Challenges and Solutions in D2C eCommerce

Over the last six years, direct-to-consumer (D2C) eCommerce sales in the U.S. have grown steadily and rapidly from $76.57B to $212.9B. And this growth isn’t just among newer, digital-native retailers; in fact, the vast majority of this revenue (approximately $160B in 2024) is being earned by already-established brands who have embraced D2C. The takeaway is clear. D2C presents a huge opportunity – and brands hoping to compete need to invest in their eCommerce capabilities and strategies.

To make the most of this opportunity, your D2C strategy should focus on providing a seamless customer experience (CX) while gathering useful consumer data, rapidly launching and testing new products and personalizing interactions.

How can brands succeed at D2C?

The number of consumer brands selling online has increased significantly in recent years. But a vast majority of businesses sell their products through intermediaries like retail partners, online marketplaces and specialized distributors. Having consumer touchpoints managed by third parties removes some operational burdens, but it also limits brands’ interactions with their customers. This distance between brand and buyer can limit engagement and growth.

To fully take advantage of the opportunity presented by D2C, your brand should take ownership of the following areas.

• Consumer Data Management

• Shopping Cart Management

• Customer Experiences

Top 3 Challenges Faced by D2C Companies

1. Data Management Challenges

The D2C model allows brands to directly access consumer data, which they can use to deliver personalized experiences. There are several challenges involved in making this happen:

• It’s difficult to derive insights from large amounts of data scattered across various systems and points of engagement.

• Timing is everything – but it’s challenging to keep tabs on customers’ online behavior, as well as seasonal shopping patterns and trends, to make the right offers at the right times.

• Legacy tech increases the amount of data separated in silos, complicating data analysis and the generation of actionable insights.

• Compliance can be a heavy lift. Protecting sensitive information and ensuring compliance with data regulations is crucial, but complicated.

• Poor data hygiene – the inability to collect relevant data, identify duplicate data points and refine data – can make your insights

• Without a systematic approach and adequate technical infrastructure, it’s difficult to transform data into business value.

2. Cart Management Challenges

D2C companies may struggle to integrate physical documents, brochures, product catalogs and other information into their online shopping cart. This hurts their ability to provide customers with up-to-date product information and can reduce sales volume.

Cart abandonment is another major challenge in D2C eCommerce. The global rate of shopping cart abandonment is more than 70%. There are a lot of reasons for this, including extra shipping costs, high taxes, long or confusing checkout processes, mandatory account creation, comparison shopping, limited payment options, payment security concerns, no discount or promo codes, perplexing return and refund policies, slow delivery and overall poor performance of the eCommerce app.

3. Customer Experience Management Challenges

Customer experience in D2C is extremely important; it’s the primary way eCommerce brands and their customers interact. But these experiences are complex; D2C brands have to manage operations, apps, carts, etc. – not to mention packing and shipping products and handling customer service issues. And customer experiences have to be seamless, relevant and timely. Plus, as your D2C business grows, you need a strategy and infrastructure that allows you to scale all of this. It’s an immense challenge that requires expertise across a lot of tasks, channels, technologies and teams.

Solutions to D2C Challenges

These three challenges are significant, but not impossible to overcome. Here’s how to solve for data, cart and experience challenges:

Solve Data Management Challenges with Technology

D2C retailers can reduce their data management and processing workloads by adopting an all-encompassing data management solution that brings together different pieces of marketing technology.

Start by evaluating your current technology stack and looking for opportunities to centralize data collection points and eliminate unwanted or redundant tech. Unifying your data sources gives your marketers more time to focus on personalization strategies, content and creative. You should also have direct, real-time access to customer data and actionable insights to make well-informed decisions. For instance, service agents should have access to data from previous customer interactions to provide the next best actions or offer product recommendations.

By integrating your Customer Relationship Management (CRM) software with a robust Customer Data Platform (CDP) like Acquia or Salesforce, you can unlock and unify your customer data to generate the rich insights that drive customer engagement. CDP helps combine customer profile data with digital engagement and transactional data, creating a 360-degree view of your customer across all their interactions. The CDP integrates in real-time with your CRM, website, mobile apps, analytics, marketing automation and other customer engagement platforms to ensure that your customer data is up-to-date and valuable.

Solve Cart Management with Outsourcing

To decrease your shopping cart abandonment rate and increase conversions, you need to optimize your shopping cart.

• Keep your cart clean, simple and fresh.

• Make your checkout process easy and fast.

• Be transparent about all costs and allow customers to review the final price before making a payment.

• Include progress indicators and product thumbnails throughout the checkout process.

One of the easiest ways to make sure all of this happens – and that it stays scalable and secure – is to outsource it to a partner with the proper expertise. This will reduce your unnecessary overhead, improve business efficiency and support customer retention.

Material’s eCommerce app development experts employ the best and latest technology to make sure of the following:

• Seamless navigation between your cart and store

• Optimized page load speeds for a speedy checkout experience

• Integrated AI chatbots to provide live support

• Cutting-edge payment integration options that make purchases simple and secure

• Automated abandoned cart recovery campaigns to prompt customers to return to complete their purchases.

We can also help automate other workflows to handle administrative and organizational tasks to ensure your eCommerce program is efficient and effective.

Solve CX Challenges with Strategic Integration

Integrating the right marketing, data and customer management platforms can help you create the kinds of seamless, personalized experiences that drive engagement, improve conversion rates and boost retention. These platforms include customer relationship management (CRM) solutions, customer data platforms (CDPs) and content management systems (CMSs).

Integrating a CRM Platform

Integrating a robust CRM tool into your eCommerce site creates a lot of engagement-building capabilities. You’ll be able to do the following:

• Follow order status updates, track inventory and shipments and enable customers to stay informed about deliveries.

• Collect information about customers across multiple channels.

• Store customer data in a centralized location. This supports all your marketing activities, from planning to targeting and execution; this also helps enable personalization.

• Easily gather customer details, including orders, payments and products viewed. This helps your sales teams upsell and cross-sell more effectively.

• Access customers’ behavioral data to address concerns before they escalate. This can improve retention and increase customer lifetime value (CLV).

• Reduce errors caused by manual data transfer. This can directly affect sales and customer loyalty, as well as minimize losses and costs.

• Approach every customer with a personalized pitch with the help of your CRM’s analytics and monitoring features.

Integrating a CDP Platform

With a customer data platform (CDP), you can gather and manage data in a centralized location. This enables a holistic view of your customers’ experiences and helps you derive valuable insights by:

• Generating relevant, actionable insights that support more valuable, longer-lasting customer relationships.

• Integrating with a robust set of business applications, made easy with prepackaged connectors and data flows.

• Collecting, organizing and consolidating customer data to build comprehensive customer profiles. This allows marketers to deliver highly personalized experiences.

• Creating a single source of truth by unifying all data silos.

• Maintaining data privacy, compliance and hygiene.

Integrating a Headless CMS

Content management systems (CMS) offer both communication capabilities and transactional features. They allow users to create, manage, store and publish content across the web, mobile and other digital channels from a centralized hub. At Material, we often recommend a headless CMS – meaning it has a decoupled architecture that separates the presentation layer (front-end) from the back-end services and logic. This makes it highly flexible and customizable to your needs and to third-party integrations. With a headless platform like Drupal that combines both content and commerce, you can deliver experience-led D2C experiences.

Drupal’s data-driven approach to eCommerce enables the following:

• Dynamic decoupled storefronts

• Multi-channel eCommerce management

• Advanced integrations with platforms like Magento, Shopify, and BigCommerce

• Custom-built APIs for marketplace integrations

• A vast range of entities and plugins that provide a complete user-centric experience

• The ability to make changes instantly to your eCommerce application, optimize your app quickly and offer rich user experiences

Integration with a Focus on Personalization

The above platform integrations help make personalization a key part of your D2C strategy. By using data to inform how customers interact with your cart and content, you can ensure their experiences are relevant and timely.

D2C retailers enjoy the distinct advantage of access to first-party data, which allows them to provide consistently optimized experiences across all channels. This enables you to do the following:

• Personalize every interaction with the customer

• Tailor content to match shoppers’ expectations

• Engage seamlessly across all digital sales channels

• Deliver personalized product recommendations

• Build customer segments to make personalized promotions and offers

Making D2C Happen

To ensure your D2C business is successful, you’ll need to address the following:

• Robust data management – It’s crucial to comply with local, state, national and global data laws and regulations. Attention to best data practices helps you remain compliant and avoid fines and reputational damage; it can also help you distill the insights you need to personalize your customer experiences.

• Seamless payment and accounting systems – Your checkout process should be frictionless, and your payment and financial management solutions (including third-party tools) must comply with Payment Card Industry Data Security Standard (PCI DSS) to ensure data protection and the security of credit cards and other digital modes of payment.

• Optimized order processing and fulfillment – Design a model that ensures fast, on-time deliveries for orders of all kinds and sizes.

Making all this happen – and making it scalable – can be a challenge. But it’s possible to offer a compelling, relevant and scalable experience by adopting the right technology and strategy. It just takes expertise – something Material has a lot of. If you’re interested in getting started in D2C eCommerce, or you want to elevate your current approach, reach out today. Let’s get the conversation started.