Hey there, great people of the D2C community who are building fantastic things! This is your host Berkay writing.
Take a 5-minute break and dive into D2C Digest for a quick overview of what’s happening in the D2C market worldwide!
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There are only 122 days left until Black Friday/Cyber Monday!❗
It will arrive sooner than you think.
Did you start preparing already?
We’re here to help you get ready. ✅
That’s why we’re offering our complete BFCM Guide, a comprehensive checklist for before, during, and after BFCM. Access it here!
💎 Changing perception of luxury post-Covid
I recently came across a very interesting article on FashionUnited, about how people’s perception of luxury has changed, especially after Covid and between generations.
It's quite insightful as there are implications for D2C companies as well.
So recently, Mercedes Erra, founder of Maison BETC, and Clément Boisseau, co-founder and CEO of strategy, conducted a study on luxury consumer behavior during and post-Covid. They aimed to understand the new relationships between consumers and luxury brands.
Why does it matter?
Mercedes and Clément believe that brands must engage with people by addressing fundamental issues like their relationship with luxury. Especially when it comes to understanding Prosumers, the most proactive and predictive consumers, influence trends. Identified through specific questions, they represent 20% of the study’s 1,800-person sample, including Gen Z, Millennials, and Boomers, who have spent at least €2,000 on luxury annually.
Their key findings:
- The study spanned nine major luxury markets: China, Japan, South Korea, Saudi Arabia, UAE, France, Germany, the UK, and the USA.
- Luxury sales surged during Covid, driven by the wealthy. Post-Covid, these consumers must choose between luxury items and other expenditures.
- The primary luxury products are bags and perfumes, with brands like Chanel and LVMH's Loro Piana and Sephora performing well.
Changing attitudes:
Well, this part is the most interesting. Because according to the study, Pre-Covid, "luxury shame" existed. Now, there's increased acceptance and admiration for luxury purchases. Consumers buy luxury "to please themselves" and appreciate those who can afford it.
Previously, consumers justified luxury purchases as investments. Now, they buy openly for personal enjoyment, a shift seen across social networks.
Global perspectives:
- In France, luxury is less openly embraced compared to the USA, South Korea, and Saudi Arabia.
- High admiration for luxury is seen in younger generations, with Gen Z showing the highest positive response to luxury as a source of dreams and aspirations.
Environmental concerns:
Clément Boisseau: 70% of prosumers and 62% of mainstream consumers believe luxury brands should be accountable for climate change. Yet, many think luxury is sustainable due to its long-lasting nature and the second-hand market.
Mercedes Erra: Younger consumers view luxury items as investments, focusing on resale value rather than manufacturing ethics.
“Previously, consumers justified luxury purchases as investments. Now, they buy openly for personal enjoyment“
This is a strong statement!
😮 Over two-thirds of U.S. consumers are now Amazon Prime subscribers
And there's even more news...
Amazon reported record-breaking sales, with an 11% increase in spending compared to last year, totaling $14.2 billion.
The latest PYMNTS Intelligence Amazon Prime Day study surveyed nearly 6,000 U.S. consumers to examine their subscription and spending habits with Amazon and Walmart. According to the study, over two-thirds of U.S. consumers now subscribe to Amazon Prime. Membership has grown to 67.3% this year, up from 65.4% last year, reflecting a growth of nearly 3%.
I mean, okay, WOW!
👖 How did Levi’s increase its sales by 19% in Q2?
D2Cs are here to disrupt traditional B2C business models, but they can still learn a lot from established brands.
One of those brands is Levi’s, which has been making smart changes to its website and mobile app, leading to a 19% sales increase in Q2. Here’s a closer look at what they did:
- Simplified Navigation: Levi’s revamped their main navigation to match how customers actually shop. By grouping products by gender first and then by category, they made it easier for shoppers to find what they’re looking for. Highlighting key features like fabric stretch, rise, and leg opening, along with adding more images and 360-degree videos, helped customers make informed decisions.
- Faster Site: They improved site and app load speed by 40% by only loading essential elements first. Levi’s also increased the frequency of content updates from every three weeks to twice a week, which keeps the site fresh and improves SEO rankings.
Impressive Results:
- 47% of Q2 sales came directly from their own channels.
- This marks nine straight quarters of growth.
- eCommerce sales are expected to hit $576.75 million this year, up from $556.11 million last year.
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D2C DIGEST
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