2022: The Year of DTC Brands

By George Eberstadt, CEO, Pixlee TurnTo

Online retail in 2022 is going to be all about the convergence of legacy and native

direct-to-consumer (DTC). The margin and brand community advantages of selling direct will continue to drive legacy brands to expand their DTC offerings (at the expense of their channels). Brands that haven’t yet ventured into the DTC waters (mostly CPG) will take the plunge. Retailers, both for margin and in response to direct competition from their suppliers, will continue to introduce new private labels at a frantic pace, and they will start marketing them directly, rather than just to their captive store customers.

This influx of DTC from established players with structural advantages—known brands and physical presence—will push native DTC brands, especially new entrants, to win on discovery and loyalty. Social media will continue to be the main battleground for discovery, and the most successful brands will be those that figure out how to turn their customer communities into their growth engines. Loyalty will evolve from primarily a tool to incent incremental purchase to a tool to foster community growth. Macro influencers will be a powerful tool for certain brands, but broad-based micro-influencers will increasingly emerge as a vehicle for most brands, with a new generation of tools making it possible to manage such programs efficiently and at scale.

Content will continue to be the fuel for community-driven growth, with increasing importance placed on the three values of authenticity, volume, and recency. Brands that master integrated community-powered content programs, both on the creation side and on the usage side, will come out on top, winning at discovery and building solid pathways all the way from there to purchase.

Today’s digital-first consumer discovers, purchases from, and engages with retailers that provide an efficient, value-added online shopping experience. eCommerce retailers are expected to keep pace with this community-first mentality shared by consumers, and should incorporate this into acquisition and merchandising strategies in 2022.