Difference Between B2C & D2C
Constantly changing e-Commerce methods have also affected consumers’ shopping habits and have increased their buying experience expectations. Customers prefer buying products directly from their favourite brands and the brands also prefer to sell directly rather than going to a third party.
In this blog, we’ll cover:
- What is D2C or Direct To-Consumer commerce?
- What are the advantages of opting for D2C commerce?
- What are the limitations of D2C commerce?
- What is a B2C or Business-To-Consumer business?
- What are the advantages of opting for B2C commerce?
- What are the limitations of B2C commerce?
- Difference between B2C and D2C
What is D2C or Direct-To-Consumer commerce?
D2C or DTC also referred to as direct-to-consumer commerce is a business where businesses or manufacturers sell their products directly on an online platform, in self-owned showrooms or outlets. DTC’s business removes the need for intermediaries like distributors, wholesalers, and retail partners. Many DTC retail brands like Nike, Adidas, and Monte Carlo are some of the legacy brands that give direct-to-consumer sales and control their entire supply chain.
According to the influencer marketing hub, there are more than 100,000 DTC businesses in the U.S.
What are the advantages of opting for DTC or Direct-To-Customers commerce?
- DTC brands don’t require third-party involvement which increases the profitability of the business by saving the margin money on the product.
- DTC brands give complete control of the operation to the business owners which allows them to plan and strategize their future business sales.
- Helps in understanding market demand and analyzing it
- Allows businesses to opt for digital-first marketing (digital-first is a marketing technique that prioritises digital marketing over print marketing)
- Stores direct customers’ data that helps in understanding customer sentiments and customer expectations from the brand.
- D2C businesses can use sales promotion strategies like discounts, tiered promotions, flash sales,
- gifts with purchases, and giveaways.
What are the limitations of DTC or Direct-To-Consumer commerce?
- Businesses compete and strategize over the same customers increasing the market competition. Using appropriate technology like delivery management software streamlines and optimise the business operations and allow the brand to stand out from the crowd.
- Although D2C gives complete control over the business but also increases the responsibility of sharing data with third parties, for eg. 3PL. However, most DTC businesses use their logistics and do not prefer to opt for third-party logistics.
What is B2C or Business-To-Consumer commerce?
B2C commerce is a type of direct selling, however, it includes e-commerce or e-retailing where businesses sell products from different brands directly via an online portal. However, there are e-commerce companies like wholesale brands- Alibaba and online retailers- Amazon that are selling products from other brands.
B2C commerce was associated with the traditional model where mall shopping, eating out at restaurants, pay-per-view movies, and infomercials facilitated the customer journey. The growth of the internet has changed the whole outlook of B2C businesses.
What are the advantages of opting for B2C commerce?
- B2C commerce has the flexibility of displaying the entire catalogue with just a mere click on the link.
- As it is a kind of house of brands, it reduces market competition and boosts online sales.
- There is no need for businesses to open physical stores and instead sell their products online. This makes the business low-cost.
What are the limitations of B2C commerce?
- Complex ordering journey as the products need customized quotes and multiple configurations to make the product visible.
- In B2C the competition is very high and it is difficult to survive the in the market.
- Delivery charges are high and with free delivery expectations, the costs become difficult to manage.
- B2C gives flexibility to the customers of products, however, it might lack efficient customer service representatives.
Both D2C and B2C models are incomparable where D2C is the result of technological advancements. Any B2C business can switch to a D2C business by just adding an online sales platform using software for delivery management. Most businesses use both D2C and B2C models to attract more consumers and add more numbers to their net profit margin.
The direct-to-consumer business is growing popular where businesses manage everything from manufacturing to order fulfilment. Many recently established companies are digitally native brands that have an online presence only. There is no involvement of any intimidatory which helps save the extra cost and eventually leads to profitability. D2C businesses can be streamlined and made more efficient with the use of technology. To know more about Direct-To-Consumer and explore how we can help you take your D2C business to the next level: Talk to Our Expert.
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He loves to explore. His passion for helping delivery industries in all aspects flows through in the vision he has. In addition to providing smart solution to make delivery process flawless, Ravi also likes to write sometimes to make it easier for people from business industry looking for digital solutions.