Tag: Marketing

Three Ways Experience-Driven Commerce is Changing Online Shopping

Contentserv Blog | 3 Ways Experience-Driven Commerce Is Changing Online Shopping

“Experience-driven commerce is the future of commerce,” said Adobe’s Executive Vice President, Brad Rencher1 in 2018. It had been two years since an experience-driven commerce future was first predicted, and because the right circumstances took place, it is safe to say that experience-driven commerce is happening now.

E-Commerce has completely transformed how consumers shop and how businesses operate. So, is experience-driven commerce really the next big thing for commerce? And how is it changing the online shopping experiences of consumers?

Experience-driven commerce, defined

According to Adobe2, “Experience-driven commerce = Maximizing sales by delivering customer experiences from discovery to purchase that are optimized with insights from real-time shopping behaviors and multichannel data.”

Specifically, experience-driven commerce is:

  • Customer-centric – presenting products in a way that resonate with what consumers are looking for
  • Omnichannel – meeting shoppers and their needs across all channels
  • Relevant product content – providing shoppers accurate, rich, complete and up-to-date product content

Experience-driven commerce trumps traditional commerce since today’s consumers are savvy enough to know and get what they want. They seek personalized experiences, connection and engagement. This means businesses need to develop experience-driven commerce strategies if they want to remain relevant and competitive.

Experience-driven commerce, the essentials

The shift to experience-driven commerce is fueled by:

The age of consumers. Millennials are currently the largest consumer group3, and Gen Z, the pickier and savvier version of Millennials, is not far behind. These current and soon-to-be consumers grew up with digital conveniences at their fingertips – and they only recognize brands that are accessible and personal.

Brands must be customer centric. Brands cannot expect these new breeds of consumers to accept everything they provide. Thus, brands need to find a way to know their customers — their needs, preferences, where they are and how they shop. The foundation to understanding this consumer behavior begins with data. Therefore, brands must harness the power of data if they want to deliver experiences tailored to the needs of these consumers.

Constant connectivity. 53% of the global population is connected to the internet4, and it is a number that is still growing as devices become more affordable. It is also estimated that an average person owns and will use at least 154 connected devices by 20304. Most consumers can therefore easily reach for any of these devices to research a product or service they need, complete a purchase, and share their experience, good or bad, online. This means that with a few swipes, consumers can make or break a brand.

Brands must be omnichannel. Today’s consumers expect to have access to what they want when they want it. To remain competitive and relevant, brands must employ a strategy that delivers a seamless experience across all platforms – desktop, laptop, mobile phones, tablets and in-store.

Personalization. Most shoppers are willing to share personal information as long as they get personalized experiences in return. In fact, 61% are willing to share private information to ensure brands understand their needs5. Furthermore, offering personalized shopping experiences are necessary for brands to build loyalty and expand their customer base:

  • 52% of consumers said they would switch brands if the company does not offer personalized communication6
  • 25% of consumers have stopped engaging with a brand due to poor personalization7
  • 35%  of Millennial consumers are willing to walk away from a brand with poor personalization7

Brands must offer personalized and contextualized product experiences.Consumers become advocates when brands meet or exceed their expectations. Brands must understand their customers and their purchase journey to create a shopping experience that specifically caters to their needs.

So how can brands deliver the demands for experience-driven commerce?

Delivering experience-driven commerce

Brands that want to focus on experience-driven commerce must re-imagine their e-commerce strategy. Many will have to begin by embarking on a digital transformation journey. Digital transformation is the catalyst for innovation in the e-commerce space. It allows brands to connect people, process, data and technology. Specifically, digital transformation can help brands eliminate organizational and technological silos, improve internal processes and empower brands to deliver accurate and updated information to its partners and audiences. This is vital to build an engaging brand message in order to generate the success expected of an experience-driven business.

Brands that are digital are in a great position to understand consumers, enhance their product offerings and deliver a channel-agnostic experience, any time. Additionally, brands must consider the following elements when shifting to a more experience-driven approach:

  • Technology. Brands need to leverage the right technology that can fully support their e-commerce strategy. The necessary solutions will depend on the products sold and the target market. At its core, the chosen technology must be able to provide solutions for personalization, analytics, testing, product information and digital assets management.
  • Data. Hyper-personalized experiences begin with data. Brands need a system of insight to ensure that data, wherever and however it is used and by whom, is high quality – complete, accurate, rich and up to date, all the time. Additionally, data must be used intelligently by way of analytics to fully exploit its potential.
  • Content. Product content is critical. It must speak to the needs and wants of consumers. To provide context around shopping experiences, product content must be tailored to the persona, preferences, location and needs of the target audience.

Experience-driven commerce begins with product experience

Great experience-driven commerce begins with meeting customers on every stage of their shopping journey. It requires understanding on how consumers use different channels to look for the information they need to decide on a purchase. Brands must send the right messages without overwhelming their consumers along the way. Furthermore, the shopping journey must be made seamless and easy.

Delivering experience-driven commerce does not have to be complicated. However, it does require the right strategy that is adaptable to the future expectations and preferences of consumers.

How D2C is Impacting Retail

How D2C is Impacting Retail

D2C, D to C or DTC, stands for direct-to-consumer, a business model that cuts the middleman (e.g. wholesalers and retailers) and allows brands to control the end-to-end process, i.e. manufacture and market their product, as well as take care of order fulfillment.

Brands and consumers can both win with D2C, with manufacturers enjoying gross margins on sales (saving approximately 10-15% from wholesale distribution and 15-40% from retailers)1 and owning first-party data to better understand end-consumers, and consumers, on the other hand, benefiting from lower cost offerings and improved experiences.

Deloitte compiled D2C’s benefits for brands in this chart:2

Deloitte infographic D2C benefits for brands
(Image Source: Deloitte)


A closer look at most of these benefits reveals D2C’s appeal for manufacturers:

Expanded reach

Unhampered by physical location, geography, time zone and even language, D2C brands can market via social media, sell through e-commerce and deliver products using third-party fulfillment service providers. This is in sharp contrast with the traditional model, where manufacturers are constrained by a retailers’ reach.


With access to an incredible wealth of data generated by digital tools and platforms, D2C brands can better understand their customers’ journeys towards a purchase. Armed with insights from first-party data, they can offer personalized experiences to specific segments and individuals, therefore improving sales as well as customer retention and satisfaction.

Customer loyalty

By owning the customer relationship, D2C brands get to know their customers deeply and thus, can deliver targeted value propositions. Through personalization and continuous engagement, they are better positioned to establish and grow loyalty from their customers.

Full assortment

With D2C, brands are free to lay out a comprehensive assortment of their products—how, where and when they want. This is unlike the traditional model, where they are restricted by a retailers’ shelves and goals.

Pricing control

Brands that have gone direct can A/B test their price to find out what works with consumers. They can also freely increase or decrease pricing according to the economics of their business unlike when they only have partial control of pricing as they have to defer to the price set by the wholesalers or distribution outlets.

Full control of merchandising

When brands own all their channels in D2C, they can offer the right products to the right consumers according to data, unlike when merchandising was the retailers’ call.


Without middlemen who have own their timing and requirements (i.e. must show proof of success for products to be distributed in certain locations), D2C brands can sell and deliver products to consumers whenever they want.

D2C threatens retail by cutting into its market share

According to Diffusion’s 2018 D2C Purchase Intent Index, more and more Americans are poised to buy from D2C brands within the next five years:3

·        A third will make 40% of their purchases from D2C brands

·        81% will make at least one purchase from D2C brands

However, despite of these numbers, eMarketer found that only department stores and other traditional mall-based retailers will be affected, not retail giants such as Amazon, Walmart and Target.4

Has D2C really upended retail?

By being agile and leaving the old-school supply chain process behind, eliminating dependences on third-party distribution systems and controlling their branding, many D2C companies have found success. Furthermore, by highlighting their truths and values, D2C companies have also increased their appeal with the millennial segment.

In addition, D2C brands have made efforts to understand end-consumers, offered flexible pricing schemes, provided delivery/shipping options and built trust through rich content and unparalleled customer service.

Take D2C’s poster child, Warby Parker’s success as an example. How did the hipster brand turn the eyeglasses industry upside-down without a physical store? Since they know their target segment, they used narrative storytelling and a creative Instagram ad strategy to hook and engage,5 eventually causing hundreds of other fashion and lifestyle brands to follow their example.

Here’s an example of how Warby Parker eliminated the top concern of consumers when it comes to buying wearable products online (the fact that consumers can’t physically try their products on):

Warby Parker How it Works

(Image source: Warby Parker)

The content may be short, but it used simple instructions, clean designs, spoke their target’s language and, most importantly, gave them the freedom to choose. Warby Parker also provided shoppers with a fun, frictionless and personalized experience – things that retailers might struggle to provide.

D2C intensifies the competition

Due to the success of D2C startups, more and more players have come into the scene. It includes big names such as Nike and Apple, making an already tight space even tighter and creating a suffocating environment for retailers, competition-wise.

Nike has been so successful with D2C that it stopped selling to Amazon in 2019. Although the decision might have included issues with counterfeits, Nike shared with Retail Drive that it’s more about improving customer experience, “As part of Nike’s focus on elevating consumer experiences through more direct, personal relationships, we have made the decision to complete our current pilot with Amazon Retail.”6

What was Nike’s D2C strategy? They called it “Consumer Direct Offense,” which aims to “serve consumers personally, at scale” and entails enhancing their digital efforts through mobile apps.7

Through the Nike Customer Experience (NCX) program,8 the brand aims to create more personal connections with customers through the “30-day free returns, dirt and all” free trials, access to the Nike Plus rewards program and Nike experts and personalized exercise routines and more.9

Nike image source_Heidi O'Neill and Adam Sussman's Transcript

(Image source: Heidi O’Neill and Adam Sussman’s Transcript)


The D2C industry was forecasted to account for $17.75 billion of total US e-commerce sales in 2020, further proving that this business model pays.

Here’s a list of top D2C brands:10

  • Warby Parker, valued at $1.75 billion
  • Dollar Shave Club, acquired by Unilever for $1 billion
  • Casper and Harry’s, each valued at about $750 million apiece
  • Glossier, valued at $390 million
  • Bonobos, acquired for $310 million
  • BarkBox, worth between $150 and $200 million

D2C’s success also has implications on marketing, as companies that used to invest in advertising and brand-building in physical stores are now looking at digital because there is where the consumers are shifting to.

As Racantour puts it, “Once a consumer has downloaded the company’s app or logged into its website, the entire experience takes place in a digital, walled garden and can be highly personalized.” 11

But it’s not only in the online space that D2C brands are besting retail. They’re also encroaching on retail’s physical spaces as many have opened brick-and-mortar stores to fulfill their omnichannel goals.

But then there’s Amazon and Walmart

D2C is here to stay. This means it’s up to retailers to rise to the challenge and evolve. They must note that retail remains a vital channel in an omnichannel environment, and look to Walmart and Amazon, which are blurring the lines of retail and D2C, for inspiration. For these two giants, the motto seems to be, “If you can’t beat them…”


1 Direct to Consumer Strategy, an Expert’s Guide
2 Deloitte, Consumer Business Going Digital / Going Direct
3 Diffusion’s 2018 Direct-to-Consumer Purchase Intent Index
4 The Future of Retail 2020
5 Warby Parker Marketing Story
6 Nike to stop selling on Amazon
7 Nike consumer direct offense
8 Nike Direct – Heidi & Adam’s Transcript
9 How Nike combines customer centricity with brand reputation to stay on top
10 Direct-to-Consumer Start-ups You Need to Know
11 Why Direct to Consumer Brands are dominating in Retail