Developing Your eCommerce and Direct To Consumer (DTC) strategy
Profit, not Loss
While DTC and digital commerce are much hyped, the challenge of building a profitable business model is often overlooked.
It is a skill set within the broader field of digital commerce, for which organisations may not have the right resources. All too often we have seen companies over invest in DTC only to fall flat on their face.
That’s why at Entropy we strongly encourage working in a LEAN manner that fosters an iterative approach to success, with a keen eye on ROI.
For more established organisations, if you don’t have a team with an entrepreneurial mindset which is willing to ‘fail fast, learn fast’, then working in this manner is likely going to be a challenge. However, remember that your competition, who increasingly are digital first start-ups, see this as their competitive advantage.
Supply chain is also key. Is your product suitable for posting? Will it fit through a letter box? If the product is chilled, how will you manage the cold chain without significantly increasing costs?
Finally, does your profit and loss work? What margins are you delivering with a DTC solution? Do you understand what your Customer Acquisition Costs are and the Life Time Value (LTV)?
Entropy can help you with the necessary upfront thinking that will maximise your chances of success so that you can avoid falling into your own “trough of disillusionment”.