In This Episode
The direct to consumer (DTC) model has been one of the biggest stories in business this century. The DTC wave is led by brands like Gymshark and The Hut Group, both now valued at over $1 billion, as well as MVMT, a watch company that grew to become a $300 million brand in just five years after its founding.
But just how are these companies generating so much revenue at this ridiculous pace? It all has to do with the DTC business model, which also requires a different approach to digital marketing.
Let’s look at an example.
Why the Direct to Consumer Model Matters
At Exposure Ninja, we’ve worked with several DTC brands over the years. One company that’s a current client of ours is Soccer Supplement.
As the name suggests, Soccer Supplement sells health supplements specifically designed for the performance needs of footballers/soccer players (we won’t get into the argument of the proper term to use).
If we had marketed this brand in, say, 2010, the process would have looked like this:
First, we’d take their product to local independent stores and beg them to stock it.
We’d have to sell the product at a discount of Recommended Retail Price (RRP) so they can take their cut and make money from each sale.
Let’s assume the partnership is successful and the supplements sell well. The next step would be to move to a larger retailer.
A large supermarket agrees to stock our product. However, they also require a brand advertising campaign, such as an in-store display or product launch, to drive people to their stores.
The supermarket demands a larger discount on RRP to make their cut, making your margins thinner.
While this model can be effective — especially for fast-moving consumer goods — it’s worth noting that selling through a middleman means that you often don’t have a direct relationship with buyers.
You won’t know who’s buying your product, where they’re from or what their preferences are.
The DTC model completely flips the script and cuts out any middlemen. This means you have complete control over the sales funnel, the customer experience and the marketing campaigns.
Check Out the Episode to Learn More
Now for the fun part — evaluating successful DTC marketing campaigns.
Join us as our Head Ninja Tim breaks down what makes DTC companies unique and how brands that use this business model market themselves online.
We’re also introducing the Exposure Ninja Star Marketing System — a five-step framework that analyses successful marketing campaigns into five key elements:
It’s a system that’s perfect for evaluating the dynamic nature of DTC marketing campaigns.
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00:00 — Introduction
01:28 — Why Direct to Consumer Marketing Is a Big Deal
05:43 — Star Marketing System
10:36 — Positioning (feat. Gymshark)
12:22 — Presence (feat. Smile Direct Club)
14:12 — Process (feat. Smile Direct Club and Lounge Underwear)
18:03 — People (feat. The Hut Group)
22:20 — Progression (feat. Myprotein)
26:05 — Actionable Direct to Consumer Tips
You May Also Enjoy…
- How The Hut Group Uses SEO to Turnover £1.1bn
- How MVMT Went from a Watch Startup to Becoming a $300 Million Fashion Brand [Digital Marketing Deep-dive]
- How Boohoo’s Marketing Strategy Helped Generate £1.24B in Revenue
- Lessons Learnt From Peloton’s $360 Million Marketing Strategy
- Unlocking Gymshark’s £150 Million Marketing Strategy Success Story [Digital Marketing Deep Dive]