More on this: There’s no escaping the reality that the longer a retailer is in business, the harder it is for that company to maintain massive growth rates.
- That’s particularly true in the current environment due to rising ad costs, among a host of other complicating factors.
Broadening the reach: Recognizing the need to diversify, Harry’s has long sold its products to traditional retailers such as Target and Walmart, expanded to overseas markets, and broadened its brand portfolio to include cat essentials brand Cat Person as well as hair care line Headquarters.
- In December, Harry’s made its first acquisition when it bought deodorant startup Lume.
- The efforts have helped balance the company’s portfolio. 43% of Harry’s revenue came from non-shaving categories last year.
- The company’s 2021 sales grew 47% to $547 million (including the Lume acquisition), with 54% of that total coming from brick and mortar.
- Those results have helped keep investors optimistic in the company’s model. Harry’s raised $140 million earlier this year at a valuation around $2 billion.
Finding new customers: ThirdLove added the fashion-focused Kit Undergarments to help it attract a younger customer base.
Kit Undergarments’ typical customer base is 18- to 34-year-olds who are more likely to live in urban areas than the typical ThirdLove customer who skews older.
Kit Undergarments also has a lower price point than ThirdLove. Most of its products range in price from $18 to $55. ThirdLove sells items such as its Bloom Demi Bra for $79 and a Washable Silk Deco Robe for $199.
- While ThirdLove’s core product remains T-shirt bras, it has expanded into a number of other categories, such as sleepwear, leggings, and tank tops. It is eyeing sports bras as a major growth opportunity this year.
- The retailer, which had no physical presence outside of a pop-up, also plans to open up to 10 stores this year.
The big takeaway: While the days of near-exponential growth for digitally native D2C brands is likely in the past, there’s still reason for optimism given the model’s inherent advantages.
- D2C brands are able to gather first-party data on their customers, which enables them to better understand their customers—and potential customers. That offers them a road map they can use to expand their product and brand mix in new ways, as well as to offer a personalized experience.