Yes, It Is Possible For DTC Brands To Grow In Today’s Economic Climate

Yes, It Is Possible For DTC Brands To Grow In Today’s Economic Climate

The highest inflation in forty years has caused consumer confidence to dip to a three-month low, forcing many to forgo new home, appliance and car purchases, according to the Conference Board. Despite these headwinds, retail as a category is predicted to continue growing, albeit at a slower pace than we have seen for the past two years. Mastercard's MA most recent Spending Pulse reports that US retail sales remained steady in April, up 7. 2% over last year. While digitally native direct-to-consumer (DTC) brands excelled during the pandemic due to a number of factors, including lower real estate exposure, inexpensive customer acquisition costs, and a surge in online shopping, today a different strategy is required for success. The past eighteen months have seen a rapid sea change in the success of performance marketing due to the rollout of iOS 14. Paired with ongoing supply chain shortages, recruiting challenges, and now, lower consumer confidence, digitally-native DTC luxury and beauty brands need to consider new avenues for growth: Explore New Retail Formats: Identifying smart ways to optimize all consumer touchpoints is another key to success, with controlled distribution remaining a major success factor for most DTC luxury brands. So much so, in