D2C Vs Marketplace: Which Is More Effective For Young Brands During Festive Sale?

The year 2021 was a joyous year full of record-breaking achievements for the startup sector but 2022 seemed shaky. Given the all happy and festive vibes, businesses, especially D2C and ecommerce startups are expecting to touch newer heights of profits and overall business growth. 

In the backdrop of a heavily-evident shift in consumer behaviour, it has been observed that consumers plan to shop online more than they did before the pandemic over the festive season. 

This festive season is a lot more different from the previous year, businesses in the sector of ecommerce, logistics and direct-to-consumer are and will be in high demand. The question here is from the sellers’ viewpoint as to which route will in turn offer higher profits, brand presence and wider customer acquisition.

How To Choose The Best?

Where the large ecommerce brands have a plan in place to tap the larger customer base this festive season, D2C brands are all geared up and are expected to onboard logistics partners. Large marketplaces such as Flipkart, Amazon, Tata Cliq, Myntra, Nykaa, Ajio and many more are pushing festive-season special sales. What about the emerging homegrown brands and startups playing in the same field?

Ecommerce Plan

Average order value makes a huge difference in choosing between both options.  Ecommerce platforms are powerful and have a wide reach, which gives D2C brands the required discovery. It is quite subjective as it depends on what stage and category the brand stand in. 

“Young brands selling their product via their own website using a pure data point of view works well but it is extremely expensive. Therefore, ecommerce platforms are much more suitable, especially where the brands can also have access to data,” Soumyadeep Mukherjee and Gayatri Gogate, founders Spice Story explains.

Industry leaders have proactively highlighted the presence of logistics players in the segment as well and mentioned that the whole D2C ecosystem has become really conducive and there are various players in the last mile segment that help you service your orders, faster, better and save some money too.

Direct To Consumer Route

For young brands to make the most of the festive season, they are advised to begin their campaigns much earlier than the peak festive period and create brand visibility. With such high competition during the festive season, advertising alongside larger ecommerce brands or marketplaces with deep pockets can take their CACs through the roof and give them no chance at standing out from the clutter.

Driving product or brand discovery organically on ecommerce platforms can be very challenging for new brands and competing with larger brands in the same category can shoot up advertising costs as well. So, selling on their own websites around the festive season or after can have a longer-term value creation for their business.

While boasting of its end-to-end supply team, Vishal Kaushik, Founder and MD, Upakarma Ayurveda said, “This year we are experiencing a great spike in orders as the economy is gradually getting back on track. Foreseeing this, our supply chain and logistics teams were already well-prepared for this festive season.”

Segments Under Spotlight

Talking about the rise in demands, beauty and personal care, health and wellness,  in the FMCG category – fashion, home décor and consumer electronics are the segments to get the most of the glory this festive season. 

Chirag Taneja, Co-founder, Gokwik opens up, “If nearly 40 per cent of the annual sales happen during the festive season, the pre-festive period is the best opportunity for young brands to build brand awareness and an acquisition funnel to their website so that they can use the data to personalise and retarget to the same customers after the festive season as well.”

Larger ecommerce platforms receive heavy traffic during such events. Even brand websites witness increased traffic during the sale period. The upsurge in online shopping has led the brands to eventually be extremely competitive on ecommerce platforms. Ecommerce has witnessed an exponential rise in India during the last five years but young brands did not take much time to spot the side effects of it.