The Rise of the Direct-To-Consumer Market
Direct to consumer brands are growing at a fast rate as it’s making it easier for brands such as Casper, AllBirds, and Peloton to bypass the traditional wholesale and retail middlemen to connect directly with their customers. Given the circumstances of how the pandemic re-shaped the physical retail landscape, the average consumer has turned to utilizing social media as a means to “window shop”. According to a study conducted by McKinsey & Company, Omnichannel shopping has steadily been growing and roughly 70% of consumers learn about brands and their products through traditional websites, apps, Instagram, Amazon, and brick-and-mortar stores. Unsurprisingly, social media holds a higher influence over not only young consumers but consumers of all age groups specifically within the hard-goods category such as jewelry, accessories, cosmetics, and fitness gear to name a few examples.
To give further context, the beauty and cosmetics category makes up 19% of the D2C industry. 77% of the industry serves within the apparels and accessories category while the jewelry and luxury goods category only makes up 4%. While there is such a heavy focus on the bigger D2C brands like those mentioned above, there are brands springing up left and right which has shifted the sentiment of venture capitalists to invest roughly $8 to $10 billion in the industry since 2019. Allbirds is a success story of the ages as it’s story and influence is powered by a focus on product innovation and an understanding of customer values. Their success is also attributed to how they directly interact with consumers on social media, how they build and refine products based on customer feedback, and the quality of their customer support to work and help promote their value.
Below are examples of up-and-coming D2C brands that you might want to check out:
- Reel created tree-free, plastic-free bamboo toilet paper to promote sustainability.
- OLIPOP makes flavorful sparkling tonic that supports microbiome and digestive health with prebiotics, botanicals, and plant fiber.
- Day Owl makes minimal, functional, and sustainable bags from recycled materials with a goal to end single-use plastics.
- Hero Cosmetics creates acne relief solutions and medicines to help keep skin clean.
- Parachute makes premium and accessible products for the home including sheets, towels, robes, rugs, and more.