As product development, website creation, and marketing have become more democratized over the past 10 years, we have seen a surge in direct-to-consumer products. Whether it's Warby Parker selling us glasses and monocles, Lola with organic feminine products, or even Himss providing men's ED and hair loss products, the market has exploded. But what is it that separates these companies from the myriad other companies or products that ended up going bust? This question becomes even more important as many of us need to shift our businesses from selling in stores to selling online and directly to the consumer. The key is in solving the right problem.
Are you solving people's convenience issues?
Brandless offered their own low-cost household products (soap, deodorant, detergent, etc.) at the low price of $3. Unfortunately, in the world of direct-to-consumer, it often costs $25 to acquire a customer. After including the product costs, shipping, and fulfillment, you need people to come back often and keep buying to make money. Now imagine you are on Amazon ordering a new case for your laptop--are you really going to make the extra step of going to Brandless to save a dollar on soap that you can already get at Amazon while you are there? Probably not, because the mental effort associated with going through another order process isn't worth the savings. If you are making something more convenient, it has to be 10 times more convenient than the competitor. Price alone will not define consumer behavior unless somehow it is dramatically lower.
Are you solving people's embarrassment?
Probably near the top of the list of things men are uncomfortable discussing would be erectile dysfunction. Drug companies are so aware of this that they now refer to impotence as erectile dysfunction, which can be reduced to ED so men feel more comfortable bringing it up to their doctors. What Himss provides is an online purchasing process that means you don't have to tell your doctor or anyone else. Consider what other embarrassments or social uncomfortable situations you can circumvent. If a toilet flush can interrupt a Supreme Court hearing, in this new world of sheltering at home, there are many new problems that need to be solved. What embarrassing situations have you found emerge and what solutions can you provide?
Are you protecting families?
What is threatening our health and safety, and can you provide something that will make us feel or be safer? Direct-to-consumer is a great place for this.
If you look at the direct-to-consumer companies that have succeeded, they have done something exceptional well--they have found a solution to a problem that appeals to our emotions. They solve for embarrassment, fear, confusion, and inconveniences. In a world affected by the Covid-19 pandemic, there are new problems that we couldn't have predicted and we will see a new generation of companies being born that solve issues we never knew we had. This may be your opportunity if you can recognize these problems and solve for people's concerns.