250 Brands to Watch – the Most Disruptive Brands and Services

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 toWatch 2020*By Category; Sorted Alphabetically by
Revenue Tier
Alcohol/Beer/WineApparel/Fashion
1.  Flaviar1.  Anomalie
2.  Glass Vodka2.  Knot Standard
3.  Hopsy3.  Le Tote
4.  MobCraft Beer4.  Poshmark
5.  Rebel Coast Winery5.  Wildfang
6.  Strike Brewing Co.
7.  VineBoxBaby Care/Parenting
1.  Greenlight Financial Technology
Apparel/Fashion2.  Tinkergarten
1.  Stitch Fix3.  Wonderschool
2.  Adore Me4.  Bark Technologies
3.  Untuckit
4.  AllbirdsEducation
5.  Allume1.  Codecademy
6.  Anatomie2.  Coursera
7.  Away3.  Duolingo
8.  BaubleBar4.  StudySoup
9.  Draper James5.  AdmitSee
10.  Eloquii6.  Classkick
11.  FabFitFun7.  CodeMonkey Studios
12.  Flint and Tinder8.  ELSA
13.  Grailed9.  Explain Everything
14.  Moxie Jean10.  Motion Math
15.  MVMT11.  Pear Deck
16.  Outdoor Voices12.  PicMonic
17.  Stadium Goods13.  Preply
18.  1Atelier14.  PsychArmor
19.  Acustom Apparel15.  SoloLearn
20.  American Giant16.  Study Edge
21.  Andie17.  Studypool
22.  Armarium18.  Testive
23.  Atoms
24.  BABOONFinance
25.  Birddogs Shorts1.  PeerStreet
26.  BOW & Drape2.  Stash
27.  Briogeo Hair Care3.  Brigit
28.  Closet Candy Boutique4.  Rare Bits
29.  Cubcoats5.  Trim
30.  CUUP
31.  EllieFood and Beverage
32.  Enflux1.  Caviar
33.  Enso Rings2.  Instacart
34.  For Days3.  Postmates
35.  For Love of lemons4.  Doordash
36.  Glyph5.  Favor
37.  Good American Denim6.  Waitr
38.  Hari Mari7.  Chowbus
39.  Harper Wilde8.  EatStreet
40.  HATCH Collection9.  Gobble
41.  Haute Hijab10.  Butler Hospitality
42.  Honeybum11.  Good Uncle
43.  Hylete12.  Goodybag
44.  Illuminative13.  Local Crate
45.  InstaNatural14.  PlateJoy
46.  Islide
47.  Ivory EllaHealth/Wellness
48.  Kiki La’Rue1.  Soothe
49.  Koio Collective2.  Aaptiv
50.  Lems Shoes3.  Blink Health
51.  Lizzy James Inc4.  Calm
52.  Local Eclectic5.  ClassPass
53.  Mented Cosmetics6.  Infinite Recovery
54.  MeUndies7.  Zeel
55.  Neighborhood Goods8.  Aura
56.  Nomad9.  Grokker
57.  Nomatic10.  Happify
58.  Parks Project11.  Learn to Live
59.  Phat Buddha Wear12.  Nutrimedy
60.  Pop & Suki13.  Obe
61.  ROOLEE14.  Shine
62.  Rowing Blazers15.  Ten Percent Happier
63.  Sarah Flint16.  Whoop
64.  Schoola17.  iCouch
65.  Shinesty18.  LARKR
66.  Summersalt19.  nOCD
67.  Super Heroic20.  Prescribe FIT
68.  ThirdLove
69.  TrackSmithHobbies/Lifestyle
70.  Trendy Butler1.  Cambly
71.  Tuckernuck2.  Glamping Hub
72.  United by Blue3.  Jubel
73.  Universal Standard4.  OpenBazaar
74.  Vie Active5.  Twigtale
75.  Villageluxe.com6.  Vimbly
76.  Western Rise7.  YogaTrail
77.  Westward Leaning8.  MeetMindful
78.  WONE9.  Siren Marine
79.  Ash & Erie
80.  Dagne DoverHome and Appliance
81.  Markhor1.  Grove Collaborative
82.  Original Stitch2.  Havenly
83.  Spruce
84.  Swet TailorPersonal Care
85.  Tipsy Elves1.  Core Wellness, Inc
2.  Mayvenn
Baby Care/Parenting
1.  OsmoPet Care
2.  Bitsbox1.  Wag
3.  codeSpark
4.  CoterieTravel
5.  Please And Carrots1.  Lyft
6.  smilo2.  Domicile
7.  Willow3.  Domio
8.  Tactical Baby Gear4.  Eightydays
5.  KEY Concierge
Consumer Electronics6.  Remote Year
1.  Awair7.  Sonder
2.  LuminAID8.  Turo
3.  Nonda9.  AllTheRooms
4.  Wynd Technologies10.  AtYourGate
5.  Embr Labs11.  Chimani
12.  Journy
Food and Beverage13.  Kimkim
1.  Home Chef14.  Mozio
2.  Thrive Market15.  Outsite
3.  ALOHA16.  Recharge
4.  Daily Harvest17.  Suiteness
5.  High Brew Coffee18.  ViaHero
6.  Kill Cliff19.  Tesloop
7.  Misfits MARKET20.  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.

SOURCE Interactive Advertising Bureau (IAB)

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