Reinventing The Direct-To-Consumer Business Model

For decades, a handful of brands dominated consumer retail in the United States. Whether Kodak in cameras or Gillette in razors, the top brands in more than 10 categories were unchanged from 1923 to 1983. Then the internet democratized the tools required to start and scale a business. Over the next two decades, a new class of startups emerged. From Warby Parker (eyeglasses) to Everlane (clothing) to Casper (mattresses) and The Honest Company (baby and beauty products), this first generation of “direct-to-consumer” (DTC) companies was defined by borrowed supply chains, web-only retail, direct distribution, social media marketing, and a specific visual brand identity (the now ubiquitous “blanding”) that favored sans-serif type, pastel color palettes, and scalable logos that were easily adapted to a variety of digital media. The direct-to-consumer startups’ rise was enabled by an environment of abundant venture capital, low competition, and above all, the advertising arbitrage that could be exploited on under-priced social media platforms. Read more at Harvard Business Review.