The Benefits and Risks of “DTC” Business

Panelists came from different backgrounds and all landed successful jobs in retail. Three of these industry professionals were LIM alumni, which was inspiring for the student attendees, and they all spoke to the internship opportunities our school provides. Each and every one of them mentioned that having this type of career guidance as college students helped get them where they are today. 

Moderator Alan Spalter introduced each panelist and let them share a bit about who they are and what they do. The guest list included:

• Heather Catalano, Vice President of Sales at Vera Bradley
• Mary Kate Guidry, Senior Product Manager at Etsy
• Patrick Mays, Senior Director of Merchandising at Lucky Brand
• Maria Vita, Category Manager at Chewy.

Two student moderators kicked off the night; Erika Parker and Marcel Smith. Both were responsible for asking the professionals questions and moderating the chat. Discussions throughout the night led to one ultimate question, “Is direct-to-consumer marketing the way of the future?” Panelists’ responses were a mix of “Yes” and “No.” As ideas were tossed around and points were being made, it was clear there are relevant benefits and disadvantages to the model.

A successful company brought up during the discussion was Lululemon. Lululemon is a direct-to-consumer brand that championed the “athleisure” trend. It was highlighted as a brand that understands their customer well. Many panelists agreed that only offering their products in their brick-and-mortar stores or online gives the brand a sense of exclusivity, elevating the shopper’s experience and making them feel part of something unique and special.

Nike was mentioned as a company looking to become more of a direct-to-consumer brand, whereas they used to rely on second and third-party retailers. Nike is a very established company with a large product line that appeals to many different customers. A hurdle flagged around Nike’s shifting gears is losing the sales they previously had with department stores like Nordstrom and Macy’s. One panelist raised the possibility of consumers being less likely to shop directly at a Nike flagship or their website, as that’s not what they’re used to.

An important takeaway from this event was that direct-to-consumer marketing can be extremely beneficial to companies, but like everything else, it runs a set of risks. Panelists stressed that in order to run a successful “DTC” business, the company must understand their consumers and strive to provide them with an enjoyable shopping experience, whether in-store and online, based on that understanding.