Direct-to-consumer (DTC) brands like Glossier and Warby Parker have become huge success stories by going outside of traditional retail channels and focusing on online sales.
But DTC isn’t the same thing as online-only. Although online sales are the fastest way to sell directly to consumers, every scaling DTC brand will ultimately roll out physical stores. These brands know the value of creating memorable experiences in every channel, and they’re using physical stores to create exciting shopping destinations where customers can experience the brand up close.
The result? More sales—online and in-store—and higher customer engagement. Here’s a look at how DTC brands are using physical stores to support their online strategy and get closer to their customers, and how your brand can do the same.
Using the Store as a Shoppable Billboard
DTC brands lack the visual exposure of their competitors because their products can’t be found on retail store shelves. Opening branded physical stores is one answer to this problem.
It might seem counterintuitive, but even with the overhead, the cost of acquiring a new customer in-store is often lower than acquiring one online. Physical locations function like interactive billboards, boosting brand awareness that can drive sales even without customers walking into the store.
These store locations are typically placed in dense urban areas—for example, Hayes Valley in San Francisco, where brands already see high Ecommerce sales. A physical store strengthens local engagement with existing customers as well as tourists eager to explore stores that can’t be found in their hometown.
If you already have established brick and mortar stores, make sure that everything you carry is available in your online store, too. Your customers now expect consistency across channels, and whether you realize it or not, they are shopping both your store and your website in almost 75 percent of purchases.
Creating Memorable In-Store Experiences
DTC brands maximize their physical storefronts to introduce passersby to their brand, whether they’re promoting all of their products or just a pop-up collection. Some brands offer “test drives,” samples, or “challenges” as fun and inventive ways to test out products before making a purchase.
Bonobos has built its in-store experience through personalized one-on-one attention focused on finding the right style and fit for the customer. Its stores serve as showrooms where all clothing is available to try on in limited sizes, and customers’ orders are tailored and shipped to their homes from a fulfillment center. The regional retailer Brass provides a similar service, as well as 20-minute video appointments for customers who can’t visit a physical store.
In addition to serving as a hub for better customer service, a great in-store experience helps strengthen a brand’s reputation as the “hot new thing.” How can your brand create a unique experience?
Encouraging Longer Sessions with Store Associates
DTC brands have a strong incentive to staff stores with enough associates to providing one-on-one customer service that supports showrooming and experiential retail selling.
In the case of Casper, store associates can educate customers on the high traditional markups of mattresses, as well as the quality and comfort that sets their mattresses apart and how Casper is able to offer this quality at an affordable price. The brand also extends in-store sessions in select stores with its innovative Nap Bar, where customers can pay $25 to spend 45 minutes napping in a sleeping pod outfitted with Casper mattresses and other sleep products.
These longer sessions can drive sales in the short term, and they’re effective at turning customers into brand advocates who make repeat purchases. This results in a greater lifetime value for the brand.
Using Data to Drive Personalization
DTC brands value customer data. They focus on going the extra mile to collect quality data that can improve personalization. Even if you’re not a DTC brand, you can get similar results by emulating what these brands do in regard to customer data.
A physical store provides access to valuable first-party customer data that might not be available from a big box retail partner. It might also only be available through a second party, which reduces the accuracy and value of that information.
First-party data helps you understand in-store customer behaviors and how those behaviors relate to buying intent—even when those purchases happen online. It can also be used to strengthen your shopping experience across channels while improving your in-store strategies.
Strong first-party data doesn’t just tell you about what your customers want—it offers valuable insights into how your inventory moves from your business to your shoppers.
Conclusion
Customers don’t care about your retail business model. They only care about the experience they receive while they shop. Your success as a brand ultimately depends on your ability to create a shopping experience your customers love. These popular DTC tactics can be borrowed and applied to any type of retail business. If you’re eager to get started, talk to Accumula about how to make it happen!