Navigating uncertain landscapes for D2C brands: What’s the path forward?

In a recent webinar for “The Shopify Corner” series, Gorgias’ Tech Partner Manager, Rohan Kapoor, hosted a panel with a group of leading D2C technology experts, discussing how direct-to-consumer brands can combat the challenges they may face in the current economic climate.

They discussed ways to optimize and fix systems that could be hindering merchants’ growth, and consumer spending and behavioral trends that brands should care about. 

The webinar featured these panelists:

  • Mark Sinclair, Merchant Success Manager, Shopify
  • Dan Anand, Tech Partner Manager, Loop
  • Greg Bauman, Director of Ecosystem Partnerships, Attentive


We think you’ll get a lot out of watching the webinar in its entirety, but if you’re pressed for time, here are some of the key takeaways:

Merchants are using personalization to retain more customers and increase LTV.

“Rising acquisition costs are one of the key things that merchants are really trying to kind of get ahead of,” says Sinclair. “Inflation is here and recession is imminent, if not already starting.”

As a result, merchants are focusing less on spending to acquire new customers, and focusing more on strategies for retaining the customers they already have – chiefly, through personalized experiences.

“Customers are very demanding in 2022. They want to shop wherever they are, however they want to shop, and they want tailored experiences. Merchants are working hard to try and create a tailored experience from first interaction to conversion.”

Creating customized loyalty experiences is also an important focus point.

Subscription-based experiences, personalized experiences, and token-gated commerce are all becoming high priorities for merchants, Sinclair adds. “You’re really leveraging your community, and creating a place that aligns your customers’ goals and identity to your brand and the products.”

Incentivizing exchanges over returns can help recapture lost revenue.

In uncertain times, every dollar counts – and savvy merchants are finding ways to retain seemingly lost revenue, by converting returns into exchanges.

For Shopify brands, 25% of products on average end up getting returned. 

“I would say it’s really important to distinguish that maybe the customer just wasn’t satisfied with the product they purchased, and they still might like the brand themselves,” says Anand. “So it’s really important that you are offering, as a brand, a couple different options to the consumer to help them find a product they like, and stay with the brand. And of course that would lead to increased LTV.”

Encouraging customers to exchange the product they didn’t want for another product means that “they’re more likely to become an advocate and hopefully come back and shop again,” says Anand. 

“And so from a dollar perspective, think about how much of your return revenue you as a brand are retaining. You can also look at it from a consumer’s perspective. How many relationships are you saving? With 25% of those consumers leaving or returning a product, how can you save those consumers and exchanges?”

Merchants can prioritize SMS marketing to drive higher customer engagement rates.

“I’m not gonna say that we’re in the year of mobile right now, but we are definitely in a mobile-first era,” says Bauman. 

“We’re really seeing that with the type of engagement, over three quarters of all online sales are coming from mobile accounts. People are becoming more comfortable with receiving text messages from brands that they’re genuinely interested in.” 

With recent iOS updates making it harder for marketers to track customers’ behavior on web browsers,  “we feel that SMS and your mobile device really is that perfect vehicle for personalization. Typically we only have one phone number or we only have one phone, right? And so the accuracy over a long period of time is going to be there.”

“When you talk about increasing lifetime value and getting the most out of your current customers, SMS is a great vehicle to give you the immediacy you’re looking for from a revenue perspective,” Bauman adds. “I know some people are uncomfortable about subscribing to SMS programs, but at this point over 80% of consumers out there have subscribed to at least one program. So that behavior is shifting, and it really is a race to own that SMS inbox as well.”

Use automation where you can to streamline costs and processes.

When every dollar put towards operating expenses is important, it’s a good opportunity to look at ways to streamline your costs and improve efficiency through automation.

“It’s important for teams to spend their time on more complex issues – things that are going to be more of a revenue-driving activity, and improve the bottom line,” says Kapoor. “And if you’re using all your manual efforts on things that can be automated, or that are very repeatable, then you’re taking away from that opportunity to generate more sales out of each of these different functions.”

When it comes to helping merchants, not every path looks the same.

Our B2C experts cautioned that every business is different, so the pathway to success won’t always look the same. They’ve found that simply listening to each merchant and working to meet their unique needs was the best way to provide support. 

“To be the best advisor, especially in these uncertain times, it’s just approaching merchants and their businesses with curiosity, compassion, and care,” says Sinclair. “At Shopify, we’re merchant-obsessed, it’s the core of our business. It’s incredibly important to each and every one of us to be an advocate for each merchant that we interact with.”

“You don’t want to put them in a growth box and say, ‘if you do X, Y, and Z, you’re gonna get here.’ I wish it was as easy as clicking a button. Instead, it’s about making sure that you’re deeply empathetic and understanding and inquisitive to your merchant that you work with.”

For more insights on how your brand can navigate through a rocky economic climate successfully, check out the full webinar.