IAB "250 Brands to Watch" Identifies the Most Disruptive U.S

EMPTY

|Feb 11|magazine142 min read

NEW YORK and PALM DESERT, Calif., Feb. 10, 2020 /PRNewswire/ -- Now in its third year, IAB has unveiled the most disruptive, influential DTC brands. More than 3,500 brands were analyzed before IAB narrowed the list to the most important 250 direct-to-consumer products. This year, for the first time ever, 100 service companies were added.

"These brands epitomize the growing disruptor brand economy, representing the leading edge of business development across the U.S. and globally," says IAB CEO Randall Rothenberg. "We watch these brands because their business model, personalized relationships with consumers and go-to-market strategies are transforming how brands are born, how they are advertised, and what consumers expect. Traditional brands aspire to their nimbleness and engagement. If they want to understand the future of the consumer economy, there is no better model to follow than the IAB 250."

New "to watch" in 2020 includes consumer brands such as Andie, BodyArmor and Wander Beauty, and services like ClassPass, Le Tote and Lyft.

"Consumers and distribution channels have changed. Brands go to market faster, with marketing that's focused on stimulating conversation and ensuring powerful one-to-one customer experiences. At the core of everything is a continuous stream of first-party data. Brands that don't adapt, will not survive," explains Sue Hogan, SVP Research and Analytics, IAB.

Top Insights From the Top Brands and Services

VC Funding is Still Emerging
Despite all the talk of VC funding and news articles about VCs looking for ROI, IAB research data tells a different story.

A scant 11 percent of IAB 250 DTC brands are VC backed. There aren't a lot of DTC brands on Sand Hill Road. Just 11 of the 87 companies on the list in California are VC backed. And 10 of the 62 in NYC are backed.

The implication? There are still plenty of funding opportunities out there. However, VC funding is not mandatory.

Social Footprint and Media Diversification Correlates to Sales
For DTC brands, their social footprint is critical to driving business. If no brand is dominating the social conversation in a given category, there is significant room for a major DTC brand to take hold and thrive. There's no question that digital spend and social footprint are correlated.  But scaling social alone will not get a DTC to the next level of growth.

IAB research has identified many opportunities for media diversification, including exciting new advertising units.

In Q4 2019 Pinterest launched "Shop the Look mobile ads" enabling retailers to feature up to 25 products in a single ad on mobile devices and direct users to their own retail site. Other features for better UX and engagement are continually being created to ensure growth and relevancy in this growing Image Search space.

TikTok is beta testing shoppable short‐form videos which will allow viewers to click on the in‐app video and be taken directly to the creator's store without leaving TikTok.

Small wonder that the referral share of traffic that social provides e-commerce sites grew 20% from 7.6% to 9.1%; this is the largest growth seen since 2016.

Subscription and Customization
It's impossible to overstate the role and impact data has on the way IAB DTC 250 brands do business. Data impacts not just how these brands sell, but what they sell. DTC is where the promise of mass customization gets real. For example, pet care brands combine specific educational information about a consumer's pet with customized products created for the pet's precise growth stage. Everything about the experience is customized—a consumer simply creates a profile and a care package arrives within 7 days.

A core part of the promise of DTC brands is that they can and will know consumers better, serve them better, and adapt to their needs better than any large-scale brand sold through mass retail.

The Rise of the Mega DTCs
In the early days, you could be excused for dismissing DTC brands as minor niche players driving tiny amounts of revenue. No more.

No less than seven disruptor IAB 250 brands have revenues of over $100M.

  • Apparel/Fashion: Stitch Fix
  • Food and Beverage: Home Chef
  • Health/Wellness: Peloton
  • Hobbies/Lifestyle: Loot Crate
  • Home and Appliance: Casper
  • Personal Care: The Honest Company
  • Pet Care: Chewy

IAB research has also revealed that the verticals yielding the highest revenue in the shortest period of time are in categories like personal care, health/wellness, baby care/parenting, and pet care.

More than Half of DTC Founders are Women 
Among the many changes wrought by the rise of DTC: it appears to be democratizing entrepreneurship. More than half (53 percent) of DTC brands have female founders.  The first wave of DTC brands with female founders included female apparel brands like ThirdLove and cosmetics brands like Glossier. In 2020, female DTC founders aren't just competing in "women's" categories, they are battling for share in nearly every category imaginable.

 


250 Direct Brand Products to
Watch 2020

*By Category; Sorted Alphabetically by
Revenue Tier

100 Direct Brand Services to

Watch 2020

*By Category; Sorted Alphabetically by
Revenue Tier


Alcohol/Beer/Wine

Apparel/Fashion


1.  Flaviar

1.  Anomalie


2.  Glass Vodka

2.  Knot Standard


3.  Hopsy

3.  Le Tote


4.  MobCraft Beer

4.  Poshmark


5.  Rebel Coast Winery

5.  Wildfang


6.  Strike Brewing Co.



7.  VineBox

Baby Care/Parenting



1.  Greenlight Financial Technology


Apparel/Fashion

2.  Tinkergarten


1.  Stitch Fix

3.  Wonderschool


2.  Adore Me

4.  Bark Technologies


3.  Untuckit



4.  Allbirds

Education


5.  Allume

1.  Codecademy


6.  Anatomie

2.  Coursera


7.  Away

3.  Duolingo


8.  BaubleBar

4.  StudySoup


9.  Draper James

5.  AdmitSee


10.  Eloquii

6.  Classkick


11.  FabFitFun

7.  CodeMonkey Studios


12.  Flint and Tinder

8.  ELSA


13.  Grailed

9.  Explain Everything


14.  Moxie Jean

10.  Motion Math


15.  MVMT

11.  Pear Deck


16.  Outdoor Voices

12.  PicMonic


17.  Stadium Goods

13.  Preply


18.  1Atelier

14.  PsychArmor


19.  Acustom Apparel

15.  SoloLearn


20.  American Giant

16.  Study Edge


21.  Andie

17.  Studypool


22.  Armarium

18.  Testive


23.  Atoms



24.  BABOON

Finance


25.  Birddogs Shorts

1.  PeerStreet


26.  BOW & Drape

2.  Stash


27.  Briogeo Hair Care

3.  Brigit


28.  Closet Candy Boutique

4.  Rare Bits


29.  Cubcoats

5.  Trim


30.  CUUP



31.  Ellie

Food and Beverage


32.  Enflux

1.  Caviar


33.  Enso Rings

2.  Instacart


34.  For Days

3.  Postmates


35.  For Love of lemons

4.  Doordash


36.  Glyph

5.  Favor


37.  Good American Denim

6.  Waitr


38.  Hari Mari

7.  Chowbus


39.  Harper Wilde

8.  EatStreet


40.  HATCH Collection

9.  Gobble


41.  Haute Hijab

10.  Butler Hospitality


42.  Honeybum

11.  Good Uncle


43.  Hylete

12.  Goodybag


44.  Illuminative

13.  Local Crate


45.  InstaNatural

14.  PlateJoy


46.  Islide



47.  Ivory Ella

Health/Wellness


48.  Kiki La'Rue

1.  Soothe


49.  Koio Collective

2.  Aaptiv


50.  Lems Shoes

3.  Blink Health


51.  Lizzy James Inc

4.  Calm


52.  Local Eclectic

5.  ClassPass


53.  Mented Cosmetics

6.  Infinite Recovery


54.  MeUndies

7.  Zeel


55.  Neighborhood Goods

8.  Aura


56.  Nomad

9.  Grokker


57.  Nomatic

10.  Happify


58.  Parks Project

11.  Learn to Live


59.  Phat Buddha Wear

12.  Nutrimedy


60.  Pop & Suki

13.  Obe


61.  ROOLEE

14.  Shine


62.  Rowing Blazers

15.  Ten Percent Happier


63.  Sarah Flint

16.  Whoop


64.  Schoola

17.  iCouch


65.  Shinesty

18.  LARKR


66.  Summersalt

19.  nOCD


67.  Super Heroic

20.  Prescribe FIT


68.  ThirdLove



69.  TrackSmith

Hobbies/Lifestyle


70.  Trendy Butler

1.  Cambly


71.  Tuckernuck

2.  Glamping Hub


72.  United by Blue

3.  Jubel


73.  Universal Standard

4.  OpenBazaar


74.  Vie Active

5.  Twigtale


75.  Villageluxe.com

6.  Vimbly


76.  Western Rise

7.  YogaTrail


77.  Westward Leaning

8.  MeetMindful


78.  WONE

9.  Siren Marine


79.  Ash & Erie



80.  Dagne Dover

Home and Appliance


81.  Markhor

1.  Grove Collaborative


82.  Original Stitch

2.  Havenly


83.  Spruce



84.  Swet Tailor

Personal Care


85.  Tipsy Elves

1.  Core Wellness, Inc



2.  Mayvenn


Baby Care/Parenting



1.  Osmo

Pet Care


2.  Bitsbox

1.  Wag


3.  codeSpark



4.  Coterie

Travel


5.  Please And Carrots

1.  Lyft


6.  smilo

2.  Domicile


7.  Willow

3.  Domio


8.  Tactical Baby Gear

4.  Eightydays



5.  KEY Concierge


Consumer Electronics

6.  Remote Year


1.  Awair

7.  Sonder


2.  LuminAID

8.  Turo


3.  Nonda

9.  AllTheRooms


4.  Wynd Technologies

10.  AtYourGate


5.  Embr Labs

11.  Chimani



12.  Journy


Food and Beverage

13.  Kimkim


1.  Home Chef

14.  Mozio


2.  Thrive Market

15.  Outsite


3.  ALOHA

16.  Recharge


4.  Daily Harvest

17.  Suiteness


5.  High Brew Coffee

18.  ViaHero


6.  Kill Cliff

19.  Tesloop


7.  Misfits MARKET

20.  VacationRenter


8.  New Age Beverages



9.  Suja Life


10.  Trifecta Nutrition


11.  Apres


12.  Aspire Food Group


13.  Banza


14.  BodyArmor


15.  Bonafide Provisions


16.  Bright Greens


17.  Coco5


18.  Crowd Cow


19.  Crunchsters


20.  Death Wish Coffee


21.  Drink Simple


22.  Elev8 Hemp


23.  Fuego Box


24.  Fuel For Fire


25.  Generosity Beverages


26.  Grow & Behold Foods


27.  JUST Goods


28.  KiiTO


29.  Koia


30.  Laird Superfood


31.  Lakanto


32.  LifeFuels


33.  MatchaBar


34.  Oakridge Dairy


35.  OLIPOP


36.  Once Upon a Farm


37.  Outlaw Beverage


38.  Prepd


39.  Protein2O


40.  Raised Real


41.  Revere


42.  Soozy's


43.  Spero Foods


44.  Tea Drops


45.  TryTheWorld


46.  Weller


47.  Yumi


48.  Zest Tea


49.  Veestro


50.  Your Super




Health/Wellness


1.  Peloton


2.  Campus Protein


3.  Care/Of


4.  Ample Foods


5.  BINTO


6.  DYLN Inspired


7.  Gennev


8.  HelloMD


9.  Kaleidoscope Labs


10.  Liquid I.V.


11.  Lume Deodorant


12.  Maude


13.  Poplar


14.  Prima


15.  253 Organic




Hobbies/Lifestyle


1.  Loot Crate


2.  Cratejoy


3.  Eaze


4.  KiwiCo


5.  Alpha Outpost


6.  Bespoke Post


7.  Elevate Accessories


8.  FringeSport


9.  Greetabl


10.  Groove Life


11.  Healthy Bees


12.  Litographs


13.  Moment


14.  Myro


15.  OpenSea


16.  Printabowl


17.  Priority Bicycles


18.  The Sill


19.  Tower Paddle Boards


20.  Fanchest




Home and Appliance


1.  Casper


2.  Touch of Modern


3.  Chairish


4.  Parachute Home


5.  Artlifting


6.  Backdrop


7.  Barn & Willow


8.  Blackdove


9.  Buffy


10.  Clare


11.  Cleancult


12.  Dering Hall


13.  Dormify


14.  GlobeIn


15.  Great Jones


16.  iDro


17.  Kaiyo


18.  Mirror


19.  Outer


20.  Stikwood


21.  Suitely


22.  Thuma


23.  Year & Day


24.  Ruggable


25.  Tushy




Personal Care


1.  The Honest Company


2.  BeautyCounter


3.  Curology


4.  Eargo


5.  Follain


6.  Glossier


7.  Hims


8.  Athena Club


9.  Boxycharm


10.  By Humankind


11.  Cora


12.  Felix Gray


13.  Function of Beauty


14.  GLOW


15.  Kosas Cosmetics


16.  L.


17.  Modern Fertility


18.  NaturAll Club


19.  Public Goods


20.  Rael


21.  Thrive Causemetics Inc.


22.  Wander Beauty


23.  Winky Lux


24.  Youth To The People


25.  Act+Acre


26.  BioClarity


27.  Facetory


28.  Joylux


29.  LOLI Beauty


30.  Ogee




Pet Care


1.  Chewy


2.  Boxed


3.  Ollie


4.  PetPlate


5.  PupBox


 

"Brands that rely on old supply chains, have a smaller social footprint, and are costly and perhaps already losing retail market share, have the most to lose – or the most to gain, depending on how you react to the changes," says Sue Hogan, SVP Research and Analytics IAB. "Someone will take your category to the next level. It can be you, or a DTC founder. It all depends on how early or late you choose to react."

Methodology
IAB 250 Brands to Watch in 2020 are founded after 2010 in the U.S. After scraping the web to create a database of DTCs, additional data is aggregated using multiple sources, including Rival IQ for social footprint and velocity. IAB uses a weighted formula to create indices to rank Economic Efficiency (e.g., Revenue; # Employees); Financial Confidence (e.g., Revenue; Funding; Partners; Max Valuation); and social metrics. Companies are ranked by categories for presentation purposes.

About IAB
The Interactive Advertising Bureau (IAB) empowers the media and marketing industries to thrive in the digital economy. Its membership is comprised of more than 650 leading media companies, brands, and the technology firms responsible for selling, delivering, and optimizing digital ad marketing campaigns. The trade group fields critical research on interactive advertising, while also educating brands, agencies, and the wider business community on the importance of digital marketing. In affiliation with the IAB Tech Lab, IAB develops technical standards and solutions. IAB is committed to professional development and elevating the knowledge, skills, expertise, and diversity of the workforce across the industry. Through the work of its public policy office in Washington, D.C., the trade association advocates for its members and promotes the value of the interactive advertising industry to legislators and policymakers. Founded in 1996, IAB is headquartered in New York City.

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SOURCE Interactive Advertising Bureau (IAB)