Direct-to-Consumer Brands 2020

Growing Pains Hit Disruptor Brands on Their Path to Maturity

About This Report
The direct-to-consumer brand movement has reached a critical juncture. Which of these brands will make the leap into the mainstream before their runway runs out?
Table of Contents

Executive Summary

The direct-to-consumer (D2C) brand movement has flourished in recent years, but it may finally be reaching a point of reckoning. As the venture and financial markets rationalize, there will be separation between the next great brands from the also-rans. Which brands have what it takes to make the leap into the mainstream?

What’s the current size and growth of the D2C market?

We forecast that D2C sales will account for $17.75 billion of total ecommerce sales in 2020, up 24.3% from the previous year. While overall sector growth remains strong and outpaces total US ecommerce gains, momentum is slowing.

Why are many D2C brands now struggling to grow?

The same low barriers to entry that enabled D2Cs to spring up overnight have also led to overcrowding and increased customer acquisition costs (CACs). Many D2Cs also lack the competencies to scale their brand via new advertising and sales channels.

What are the common elements of great D2C brands?

The most powerful brands combine modern-day aesthetics, high-quality product design and experience and differentiated positioning within their category.

Which advertising tactics are D2C brands using to reach their next phase of growth?

Many D2C brands are evolving beyond performance-based search and social ads to more traditional branding media, like TV, podcasts and out-of-home, but they are doing so while incorporating performance advertising principles.

How are D2C brands getting into physical retail?

D2C brands are expanding distribution by opening permanent stores, pop-ups and creating retail partnerships with traditional brick-and-mortar retailers.

WHAT’S IN THIS REPORT? This report provides the latest trends in D2C brand adoption and analysis of how D2Cs can best position themselves for long-term growth.

KEY STAT: In the US, we estimate that there will be 87.3 million D2C ecommerce buyers ages 14 and older in 2020, up 10.3% from the prior year.

Here’s what’s in the full report


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    Table of Contents

    1. Executive Summary
    2. The Growth (and Growing Pains) of D2C Brands
    3. Expanding the Brand
    4. The Evolving Ad Model of D2C Brands
    1. Expanding Retail Distribution Models
    2. Key Takeaways
    3. Insider Intelligence Interviews
    4. Read Next
    1. Sources
    2. Media Gallery

    Charts in This Report

    Interviewed for This Report

    Brian Berger
    Mack Weldon
    Founder and CEO
    Interviewed March 5, 2020
    Rachel Bogan
    Work & Co.
    Partner, Product Management
    Interviewed December 17, 2019
    Michelle Cardinal
    Founder, CEO
    Interviewed February 19, 2020
    Jane Crisan
    President and COO
    Interviewed February 19, 2020
    Aaron Fetters
    Head of Client Development
    Interviewed February 28, 2020
    Mayur Gupta
    Interviewed December 11, 2019
    Imran Khan
    Founder, CEO
    Interviewed December 3, 2019
    Alex Kubo
    Vice President, Ecommerce and Digital Marketing
    Interviewed September 25, 2019
    Dave Morgan
    Founder, CEO
    Interviewed December 13, 2019
    Rachel Tipograph
    Founder, CEO
    Interviewed February 18, 2020
    Amish Tolia
    Co-Founder and co-CEO
    Interviewed November 1, 2019
    Rebecca Traverzo
    Vice President of Marketing
    Interviewed March 13, 2020
    Andy Prochazka
    Co-Founder and CMO
    Interviewed November 21, 2019


    Andrew Lipsman


    Bianca Carasus
    Blake Droesch
    Junior Analyst
    Jasmine Enberg
    Senior Analyst
    Rimma Kats
    Executive Editor
    Oscar Orozco
    Director, Forecasting
    Amy Rotondo
    Director, US Research
    Yoram Wurmser
    Principal Analyst
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