D2C the new buzzword, relevance in the food business

 – Pawan Raj Kumar, Co Founder – HoiPure

D2C or Direct To Consumer is the new buzzword that basically implies brands selling directly to consumers without any sales channels or agents in between. While ecommerce has made it possible, it is the fact that the consumer that has demand for a variety of food products is scattered all over the country that makes online D2C not only relevant but also essential.

In the traditional, offline sense this model of selling directly to consumers has always existed. Many consumer brands especially in garments, cosmetics, shoes etc have always been selling through their own branded stores. However this offline model was cumbersome and capex heavy making it unviable for most food businesses, especially in niche segments, to go D2C in the offline world.

With the growth of disposable income coupled with prevalence of ecommerce, the internet provides just the right level playing field for start ups and niche market players to go D2C.

This is especially true for the food businesses. There is a plethora of products and there is a variety of demand from consumers scattered all over the globe. In the past few years there have also been new trends or fads that are creating even bigger demand for niche products. The demands vary from healthy to indulgent, traditional to modern, fresh to packaged, plant based to frozen meat, keto to gluten free etc. Serving such varied needs from various pockets of the country would have been almost impossible for any company had it not been for the internet.

D2C brings higher margins and efficiencies to brands while allowing consumers a much easier access to various products. However, like all good things, D2C brings its own set of challenges too. It is costlier to reach out to customers and deliver directly. It becomes even more difficult for food companies as average order values can be much lower. However there are a few startups, like Licious & Fresh to Home, that have shown the way but Hoi Foods an NCR based start up has taken it beyond meat.

For a food business to go D2C essential requirements are a variety of products, higher average order value and quick delivery. Hoi Foods set up a website called Hoipure.com in the middle of 2020 during lockdowns and in less than a year has built a customer base of almost 50000 customers. Hoipure offers a big range of frozen and other Ready to Eat / Cook products that it delivers within 3-4 hours. Hoi Foods has a network of kitchens and dark stores that allows them to do that.

There is a change happening in the ecosystem and it is getting accepted very fast. It is convenient, it is efficient and it allows consumers to satisfy their diverse demands. D2C is not just a buzzword it is here to stay and grow.