What happens when D2C brands diversify product lines?
Direct-to-consumer brands that have made their names focusing on one product very well are starting to expand into new product lines, making their selections broader and more akin to what you would find in a traditional store.
Allbirds and Warby Parker are both planning to significantly boost their selection of products in categories adjacent to their main one, according to PYMNTS. Apparel currently takes up less than 10 percent of Allbirds’ product offering, but the shoe brand is planning on raising that number with new selections of lifestyle and performance products.
In the case of Warby Parker, the eyeglass brand is planning to build its contact lens and vision testing business, areas where it lags significantly behind traditional eye care retailers.
The move by Allbirds and Warby Parker do not represent the only shifts these two direct-to-consumer brands have made to begin operating more like traditional retailers.
The once online-only Allbirds began opening physical store locations in 2017, with its first store in San Francisco and a second following a few months later in New York City’s SoHo district. At present Allbirds has 31 store locations nationwide, having opened up four in the third quarter, according to Barrons.
Warby Parker has taken a similar tack. The company was founded as an online-only retailer in 2010 and slowly began opening physical stores in major markets in 2013, beginning with a NYC location, according to CNBC.
The eyeglass brand now boasts more than 130 store locations, according to Chicago Business Journal. Its newest Chicago location will offer eye exams, a full selection of glasses and will sell the brand’s first new set of contact lenses.
Similarly, over the past few years, D2C footwear brand Soludos expanded into women’s apparel after a successful test-run, according to Forbes. The brand found that apparel purchasers had a 50 percent higher LTV than non-apparel customers. Razor brand Billie expanded into beauty essentials, and shoe brand Rothy’s expanded into bags.
- Direct-to-Consumer Brands Become Platforms as They Expand Beyond Core Products – PYMNTS
- Allbirds Stock Sinks Even as Revenue Growth Is Strong – Barrons
- As Warby Parker approaches 100 stores other internet brands follow – CNBC
- Warby Parker opens its 9th Chicago-area store – Chicago Business Journal
- More Direct-To-Consumer Brands Are Expanding Their Product Lines: Here’s Why – Forbes
DISCUSSION QUESTIONS: Should D2C companies that make their name on one product consider expanding into adjacent categories? What are the potential advantages and disadvantages of extending a narrow product mix?