The Indian economy grew at a CAGR of nearly 8% during the recent global economic crisis. However, many companies struggled to expand their reach despite a booming economy. Until last year, several FMCG companies took D2C distance to new heights. Here are some of them. Vieve Protein Water, Coca-Cola, Toms, and Saffron saw their market share grow. To get the complete data about “Direct to Consumer (D2C)” as shown by a general perspective, visit the site “Warehousity”.
Coca-Cola:
The global soda giant’s D2C reach in Latin America grows as consumers migrate from traditional food stores to online and mobile delivery options. By partnering with several restaurants and third-party aggregators, Coca-Cola has enhanced its presence on digital menus and in combos. In the second quarter, the company also collaborated with large restaurant delivery intermediaries to add value bundles to 4,500 restaurant menus. These partnerships also enable Coca-Cola to adjust its supply chain to prioritize the delivery of core brands.
Coca-Cola execs decided to scrap its 1963 Tab brand in the recent quarter, which became iconic when it chased Diet Rite Cola and Royal Crown’s Diet Rite. The tab is one of the many underperforming Coca-Cola brands facing voluntary extinction. However, Coca-Cola executives compared the move to portfolio pruning to high cholesterol levels.
In Mexico, Coca-Cola has taken its D2C reach to the next level by implementing the new online experience, Coca-Cola en tu Hogar. The service allows consumers to order their favourite beverages directly from the comfort of their own homes. Unlike traditional brick-and-mortar stores, Coca-Cola en tu Hogar also features Coca-Cola’s most popular brands, such as Ciel water and Santa Clara milk. This innovative approach has allowed the company to become an Internet business with an increase in average order value of 18 per cent. It also experienced triple-digit increases in overall website traffic and 45 per cent growth in new accounts in 12 months.
To make its D2C reach wider, Coca-Cola used Adobe Commerce to identify unserviceable zones and then improved its geofencing module to expand its D2C reach into more rural areas. To better serve customers, Coca-Cola reduced its traditional marketing budget. As a result, it is increasing its focus on digital-first campaigns and away-from-home segment sales.
The rise of the D2C marketplace has created an environment for challenger brands to grow and thrive. D2Cs must focus on branding, supply chain optimization, and building customer relationships. The challenges faced by challenger brands are many. Those who have been successful in the D2C space will thrive in the future. In the current retail environment, challenges are inevitable. And D2Cs are positioned to take advantage of that.
This growth in alcohol sales was fueled by consumer demand and looser alcohol regulations. Many states updated their laws for cocktails, while liquor stores and grocery stores also started delivering alcohol to consumers. Many bill proposals were based on laws enacted during this pandemic. The pandemic also spurred consumer demand for brands that engage with consumers. As a result, alcohol sales rose by 500% YoY, and the D2C space has had to adapt. Nevertheless, it will continue to evolve after the Covid-19 pandemic.
Toms:
The iconic footwear brand TOMS has always used social media to engage customers. As the founder of a company with a one-for-one business model, the brand knew it could make a positive impact by using this channel to listen to its customers. And during the pandemic, TOMS is listening even more. They launched a campaign where followers could share pictures of their bare feet and donate a pair of shoes for every photo.
The coronavirus pandemic has forced people of all ages to adopt new digital behaviours. And because they’re increasingly dependent on digital products, brands that take advantage of this trend are likely to be successful in the long run. But to take full advantage of this opportunity, brands must invest in the right processes and solid budgets. Brands that focus on providing exceptional value to consumers will reap the rewards in the future.
Bombas, which launched a D2C sock startup in 2013, is one example of a company that successfully leveraged D2C to scale its global presence. Its revenue increased by 10x from $47 million in 2013 to a whopping $100 million in 2018. The company uses long-staple yarns and uses moisture-wicking and antimicrobial properties. They’re also targeting the poorest people in the world.
The most successful D2C brands take their marketing and product strategy one step further. They market and sell their products independently, without the constraints of traditional brick-and-mortar retailers. The company positioned itself as the antithesis of Amazon and the other big players in retail. The product selection of Amazon is extensive, but it also has a section for “Compare to” items.
The success of D2C companies depends on the level of mindshare that they can earn. Successful companies use both a subtle and a “shock and awe” launch storytelling strategy. Casper’s launch party even featured rapper Warren G. This type of marketing strategy is known as “bottom-up marketing.”
Bonobos were founded in 2007 and acquired by Walmart in 2017. It started with a simple premise: better pants for men. Six months after the launch, the company reached $1M in annual run rate. Later, the company began selling formal wear, swimwear, shirts, and other accessories. By 2013, it had grown to nearly 70M. In addition, it has attracted high-profile funding.
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