In 2020 direct-to-consumer (DTC) brands boomed, eCommerce saw 10 years’ growth in 3 months, and brick-and-mortar retail remembered the internet was a thing.

All this accelerated what we already knew - that the future of commerce is online. It also teed up the mother of all digital royal rumbles in 2021, as vendors of all varieties compete for online elbow room and ultimately, wallet share.

“This moment in modern retail history is unprecedented, and there is no playbook for dealing with this level of turbulence.”

Marcus Startzel - CEO, Whitebox quoted in Forbes

How can DTC brands - many of whom won big in 2020 - meet the new challenge of record online competition this year? What specific strategies can they action in the next 12 months to build audiences, win new business, and retain revenue?

To find out we spoke to Nik Sharma of Sharma Brands, who makes his living investing, advising and operating some of the smartest brands in the DTC ecosystem.

Reddit 🤓

The front page of the internet boasts 130,000 interest-based communities and 2.2 million subreddits - every one of them awash with questions generated by its 430 million active monthly users.

Shameless plugging is a big no no here, but content led community engagement in response to legitimate consumer queries can win big traction for brands. For a food merchant say, the ‘Healthy_Recipes’ subreddit is a goldmine of queries and conversations you can freely engage with to get in front of the right audience:

Source: Reddit

Quora❓
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This literally exists as a question-and-answer platform. Quora has a user base of 300 million, 65% of whom are higher income millennials with college degrees - the ideal buyer profile for many DTC brands.

63% of site traffic arrives through googled queries - if you’re providing valuable answers within your niche it’s your brand they’ll see as the solution. Numerous questions on how best to exercise at home are potentially free advertising for a merchant in the fitness space:

Source: Quora

Strong SEO🕵️

Not a platform as such, and certainly not new, but the time investment required to leverage SEO effectively means most brands don’t fully exploit it to address issues people are googling. If you’re a sustainable coffee brand say, there’s 15-20 queries consumers might have about that topic.

Creating detailed SEO optimized content that ranks high in Google’s SERP, positions your product as the answer to the questions already being searched for online.  

“If you invest really heavily in SEO for a year you’ll reap the rewards for the next 12 years.”

Nik Sharma - CEO, Sharma Brands

Source: Moz

DTC often does retention badly. Most merchants either don’t really bother with it, or they think about it wrong.

And that’s a problem, because although many won big last year, 2020 won’t happen again. Which makes hanging onto as many of those new customers as possible in 2021 critical.

Keep your brand top of mind

Good retention is about coming up with plays that keep your product in the top 15-20 things in a person's head at any one time.

Consumers respond to things that make their lives easier, less boring and more entertaining. Brand's retention should tap into those desires, and include levers like:

At all times, merchants must cater for what people really care about - which is almost never a brand or founder story - but something relevant to their needs.

Get it right and when consumers encounter a problem relevant to your niche, they’ll think of your brand. If you sell clothes, people considering a change of look should remember you. If you sell detergent, and those with dirty kitchen worktops immediately think of your brand - that’s a sign of good retention.  

Actionable strategies to retain customers in 2021

Those building in a category that took off last year - like homeware, personal care, beauty and pet care - should rapidly launch new products to capitalise on that growth. This is particularly key for brands not selling repeat purchase items. Cookware vendor Caraway did this effectively late last year by bringing out a limited edition, marigold colored product set.

If breakneck product development isn’t an option, go hard on content, collaborations and partnerships to keep yourself top of mind for those that did buy.

For brands with a subscription capability, double down on that by ensuring your offering is fine tuned, optimized and in line with what your customers really want.  

Online is more congested than ever

Explosive growth in online shopping presents both opportunities and challenges for DTC brands. Feverish competition for audiences on digital platforms will drive innovation and heighten customer expectations. In this context, positioning your brand as the answer to consumer’s questions is a low-cost way to cut through.

Partnership means more than just liking each other’s Instagram posts

Co-branded product launches are the way to go for partnership plays. Benefits include widening your conversion funnel, earning social proof, as well as splitting time and production costs. Successful mashups don’t necessarily have to come from players within the same niche either.

If you’re not entertaining you’re not selling

The average consumer encounters around 6,000 marketing messages per day - most are ignored. People of all ages have busy lives and just want to be entertained - reflect that in your advertising and you’ll win business.

2020 won’t happen again

Last year’s unprecedented shot in the arm for online merchants won’t be repeated. That makes retaining those newly won customers a key strategic lever in 2021. Keeping yourself top of mind with new products, compelling content and optimised subscriptions is the way to do it.