Issue No. 231: Commoditization is the enemy.

A last word: what does a DNVB mean anyway?

After issue number 230’s feature on Pixlee’s DNVB round up, I received no less than twenty-seven emails from readers seeking clarification on the list.

For one, I would have made a few additions and deletions to the list. But it’s also important that we narrow down the meaning of what the industry means by DNVB. In issue number 228, I highlight differing distribution strategies.

Under the startup umbrella, there are retailers and vertical brands. The difference between the two depends upon the company’s level of exposure. By all accounts, Andy Dunn is the godfather of the vertical commerce business and in May 2016, he wrote the penultimate piece on the online retail business.

Two paras stood out:
(1)

The digitally-native vertical brand is way more customer intimate than it’s competition. The data is better because every transaction and interaction is captured. You don’t have to combine data across businesses, because it’s all one business. You are not blind to your wholesale business, because you don’t have a big wholesale business. It’s one CRM. It’s one store, where everybody knows your name.

(2)
While born digitally, the DNVB need not end up digital-only. This means the brand can extend offline. Usually its offline incarnation is through its own experiential physical retail, or highly selective partnerships. In nearly all cases of partnerships, the brand controls its external distribution versus being controlled by it. Any offline retail is not about warehousing product, it’s about marketing the brand and delivering great one to one customer service. It may be pop-ups. It may be permanent locations. It may be installs at existing retailers.
There are numerous arguments for being a retailer, the first being a retailer’s hundreds or thousands of touch points. Many of the finest brands on earth fall under this category. But as I mentioned in 228, DNVB’s are data-driven with eCommerce as the core competency. These strategies cannot be more different; one strategist employs a data scientist and the other strategist employs of VP of Sales.

This is the opinion of Web Smith.

 

See more of the issue here.

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