In Deposco’s 2024 European Direct-To-Consumer (D2C) survey, 54% of respondents said that their D2C sales had increased by more than 25% over the past 12 months.
Recent Statista data found 52% of UK shoppers have ordered fresh food and beverage products online as of March 2024.
But many brands are yet to offer a D2C offering, concerned by the risk of channel conflict, operational overheads and supply chain issues. To add to this, many manufactures aren’t digital-first by nature and lack the capabilities to set up and maintain complex ecommerce offerings.
So if you’re on the fence or looking to embark on your first venture into D2C ecommerce – or perhaps consider if it’s worth levelling up your ecommerce experience – we’ve outlined eight key considerations as some food for thought.
1. Get your product data in shape
Many organisations have an abundance of data in different silos, with pricing in one spreadsheet and product descriptions in another, which can create difficulty when moving data into your ecommerce platform and managing inventory.
Before adding ecommerce functionality to your digital product, consider investing in a Product Information Management (PIM) system in order to develop a strong data governance strategy. This will minimise the challenges of managing large quantities of data and ensure that you’re able to easily update your product offering.
Whether you’re venturing into D2C sales or levelling up your ecommerce offering, revisiting your data strategy and ensuring your technology stack is effectively delivering on this is important in driving online growth. We recently migrated Protyre onto a composable technology stack to improve the operationalisation of data – leading to a 67% increase in online revenue.
2. Organise your fulfilment methods
Due to the short shelf life of many food and beverage products, manufacturers are up against the clock to deliver goods to customers in a timely manner. When looking to sell products online, you will need to consider how products will be effectively packaged to ensure that they stay fresh and increased packaging costs to protect breakables when travelling from the warehouse to the customer.
Additionally, it’s important to consider the cost implication for the customer when delivering the product to ensure competitiveness. Do you have access to your own fleet of refrigerated vehicles? Or are you able to leverage last-mile providers such as Amazon to deliver goods? You may also be able to consider operationally low-cost services such as Just Eat and Uber, which require low investment but may chip away at profit margins.
3. Consider pricing and promotions
When selling online, your prices need to be consistent with your in store prices, or have clearly defined online-only promotions to help customers understand why prices may differ to avoid friction in the buying process.
For businesses who are new to ecommerce but have previously offered retail promotions, you must clearly define and catalogue all of your promotions that you want to offer your customers before selecting an ecommerce platform to ensure that your chosen platform can fulfil your promotional needs and be future ready for growth. For instance, it’s worth considering whether you can run multiple promotions simultaneously or rules for stacking promotions at checkout (i.e. BOGOF and 10% off your first order).
4. Design a user-centric experience
According to PwC, 32% of customers stop doing business with a brand they love after only one bad experience. It’s therefore mission critical that your ecommerce platform provides your customers with an easy-to-use experience that will encourage repeat purchases.
Involving your customers throughout the product development process through user research and user testing is essential to ensure that your online store appeals to your existing customers and encourages loyalty.
We migrated three disparate ecommerce experiences into a single solution for Interflora. Through user research, we created a new design system, which drove visual design consistency and accelerated development time across the new website. Customer insights supported us in making better informed decisions as to the prioritisation of features developed and instilling confidence that we were building the right things for the right reasons.
5. Personalisation is no longer a nice to have
McKinsey note, 71% of consumers expect personalised experiences and 76% report frustration when this doesn’t happen. Your personalisation strategy should be considered from the beginning of the process of selecting an ecommerce platform – just like we designed for Majestic Wines, who needed an optimised ecommerce experience that mirrored the personalised in-store customer experience.
Many large food and beverage companies offer rewards programmes to collect customer data to personalise offers and encourage loyalty. However, it’s important to ensure that your rewards programme doesn’t incentivise behaviours that the customer would have already done. Encourage your customers to try something new or offer free gifting after a number of orders to drive sales.
Specialist food and beverage businesses should move away from the ‘novelty’ factor and think more about the experience you can create to encourage repeat purchases and incentivise loyalty. Subscription services and exclusive clubs can offer a chance for customers to try more of your product range and encourage them to be loyal to your brand.
6. Marketing isn’t just for customer acquisition
While marketing plays a significant role in acquiring new customers, we need to shift from thinking that marketing should simply get new users onto your website. Your marketing should also encourage loyalty.
When moving into ecommerce, your marketing needs to move with you. If your marketing team has not already been looking after ecommerce, you will likely need to grow your marketing capability to ensure that you are able to effectively manage your ecommerce offering, merchandising and analytics while also managing pre-existing business needs. If this isn’t the case, it might be time to make your first ecommerce hire or lean upon external expertise.
7. Think about how you’ll manage new overheads
When considering an ecommerce strategy, it’s important to understand the additional overheads that will be required, such as introducing a customer services team to deal with queries and returns.
You should also think about stock control. Will your store stock be competing with your online stock? How will you be managing inventory for both online and in store and replenishing stock levels?
8. Work with a trusted agency or consultant
There are a number of advantages to starting an ecommerce business now. The industry is mature and you can get up and running quickly, but you should make sure that your people, process and technology supports your business model. We find it useful to benchmark your ecommerce maturity to understand at which points you should invest in key technologies and what those investments look like.
While it’s easy to start, it’s also easy to make mistakes. Working with an experienced agency or consultant that has been on this journey can help minimise the risks associated with starting an ecommerce business or diversifying into D2C sales.
Looking to start your ecommerce journey? Get in touch with one of our digital experts to see how Candyspace can help you.
