active 7 months, 4 weeks ago Reasons Brands Should Sell Directly To Consumers Online Public Group
Traditionally, brands sell direct to big retailers and use distributors to reach small and independent shops. It’s a model that’s worked for decades. But in a digital world, this balance is disrupted.
Brands that don’t have strong direct-to-consumer channels are at a fundamental disadvantage compared with those that do and are missing out on additional revenue. Smart brands use their online stores as a means of introducing new customers to their products.
Here are four reasons why selling direct to your customers is essential in today’s retail landscape and 12 strategies to help you get started:
1. To Receive A Fair Share Of The Demand You’ve Created
There are two kinds of customers who buy your product from a retailer: those who went to the retailer looking for your type of product and then saw your brand, and those who went to a retailer specifically to purchase your brand’s product.
In the first case, the retailer introduces the customer to your product. In the second, your brand introduced the customer to the retailer.
Let’s take Nike as an example, a brand with quite a bit of consumer pull. Is it possible that a customer walks into Foot Locker and decides to buy a pair of Jordan shoes? Absolutely. In that case, it was extremely beneficial for Nike to have Foot Locker as a retail partner.
Now let’s assume a customer searches for “Jordans” online. Nike has created that brand demand. It’s produced a product that is specifically sought after — to the tune of close to 700,000 times per month:
In a case like this, it’s certainly fair for Nike to capitalize on the demand it’s responsible for creating by selling directly to consumers.
Run paid search ads on your own brand and product terms.
Run a Google Shopping campaign to dynamically capture brand and product demand. (I say Google Shopping, but this applies to other comparison-shopping engines, as well.)
Optimize your store pages to appear for brand and product terms. Nike had a brand page specifically built for Jordan to best satisfy that search query; your brand should do the same.
2. To Generate More Demand And Brand Recognition
How well are your co-op marketing dollars really working? In the best-case scenario, brands can attribute a loose correlation between the money they throw at retailers for co-op marketing and an increase in sales. The bigger the brand, the harder it is to tell.
I’ve been on both sides of the co-op money train, and I can assure you that a lot of it is poorly used. But it’s the only marketing outlet many brands have for direct response advertising.
Now let’s assume a customer isn’t specifically looking for Jordan, but he or she is in the market for a good pair of basketball shoes. Isn’t this a great time to introduce him or her to Nike?
To be fair, it may be because I just visited Nike’s online store, and I’m now part of its retargeting pool, but a search for “basketball shoes” puts Nike front and center.
If Nike were relying entirely on retailers, it’s likely that even if Jordan appeared in search results, the landing page would be cluttered with products from Adidas and Reebok, too.
Retailers have little to no incentive to push your product over another. They’re going to prioritize what sells.
If the customer isn’t sure about a pair of Nikes, but they can close the deal on Reebok, its over. They’ll sell the Reebok shoes, and they won’t think twice. They may even buy less stock from you the next time they place a wholesale order.
Co-op marketing dollars can be very effective, but remember that whenever you control the shopping experience, your focus is on pushing your brand. When a retailer controls it, the focus is increasing sales.
Run non-brand paid search ads. If you’re having trouble getting a good return on investment, see if you’re making any of these common PPC mistakes and consider using Google’s “target and bid” option on remarketing lists for search ads.
Optimize your site to rank well on search engines for non-brand terms.
Use PR to build buzz (and links) that point directly to your online store.
Run giveaways, contests and sweepstakes to collect emails on social media.
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