The Allure of Direct to Consumer Ethical Brands

Tamsin McLaren

Business Case
Source: Bloomsbury Fashion Business Cases
DOI: 10.5040/9781350197046.010
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This case explores how Allbirds, a direct-to-consumer (D2C) ethical footwear brand was founded, its growth from 2016 to 2020, and how it may continue to expand in the future. Originally cofounded in 2016 by Joey Zwillinger and former professional soccer player Tim Brown, it addressed a gap in the market for unobtrusive and comfortable leisure shoes made from natural materials. Prior to the brands inception, Brown secured a $200,000 development grant from a New Zealand wool industry research group that helped enable early prototyping. In 2016 the brand gained B-corporation status, meaning it meets the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose. As a D2C brand, it sells online without employing a more traditional wholesale model. It was able to gain traction in its infancy by fans of the brand including former US President Barack Obama, and product seeding with Silicon Valley and Hollywood celebrities. The brand, now headquartered in San Francisco, achieved sales of more than a million pairs in the first two years. Its marketing and brand management challenge is now how should it expand, both in the US domestic market and internationally.

Due to its initial reliance on a single “hero” product, the challenge is how to grow its consumer base without alienating the original early adopters. Critical factors in the brands journey are explored; the relevance of the D2C business model in today’s brand-scape, the challenges of international expansion in Europe and China, the threat of counterfeits, product line management, and its marketing communications mix. Key marketing frameworks are outlined in the exploration of central business questions, and their application prompts critical discussion and analysis that could inform future recommendations. This study includes pre- and post-pandemic data, and students are encouraged to consider how the brand may continue to grow post-pandemic.

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