Is Going Direct-to- Consumer the Way Forward for Retail?

Key Points

• More and more retailers such as G-III Apparel, Nike, Adidas and VF Corporation are rebalancing their distribution in favor of a direct-to-consumer (DTC) model. Beauty companies such as L’Oréal and Procter & Gamble have also focused more on DTC channels in recent years.
• Apparel and beauty companies can now reach customers directly through multiple digital channels, and with less effort physically using new store formats such as pop-up stores.
• Going direct means retailers have more control of the retail experience, better engagement with customers, as well as improved product margins. However, going fully direct means forgoing the scalability that comes with wholesale distribution, so it is not a straightforward decision.