Namrata Patel, VP of Product at Minted, wrote an insightful analysis and prediction about the changing climate for direct-to-consumer (DTC) brands in April that I think we will see play out in real life in the coming months and years––to historic proportions. Allow me to explain. What struck me about the essay is that it becomes very clear just how much the modern conversation (and reporting) seems to focus on the supply side. Here, Patel asks the reader to consider the significance of this list of demand-side changes:
- Consumers are no longer signaling on a local scale, but rather on an internet scale.
- Visual social media has up-leveled consumers’ design sensibilities.
- Together, these two changes have accelerated trend cycles…
- And stoked an equally powerful countercurrent toward ‘better, fewer’ embodied by brands like Everlane, Cuyana, and AYR.”
After explaining each in further detail, she ends her essay with a broad prediction that I’ll try to summarize here in my own words. While consumers are changing how they want to discover, compare and interact with brands (more quickly than brands are able to respond to those changes), online platforms are the primary limiting factor to building stronger relationships with consumers, regardless of market (Patel lists nearly two dozens examples of DTC brand cases). Without the ability the change how platforms work for brands, Patel imagines that consumers will foster mass disruption––perhaps of a scale that brands and platforms should worry about ahead of time.
“Continued fragmentation of brands will only make the discovery problems and the poor customer experience worse, leaving a massive opportunity to reimagine the retail experience on the demand side.”
Continue reading: The Hyperfragmentation of Retail and Why the Biggest Winners are Digital Ad Platforms, not Microbrands (Medium)
You don’t have to look very far to notice how quickly brands are moving to meet these consumer shifts––the question is whether or not brands even have the power to move at the speed of this light. Another question: Can we reliably predict what disruption may come with the data currently available? I’ve rounded up a list of recommended essays for those interested, below, and I’m leaving the popular topic of subscriptions out of this since it feels more tactical than strategic in this context.
- The rise of giant consumer startups that said no to investor money (Recode, August 2018)
- Dollar Shave Club’s men’s magazine “Mel” grows up (Fast Company, August 2018)
- Direct-to-consumer brand Casper on shaking up the retail experience (Marketing Week, August 2018)
- How Direct-to-Consumer Brands Are Tearing Down and Rebuilding the Marketing Scene (Ad Week, March 2018)
- Ad agencies see an uptick in business as direct-to-consumer brands expand beyond Facebook (DigiDay, June 2018)
- Direct-to-Consumer Merchandising, Explained (Racked, 2016)