Bridging the gap
The rise of Direct to Consumer businesses
Direct to Consumer (D2C) businesses have been launching across consumer categories in recent years – from apparel to beauty – fuelled by VC funding and a business model promising higher margins and a direct relationship with the consumer.
The emergence of these businesses has raised a number of questions across the market:
- How can the potential for these businesses be assessed?
- What are the right metrics to assess performance?
- Given the large amounts of capital deployed, what can an investor expect from a D2C business?
- What are the implications for competitors with more traditional business models?
Bits & bytes
The Chinese fast moving consumer goods online market is worth more than $25.3bn today, far surpassing any other country in the world. China has always been the winner in the e-commerce space — on the annual Single’s Day event in 2015, Alibaba alone sold almost double of Cyber Monday, Black Friday, and Thanksgiving combined — $14.3bn.
Kill or cure
As the saying goes, be careful what you wish for. UK food and drink producers under siege from stagnant growth, falling prices and tightening margins have been desperate for these grim market fundamentals to change