DTC Dispatch #004

LATEST NEWS

Jones Road Grows During BFCM Without Discounts

Jones Road repeated a winning strategy from the past 3 years: offering miniature sizes of a hero product (the Miracle Balm). This version of their product is only something they offer during Black Friday/Cyber Monday and during Memorial Day. Customers could create a bundle of 4 shades from a selection of 10. Over the four days of BFCM, Jones Road reported selling 375,000 units and generating $25.7M in sales.

Our take: One key detail buried in this article we believe is telling to the success of this strategy: repeat customers made up 60% of revenue for this promotion, which the Jones Road CMO identifies as higher than a typical month for them.

This information combined with the overall structure of the offer reveal the secrets of its success:

• Create scarcity and urgency by doing limited-run production of a product specifically for a promotion.

• Make the promo product similar/related to a hero product to increase the likelihood it will appeal to your customers.

• Build expectation with your customers and prospects by communicating the promotion in advance of the launch.

• If relevant, offer easy bundling functionality to drive up AOV and capture demand (we happen to know Saint Hugo was behind the CRO development for Jones Road).

Deloitte: Holiday Shoppers Are Ready to Spend

According to a recent consumer survey conducted by Deloitte:

• Holiday spending is projected to increase by 14% compared to 2022. This would put spending higher than pre-pandemic levels.

• The biggest increase in spending (26%) is projected to be with those earning $50k-100k/year.

• 3 out of 4 consumers expect higher prices as a result of inflation.

• Consumers plan to shop in person when they can to avoid shipping costs.

Our take: This survey spells good news overall for DTC brands going into the holidays. Particularly if you’re marketing to the middle-income group or those making over $200k. One interesting takeaway for digital DTC: incorporating free shipping into your offers may move the needle more this year than before.

30% increase in orders for BNPL provider Klarna

Klarna reported a 30% increase in usage compared to BFCM last year. Top product categories included food processors, TVs, coffee makers, home theater systems, and hard drives.

Our take: In the midst of inflation and economic headwinds, it seems customers have a greater need for paying with installments. Especially considering this 30% figure is double the average increase in topline revenue for DTC. If you aren’t leveraging “Buy Now, Pay Later” tools and your products are at a higher price point, this might lead to an uptick in total revenue.

Activewear brand Bandier seeks to sell IP, assets

As an alternative to filing for bankruptcy, activewear brand Bandier is currently seeking a buyer for its assets — which includes inventory, intellectual property, web properties, vendor data, and customer data.

Our take: It’s unfortunate to see another brand closing their doors, however this is a powerful lesson in the importance of building inherent value into a business through assets. In a best-case and worst-case scenario, valuable web properties and a huge database of contact information and consumer insights will add to the valuation of a business when it’s time to sell.

FEATURED CONTENT

$50M in business lessons…

Our take: You know how the kids love to say “beware of unearned wisdom?” Well Dylan Ander of Heatmap provides some hard-earned lessons in this post — highly applicable for founders, wantrepreneurs, and executive leaders.

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