Matt Katz shares insights into the changing DTC retail market in this Retail Dive article.

He “describes what’s happening now as a ‘reset’ driven by overinvestment in DTC and underinvestment in stores. The importance of stores and wholesale is now sending investments back in the other direction, and retailers are unlikely to lean back into DTC as hard as they did — that is, unless investors start funding it again.”

Matt describes that, now more than ever, the DTC customer is king, “I think we’ve moved from retailers having the advantage. The retail-brand wholesale relationship used to be heavy, heavy retail. That was your point of distribution and the retailer chose which brands were most important, right?. Consumers have taken over the leverage point and they are buying on availability and price and experience.”

He looks to what the space will look like in the future stating, “I think you’ll see some of these brands may launch with very small strategic partnerships that give them their presence. And if you can prove that the brand has staying power and pull, then you’ll see continued investments in flagship real estate models. That could range from pop-ups to permanent stores or limited geographic partnerships with retailers, but regardless, there is likely to be a greater emphasis on how quickly a brand can grow its points of distribution.”

Read the full article HERE

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