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Taking the Fear Out of Direct-to-Consumer Sales

Manufacturers are looking to third parties for help in adding consumer sales to their former B2B-only business models.

Today, as the demand for frictionless buying experiences heightens, manufacturers face many challenges transitioning into direct to consumer sales, including accessing data, maximizing conversions and channel conflict concerns.

According to a study commissioned by marketplace solutions provider Mirakl and SAP Hybris, an e-commerce solutions provider, manufacturers are turning to the online marketplace model to help remedy these issues. With an online marketplace, manufacturers are able to interact with consumers efficiently, support their own customer data and fulfill channel partner sales.

The study, conducted by worldwide advisory firm Forrester Consulting, surveyed 125 manufacturers and found that 53 percent are selling through third-party marketplaces or through channel partners. Respondents said they chose this route due to their inexperience with ecommerce, potential channel conflict and the expense associated with building out their own platforms.

Further, the study showed that many manufacturers that go it alone are less confident in managing transactions and direct customer relationships. For example, only 35 percent are confident in their ability to convert visitors to buyers. But those companies that use third-party marketplaces are 10 percentage points more comfortable making conversions. Similarly, only 28 percent feel comfortable in their ability to capture consumer information on their own sites, while 32 percent feel confident with this via their third-party partners. Manufacturers with online marketplaces were also 9 percent more confident in managing final stages of purchase fulfillment than their counterparts.

Despite facing challenges, most manufacturers are aware of the benefits of direct customer relationships. The study indicated that 90 percent of manufacturers said converting site visitors to buyers would be a crucial capability. Almost 90 percent of manufacturers also said that managing the customer experience through the entire purchasing cycle would boost their business potential.

Consumer insights were also important to manufacturers, with 84 percent stating that they would like to communicate pricing information to shoppers, as well as 80 percent that expressed interest in tracking consumers from visit to purchase.

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While consumers demand better shopping experiences, manufacturers could pursue a direct selling model to stay relevant in the competitive market. By facilitating direct consumer relationships on online marketplaces, manufacturers could tap into shopping behaviors, establish a seamless purchasing process and perform well amidst retail’s changing landscape.