Everything is better at scale, and for direct-to-consumer (DTC) companies, scale can be achieved with the following recipe: a trusted name with a captive audience waiting to see what you do next and an efficient supply chain enabling great margins and competitive prices.
For a burgeoning DTC company today, the internet has provided a host of ways to hack scale without writing a single line of code. Buckle up as we walk through how to hack the principles of scale: trust, audience and supply chain.
HACKING SCALE: TRUST
This sounds like an oxymoron, but what I mean is fast-tracking the customers’ feeling of faith and security in your brand, much like how someone feels when they visit an old faithful’s site like Apple or Chase. What do some of the most trusted brands have in common aside from being around for a “minute” and having piles of cash? You guessed it: scale. But, how can a new DTC brand get there quickly?
1. Prioritize Design
At the launch of Shyp, one of Fast Company’s 50 Most Innovative Companies in 2016 and where I was head of operations, three of us sat around a table in the founder’s apartment, yet we had tens of thousands of sign-ups thanks to our website, which was beautiful, fast and well built. For a startup, platforms like Shopify and Webflow offer some aesthetically pleasing template sites to start, as well as access to experts who can help bring your vision to life via template customization.
2. Perfect, Quick Fulfillment And Customer Support
For online shoppers, gaining their trust is the highest point, and it’s often when they click “buy.” As time passes, that trust can erode at an increasing rate. If a first-time buyer’s product doesn’t arrive on time, their confidence in your company is likely to vanish. If the delivery promise is kept or bested, trust is validated, and early customers may turn into both repeat buyers and your biggest brand advocates.
It’s hard for startups to offer the level of service set by Amazon — two-day delivery and rapid-fire refunds/replacements for product snafus. However, there are online retail apps you can integrate that allow your customers to add shipping insurance at checkout to replace lost items without using a ton of internal resources.
HACKING SCALE: AUDIENCE
Influencers are modern-day storytellers who have swapped text for carefully crafted photos and videos to build a community that comes back to their posts time and time again. These days, people aren’t just looking for products; they’re looking for stories they believe in, told by brands they want to support.
1. Dedicate Budget To Social Media Ads
DTC brands should start here even before they have a product. Create an initial well-designed landing page that captures your company’s vibe, and then launch a simple Facebook and Instagram ad campaign to drive potential customers to your site. This will help gauge your target customer’s base level of interest. For those who already have products, you can leverage social media ads to amplify the story you’re telling (just, please, don’t buy followers).
2. Social ‘Seeding’
Seeding is an industry term for gifting products, particularly before a launch, in the hopes that the recipients show them off on social media. It’s a well-known strategy — one that both Kim Kardashian and Taylor Swift have reportedly leveraged. While Gigi Hadid probably won’t flaunt your product (yet), you can seed micro-influencers who have smaller audiences with higher engagement. Traditionally, seeding is brute force: widespread direct messaging, shipping the products and praying they post. Luckily, there are influencer marketing platforms that offer the tools to make this process easier and less time-consuming.
HACKING SCALE: SUPPLY CHAIN
1. Select The Right Size Manufacturer
Find a small manufacturing pond where you’ll be a big production fish. Flashy factories with beautiful showrooms and profiles are usually accompanied by high product minimums that leave young brands with unsold inventory. Instead, find sample rooms and small manufacturers with teams of around 25 people. Questions to ask as you search for your manufacturing partner include: How big is your team? What’s your total monthly capacity?
2. Tap Platforms
Platforms that aggregate your volume along with hundreds or thousands of other similar companies get discounted rates on behalf of the total volume. Sure, they take a percentage of the savings, but it means that on day one, as a new company, you’re getting big-league rates. For example, Flexport is great for bulk shipments by air or sea, Shippo for sending products to your customers and Lumi for custom packaging.
This article originally appeared in Forbes written by Forbes Councils Member Andrew Wyatt, co-founder and CEO of CALA.