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D2C for CPG Brands 2023

How to Drive Profitable Ecommerce Revenues Through Direct Selling Strategies

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About This Report
Consumer packaged goods (CPG) brands have attempted to break into D2C ecommerce in recent years, to varying degrees of success. How can they avoid unprofitable strategies and develop a viable D2C ecommerce channel?
Table of Contents

Consumer packaged goods (CPG) and beauty brands that pivoted to D2C strategies during the pandemic are struggling to convince shoppers to unbundle individual purchases from their regular grocery and drugstore trips. But certain brands—including several disruptors leading the next wave of D2C growth—have shown that profitable D2C ecommerce sales can be achieved.

Key Question: What are the best strategies for CPG and beauty brands to grow their D2C ecommerce sales?

KEY STAT: Pure-play D2C beauty brands have dramatically increased their ecommerce sales from $2.3 billion in 2020 to $3.5 billion in 2022, per NielsenIQ.

Here’s what’s in the full report

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Table of Contents

  1. Ecommerce’s share of grocery and CPG sales varies widely by product category.
  2. Increased digital ad spending by CPGs will help drive their D2C ecommerce sales.
  3. Subscription fatigue won’t limit CPG brands’ potential for subscription commerce.
  4. CPG brands must evaluate whether D2C is a viable channel for them.
  1. High customer lifetime value is the key to D2C viability.
  2. CPGs should determine if subscription ecommerce in their categories will drive LTV.
  3. CPGs and beauty brands are leading the latest wave of digital natives’ growth.
  4. TikTok is the future of CPG brand discovery in D2C.
  1. CPG brands are abandoning Facebook ads while ramping up their TikTok spend.
  2. CPGs can use D2C strategies to drive profitable brand growth under the right conditions.
  3. Sources
  4. Media Gallery
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About This Report
Consumer packaged goods (CPG) brands have attempted to break into D2C ecommerce in recent years, to varying degrees of success. How can they avoid unprofitable strategies and develop a viable D2C ecommerce channel?
Table of Contents

authors

Andrew Lipsman

Contributors

Whitney Birdsall
Senior Forecasting Analyst
Suzy Davidkhanian
Principal Analyst, Retail & Ecommerce
Blake Droesch
Analyst
Amy Rotondo
Director, US Research
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