NEW YORK—With brands such as Warby Parker and Allbirds among those leading the charge, U.S. direct-to-consumer (D2C) ecommerce sales will reach $151.2 billion next year, an increase of 16.9 percent compared to this year, according to eMarketer’s recent D2C forecast.
And while the good news for the brick-and-mortar sector is that D2C purchasing will account for just 2.5 percent of total retail sales in 2022, the popular D2C brands “have challenged and successfully disrupted the retail industry by diversifying consumer experience,” eMarketer noted.
Originally, D2C referred to digitally native brands without a physical storefront that sold directly to consumers by website.
However, many founders of D2C companies–including the team at Warby Parker–say they went to market with the intent to solve a perceived pain point in the marketplace that they personally experienced. Over time, D2C has evolved into a business model with legacy brands, like Nike and The Clorox Company, having D2C components today, also.
Pure-play D2C companies like Peloton, Warby Parker, and HelloFresh, for example, curate every interaction—from marketing to delivery—with customers and share distinct commonalities that have enabled D2Cs to thrive.
While customer acquisition can be expensive for D2Cs, note that the model offers companies control over each product’s marketing. Each D2C is challenged with convincing customers that it offers something consumers can’t find anywhere else. Ricky Joshi, co-founder and chief strategy officer at mattress company Saatva, said what this means is that the brand avoids the “glitz and glitter” that surrounds typical D2C brands and instead “sticks to the value proposition and the philosophy of the company as it started.”