disruptors, gaining popularity and market share through speed, nimbleness, affordability and an enhanced online shopping experience.

Shein and Temu aren’t just taking on existing platforms like Amazon, they are also targeting each other. This is best evidenced by recent litigation Shein has levied against Temu. The litigation hinges on Shein’s claims that Temu has encouraged influencers to make false and deceptive claims about Shein in their promotion of Temu as well as creating accounts to mimic Shein online. This legal battle illustrates the growing competition between the two companies as well as the huge financial stakes.

Which app is better and which model is more sustainable is something only time will reveal, but direct selling companies can definitely adopt and adapt some of their affiliate and gamification strategies to up their own online shopping experience. 

From the May 2023 issue of Direct Selling News magazine.

The post The Rise of Shein & Temu first appeared on Direct Selling News.