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Lessons FMCG should learn from DTC Revolution

DTC Brands always have in the news for generating different kinds of headlines. Whether it is least useful or about making a profit in different ways, according to industry analysts, Fast Moving Consumer Goods (FMCG) can learn a lot these DTC brands.

Chris Worrell, who is the Head of Strategy at Wavemaker, recently published his second of a two-part paper. In his paper, he stated that right now it is pretty early DTC Brands’ lifecycle to dismiss these as a fad or even assess the lasting impact that they have managed to make. 

He further said that FMCG brands currently have all the available opportunities. The company strategists need to decide whether it would be profitable for them to pursue the option open to these FMCG brands.

However, the experts have divided opinion since DTC brands are also a significant threat. A section of critics has accused them of creating a situation where traditional advertising dollars have shifted into customer acquisition cost, which is unsustainable, and they are even unprofitable. They have also tried to ship customer relations into different business models. These are the areas which currently retailers are covering.

Worrell has also noted that whatever the truth may be, DTC has managed to land on a formula which could appeal to a particular category of buyers. He stressed that its formula lies in the simple form. It does not counter to models led by innovation belonging to the large sector. It has got variant and sprawling count lines. However, they should not launch this model keeping the consumers in mind. However, there should be space on the respective shelf belonging to these companies.

Currently, the DTC brands have managed to master digital ecosystem space where they are using methods such as Search Engine Optimization (SEO), Influencers, reviews, Content management, etc. All these steps are helping the business models of DTC, and they can also build strong mindshare.

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