As European brands enter the peak season - with Black Friday, Cyber Monday and Christmas just around the corner - how can enhancing a D2C sales strategy support them to control costs and build better relationships with their consumers, despite growing economic uncertainties?
Across Europe, there are a range of social and political factors which are causing consumers to feel the pinch. From the ongoing energy crisis to rising inflation and interest rates, the cost of living is causing consumers anxiety. When it comes to choosing between buying goods or heating their homes, the answer is a logical one. Consumers are likely to be spending more sensibly over the coming months, justifying each penny they part with.
The economic environment is presenting challenges to consumers, and this is having a knock-on effect on brands. With consumers spending more cautiously in recent months, European brands may have more stock than usual in warehouses and be looking to release this through discounting goods in November and December.
But in order to do this, taking advantage of the economic situation and building a resilient supply chain fit for regional growth, embracing a D2C strategy is crucial. For European businesses – no matter the size – selling direct to customers, rather than going through third-party marketplaces, can support their growth, enabling them to improve their speed to market and, in turn, become more agile and resilient.
How can European brands use the current economic environment to build a robust D2C sales strategy which supports success during the peak season and growth for the future?
Better connecting European brands with their customers
The last two years have presented European retailers with countless supply chain challenges. From the Covid-19 pandemic to the Suez Canal obstruction and the ongoing war in Ukraine, retailers have had to contend with continued disruptions – but these disruptions have led to fundamental shifts in the way that many retailers do business.
Moving away from third-party e-commerce platforms allows European brands to build closer, more direct relationships with their customers, while also avoiding the large commissions that these platforms charge. Rather than surrendering profit margin and valuable customer data, European brands can capitalise on the lifetime value of a consumer through a D2C strategy.
Around 90% of brands are moving towards (or certainly exploring the idea of) a D2C strategy, driven by the need for revenue streams which are less dependent on other marketplaces or wholesalers, and more focused on the end customer.
When a customer makes a purchase directly from a brand, information like names, email addresses and physical addresses are shared, and these data points can be used to produce a big-picture view of the average shopper and their behaviour.
But these insights aren’t just useful for understanding existing shoppers’ spending habits – the data can be used for retargeting, enabling brands to reach new customers who look and behave like their existing ones.
For European brands operating small to medium sized businesses, this is a central advantage of harnessing the power of D2C. Shifting focus from third-party e-commerce to owned platforms enables brands to generate new revenue streams, acquire data to build new customer bases, and ultimately put more focus on the end customer and meeting their needs.
Case study: ShipEntegra
Many small businesses want to sell their products through online marketplaces, such as Amazon, Etsy or eBay. Turkish technology company, ShipEntegra, is one such provider integrating its customers’ online stores with eMarketplaces, providing small businesses with logistics support on regulations, duties, returns processes and other logistics aspects, enabling their customers to expand readily into new European markets.
Through their portal, ShipEntegra manages 15,000 shipments per day from Turkey to all of Europe on behalf of their small and medium sized customers. In doing so, they make use of some of the well-known courier companies, but they face issues in terms of the dependency and reliability of these dominant players.
Sealand agreed to support ShipEntegra with an alternative value offering to diversify their delivery model, offering less dependency on these couriers. Now, Sealand is supporting the company with transportation via air freight to Sealand’s e-fulfillment centre in the Netherlands, before then being delivered to end consumers across Europe.
This is just one example of how Sealand, through the power of Maersk, is adding value to European customers' transportation journeys. With Sealand as an intra-regional logistics partner, brands can lean on the regional expertise and local knowledge of our logistics experts, receiving tailored guidance and support from first to last mile.
As an e-commerce enabler, working with reliable suppliers that offer a wide range of product offering is one of our priorities. Maersk perfectly fits this description by being a trustworthy one-stop-shop. Within the scope of our partnership, our aim is to extend our services by bundling various Maersk products in the near future.
Becoming more agile through omnichannel fulfilment
When it comes to operating a streamlined D2C sales strategy, effective inventory management is crucial. European brands need the right supply chain setup to fulfil customers’ orders from one holding position, whether those orders are B2B, B2C or D2C. By embracing omnichannel fulfilment and consolidating stock into select, strategic locations, brands can flow their inventory faster and with more agility through their destination supply chain.
For brands in Europe, this can be a simple yet effective way of managing inventory and fulfilment. By near-sourcing – bringing certain operational elements closer together – brands can cut out unnecessary delays in transporting goods, reduce the likelihood of both overstocking and understocking, and speed up their product’s arrival time with the customer.
Omnichannel fulfilment allows European brands to make smarter, more informed decisions about their stock and where it needs to be. For example, brands can choose to place their most popular items in a part of the region which makes its transportation easier; on the other hand, less popular items can be held elsewhere, freeing up space for more popular goods.
With goods travelling from factory to sofa, omnichannel support aligns European brands’ inventory, logistics and distribution across all channels, ensuring brands meet consumer demand during peak season and embrace new revenue streams.
As we approach the peak season, European brands need an intra-regional logistics setup which can allow them to control their inventory, build closer relationships with their customers, and bring greater agility and speed to their overall supply chain.
But alongside this, brands require a logistics partner to guide them, bringing care and regional expertise to the table to support them in delivering on their customer promises. This is about more than just a streamlined and straightforward logistics setup, propelled by a D2C strategy; it is about having the right partner to support growth and market success.
Sealand, through the power of Maersk, can support European brands to weather the economic storm, combating reduced consumer spending through developing an agile and resilient D2C strategy which gives brands a sense of control over their inventory and the flexibility to speed up or slow down their supply chain depending on circumstances.
Through embracing a D2C sales strategy, European brands can accelerate growth, meet the needs of consumers, reach new customers through access to valuable data, streamline their inventory management and fulfilment strategies, and provide a high-quality service right through to the last mile.
Sealand is supporting European brands to realise their potential, bringing speed, agility and care to its customers’ intra-regional supply chains and combining local knowledge and regional expertise to reduce complexities during peak season.
To learn more, visit E-Commerce Logistics & Order Fulfilment Services | Maersk