October 31, 2019
The direct-to-consumer (DTC) sales model is making major alterations in the world of retail. Over the past five years, DTC pioneers like Warby Parker, Dollar Shave Club and Casper Mattresses have transformed how people purchase beauty and skincare products, home goods and even prescription eyewear.
Recognizing their notable success, legacy brands like REI and Under Armour have since expanded their DTC channels. However, not every brand that initiates this approach prospers. Here’s what it takes to thrive in the DTC landscape.
Cut out the middleman
By severing ties with retail intermediaries, DTC brands have direct control of their supply chain, allowing them to better engage consumers, provide quality customer service and build a trusted brand image that drives sales and creates loyal customers.
Warby Parker’s co-founder and co-CEO Dave Gilboa, encourages retailers to discover and leverage how customers are connecting to and interacting with, brand experiences. Gilboa speaks from first-hand knowledge after launching Warby Parker’s digital engagement strategy in 2010.
Nearly a decade later with an estimated worth of $1.75B Warby Parker has opened over 90 brick and mortar locations and with another 30 stores expected to open over the next year. Such an achievement is dubbed the “Warby Parker model,” a success story that continues to inspire DTC retailers.
They Make a Connection
Today’s top brands know that trust and loyalty can no longer be bought. With the rise of mobile and social technologies, consumers are demanding more personalized and streamlined shopping experiences.
Gilboa attributes much of Warby Parker’s achievements to the company’s “intense focus” on creating memorable customer experiences and investing in the technology that propels this vision.
We built our point of sale in our stores, which we didn’t want to do,” he revealed. “But as we looked across what was available in the industry, we didn’t see anything that really delivered the experience that we wanted for our consumers, in particular, those that were engaging with us online and offline.
Coming to a City Near You
After finding their stride online, many digitally native brands are trading in clicks for bricks as they shift toward a more physical future. Over the next five years, eCommerce retailers are forecast to open 850 brick and mortar locations throughout the U.S. and Canada. Others plan to expand their brand through pop-up shops and placement deals with big-box retailers.
For Warby Parker and other previously DTC-only retailers, the addition of physical spaces was a strategic move to help to reinforce online sales by educating the public about their products and gaining their trust. For others, brick and mortar was always the end goal.
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Article originally published by RETHINK Retail, a Valtech media company.
