LAS VEGAS\u2014Having categorized more than 400 marketers in the direct-to-consumer space, LUMA Partners knows what has helped to make many of them successful. Trying to imitate them within the confines of traditional marketing isn\u2019t easy, so some legacy companies are acquiring them for both their market share and contemporary culture, according to Founder & CEO Terry Kawaja.<\/p>\n

\u201cThis isn\u2019t some fad, some flash in the pan,\u201d Kawaja says in this interview with Beet.TV at CES 2019<\/a>.<\/p>\n

While it\u2019s still early days in the sector, \u201cWe are seeing companies in a variety of verticals, in a relatively short period of time with relatively little capital, garner significant market share, in some cases double digit-market share, away from category incumbents who have been building their brand equity for decades.\u201d<\/p>\n

In its D2C BRAND LUMAscape, the investment banking firm identifies more than 400 direct-to-consumer companies. The overwhelming majority are in clothing and apparel, followed by personal\/family care and home\/furnishings, then food\/ drink and travel.<\/p>\n

The rise of these companies \u201chas major implications for the marketing world writ large, and our message to traditional marketers is don\u2019t take this lying down,\u201d Kawaja says. \u201cTake a good hard look at what is causing the success of these startups because yes, while like any tech ecosystem, many of them will die but some will live and become major competitors.\u201d<\/p>\n

It comes down to a build-versus-buy scenario, but it can be very hard for legacy marketers to create a cool, new direct-to-consumer brand, according to Kawaja. His hypothetical example is a company selling a high-margin product through traditional means. \u201cIt\u2019s like having a virus. The antibodies will come out and kill it. Good luck with your new division that\u2019s going to circumvent that and disrupt that. That\u2019s hard for a legacy company to do.\u201d<\/p>\n

Companies that have opted for buy versus build include Walmart and its acquisition of Jet.com for $3.3 billion. \u201cNow they\u2019re sort of infusing the culture that Mark Lore developed at Jet to drive Walmart\u2019s broader ecommerce business.<\/p>\n

Then there are Unilever and Dollar Shave Club and Procter & Gamble\u2019s purchase of natural deodorant brand. These and other well-established companies \u201care capturing the growth, capturing the magic if you will, of these DTC brands. Not just for the business per se, but also to sort of infuse that thinking, that culture, that approach to the marketplace,\u201d says Kawaja.<\/p>\n

This video is part of Beet.TV coverage of CES 2019. The series is sponsored by NBCUniversal. For more coverage, please visit this page<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

LAS VEGAS\u2014Having categorized more than 400 marketers in the direct-to-consumer space, LUMA Partners knows what has helped to make many of them successful. Trying to imitate them within the confines of traditional marketing isn\u2019t easy, so some legacy companies are acquiring them for both their market share and contemporary culture, according to Founder & CEO […]<\/p>\n","protected":false},"author":17,"featured_media":58745,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"mc4wp_mailchimp_campaign":[]},"categories":[7773],"tags":[4213,4227,6046,6184,7737,7819],"_links":{"self":[{"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/posts\/58743"}],"collection":[{"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/users\/17"}],"replies":[{"embeddable":true,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/comments?post=58743"}],"version-history":[{"count":0,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/posts\/58743\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/media\/58745"}],"wp:attachment":[{"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/media?parent=58743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/categories?post=58743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dev.beet.tv\/wp-json\/wp\/v2\/tags?post=58743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}