What’s in it for me? Discover the inspiring stories of four successful DTC brands.
When it comes to understanding how to set up an e-commerce business, there’s no shortage of resources.
For every problem you’re trying to solve, there are dozens of books, YouTube videos, or blog posts ready to help.
Whether it’s the best way to take payments or how to set up an Instagram advertising campaign, technical knowledge is everywhere.
But there are other areas less covered in those e-commerce resources.
One is how direct-to-consumer brands actually come into being.
Another is how founders use their backgrounds and experiences to build their businesses – and how they identify problems that need to be solved and subsequently set up brands to do just that.
These questions are the topic of this Blink.
We’ll look at how four direct-to-consumer founders made decisions that propelled their brands into the limelight.
But it’s not only what the decisions were that’s important – it’s why they were made, and how they impacted success.
The goal of this Blink is to inspire.
It doesn’t matter if your brand is already profitable, or if you’re just starting up.
The wisdom contained in the stories of these four brands is universally applicable, and there’s something here for everyone.
In this Blink, you’ll learn why the most unique brands keep manufacturing in-house; how some DTC brands are helping in the fight against climate change; and what a “letterbox bouquet” is.
Meet Jane, the founder of Sugru.
Staying patient and starting small are two good things to consider when founding a DTC brand.
She knows better than most that waiting is the name of the DTC game.
Her product is an award-winning flexible, silicone glue that sets overnight.
Jane herself refers to it as “space-aged rubber,” and its uses are potentially infinite.
To name a few, you can repair fraying cables, seal holes in leaky appliances, or even make your shoes more comfortable.
But after coming up with the idea, it took Jane six whole years to bring the product to market.
Initially, she’d created what is now known as Sugru to use in her university master’s project.
Soon after, she realized the potential it had to help others.
An investor also realized this potential after coming across her university project in a British Airways magazine.
With funding in hand, the next six years involved making sure the product was perfect.
Along the way, she sought out support from leading silicone experts.
She assembled a small team to assist her.
These long years comprised an important lesson that other entrepreneurs often forget – before your product hits the market, it needs to be able to do what it’s designed to do.
No matter how good your initial idea is, a half-baked product isn’t going to go anywhere.
So once you have a product in mind, strap in, be patient, and get ready to play the long game.
That’s precisely what Jane did.
And after six years, she was ready to launch Sugru into the world.
Her initial sales plan?
To license the production and distribution of Sugru to larger companies.
After working so hard on her product, you can imagine how upset she was when everyone she approached turned her down.
Sugru was simply too innovative, and the companies couldn’t see it fitting into their product lines.
But Jane wasn’t deterred.
If she wasn’t allowed to start big, then the only option was to go small.
This is where the humility of effective entrepreneurship comes in.
For a lot of founders, years of development should be followed by launching a brand with gusto, with the goal to scale up as quickly as possible.
Big launches lead to big costs, however.
And with big costs comes high risk – and a higher price of failure.
One way to avoid this is by adopting the small mindset.
By keeping your startup costs low, you lower your risk of failure.
And without a high price of failure hanging over your head, you’ll have more freedom and flexibility to try new things.
This is precisely what Jane decided to do.
The year was 2009, and the new e-commerce economy was exploding.
So she decided to do it alone.
With her remaining investment money, her team transformed their development lab into a Sugru factory.
They produced a thousand units, filmed a product explainer video, and designed a simple website.
Within six hours of the site launching, all one thousand units were sold.
With wind in their sales (pun intended), Jane’s team moved on to phase two – generating PR buzz by sending out free samples to the press.
Sure, most were ignored – but those that landed hit big.
The Telegraph published a 10/10 review, and from there the positive PR didn’t stop.
In 2010, Time magazine listed Sugru in their top 50 inventions of the year.
Jane’s story illustrates the importance of a slow and steady approach to developing your DTC product.
“Good things come to those who wait” is a common saying to most.
But when it comes to DTC founders, it can strike a nerve.
This is because starting an e-commerce business is often a waiting game of trial and error – of defeat and perseverance.
Every DTC brand should put the needs of the customer first.
Not all DTC products have to be innovative, original inventions.
Sometimes, entrepreneurs start out by observing existing products and industries.
By doing so, they identify customer pain points that could be fixed by improving an existing product or service.
Entrepreneur Aron Gelbard is obsessed with eliminating customer pain points.
His quest began while he was working at consulting giant Bain & Company, where he spent a lot of time measuring customer satisfaction levels across different industries.
Looking at customer surveys and other metrics, he identified one industry in particular with continuously low customer satisfaction: flower delivery services.
Customers were simply not happy with the industry as a whole.
There were a host of issues that flower companies were neglecting to solve.
They’d regularly substitute products.
Flowers would die too quickly after delivery.
But perhaps the biggest problem was the need for flowers to be delivered upright and by hand – all while being in water.
And customers had to be home to receive such a delivery.
So, in 2013, Aron decided it was time to do something about this.
He quit his highly paid job at Bain to start Bloom & Wild, his own flower-delivery DTC business.
He already had a solution to end customers’ woes: a way to deliver packaged flowers through the letterbox.
While researching the flower industry, he discovered that flowers only become hydrated and need to be kept upright after they hit flower shops.
Before that, they’re dehydrated – in other words, they don’t need water.
What’s more is that they can be kept in a box.
By putting two and two together, Aron realized that by shipping dehydrated flowers, he could solve a major pain point customers were experiencing.
As flowers are long and thin, he could offer slim packages that could be delivered without customers needing to be home.
Long story short, the idea was a huge hit.
In the years since Aron founded Bloom & Wild, the company has grown; they now ship their signature mailbox bouquets to four million customers every year.
But Aron’s urge to rid the world of customer dissatisfaction didn’t stop with his success.
Bloom & Wild may have been bringing more joy to customers than the rest of the industry, but was that the best benchmark?
Could they make their customers even happier by improving their own business?
Aron continuously conducted customer satisfaction surveys after Bloom & Wild was founded.
And he slowly started realizing that a portion of his customers weren’t happy with the email reminders they received.
Sure, most customers appreciated being able to put the birthdays of loved ones into the company’s site – that way, they’d never miss out on sending flowers in time.
But others weren’t happy to receive notifications before occasions like Mother’s Day.
The reminders were annoying – or even painful – to some customers and were causing them to unsubscribe.
So Aron got his team together to figure out a way for customers to opt out of specific emails.
The scheme increased customer happiness so much that the company decided to share how they implemented it with others.
Countless British companies took them up on the offer, including the Telegraph, the Body Shop, and Treatwell.
This move toward allowing customers more control over the marketing they receive has been dubbed the “Thoughtful Marketing Movement.
” It’s even begun seeping into the American market.
At the end of the day, it doesn’t matter what kind of company you run – constantly trying to measure and improve customer satisfaction will up your game.
After all, the customer is always right.
Customer satisfaction is one of the most important forms of data that DTC brands can harness – but there are more.
Don’t underestimate the power of data when it comes to driving your business forward.
When all of your business is conducted online, there are a lot of different kinds of data you can analyze about your customers: how long they spend on a page, their purchasing habits, or how highly they rate products they’ve received.
It was this obsession with collecting and analyzing data that drove the founding team of Graze, a snack subscription service.
They weren’t food industry insiders; they were tech heads looking to make an impact.
When they presented their business model to others in the industry, they were met with scorn.
Some even described it as “bonkers.
” After all, sending snacks regularly in the mail had never been done at this scale before.
How would they make a profit by shipping small amounts of food with high delivery costs?
If the Graze team was going to succeed, they needed to embrace the power of data.
And that’s precisely what they did.
From the get-go, they made sure they were tracking every aspect of how customers interacted with their website.
One way they utilized the huge amount of data they were collecting was through performance marketing.
This is all about using your data to make fast decisions.
For example, during their first year, they decided to try including fruit in the snack boxes they sent out.
But based on product reviews and customer service data, they realized it wasn’t going down well with customers.
So they switched course.
Out with the fruit, and in with other snacks.
Using performance marketing, they figured out how much it costs to convince customers to try snacks they hadn’t heard of before.
If one snack didn’t work, they quickly iterated and produced new ones.
Over time, the mountain of data they collected allowed them a lot of insight into the tastes and consumption habits of their customers.
While leveraging data has been crucial for Graze’s success, there’s another aspect to their business that sets them apart from their non-DTC competitors.
And this is harnessing the power of vertical integration.
It involves trying to keep all your operational processes in-house.
In Graze’s case, this meant manufacturing their own snacks instead of outsourcing to traditional food factories.
This decision ties in perfectly with their data-driven culture.
If a snack isn’t doing well, they need to be able to pivot quickly.
But outsourcing manufacturing is not a quick process.
By doing all the manufacturing in-house, they can quickly develop, produce, and ship new products on a regular basis.
What’s more is that they can measure the cost of every single step throughout the whole process.
This feeds back into their data collection, allowing them to adjust each step to help drive profit.
DTC brands are all about presenting a unique product.
And if you want to be unique, it might be a good idea to consider doing everything yourself – including manufacturing.
Combined with harnessing the power of data, the lessons of Graze’s success should be embraced by all DTC entrepreneurs looking to start their own business.
If you’re successful, you might just reach where Graze is at today – with half a billion reviews under their belt, they’ve perfected the art of keeping their customers hooked.
Graze showed the food industry that it was possible to reinvent the process of consuming snacks.
When it comes to convincing customers, let your product do the talking.
One of the reasons why it worked was that people already love snacks – Graze just revolutionized the process of producing and shipping them.
But what about DTCs that want to convince people to try products they don’t already love?
Surely this would be a hopeless business venture.
What’s the point of DTC convenience if your customers aren’t already consuming the product to begin with?
Well, this logic wasn’t going to stop Jonathan Petrides, who goes by his initials JP.
His goal?
To convince the world that switching to a vegan diet could be reasonably priced – and tasty to boot.
But he knew it wasn’t going to be easy.
When he himself switched to a vegan diet, he tried in vain to convince others using scientific and ethical arguments.
But what did work was simply cooking for friends and family, all without informing them that what he was making was vegan.
“There’s seriously no meat in this?
” they asked.
When he decided to found a vegan meal DTC company, he knew he needed to embrace an important principle – let the product do the convincing.
It was one thing to convince friends, though.
Convincing strangers online was going to be a different game.
He needed to make sure there were as few barriers as possible for customers to consume the meals.
Shipping the ingredients chilled wouldn’t do – this would put too much pressure on people to consume them quickly.
Inevitably, it would lead to food going to waste.
So, JP decided to make the experience as easy as possible for customers by shipping the food frozen.
Initially, the people he shared his idea with thought it was impossible.
Until that point, no startup had managed to ship frozen meals and generate profit.
But JP was on a mission.
He set out to do what many DTC founders have done before him: conduct a market test.
The goal was to see if the food would remain frozen during shipping – and if customers would come back for more.
Once JP and his team had assembled 150 orders for six meals, they got cooking – and then shipping.
Generally, the food remained frozen, and customers were happy.
But would they come back?
Within two months, 15 percent of the 150 initial customers returned.
JP was convinced.
It was time to go all in.
Three months later, Allplants opened for business.
The launch went smoothly, with one caveat – the company had no marketing budget.
But JP had thought ahead.
He’d decided to launch in January, which coincided with the yearly Veganuary campaign.
And after the team behind the campaign learned of the new DTC startup, Allplants managed to get a lot of free marketing.
With that in hand, the company moved from strength to strength.
Today, Allplants ships out 50,000 meals a week to its customers.
But that isn’t the metric that JP is most proud of.
Instead, it’s that 60 percent of customers were not vegan or vegetarian when they started ordering from Allplants.
Not all DTCs have to be committed to saving the planet.
But in JP’s case, it sure does help.
And with £38 million raised last year in Series B funding, Allplants is on track to make a huge difference.
Final summary
There’s no one-size-fits-all approach when it comes to DTC success.
But there are a number of principles to keep in mind.
First, remember to be patient when it comes to perfecting your product – there’s no point in launching a half-baked product, no matter how good your initial idea was.
Second, always put the customer first.
Identify their pain points, and try to eliminate them.
Third, don’t underestimate the power of data.
As an online business, you’ll be able to track detailed behavior of your customers.
Use this data to help you make better decisions.
And finally, if convincing people to buy your product fails, then let the product itself do the convincing.
Make it as easy as possible for people to receive and use your product; the convincing will follow from there.