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Digital shops, media agencies, influencer marketing platforms bet big on D2C services

There are about 800 plus direct-to-consumer (D2C) brands in India. In a country where there are more than 100 million online shoppers, the D2C category is poised to create a $100 billion market opportunity by 2025. The D2C way of doing business has pushed many legacy brands to open up new sales channels by either creating their own presence online or by acquiring existing digital businesses. Seeing that as the next big opportunity, digital shops, media agencies, and influencer marketing platforms are investing in providing D2C services in various ways.

Home-grown companies set the ball rolling

In 2022, Qoruz, a home-grown influencer marketing company, started working on designing D2C-centric solutions. The firm is currently offering opportunities and making specific offers to D2C startups to help increase brand awareness, accelerate sales and streamline influencer campaigns.

Praanesh Bhuvaneswar, chief executive officer, Qoruz, tells Storyboard18 that creating new solutions and experimenting with D2C startups is easier. While the marketing investments for most new D2C startups are low, they don’t think twice to take a chance and try out new solutions.

“If these solutions work for them, they start scaling fast. We test out several products at different points in time. To create this proof of concept, we have to onboard as many brands as possible to frame the thesis. It is easier to convince a startup to partner with, who will invest with you and give you the time for feedback and conversations,” explains Bhuvaneswar.

According to brand experts, D2C startups are looking for solutions that will help their bottom line to grow, along with garnering simplified marketing strategies. Recently, home-grown independent agency network, Zoo Media, acquired The Starter Labs. This was done to strengthen Zoo Media’s D2C capabilities among consumer brands in India and is also aligned with the company’s accelerated global growth strategy.

Global ad network companies also see opportunities

While home-grown marketing agencies and platforms are betting big on providing services to D2C brands, global advertising network companies are also seeing opportunities in this side of the business.

WPP-owned media agency Wavemaker India recently launched a specialised D2C unit. As a part of the mandate, the agency will consult and implement its end-to-end solution toolkit for brands to simplify strategy and deployment for the many moving parts of a D2C channel.

Vishal Jacob, chief transformation and digital officer, Wavemaker India, says while launching a D2C channel, brands are essentially setting up a new revenue stream from scratch.

“It requires careful analysis of several business considerations such as product catalogues, pricing strategies, unit-cost economics, market coverage, technology stack implementation and such. This exercise can quickly overwhelm even the most established client teams who do not have deep expertise in the commerce space,” he adds.

The agency is already working with legacy brands like MTR Foods, Nokia and L’Oréal under the new service. While companies like Qoruz and Zoo Network are looking at providing D2C services to new-age brands, Wavemaker India is looking at both startups and legacy brands as potential partners.

Jacob observes that legacy brands often need help in implementing the modern e-commerce technology stack and also in expanding the scope of their integrated marketing programmes to include a robust e-commerce strategy.

However, D2C startups, on the other hand, are trying to solve a different set of problems. They are looking for ways in which they can unlock growth and scale their business by building a strong brand through a superlative experience.

Given that agencies and marketing companies have varied experts on board who can handle commerce, media, and content to technology, brands are also seeking D2C solutions for them. Over the years, the expectations that brands have from agencies have changed.

“Traditionally, agencies have always helped brands to reach their consumers via the most culturally relevant touch points and played within the remit of advertising and brand communications. This remit has now evolved to working with clients as business partners and helping them scale business rather than just limiting the scope to advertising,” he says.

Future-ready thinkers, who have streaks of creativity are exploring D2C services, to provide solutions with agility for brands across the spectrum. This is a promising new business avenue, conclude experts.