If you follow trends in the retail and ecommerce markets, or have shopped online in the last decade, you might know that direct to consumer companies are radically transforming the way we buy everything from shoes to dog food.
Companies are utilizing slick websites and mobile apps, savvy social media strategies, and hard to deny subscription models to position direct to consumer (D2C) as the future of retail.
As a dedicated consumer-direct business, we wanted to help explain this business model to show how Rad Power Bikes makes getting you an ebike fast and easy.
Let’s start with the basics. A consumer-direct company is one that sells its products directly to customers, without third-party retailers, wholesalers, or other middlemen.
Typically, these companies do most of their business online. In fact, many consumer-direct companies don’t even have physical retail locations. Rad Power Bikes sells ebikes both online and out of showrooms in Seattle; Vancouver, British Columbia; and Utrecht, Netherlands.
While this model isn't necessarily new, it has become increasingly popular for startups and entrepreneurs because there are fewer barriers to enter the market. If you have a viable product, a functioning online sales platform, and some creative ideas, you have the foundation for a successful direct to consumer company.
What's in it For You, The Customer?
The rise of direct to consumer businesses has created a host of benefits for customers. One of the most noticeable perks is lower costs for high-quality products.
Consumer-direct businesses can typically offer lower prices because they have direct control over how their products are sold. In a traditional retail method, a brick-and-mortar store sells its products at a higher price than what they paid the manufacturer or distributor in order to make a profit.
And while this makes sense from a business standpoint, it means consumers might pay twice as much (or more) for a product than they would when buying direct. By cutting traditional retailers out of the equation, consumer-direct companies can eliminate large markups and provide the best deals for consumers.
Another upside to consumer direct and ecommerce, in general, is efficiency. With the right content, interface, and user experience, customers can visit an online store 24/7, and access every available product, size, and color variation without having to leave their homes.
Why Doesn't Every Business Sell Direct?
There are also challenges that come with running an online-only business. D2C businesses handle not only the product lifecycle, including supply chain, ordering, fulfillment, and operations, but finance, ecommerce, marketing, media relations, customer service, and tech support to boot.
Direct to consumer companies place a large emphasis on their quality control and customer support efforts. With no retailer as middleman, companies are directly accountable to their consumers and receive feedback in real-time.
When a company lives up to its promises, this level of transparency can benefit both customer and e-retailer, and customers are more likely to become loyal advocates for that brand. On the other hand, this also opens companies up to complaints or criticism.
Take Amazon’s 2015 Prime Day event, for example. Hyped up as the summertime Black Friday, shoppers around the world expected the inaugural event to feature some of the best discounts of the year. But people quickly discovered that a lot of the so-called deals were on products that you might find at a garage sale or an As Seen on TV store, and social media exploded with disappointment. The hashtag #primedayfail was created to poke fun at the e-retailer and highlight some of the more outrageous items that went on sale.
This backlash didn't have much of an impact on Amazon, but did show how quickly public opinion can turn when a company makes misleading statements or false promises.
No Smoke and Mirrors, Just Helping Hands
Making a big purchase, like an electric bike, sight unseen, can be a daunting task. But that's where buying from a brand who has earned your trust can make all the difference.
When you buy an ebike from Rad Power Bikes, you're buying into a promise -- one that we've made it our mission to fulfill. Read more about the Rad difference here.