Direct-to-consumer brands are no longer niche upstarts – they’ve become a formidable force in American retail.
From mattresses to makeup, DTC companies are reshaping how we shop and how brands build relationships with customers.
How did we get here, and what are these brands doing today to thrive?
Let’s explore the current DTC strategies in the USA, the data-driven tactics fueling growth, and how consumer behavior shifts are guiding marketing, personalization, retention, and more in 2025:
DTC growth: from upstarts to industry staples
Not long ago, buying “direct” often meant niche websites or experimental brands. Now, the DTC model has gone mainstream.
There are an estimated 110,000–120,000 DTC companies in the U.S., roughly 13% of all e-commerce businesses.
In fact, DTC sales made up about one in every seven e-commerce dollars in 2022.
U.S. DTC e-commerce revenue tripled from $36 billion in 2016 to $128 billion in 2021, and it’s projected to surpass $210 billion by the end of 2024..
Nearly six in ten Americans bought from a DTC brand at least once in 2021, and about two-thirds planned to do so in 2022. The DTC channel now attracts both startup innovators and retail giants alike.
Three product categories dominate this space: fashion/apparel, home goods, and food/beverage. Over 75% of U.S. DTC brands fall into those areas – not surprising, as these are categories where brand identity and fast product cycles matter.
The pandemic era accelerated DTC adoption; in 2020, DTC brands saw nearly 45% growth as consumers flocked online.
Established manufacturers also jumped on board. By one estimate, 40% of U.S. manufacturers are now selling directly to consumers, seeking higher margins and closer customer connections.
Traditional retail companies from PepsiCo to Nike have launched DTC initiatives. In fact, established brands accounted for about 75.5% of DTC sales in 2022, showing how even legacy companies are embracing direct channels.
Nike’s own direct efforts are a prime example – the brand’s DTC division (apps, site, and owned stores) now generates roughly 35% of Nike’s profits.
This “mainstreaming” of DTC means more competition but also more validation of the model.
Check this out:
The benefits of launching a DTC brand
Evolving consumer behavior in the DTC era
Why are consumers drawn to DTC brands? Shoppers today expect more from brands than just products on a shelf.
Many actively seek out brands that align with their values and offer a personal touch.
Cultural shifts have created an “increasingly conscious consumer” who cares where their money goes.
These consumers appreciate when a brand stands for something meaningful and provides value beyond a one-time transaction.
Direct brands often deliver on these expectations.
In a recent survey, 23% of consumers said DTC companies offer better quality products, and 18% said DTCs provide better customer service than traditional retailers.
This makes sense – owning the entire customer experience allows DTC businesses to obsess over quality and service. They control everything from product design to unboxing, so they can fine-tune details that influence satisfaction.
Our increasingly digital, choice-rich market has made customer experience a key differentiator, and DTC brands are built around delivering a smooth, tailored experience.
When something’s not right, they can pivot quickly.
For example, lingerie startup Adore Me uses AI to comb through thousands of customer reviews and pinpoint issues; when customers flagged a faulty bra clasp, the company immediately fixed the design. That kind of responsiveness builds trust.
Consumers also crave authentic brand relationships. About 66% of people say it’s easier to understand an individual brand’s values than a large retailer’s, and 61% feel that single-brand DTC sites offer a more personalized experience.
Shoppers like feeling a human touch behind the storefront. It’s no wonder many DTC marketers lean into storytelling and community. Brands often share their mission or spotlight customers and creators to forge a personal connection.
Clevr, a California-based direct-to-consumer beverage brand, illustrates how DTC companies infuse values into marketing. In a recent email campaign, Clevr featured an interview with an Indigenous artist and environmentalist, highlighting “Unity in Diversity” and the brand’s community values. This kind of storytelling helps DTC brands stand out as more than just a product – they become a part of consumers’ lifestyle and beliefs.
In addition, consumers shopping directly from a brand have certain heightened expectations.
Research shows that when buying direct, people place greater importance on after-sales support, knowledgeable staff, and detailed product information compared to buying from a third-party retailer.
Essentially, if a customer comes straight to the brand, they expect the white-glove treatment.
DTC companies like to offer perks such as exclusive access or special pricing to reward that direct relationship. Some brands give “only on our site” product drops or best-price guarantees for buying direct.
Others implement subscription discounts or loyalty points that shoppers can’t get on Amazon or in stores.
These DTC strategies in the USA play into consumer behavior: people are willing to go out of their way for a brand that offers unique value or aligns with their identity.
However, meeting consumer expectations is a moving target.
Brands must be careful not to abuse the direct line to shoppers.
An in-house study by Made With Intent found 63% of online shoppers feel manipulated by common e-commerce tactics, and 46% feel overwhelmed on sites.
For example, incessant pop-ups or pressure discounts can backfire – 1 in 5 shoppers will actually leave a site if hit with a pop-up too early.
The lesson for DTC brands: transparency and genuine engagement win in the long run.
Shoppers love a personal touch, but they can tell the difference between authentic personalization and gimmicks.
Leveraging data for personalization and product innovation
Data is the lifeblood of modern DTC strategy. Unlike selling through a retailer, DTC brands have a direct window into customer behaviors and preferences. Every site click, purchase, and review is a data point that can inform the business.
First-party data – information collected straight from customers – allows these brands to personalize shopping experiences in ways traditional retailers often can’t.
Many companies are even gathering zero-party data, which is information customers voluntarily share (like style preferences or fit details), to tailor offerings.
All that data enables hyper-personalization.
61% of consumers say individual brands provide a more personalized experience than multi-brand retailers.
If you buy a razor from a DTC shave club, you might get an email precisely when it’s time for a refill.
If you browse a DTC fashion site, you’ll likely see recommendations in your size and style.
Brands segment customers by behavior or lifecycle stage and then send targeted messages rather than generic blasts.
For example, a brand might automatically email a first-time customer with a welcome offer, invite a third-time buyer to join a VIP program, or show a lapsed customer new arrivals similar to past purchases. It’s a far cry from the one-size-fits-all catalog mailers of the past.
Crucially, data isn’t just for marketing – it feeds back into product development. We saw how Adore Me fixed a product flaw by analyzing review data.
Many DTC brands use feedback loops to continually improve. They may A/B test new flavors or designs on a small scale online (since they control their sales channel) and iterate quickly based on what customers like.
This agility in innovation is part of DTCs’ competitive edge. As a result, DTC brands often boast more rapid product cycles and limited-edition drops that keep shoppers engaged.
But personalization is a double-edged sword; it must be done thoughtfully.
Consumers appreciate relevant recommendations – to a point. If a brand overdoes it with incessant retargeting ads or feels “creepy” in using data, customers may pull back.
The landscape has also changed with privacy shifts like Apple’s iOS 14.5 update, which limited ad tracking and made it harder for brands to follow consumers around the web.
In response, many DTC marketers focus on contextual and content-driven personalization (telling a resonant brand story or creating useful content) instead of purely behavior-driven ad targeting.
In short, data is a powerful tool for DTC growth, but the human element – creativity, empathy, and respecting customer trust – remains paramount.
Check this out:
The benefits of personalization in ecommerce
Marketing in the age of TikTok and influencers
DTC brands have a reputation for clever, buzzworthy marketing. In the early days, many of these companies grew up on social media, leveraging influencers and viral content instead of big TV campaigns.
That trend has only intensified.
By 2023, influencer marketing is a staple of DTC strategy – and it’s evolving in interesting ways.
It’s easy to see why DTC marketers flock to influencers.
A survey by the Interactive Advertising Bureau found that 20% of DTC shoppers are influenced by celebrities to make purchases.
Instagram and YouTube were prime channels in the 2010s, helping brands like Casper, Allbirds, Bonobos, and Warby Parker grow rapidly by partnering with content creators.
Influencer marketing often yielded lower customer acquisition cost (CAC) than traditional ads, and it helped new brands build credibility through relatable personalities.
Today, TikTok is the new frontier.
The short-video platform has become a goldmine for DTC discovery – so much so that “TikTok made me buy it” became a catchphrase for impulse purchases.
Social commerce is now mainstream: an estimated 19.4% of all e-commerce is driven by social shopping.
TikTok, in particular, has integrated shopping features directly into the app. In Southeast Asia, TikTok Shop facilitated over $11 billion in sales, and the platform has grossed well over $1 billion in combined sales in the US and UK so far.
Here in the U.S., almost 1 in 3 daily TikTok users have bought something through the app.
DTC brands are eagerly hopping on these trends. They create catchy short-form videos, engage influencers who align with their brand voice, and even sell directly via TikTok Shop.
The message is clear: channels like TikTok and Instagram aren’t just for awareness – they’re full-fledged sales channels now, and DTC brands ignore them at their peril.
We’re also seeing influencers themselves becoming brand owners. Rather than just sponsor products, some popular influencers have launched their own DTC brands (think of celebrity examples like Kylie Jenner’s Kylie Cosmetics).
This cuts both ways for DTC strategy: brands may collaborate with influencer-founded companies for cross-promotion, or they might find themselves competing with the very tastemakers they once hired for ads.
The digital marketing landscape isn’t without challenges.
Paid social ads have become more competitive and expensive. As mentioned, privacy changes have made it harder to precisely target audiences, driving up acquisition costs.
By 2019, the cost to acquire a new customer online had already spiked over 60% compared to 2013, and it’s only grown since.
In a recent survey, 66% of DTC companies said rising customer acquisition cost was their top scaling challenge.
To adapt, DTC brands are getting creative. They’re focusing on storytelling – essentially making marketing content so engaging that it hooks consumers even without hyper-targeted delivery.
Liquid Death (a DTC canned water brand) is a great example: its TikTok features absurd, humorous videos that regularly go viral, building brand affinity organically.
Other brands are exploring old-school channels like direct mail, podcasts, or streaming TV ads to diversify their reach and reduce digital ad saturation.
And of course, DTC brands lean heavily on their own websites and email lists for marketing – areas where they don’t have to pay a gatekeeper like Facebook or Google for access to their fans.
Many use Shopify as their e-commerce backbone, which makes it easy to launch online stores and manage multi-channel sales.
Shopify’s rise itself mirrors the DTC boom, as thousands of entrepreneurs use the platform to stand up sleek sites overnight.
Traditional marketplaces like Amazon are a bit of a frenemy to DTC brands: on one hand, Amazon is a huge source of demand; on the other, selling there means ceding some control (and data) and competing on a crowded playing field.
Some DTC brands list products on Amazon to gain new customers, then try to entice repeat business on their own site.
Others avoid Amazon to keep the experience exclusive.
Either way, Amazon’s influence is felt – notably, its Prime shipping has set a high bar for consumer expectations.
Which brings us to another key aspect of DTC strategy: fulfillment and omnichannel approaches.
Check this out:
TikTok for brands: insights from a TikTok expert
Omnichannel DTC strategies in the USA: from clicks to bricks
Despite their digital roots, many DTC brands are increasingly blending online and offline experiences.
The reality is that consumers shop in an omnichannel way – they might discover a brand on TikTok, check it out in a local pop-up store, and then order from the brand’s website.
Forward-thinking DTC companies want to meet customers wherever they are, which has led to a wave of physical retail experiments and partnerships.
Interestingly, around 47% of small to mid-sized DTC brands now have some brick-and-mortar presence.
That presence can take many forms: flagship stores in major cities, temporary pop-up shops, product displays inside larger retailers, or even their own showroom trucks that tour the country.
Digitally native eyewear brand Warby Parker famously opened showrooms so customers could try on glasses in person.
Casper placed mini-stores in Target to let shoppers test mattresses.
These moves aren’t about abandoning the direct model – they’re about augmenting it.
Physical touchpoints can fuel online growth by increasing brand awareness and giving hesitant customers the confidence to buy later via the website.
It all “merges nicely,” as one report put it, into a cohesive customer journey spanning both online and offline.
A key benefit of DTC going offline is the experience factor.
Stores aren’t just places to buy; they’re marketing channels in their own right. Many DTC storefronts focus on experiential touches rather than stockpiling inventory.
For instance, Fabletics, an athletic apparel DTC, operates physical stores where shoppers can view and try on items but don’t necessarily walk out with bags of product. Instead, they order via in-store tablets and have the items shipped to their home.
The stores often host workout classes and community events, reinforcing the lifestyle aspect of the brand.
This strategy turns a store visit into a memorable encounter that deepens loyalty (and generates plenty of social media content from visitors).
Fabletics’ “hands-free shopping” model lets customers try clothing in-store and then order on a touchscreen for home delivery. Such hybrid retail experiences allow DTC brands to combine the tactile benefits of brick-and-mortar with the convenience of e-commerce (8 DTC Statistics You Need to Know (2024)).
One reason DTC brands look to brick-and-mortar is to combat some of the logistics and convenience challenges they face against traditional retailers. A significant 40% of Americans say they’d choose a regular retailer over a DTC brand if it meant getting fast, free shipping..
Big players like Amazon have trained us to expect near-instant delivery. For a growing DTC business, matching those speeds nationwide is expensive and complex.
Many respond by partnering with third-party logistics firms or using distributed warehouse networks to cut delivery times. Others turn shipping speed into a selling point of membership programs or premium tiers (for example, offering free two-day shipping to subscribers or high-tier loyalty members).
Another challenge: accessibility.
About 32% of U.S. consumers still prefer the sheer convenience of picking up a product at a local store.
If you run out of laundry detergent, it’s quicker to grab it at CVS than order from a DTC detergent startup and wait for mail delivery.
DTC brands recognize this and offer solutions like subscription services and predictive re-order reminders.
By analyzing a customer’s purchase frequency, a brand can send a polite nudge – “Running low? We’ll ship your next refill now” – right before the customer would otherwise head to a store.
Subscription models (which we’ll dive into shortly) also address this by putting replenishment on autopilot.
In some cases, DTC brands partner with brick-and-mortar retailers in creative ways. Rather than full wholesale relationships, they might do limited placements or “pop-ins” at popular stores to raise their profile.
Target and Nordstrom, for example, have dedicated sections for DTC-born brands. This gives DTC companies the benefit of foot traffic and instant availability, while the retailer gains trendy products that draw younger shoppers.
Such partnerships need to be balanced with the DTC brand’s direct channel – often the in-store selection is curated, with the brand encouraging shoppers to visit its own site for the full catalog or special editions.
Ultimately, the omnichannel approach acknowledges that DTC is not strictly e-commerce; it’s a consumer-centric model.
The brands that stand out are those that appear wherever their customers need them, whether that’s on a phone screen, a doorstep, or a city street.
Check this out:
How to build an effective omnichannel strategy as an ecommerce business
Retention, loyalty, and subscription models
Amid all the growth and marketing glitz, DTC brands have learned one hard truth: long-term success hinges on keeping customers around.
Retention is king.
Many direct brands found out the expensive way that you can’t endlessly pay to acquire new customers if too few stick around to buy again.
The top-performing DTCs have shifted focus to lifetime value (LTV) over rapid user acquisition.
In fact, DTC brands in the top 25% (the leaders in their categories) have customer lifetime values about 5× higher than the average, highlighting how crucial repeat business is to sustainable growth.
A one-and-done customer isn’t very valuable; a loyal fan who comes back for more – and perhaps refers friends – is the real prize.
To boost retention, DTC companies are investing heavily in loyalty programs, personalization, and community-building.
Traditional loyalty programs (earn points, get rewards) are common, but DTC brands often put a twist on them. For example, Hero Cosmetics (known for its acne patches) created a tiered points system where customers earn points not just by spending money but by engaging – writing reviews, following on social media, etc.
What’s unique is that customers can choose how to redeem their points, picking rewards that matter to them.
This flexibility makes the loyalty program feel more personal and relevant, rather than a generic coupon everyone gets at a fixed threshold.
Other brands have VIP clubs that grant members early access to products or exclusive merch drops, making loyal customers feel like insiders.
Subscription models deserve special mention in retention strategy. Selling subscriptions (whether for monthly curated boxes, refill packs, or membership access) creates recurring revenue and convenience that keeps customers from straying.
The subscription e-commerce market is growing about 18% year over year, and DTC players are a huge part of that. We’ve seen everything from coffee to pet food to sneakers offered on subscription.
Pet supply retailer Chewy, for instance, lets customers set up “Autoship” for pet food with a small discount and timely refills, which has been immensely popular.
Amazon’s “Subscribe & Save” is a similar concept applied marketplace-wide – a sign that even the e-commerce giants validate the power of the model.
Some newer DTC brands are built entirely on subscription.
Take Butternut Box, a direct-to-consumer dog food company: you can’t make a one-off purchase; you sign up for a meal plan subscription. The model forces a focus on customer satisfaction (since the default is the relationship continues). It paid off – Butternut Box’s sales almost doubled last year as it expanded internationally. The appeal is obvious: as long as subscribers stay happy, the company has a predictable revenue stream and the customer doesn’t have to remember to re-order.
However, subscriptions also raise the bar – if the product or experience falters, customers will cancel in a heartbeat. That’s why “subscription fatigue” is something brands must counteract with continual value (through perks, content, or product improvements).
Even for brands that aren’t strictly subscription-based, adopting a subscription mindset can help retention.
This means thinking of ways to keep customers engaged on a regular cadence. It might be a seasonal subscription box option, a membership club, or simply treating repeat purchasers with extra care.
The economics of retention are compelling: selling to an existing customer can be 60–70% likely to succeed, versus only 5–20% for a completely new customer.
A slight uptick in repeat purchase rate can significantly improve profitability. As one classic Bain & Company study found, a mere 5% increase in retention can boost profits by 25% to 95%. DTC brands live and die by these stats.
There’s also a philosophical shift toward community among DTC companies. Retention isn’t just a marketing funnel metric; it’s about fostering genuine loyalty.
Brands big and small host online forums, Facebook groups, or in-person events to turn customers into communities.
When you buy outdoor gear from a DTC brand, they might invite you to local hiking meetups.
If you subscribe to a DTC coffee club, you might gain access to a Discord channel with roasters and fellow coffee aficionados.
These efforts deepen the customer’s bond with the brand (and with others who use it). A customer who feels part of a like-minded community is far less likely to churn than one who sees their purchase as a mere transaction.
All of these retention plays – loyalty programs, subscriptions, communities – feed into maximizing customer lifetime value.
That’s critical because, as we discussed, customer acquisition costs (CAC) have risen across the board.
Many DTC brands discovered that to grow profitably they need to increase the value of each customer to outrun the CAC.
In other words, CLV (customer lifetime value) must sufficiently exceed CAC for the business model to work long-term.
If it costs $50 in ads and promotions to acquire a customer who only buys once for $30, that’s not a viable formula.
But if that customer ends up spending, say, $200 over two years and referring a friend, the initial investment makes sense.
This equation is why we’re seeing such a strong emphasis on retention tactics in the DTC world today.
Check this out:
Building a successful subscription-based ecommerce business
Starting a loyalty program: Brevo survey insights
Looking ahead
Direct-to-consumer brands have rewritten the rules of retail with their data-driven, customer-centric approach.
They’ve proven that you can launch a brand on Instagram, grow it with smart analytics and storytelling, and build a loyal following without a single physical storefront (at least initially).
As we head further into 2025, the DTC journey continues to evolve.
We can expect to see even more integration of online and offline experiences, more innovative uses of customer data (balanced with respect for privacy), and continued experimentation with emerging platforms like TikTok Shop or whatever new channel rises next.
The playbook for the success of DTC strategies in the USA now includes a bit of everything: the efficiency of e-commerce, the personalization of a boutique, the reach of social media, and the engagement of a community club.
Brands that can execute on multiple fronts – while staying true to a coherent brand story – are the ones winning consumers’ hearts (and wallets).
The lines between “DTC” and “traditional” are blurring as well.
Ultimately, direct-to-consumer is becoming simply a mindset adopted by all kinds of companies: one that puts the consumer first, uses data smartly to serve their needs, and isn’t afraid to meet the customer wherever they are.
In a market that changes as fast as consumer preferences do, DTC brands will keep adapting. The recent trends show an industry maturing: flashy growth hacking is giving way to balanced, sustainable growth DTC strategies.
It’s a thrilling time in retail, and DTC brands are at the forefront of that excitement – directly connected to the consumers who will shape their next moves.
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