Logistics Tech for Last-Mile Efficiency in Direct to Consumer Selling
As in-store retail shrinks and consumers turn to online for essential and non-essential shopping, there is a new shift towards direct to consumer selling among retail and CPG brands.
What is Direct to Consumer Selling?
Direct to Consumer or D2C selling is a retail strategy wherein brands sell merchandise directly to consumers without involving distributors/wholesalers.
D2C Fulfillment Options
In-House Fulfillment |
Fulfillment by E-commerece marketplace |
3PL Provider |
Managing in-house fulfillment without help of 3PL provider |
Compaines selling their items through Amazon/any other marketplace. Amazon underakes fulfillment activities |
Outsourcing the entire fulfillment process to the thirs-party logistics provider |
Level of control: High |
Level of control: Low |
Level of control: Medium |
Scalability: Low |
Scalability: High |
Scalability: High |
Affordability: Low |
Affordability: Low |
Affordability: Medium |
Best suited for starter D2C business or small E-commerece stores |
Best suited for smaller or emergency brands |
Best suited for large and growing e-commerce stores |
Not suited for bigger and growing companies |
Not suited for big brands as there are possibilities of cloning |
Not suited for small and starter D2C business |
Direct to Consumer: The Rising Popularity
Brands are taking the D2C path now more than ever before
- From 2016 to 2019, Direct to Consumer E-commerce grew at three to six times the rate of overall E-commerce sales. (eMarketer)
- D2C sales are forecasted to account for $17.75 billion of total E-commerce sales in 2020, up 24.3% from the last year. (eMarketer)
- Globally, D2C startups have raised between $8 billion to $10 billion in known venture capital across more than 600 deals since the start of 2019. (TechCrunch)
- Today, more than 57% of consumer brand manufacturers are embracing D2C selling. (DigitalCommerce360)
- 52% of DTC brands experienced surges in demand since the start of the pandemic. (Forbes)
- By 2023, 75% of D2C brands are expected to offer subscription-based services. (MultiChannelMerchant)
Consumers, too, prefer buying directly from brands
- By 2022, the number of DTC E-commerce buyers will reach a milestone at 103.4 million. (eMarketer)
- A third of U.S. consumers plan to do at least 40% of their shopping from D2C companies in the next five years. (DiffusionPR)
- 81% of consumers say they’ll make at least one purchase from a D2C brand within the next five years. (DiffusionPR)
- More than one in four — 27% American consumers will purchase D2C products in the next five years because of greater convenience. (DiffusionPR)
- Two-thirds of consumers expect the ability to connect directly with brands. (DigitalCommerce360)