The pandemic-era digital spending boom is leveling off as consumer spending patterns return to something resembling normal. The e-commerce space is much more crowded than in 2018 or 2019 too.
And so many direct-to-consumer (D2C) brands that rapidly scaled up their digital marketing and sales in 2020 and 2021 find themselves at a crossroads. They know additional digital investments won’t produce the same returns as before. But they’re also painfully aware of the risks of changing tack and building a brick-and-mortar presence even if the potential payoff — reaching new customers and generating the sort of brand loyalty that’s difficult to replicate online — is clear.
If your closest competitors are diversifying into physical retail too, building a more visible and … [+] engaging brand is the surest way to separate your storefronts from the pack
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If you’re also struggling to chart a path forward for your digital business and wonder whether now isn’t the time to invest in brick-and-mortar, make sure it’s a good fit first. Brick-and-mortar isn’t appropriate for every digital-first D2C business, at least not right away.
That said, now is the best time in years to build a real-world retail presence. Predictions of an imminent retail collapse are as old as the Internet itself. They’re unlikely to prove true anytime soon. Consumers craving tactile, experience-driven “IRL” shopping experiences are breathing new life into the sector right now. Meanwhile, the in-person retail reset — many restaurants and independently owned shops closed permanently during the pandemic, leaving a glut of prime space — has created a rare opportunity for D2C sellers to lock in long-term leases on generous terms.
Even in this unusually favorable environment, the brick-and-mortar transition is no walk in the park. Competition from IRL incumbents and like-minded digital-first transitioners abounds, and managing (not to mention scaling) a physical retail…
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