Reinventing the Direct-to-Consumer Business Model

There are several big trends impacting consumer brands. New brands like Dollar Shave Club that are skipping traditional retail and building their own relationships with consumers are threatening traditional brands in categories they never thought possible. At the same time, while brands need to sell through Amazon because of its reach with consumer

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The next generation of brands will still start with the story, but the other moats (logistics, distribution, sponsorships, etc) wither from there. We’ll see the next generation of “DTC” (direct to consumer) brands migrate to traditional retail channels, join large cross-brand data co-ops, shift marketing dollars to community management, and generat... See more

The promise of the internet has always been a low barrier to entry enabling unique people and brands to find passionate audiences and sustainable business models. That is more possible now through the combination of direct distribution, vertical focus and (often) direct monetization models. But the brands that can pull off DTC strategies need to be... See more

Now that a few high profile DTC brands have been punctured on the public market and the economy is crashing, VC-driven DTC business model will likely go into its own recession. Without DTC, there is an opportunity for a variety of smaller, more sustainably funded players who do not seek hypergrowth.

A lot of DTC brands, across categories, adopted “reviving the middle” strategy in the form of good quality items at affordable prices and excellent service. The downside of this model is that it’s costly, and most of these brands emulating it are VC-funded and not yet profitable. Scaling this model is also a challenge, as costs of supply, productio... See more

The direct-to-consumer wave began in the twenty-tens as a new generation of startups promising to “disrupt” traditional industries for consumer goods. Instead of leaving the market to century-old stalwarts like Gillette, for example, a company like Dollar Shave Club, founded in 2011, would set up its own supply chains to manufacture razors; add cle... See more