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The postmortems are complete and the obituaries have been written: the direct-to-consumer model is dead. Or is it? It's true that since the pandemic ended, multiple headwinds have combined to put DTC brands in trouble—from inflation to competition from established players like Amazon and Walmart. All these problems are very real—but none of them go to the core of what's really holding back DTC brands. In my latest article for Forbes, I discuss how the big challenge to these businesses isn't the DTC model itself, which has a lot of strengths. It's the way it's being implemented—and that's a very solvable problem: https://lnkd.in/gs8iRnry #futurefocused #strategy #growthstrategy #DTCmodel #DTCstrategy #DTCbrands #directtoconsumer

Direct-to-consumer (DTC) brands!! a 97% drop from 2021 $5 billion to $130 in 2023 YTD. Two main factors: 1. The 2021 investment surge was largely driven by e-commerce aggregators like Thrasio , Perch and others, which raised funds to acquire smaller brands and scale them, especially on platforms like @Amazon. A trend that slowed, leading to industry layoffs and some companies merging. 2. Consumer products as a whole have fallen out of favor with investors driven by VC DTC companies in the public market, such as Allbirds and Rent The Runway with stock prices drop below $1. Pivot? Maybe – some DTC brands have been shifting strategies to include more offline channels. For instance, Glossier, Inc. has partnered with SEPHORA and opened physical stores, Madison Reed is now available at Walmart and other formerly online-only brands like Magic Spoon , Casper and Dollar Shave Club are selling through major retail chains and opening their own brick-and-mortar locations. This pivot suggests that DTC brands are finding it necessary to diversify their sales channels beyond the digital space to maintain growth and presence in the market.

Direct-to-consumer (DTC) brands!! a 97% drop from 2021 $5 billion to $130 in 2023 YTD. Two main factors: 1. The 2021 investment surge was largely driven by e-commerce aggregators like Thrasio , Perch and others, which raised funds to aquire smaller brands and scale them, especially on platforms like @Amazon. A trend that slowed leading to industry layoffs and some companies merging. 2. Consumer products as a whole have fallen out of favor with investors driven by VC DTC companies in the public market, such as Allbirds and Rent The Runway with stock prices drop below $1. Pivot? Maybe – some DTC brands have been shifting strategies to include more offline channels. For instance, Glossier, Inc. has partnered with SEPHORA and opened physical stores, Madison Reed is now available at Walmart and other formerly online-only brands like Magic Spoon , Casper and Dollar Shave Club are selling through major retail chains and opening their own brick-and-mortar locations. This pivot suggests that DTC brands are finding it necessary to diversify their sales channels beyond the digital space to maintain growth and presence in the market.

Direct-to-consumer (DTC) brands!! a 97% drop from 2021 $5 billion to $130 in 2023 YTD. Two main factors: 1. The 2021 investment surge was largely driven by e-commerce aggregators like Thrasio , Perch and others, which raised funds to aquire smaller brands and scale them, especially on platforms like @Amazon. A trend that slowed leading to industry layoffs and some companies merging. 2. Consumer products as a whole have fallen out of favor with investors driven by VC DTC companies in the public market, such as Allbirds and Rent The Runway with stock prices drop below $1. Pivot? Maybe – some DTC brands have been shifting strategies to include more offline channels. For instance, Glossier, Inc. has partnered with SEPHORA and opened physical stores, Madison Reed is now available at Walmart and other formerly online-only brands like Magic Spoon , Casper and Dollar Shave Club are selling through major retail chains and opening their own brick-and-mortar locations. This pivot suggests that DTC brands are finding it necessary to diversify their sales channels beyond the digital space to maintain growth and presence in the market.

eCommerce: The Growth Lifecycle_Maximizing Long-Term Profitable Growth ✨ Exceptional visual by our friend Preston 🩳 Rutherford, co-founder of Chubbies Shorts. Core Question: (1) How can brands successfully navigate each stage (there are 7) of growth, avoid pitfalls, and maximize profits? Fun Facts: (3) 🎉 7 stages <> Brands must navigate seven distinct stages of growth, from DTC (Direct-to-Consumer) only to fully balanced, multi-channel distribution. 🎉 4 channels <> Digital DTC, Amazon, Wholesale, and Owned Stores are the four primary channels in which brands can expand. 🎉 Profits scale <> Balanced distribution across channels helps brands maximize profitability and grow long-term brand strength. Stages of Growth: (7) 🔐 Stage 1: Digital DTC Only — Brands are in the honeymoon phase, enjoying early success. It's crucial not to over-rotate on short-term wins. 🔐 Stage 2: DTC Only — Growth is happening, but hitting limits. Over-reliance on discounts and promotions can slow down long-term brand building. 🔐 Stage 3: DTC with Short-Term Tactics — Revenue grows, but too much focus on short-term tactics harms brand strength. 🔐 Stage 4: Adding Amazon — Brands open up new TAM (Total Addressable Market), but the overlap between DTC and Amazon can lead to cannibalization. 🔐 Stage 5: Adding Wholesale — The addition of wholesale fuels growth, but oversupply can lead to profit drops. 🔐 Stage 6: Balancing Channels — Proper balance across DTC, Amazon, and wholesale drives long-term success, as heavy discounting can impact margins. 🔐 Stage 7: Full Channel Balance — At this point, brands achieve healthy, resilient growth across all channels with strong profits and multiple revenue streams. Now What?: (2) 1️⃣ Strategic Channel Expansion — Ensure that the expansion into new channels (Amazon, wholesale, owned stores) is balanced with long-term brand strength, avoiding over-reliance on any single channel. 2️⃣ Focus on Profitability — As channels expand, profitability becomes key. Ensure you're not oversupplying or relying too heavily on discounts, and focus on a healthy balance across channels. #ecommerce #digital #omnichannel #strategy #cmo #cdo #ceo #cro #leadership #retailecommerceclub #cpg #privateequity #playtowin

Learn everything about retail's fastest-growing business model, including its history, the pros, and the DTC brands making waves. What Is Direct-to-Consumer? Everything You Need To Know (2024) https://lnkd.in/gp_a-hu3

The Growth Lifecycle: Do you know the seven stages?

Very interesting chart. For Southeast Asia the context is different obviously but the key message remains: multi channel and balance.

I like how this post breaks down the typical growth stages of a DTC business, and especially highlights the unique challenges that arise at each stage. The emphasis on balancing channel expansion with long-term brand development is indeed crucial.

In the Fight for Mutual Survival, DTC and Retailers are Frenemies. Retail TouchPoints recently published my thoughts on those on the Fortune 500 list who are driving growth using a playbook from brands like Prose, The Farmer's Dog, and Parachute Home. The fastest-growing DTC brands are also taking notes on the wins and failures of retail giants. 1. Approach each collab as a ‘mini brand.’ A lot of larger corporations like Amazon Business and Target have successfully crafted mini-brands within their suite of products and services — offerings like Amazon Essentials and Amazon Fresh that act as if they’re a smaller DTC offering. 2. Don’t hold back. In-store, online, and on social media, brands should feel fully integrated, not like a spur-of-the-moment afterthought. Customers can tell when both brands are only offering a small part of what makes them special — access only in some stores or promoting only remnant products. The brands that go all-in can expect greater success. 3. Communicate shared values. When brands put their heads together, they’re able to signal to the customer that they have shared values, they’re blending the old with the new and meeting customers in a way they may not have prior to their collaboration. This is especially important as customers increasingly take a values-centered approach to their purchasing decisions.