Many Ecommerce Options for Brand Manufacturers

There might be no better time for a producer or private-label brandnew. As recently as 10 years back, in case you created your own brand of merchandise, you probably sold them via a multi-level distribution station. As soon as you attained a high enough sales volume, you might have been able to negotiate prices directly with international retailers.

Your investments on your brand were typically in security, print or other forms of traditional media advertising, and public relations. The actual selling and merchandising typically rested with your reseller channels.

What a difference ecommerce has made. Now’s brand producers may still sell through conventional channels. But they also have a number of different sales and marketing channels available. Most are very low risk and need limited investment.

Clients are now accustomed to purchasing online. They do extensive research, see many unique sites, comparison shop, check on what friends are buying, and look at a huge array of merchandise before making purchasing decisions. Because of this, we’re seeing a high growth in so-called lifestyle brands that appeal to high-income buyers.

Rather than just buying a functional bag, water bottle, or set of socks, buyers increasingly seek specialized, premium products. Well-conceived brands appeal to those buyers by associating their products with a specific lifestyle — outdoorsy, rugged, athletic, stylish. These market products often have more restricted distribution and a more personalized appeal.

Because of this, there’s a resurgence of”Made in the USA” production startups that aim the lifestyle market with niche products. If you produce your own products or have the ability to private label products, benefit from the enormous growth opportunities available in various ecommerce websites to reach those lifestyle buyers. And when product manufacturers will need to increase capital, crowdfunding websites like Indiegogo and Kickstarter offer innovative ways to finance growth.

Fundraising Opportunities

If you manufacture a product in a EMS PCB assembly line, you can raise money on several different crowdfunding websites, where participants make a donation, not an investment or a purchase. There’s a risk they won’t receive their anticipated”reward,” that ordinarily is the products the company makes. With any crowdfunding effort, you describe your product offering, your intended use of funds, and your rewards for contributing to the effort.

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Here are just two examples of successful current campaigns.

Xoab is a startup U.S.-based maker of high-end socks. Its Kickstarter effort raised far more than its target goal of $50,000 to finance the purchase of dyed yarn and to expand product offerings. Xoab’s effort is well organized and presented, leading to a successful fundraising campaign.

Thompson Tee, a technical clothing maker, raised more than $25,000 with an Indigogo effort a couple of months ago. It’s using the funds to expand its product line to include black tee shirts. I will expand on Thompson Tee later in this report.

Thompson Tee

There are lots of similar crowdfunding success stories. You don’t have be a startup business to use these websites. This innovative way of financing reduces the need to find expensive capital from external investors that dilute your equity stake.

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Channel Growth Opportunities

Your own online store. Launching your own ecommerce website is a fantastic place to begin and continue to grow earnings. You will probably have high margins, direct communications with your clients, and the ability to closely manage your brand and messaging.

Many manufacturers grow so fast, they tend to ignore other stations. Other people make a strategic choice to control their own station. Red Oxx is a manufacturer of rugged luggage located in Montana which is highly profitable. Its credo is”Not sold in a shop near you.” It operates a single factory shop and an ecommerce website, which is quickly moving up on the online Retailer 500 list.

Henkaa is a Canada-based maker of convertible dresses for bridesmaids and formal events. Similar to Red Oxx, it’s an extremely successful ecommerce operation in addition to a local factory shop. By controlling these stations, Henkaa gains a deep understanding of its clients and their requirements.

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Every manufacturer should operate its own online store. If you compete with your reseller channels, so be it. The big brands are all doing it. You don’t need to undercut your resellers in price. You have the choice of selling exclusive products in your online store, and it is also a fantastic spot to test new products, sell lower-margin goods, and move excess stock.

Marketplaces. If you control your brand, think about selling on marketplaces, such as Amazon. As a small brand, you may reach a very limited market by relying on your own ecommerce website. Selling on mass-market sites like Sears, Rakuten, and Amazon will expose your products to a much bigger audience. Additionally, there are specialized marketplaces like Zazzle.com which are well suited to market and custom manufactured products.

To reach international markets, think about marketplaces. If you use Fulfillment from Amazon in different countries, you may eliminate the worry about costly overseas delivery, VAT taxes, and other customs issues. This is a quick path to international expansion for many producers.

Admittedly, some products might not match mass-market websites. But high-income, lifestyle buyers also store there. You may pull in a whole new set of buyers. Worried about decreasing the value of your brand? It is possible, but unlikely given the wide variety of goods being sold through marketplaces today.

Online hybrids. There are a few significant newer pure-play online retailers that I classify as”hybrids” They have market characteristics, social-shopping attributes, and traditional freelancer designs — with a small affiliate marketing thrown in. These hybrids comprise Fancy.com, Fab.com, and Wanelo.com. You can set up your own”shop” within Fancy.com and Wanelo.com. You can conduct your own”sale” in Fab.com. All three appeal to lifestyle and fashion-oriented buyers. Fancy.com features more modest brands compared to others.

Multichannel Revenue Alternatives

Most manufacturers should think about a true multichannel strategy. I have recently spoken with several small startup entrepreneurs which are growing many channels simultaneously.

Thompson Tee sells sweat-proof tee tops to the small segment of customers that sweats profusely. It operates an extremely successful online store, sells in marketplaces, and pursues a big-box retailer plan.

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Archival Clothing is a U.S.-based maker of bags and clothes that are extremely well made and rugged. It sells through traditional market retailers and also pursues growth in different channels.

Archival

Marketing Channels

Much has been written about how brands are utilizing various social media and electronic advertising channels. Here’s a fast review.

  • Social media. Facebook, Twitter, Pinterest, Instagram, Flicker, and others may deliver your brand message and communicate with clients and prospects.
  • Email advertising provides messaging and create promotional offers.
  • Search marketing reaches new audiences for your products.
  • Comparison shopping engines reaches new audiences.
  • Remarketing targets shoppers that have visited your online shop.
  • Affiliate advertising reaches target markets through content networks.

The advantage of the marketing channels for smaller producers is that you can create targeted investments, test your results, and exit quickly or scale based without breaking the bank. Make a staged strategy and attempt them all.

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