D2C Brands: What They Are & Why Everyone’s Building One

June 4, 2025

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If you’ve ever bought a boAt speaker, ordered a Bombay Shaving Company’s beard kit, or added SUGAR lipsticks to your cart—all without stepping into a physical store—you’ve already experienced the power of D2C. Short for Direct-to-Consumer, D2C has gone from startup jargon to a defining feature of India’s modern consumer economy.

Reports suggest that India’s D2C industry is supposed to cross the $100Bn mark by the end of 2025. In fact, the industry is apparently growing at a remarkable CAGR of 40%.

Running a successful D2C business is a challenge, but can be incredibly rewarding. So what exactly running one entails?

And why is every third founder talking about launching a D2C brand?

Let’s decode.

What is D2C, Really?

At its core, D2C means selling products directly to the customer—without intermediaries like wholesalers, distributors, or large marketplaces. D2C brands own the entire journey: from manufacturing and marketing to sales and support.

Unlike traditional retail or even online marketplaces like Amazon or Flipkart, D2C players typically sell via their own websites or apps and maintain full control over brand experience, customer data, and pricing.

Another similar term of note is B2C which stands fir Business-to-Consumer. Both are processes to get products to consumers, which is the ultimate objective of businesses.

But as a marketing strategy and a customer journey, D2C/DTC e-commerce, or Direct-to-Consumer e-commerce, has pronounced differences from B2C- namely that B2C may involve retailers or wholesalers in the distribution chain.

For D2C, think: Wakefit, The Souled Store, Lenskart—brands that started online, built communities, and converted Instagram likes into loyal buyers.

Buying from a D2C brand is like getting your bread straight from the baker—not the supermarket shelf—fresh, personal, and exactly how they intended.

Are There Benefits to Running a D2C brand?

One of the biggest advantages of running a D2C business is the complete control it offers over the customer experience—from how the product is marketed and packaged to how it’s delivered and supported. Unlike traditional retail, where brand identity often gets diluted, D2C allows startups to craft a consistent, personalised narrative across touchpoints.

It also gives brands direct access to customer data, enabling them to make informed decisions about product iterations, pricing, and marketing strategies.

With no middlemen, margins are typically higher, and customer relationships are stronger—making it easier to build brand loyalty and long-term value.

In a market driven by experience and community, D2C empowers founders to stay agile, experiment fast, and grow on their own terms.

Why D2C is Big in India

India’s D2C wave is powered by three things:

Digital-first consumers – With 800+ million internet users, there’s a growing appetite to shop online.
Low entry barriers – Brands can start with Shopify, Instagram stores, digital marketpkaces, and a few lakhs of investment.
VC interest – Over $3 billion has flowed into Indian D2C startups in the past few years.

From personal care to pet food, D2C brands are flooding every niche. According to reports, the Indian D2C market is projected to hit $100 billion by 2025.

But it’s not all smooth sailing.

D2C isn’t a shortcut—it’s a commitment. Without strong ops and retention, it can drain cash fast and crumble under its own hype.

The Double-Edged Sword of Going Direct

While D2C sounds empowering and not to be Taylor Swift but, it also means you’re on your own.

You handle everything—from customer acquisition to logistics and returns. Some key challenges include:

Sky-high CAC (Customer Acquisition Cost): One of the biggest hurdles for D2C brands is acquiring customers in an increasingly saturated digital space.

With most discovery happening through platforms like Instagram, Facebook, and Google, brands are often locked in bidding wars for attention—driving ad costs up significantly. If not managed carefully, marketing spend can quickly outpace revenues, especially when targeting first-time buyers who may not convert again.
Retention Struggles: Getting someone to make a first purchase is hard—but getting them to come back is even harder. Unlike marketplaces that benefit from habitual usage and massive SKU variety, D2C brands must work much harder to earn customer loyalty.
If the product doesn’t deliver immediate value, or if the post-purchase experience is poor, chances of a repeat drop drastically. Building retention requires proactive strategies—like email flows, loyalty programs, product bundling, and regular engagement through content or community.
Operational Stress: In a D2C setup, the brand is responsible for every step post-sale—including warehousing, inventory management, order fulfillment, shipping, customer service, and returns.Any breakdown in this chain—delays, stockouts, damaged deliveries—directly affects the customer experience.
Without robust backend operations and logistics partnerships, even the most well-branded D2C startup can quickly lose credibility and face reputational risks.

Which is why successful D2C brands obsess over unit economics, customer lifetime value (CLTV), and retention cohorts just as much as they do about packaging or influencer campaigns.

Key Metrics D2C Brands Track

To stay profitable, D2C founders obsess over these metrics:

CAC (Customer Acquisition Cost): How much you spend to acquire each new customer
CLTV (Customer Lifetime Value): How much a customer spends over their entire relationship with the brand
Gross Margin: What’s left after production costs but before operating expenses
Retention Rate: How many customers return to make a second (or third) purchase
AOV (Average Order Value): Total revenue divided by number of orders

Balancing CAC and CLTV is critical. If you’re spending ₹700 to acquire a customer who only buys a ₹500 product once—you’re losing money.

Remeber, D2C gives you freedom—but demands full ownership. Great for brand-builders, tough for the lazy.

And if you’re looking for more practical insights, tips, and definitions, stay tuned to Growth Sense News as we break down the A-Z of Startup Jargon in this series.

[This content is for informational purposes only and does not constitute legal, financial, or investment advice. We do not assume any liability for actions taken based on this information]