Adapting Retail Strategies for a Digital-First World

We've been methodically advising clients to diversify away from pure "DTC" and towards digital-first consumer products since well before the tariff headlines. Why? Because we saw the writing on the wall. Not tariffs specifically, but the fundamental vulnerability of physical product businesses reliant on global supply chains. After watching clients struggle through COVID disruptions, it became obvious that businesses built on shifting physical atoms across oceans were inherently fragile. When physical products become trapped in geopolitical crossfire, consumers don't stop spending. They redirect toward digital alternatives that solve the same problems without the supply chain baggage. I'll share few ways we've helped clients broaden their horizons and widen their margins that could open up similar thinking for your business. Premium Membership Programs: - Several clients have launched paid membership tiers ($99-299/year) offering early access to products, exclusive colorways, and enhanced customer service. These generate predictable, high-margin revenue that isn't subject to tariff pressures. Digital Product Extensions: - One beauty brand now offers personalized skincare regimen consultations via Zoom ($45 per session) with licensed estheticians. This service-based revenue stream requires zero physical inventory yet deepens customer relationships. Domestic Final Assembly: - Another client imports basic components from China but has shifted final assembly and customization to US facilities. This qualifies products for "Assembled in USA" status while creating opportunities for higher-margin custom work. Ultimately, this is about recognizing a fundamental market shift. Smart founders saw this coming. While everyone was chasing the Allbirds/Warby Parker playbook from 2018, the visionaries were building scalable, capital-efficient digital businesses with 80%+ gross margins and zero exposure to global shipping chaos. My goal is not for us to abandon physical product clients, but rather help them build complementary digital revenue streams that can weather the coming storm. Those who can't adapt will be washed away when the tsunami of inventory shortages and price inflation hits later this year. Hope isn't a strategy, and this trade war won't be resolved with a handshake and a press conference.

I've been thinking about what DTC brands get wrong about omnichannel expansion recently. The temptation is to try to be everywhere at once. But the real winners are strategically aligning each channel to build a holistic growth engine. Here’s how to do it right → First, you must have channel-specific thinking. Every channel needs its own playbook. A helpful framework to structure your efforts... DTC Website: • Focus on basket building • Higher AOV targets • Full-price strategy • Data collection hub • Customer relationship building TikTok Shop: • Single-product purchase reality • Organic content engine • Lower AOV expectations • Limited data access • Treat as a retail channel Amazon: • Multi-pack strategy • Bundle economics • Marketplace presence • Competitive monitoring • Specialized management Next up, the Integration Challenge → The biggest mistake brands make is trying to force the same strategy across all channels. Example: One brand we spoke with increased shipping costs on TikTok Shop to push customers to their website. Instead of fighting the platform's natural behavior, they should have optimized for it. You must also consider your unit economics because each channel has its own cost profile. - TikTok Shop might be a loss leader but drive retail success. - Website sales might have better margins but higher customer acquisition costs. - Amazon might have lower margins but better operational efficiency. Here is the new omnichannel playbook: 1. Channel Optimization - Build channel-specific content - Adjust pricing strategies per platform - Create platform-specific bundles - Set realistic KPIs for each channel 2. Data Strategy - Accept data limitations on newer platforms - Focus on first-party data where possible - Build cross-channel customer profiles - Use creative solutions for retention 3. Team Structure - Specialized expertise per channel - Clear ownership of metrics - Flexibility to shift resources - Mix of in-house and agency support The brands that will win aren't the ones just running around trying to be everywhere - they're the ones being intentional about how they show up in each place. Success also isn't about ideal profit extraction across all channels. It's about understanding each channel's role in your broader ecosystem and optimizing accordingly. Key Takeaway: Don't try to make every channel work the same way. Start building channel-specific strategies that work together to drive overall growth. 

shifting how we viewed digital took chubbies from an 8-figure, negative-profit ecommerce store to a 9-figure, profitable omnichannel brand as a digital-first brand believing DTC was the future, this was a tectonic shift we wish we realized it sooner...would have saved many a sleepless night so you don’t make the same mistakes we did, here’s 1) the mistakes 2) 3 lessons 3) 3 actions you can take today let's do it *the mistakes* at chubbies we built our ecommerce business to 8 figures of revenue before we really understood the role of digital for consumer brands for the first few years, we were fully bought into the ecommerce revolution we thought the role of digital was to offer a convenient place to purchase items you love without the hassle of going to a retail store we thought online retailers were competitors we wanted to own the transaction for brand control and support our ability to measure LTV: CAC since DR, discounts, ROAS and revenue mattered most at the time then we almost went out of business *3 lessons* 1) digital is not for transactions, it's for connections as we deconstructed our business to find scalable profitable growth, we realized the internet’s true value to brands it was not just a vehicle for transactions the value of the internet to consumer brands was that the internet had become the house of brand the internet became where consumers connect with brands across social networks, mailing lists, websites, etc the internet was the place consumers share their thoughts and emotions towards brands freely and openly in a way that billions of people could consume the internet was where consumers learned about their favorite brands, diving into the story and purpose our realization was that this basket of digital behaviors towards our brand was our brand 2) the best way to see the impact of brand was by being omnichannel truth be told, we couldn't make brand work the way we needed it to when DTC only only later did we learn that the measurable impact of "brand marketing" was far higher when we started to be available more broadly in retail compared to being DTC only ...but we had to get into retail (and show up the way we wanted) to make this possible 3) leaning into number 1 ALSO generated the retail demand that made number 2 possible (something we didn't fully realize the value of at the time) *3 actions you can take today* 1) take a hard look at the assumptions driving your view of digital DTC are they still correct? do they need to be reassessed? given where you are as a brand, what's the right strategic view for YOU 2) if the connection vs transaction view resonates, vet your internal capabilities to see if they match what's needed to build those connections put simply, do you have an internal content machine? 3) broaden the definition of 'customer' add the retail buyer into your filter when thinking about how to maximize desire for your brand hope this helps