In 2021, overseas DTC brands will be listed together, including many brands such as Warby Parker and Allbirds. In addition, the success stories of SHEIN and PatPat have enabled the industry to see the growth space and possibilities of the DTC model. At a time when brands are going global, despite the frequent mention of DTC, we still see that there are still many issues that deserve to be discussed in greater depth. Is DTC just a channel? In addition to the topic of marketing diversion, what kind of attention is paid to the products that directly interact with consumers and the supply chain behind them?
On the afternoon of March 22, the second phase of the "Online Sharing Meeting" organized by LET'S CHUHAI CLUB, a high-end community under 36Kr, invited Gu Zhenyu, founder & CEO of Vesta, home technology brand, and Molly Xu, head of business at Klarna, Europe's largest fintech unicorn in China, and more than 100 members from DTC brands, platform sellers and service providers to chat about the growth observation of China's DTC brands.
The following are the wonderful ideas we have summarized and shared with you.
Embracing environmental protection, emphasizing "sustainability", positive and distinct values are "brand standard"
Positive and distinct value output is an essential "label" for first-line brands in Europe and the United States. Vesta observes that it is difficult to impress the current main consumer groups in Europe and the United States (post-85s, post-90s and GenZ) only by relying on cheapness and cost performance, they like innovative products created by new energy, new materials and new raw materials, promote the values of environmental protection and sustainable development, and pursue consumer brands that can strongly resonate with themselves at the cognitive level.
Reflected in the landing level, the company injects the concept of environmental protection and sustainability into the brand's actions and concepts through various means. Vesta, for example, transparently informs consumers of the carbon emissions generated in each link of material selection, production and transportation, and carries out "a series of carbon offset measures" in a targeted manner. Non-marketable returned products are donated to charitable organizations, and global environmental organizations are supported by 1% of annual revenue. And 100% vesta products use bamboo fiber, eucalyptus fiber, silk, these degradable and environmentally friendly materials.
Source: Vesta's official website - the page has a sustainable concept section
As a company born in Europe that has always focused on ESG issues, Klarna is also promoting these sustainable brand concepts. Molly introduced that Klarna's app supports consumers to query the carbon footprint of purchased goods, and also regularly cooperates with merchants on the payment side, representing merchants and donating to cooperative institutions.
Image source: Klarna Twitter
There are hidden dangers in the "Shenzhen model"
Both Vesta and Klarna have observed that traditional cross-border sellers tend to fall into the "Shenzhen model" mindset, where they get OEM goods from Chinese factories and sell them at low prices in the form of shops, hoping to quickly gain market share. They tend to be more concerned with short-term ROI than brand influence, mistakenly equating exposure with brand impact.
How to avoid this "short-sighted" mode of thinking, specific to the practical link, the company needs to carefully consider and design all aspects of the product, including building a brand independent station, avoiding the set of Shopify's existing templates to build an indiscriminate website. According to the characteristics of the category and the display needs, detailed thinking and design are carried out, and the pages are developed separately. For example, Vesta's products are mostly high-end single products for high-end consumers, and the decision-making time is long, so the product page will comprehensively and informatively display the raw materials, performance, material properties and user evaluations of the products. This gives users a more complete picture of the product and then makes a decision to buy.
Source: Vesta official website - product introduction page
The streaming method of refined label combination is highly respected
Both Vesta and Klarna have observed that with the implementation of the platform's data supervision policy, the traditional extensive material delivery method and the form of relying on machine self-learning recommendation have gradually declined, replaced by bottom-up, through the combination of tags to achieve efficient delivery conversion.
Reflected in the specific operation, the company can find some accurate tagtags covering 20,000-30,000 people, outline a specific portrait of the crowd through the form of combination, and then go to the platform to put it. For example, the portrait of NewYorker will be set with a label similar to "New York pays attention to the people who pay attention to high-end real estate leasing", Vesta through these niche label combinations, accurately circle the middle class in New York with housing and rental needs, and carry out product awareness advertising for this segmented group, and ultimately enhance the purchase conversion.
The above is a summary of wonderful views, DTC brand friends who missed this issue of the event, if you want to have a more in-depth discussion, please add 36Kr out of the sea assistant WeChat friends (ID: wow36krchuhai-xzs) to get in touch with us.
We will continue to pay attention to the development of the Chinese DTC brand in the world, launch more content and online and offline activities, please pay attention to 36Kr to the sea.
The third phase of the online sharing session is previewed | Interpretation of opportunities to go to Europe
Unlike popular destinations such as Southeast Asia and Latin America, Chinese companies are relatively calm in the face of the European market with a population of 740 million and a huge market map. Although European governments pay great attention to open innovation and the venture capital environment is booming, due to language, culture, regulatory policies and other reasons, the European market is relatively scattered, including mature developed markets represented by France, Germany, Italy and Britain, as well as relatively emerging markets in Eastern European countries. For Chinese companies that want to go to Europe, what are the opportunities worth seizing? What are the differences in the characteristics of different countries in Europe? Which of these markets is more suitable for the layout of Chinese enterprises? How should overseas enterprises do a good job of localization and avoid risks?
On April 21 (Thursday), from 3:00 p.m. to 5:00 p.m., the online sharing session (phase III) created by LET'S CHUHAI CLUB, a high-end community under 36Kr, will focus on the opportunities and challenges of Chinese enterprises going to Europe at present.