Have you ever thought about buying a pair of pants online without trying them in real life? Or a pair of glasses? Or even a mattress?
While using Facebook or Instagram, listening to podcasts or just browsing the web, you may have come across ads from brands such as Betabrand, Warby Parker, Casper or Harry’s. These companies represent a growing niche in the retail marketplace: direct to consumer. They bypass traditional retail channels and sell their own products themselves using social media.
These brands tend to have cachet, particularly with younger people.
Nearly half of millennials, in one survey, said they were influenced by social media in their purchases, compared to 19 percent of all other age groups.
There are potential benefits to shopping this way. But there can be drawbacks too.
Price: Direct-to-consumer brands pitch that they can offer higher quality at lower prices by cutting out the middleman. Warby Parker pioneered this area by offering all of its eyeglasses for a single uniform price of $95. That can compare to hundreds of dollars at traditional retail.
Quality: As companies with a limited range of products, these brands are squarely associated with the products they sell. This compares favorably with buying at Amazon or a big box store where the actual maker is somewhere far down a global supply chain. Some of these companies promise better manufacturing practices or other socially responsible approaches to business.
Also, since they are direct to consumer, some of these companies can be more nimble with offering a variety of updated options, in response to consumer demand. Betabrand, an online apparel brand, for example, has a “crowdfunding” model. New styles are introduced and get made only if enough people pledge to buy them.
Service: In order to get you to buy things online you might otherwise not, these companies often try to offer highly responsive customer service. This can include free try-ons, free samples, free shipping and returns, and customer loyalty programs.
At the same time, some people like to shop and make decisions on a purchase without having to interact with sometimes-pushy salespeople.
But that’s not all there is to shopping on social media. ...
Try-ons: A major reason that people don’t like to shop for glasses, clothes or mattresses online is, of course, that they want to try these things on in person.
And this can be a big drawback to online shopping.
These companies may offer trial periods and money-back guarantees, but they do that in full knowledge of a home truth of consumer psychology. That is, once the product gets into your home, it is most likely to stay there.
Marketing: Just because there are no sweaty salespeople breathing down your neck when you shop online for, say, mattresses, that doesn’t mean there is no unwanted marketing associated with these brands.
A recent investigative report in Fast Company, a business magazine, showed that various online mattress companies offered both incentives and threats to bloggers who represented themselves as independent reviewers of mattresses. Some of these bloggers may have been earning millions of dollars. The bottom line is to take anything you read online about a product with a grain of salt, even a supposedly “independent” review.
Locked-in: For savvy consumers, one more drawback of many online direct-to-consumer retailers is the subscription model. A mattress is likely to be a once-in-a-long-while purchase. But other companies specialize in products you’ll buy again and again: glasses (Warby Parker) or contacts (Hubble); razors (Harry’s) or feminine products (Lola).
And a whole other category of direct-to-consumer, web-focused retailers turn just about any product category into a subscription, usually in the form of a monthly box: cosmetics, snacks, pet treats, clothing, you name it.
Here’s the issue: We all get exhausted making decisions month in and month out.
These companies rely on getting your credit card information once and then sending you products whether or not you want them or need them. This can be hard on your budget, even if it’s fun when you open the mail.