Why has D2C become more important?
Traditional manufacturers face serious competition from direct-to-consumer companies. CPG companies continue to sell through retailers and distributors, but they can’t ignore direct-to-consumer strategies.
Many new-age CPG brands have embraced an online-only business model. Brands no longer need to rely exclusively on retailers; they can attain power by creating more channels to sell their product(s). A competitive advantage in today’s fast-moving digital world is to be able to innovate and launch products quickly. These innovative, online-based CPG companies embrace consumer trends and understand the value millennials and Gen Z places on experience. And some powerhouse manufacturers have taken note by investing in product innovation and/or acquiring brands that extend their reach.