scorecardresearch

How is technology elevating post purchase experience enabling growth of D2C brands in India

The rising competition in D2C has led to brands aggressively investing in technology solutions to solve various business problems across the operation cycle.

D2C, online shopping, e-commerce, technology, SaaS, software, inventory management, warehouse, logistics, automation, retail, retail industry, D2C brands
Technology is a key enabler to elevate post purchase experience for consumers.

By Kapil Makhija

The onset of the COVID-19 crisis proved to be an inflection point for e-commerce, fast-tracking its adoption by years, if not decades. The growth trajectory for e-commerce companies has been on a record high as consumers continue to prefer the safety, convenience, and comfort offered by online shopping platforms. From being just a niche and good-to-have strategy, Direct-to-Consumer has metamorphosed into becoming a powerful driver of the retail revolution in the country. With unfazed, booming popularity and rising focus on delivering customer delight, the D2C segment has emerged as a clear winner in disrupting the status quo of the retail and e-commerce landscape. D2C is slated to touch $ 100 billion by 2025, according to The Rise Of India’s D2C: Market Landscape And Trends Report, 2021. Even small sellers from tier-II and tier-III cities are taking the D2C route and establishing strong brand identity, whereas established brands are dipping their toes into the D2C space through strategic investments or by acquiring digital-first companies to tap into a new base of customers. 

The rising competition in D2C has led to brands aggressively investing in technology solutions to solve various business problems across the operation cycle. While there is immense focus on creating brand awareness and offering a great pre-purchase experience to drive sales, companies often forget that a real relationship between a brand and a consumer is formed once a customer clicks on the buy button. The post-purchase experience is as important as the pre-purchase experience, and it plays a pivotal role in building a robust and sustainable business. According to a recent study conducted by Fredrick Reichheld of Bain and Company, increasing customer retention rates by 5 per cent increases profits by 25- 95 per cent. 

Several post-purchase factors, such as the convenience of tracking orders, on-time delivery, and ease of customer service, play a vital role in influencing customer loyalty which in turn increases the repeat customers. Brands must focus on investing in technology for an effective post-purchase experience. The post-purchase experience can be broadly classified under three key steps mentioned below. Technology plays a vital role in driving operational efficiency across these three steps. 

Technology to manage orders and inventory

Businesses are all about what they offer and faster order processing and inventory management plays a crucial role in good customer service. As customer acquisition cost continues to rise, brands must offer a great post-purchase experience to achieve a higher repeat customer rate. The post-purchase journey begins with locating inventory and processing the order. While selling on multiple online platforms, it becomes challenging to ensure optimum inventory utilization and ensure faster processing. Therefore brands need to invest in order management solutions. An order management solution enables faster order processing by integrating all sales channels on one single platform, making it simpler for sellers to manage orders and have a centralized view of inventory. It also helps companies with multiple warehouses or pick-up locations, by automatically allocating orders to the right fulfillment source based on various criteria, such as location, stock availability, demand channel, delivery preference, etc. The inventory management solution further provides a unified view of inventory placed across multiple warehouses and stores. 

Technology to streamline warehouse operations

Warehouses are at the heart of e-commerce operations, and a smooth well-organized warehouse can enable a company to achieve maximum efficiency. It plays a most crucial part in supply chain operations. Therefore it’s very important for companies to invest in warehouse management solutions. Warehouse management software is not just about stock location and stock level of the goods, it must be able to meet the dynamic requirements of a D2C brand. A good warehouse management software helps in receiving the inventory, placing them on the designated shelf; improving the picking and shipping of orders, and getting real-time information on the inventory and can be integrated into your existing ERP system as well. A well-defined warehouse management software can immensely benefit e-commerce and retail businesses by lowering labour costs, enhancing Inventory accuracy, improving operational flexibility, reducing errors while picking and shipping goods, upgrading customer services, and accessing real-time data.

Technology to expedite last-mile delivery and easy return processing

E-commerce delivery is the most complex process of making a product reach right at the doorsteps of a buyer. It requires the highest amount of attention, assurance, and effectiveness. It’s often said that nothing satisfies a customer more than fast and easy deliveries. A D2C brand must focus on offering a great customer experience that is unique to the brand and finding the right shipping partner plays a key role in it.  While all D2C brands have collaborated with multiple shipping providers, the company must find the right service provider for each delivery. D2C brands can deploy Logistics management solutions, to achieve AI-based robust allocation that automatically allocates the order to the most-preferred courier service provider based on a comprehensive rule engine (location, priority, cost, etc.) along with track and trace functionality. 

Despite the fast and error-free deliveries, companies will have some return orders. Returns are an inevitable part of the e-commerce business. While each industry has its different return volume, it constitutes a huge part of operations cost and can directly impact the bottom line. Therefore it’s important to have a robust return management policy and technology to ensure hassle-free returns. A good return management solution can not only help in smoother returns processing but also can help alert D2C sellers about orders with high return potential and measures to minimize returns. 

It’s well established that the D2C trend will continue to grow in the years to come, and more brands will embrace the technology to streamline operations. Also, a lot of D2C brands are expected to adopt traditional retail channels as well and will require omnichannel solutions to offer a unified shopping experience to consumers. 

As e-commerce continues to grow, the demand for SaaS platforms helping simplify e-commerce selling will become a necessity and the ecosystem is expected to adopt technology at a faster pace to help bring the necessary efficiency, agility, and innovation to the operations of D2C brands.

(Kapil Makhija is the CEO of Unicommerce)

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

Most Read In Industry