With the rising of e-commerce, creating a D2C (direct-to-consumer) strategic plan is more crucial than ever; yet, how can businesses expand their D2C operations?
In order to achieve breakthrough D2C e-commerce growth and elevate their brands from good to great, management strategies were identified based on the areas in which leading omnichannel businesses can attain.
In this article, GCT Solution - a top e-commerce website development company in Vietnam, will provide 3 strategies to help companies to take advantage of D2C E-commerce growth.
For direct-to-consumer eCommerce to work, the top leaders must put it at the top of their list of priorities. First, D2C's strategic role and goals need to be clarified. The strategic role and goal would be clear about the types of customers that direct-to-consumer eCommerce and other channels are trying to reach, and there would be clear guidelines for the value proposition that needs to be designed and delivered.
The CEO, the Board, and the rest of the executive team's job should then be to shape the details of the organization's D2C e-commerce strategy and goals and support them. They should also turn these goals and strategies into practical KPIs for each part of the organization. E-commerce requires cross-functional and cross-channel collaboration on a scale that has never been seen before, as well as bold decisions that lead to breakthroughs. This is because customers have very high standards for online businesses today. Only if the CEO and the Board are fully behind the plan and its KPIs will these requirements be met.
Appointing a leader with experience in either pureplay or omnichannel e-commerce is a good way to get the CEO ownership and decision-making power needed for e-commerce growth. Before the rest of the company can change, the people at the top must first change the way they think.
For an e-commerce business to be successful, it needs the right staff and technology to work on a large scale. Any organization has to go through big changes to hire the right people and build a new technology infrastructure. Managing a "breakthrough" e-commerce business on top of these changes automatically adds complexity and risk. It is important to invest ahead of time and build up the necessary resources, like people and technology, more than usual. Strategic decisions should lean toward e-commerce.
A logical investment would be a good way to handle this reallocation of resources. The concept means that resources and investments need to be changed before growth happens. This is done by using allocation rules that figure out the share of investments based on the expected revenue a quarter or a year from now.
Even though this strategy would mean putting more money into D2C e-commerce than other parts of the business, it would help the business go from "running behind" to "being ahead."
Investing decisions should be made objectively by looking at growth and return like an "external investor." When looking for long-term returns, external investors tend to put more value on growth than on margins. Since people are likely to keep moving to eCommerce, businesses should invest ahead of the curve to make sure they get more than their fair share of this growing channel.
One question that still needs to be answered is how to decide which investments to make and in what order. One way to evaluate digital investments is to look at how much money they are expected to bring in, making sure to take into account "do-nothing" or "base-case" scenarios as well as the overall goals of the proposed strategy. For e-commerce, the "do-nothing" case may not mean net-zero change, but rather a steady (or faster) loss of value, especially when trends after COVID-19 are taken into account. This kind of investment strategy is used by banks, which have put a lot of money into mobile banking apps and digital channels in the past few years, mostly to keep and grow their market share.
Direct-to-consumer eCommerce