🛍 DTC Daily - Wednesday, Mar 8

🏬 Is it time to pivot to retail?

📰 TL;DR - We've all heard about the post-pandemic return to retail, but does that mean it's time for you to make the leap? AdWeek has a pretty thorough piece arguing the merits of DTC brands pushing into retail. It's true that DTC has had mounting challenges and in 2024, it's projected that 72% of purchases will be made IRL. It's also true that many DTC brands that found great success in the last five years are so are making wholesale deals or opening physical locations for the first time.

💡 Insight - Rather than get into a DTC vs. retail debate, the reality is that both are viable channels. If you can do both, you can benefit from the advantages of both. But as this article points out, not every DTC is ready to make that jump. You need to consider your supply chain, your capital, your competition, and the legal ramifications of making wholesale deals. Having both sounds nice, but that doesn't need every DTC needs to enter retail to be a success story.

➡️You can read the article here...

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🛒 ThredUp sees a bright resale-as-a-service future despite losses

📰 TL;DR - ThredUp is a leader in the resale-as-a-service market, partnering with existing brands to set up their own secondhand sales channels. They've just reported their Q4 results, which show their revenue fell 2.14% from last year, and active buys are down slightly as well. However, they're still ahead of the estimates. Part of that loss can be attributed to new clothing retailers cutting prices, especially around the holiday season.

💡 Insight - The future for resale still looks bright. ThredUp is eyeing profitability by the second half of 2023. But that also means the potential for new fees for sellers. We believe resale is here to stay and more and more brands are signing deals with ThredUp and its rivals. Keeping an eye on ThredUp's fee structure will give you a good idea of how to make resale-as-a-service profitable for brands who use it. Let their growing pains be your roadmap if you want to get into recommence yourself.

➡️You can read the article here...

💸 Survey: Where millennials are spending their cash

📰 TL;DR - Roth MKM has a new survey out about millennial spending habits and the insights are worth noting. First, 76% of millennials have reduced their discretionary spending, which shouldn't be surprising as every survey lately seems to show the same across age groups. The survey also covers which brands and categories millennials are attracted to, and the theme seems to be health and wellness, as well as home and pet goods and services.

💡 Insight - We talk about Gen Z a lot, and while they are certainly taste-makers, millennials are a huge cohort who are now adults with jobs, families, and cash to spend. The stat I want to highlight is this:

That's great intel for you. Subscription options only seem to be getting more popular, as does personalization options. Offering both is a great way to connect with millennial customers.

➡️You can read the article here...

🧥 Why Canada Goose is leaning into DTC

📰 TL;DR - ModernRetail spoke to Carrie Baker, the president of Canada Goose, about why the brand is making a big bet on DTC. Well actually, it's not really a bet — they have a solid understanding of why DTC is an important channel. The brand plans to make DTC 80% of its revenue by 2028. Baker says that the strategy is very much about creating an experience that highlights the brand's story, and DTC is a prime place to do that.

💡 Insight - Reflecting on that AdWeek story above, this really shows the power of running DTC and retail as complementary channels. For them, e-commerce is the place customers go to do research, which offers great data and insight for Canada Goose. Then, retail offers an immersive experience. The lesson here, as above, is that doing both lets you employ two strategies that ultimately work together. Also, as another nod to resale, Baker added "we know that re-commerce is thriving."

➡️You can read the article here...

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