It’s no secret that millennials are on target to become the biggest consumers in modern history. AdAge predicts the population of 23- to 38-year-olds (those born between the years 1981 and 1996) will spend more than a whopping $10 trillion in their lifetimes. Further, 60 percent of purchases were made online in 2019, say experts at Digital Commerce 360, up from 47 percent just two years ago. With all that screen time and all those flying dollars, the latest millennial-driven commerce trend was, perhaps, inevitable. Instead of shopping for engagement rings at traditional brick-and-mortar jewelry stores, this demographic has started doing it online.
New Options for DTC Brands
DTC brands—also known as direct-to-consumer or internet brands—are digitally native, meaning they bypass the traditional sales model of distributing goods via a retailer or physical store outlet and instead deliver directly to consumers from the manufacturer, thereby cutting back on space costs or wholesale fees. Think: Glossier (cosmetics), Harry’s (razors) or Casper (mattresses), which are counted among 2019’s most successful DTC groups. The idea of purchasing something as valuable and sentimentally significant as a diamond engagement ring or wedding band online was once unthinkable. But a new crop of successful DTC ring companies—Brilliant Earth, Couple.co, Vrai, Majesty Diamonds, Manly Bands, With Clarity and Erstwhile Jewelry, among others—is proving that millennials are ready to revamp the old-school wedding-planning model. Thanks is due in part to online mattress brands, like Casper, Saatva and Tuft & Needle. While there was a time when it sounded absurd to plunk down two-thousand-plus dollars for a mattress without first lying on it, those now-ubiquitous sales helped ease the stigma surrounding DTC deals for other luxury items.
Why Millennials Are Making It Work
The wedding industry is a money-making machine, projected to generate $76 billion in revenue by the end of this year. Yet it was also overdue for an overhaul. It follows that this revolution should be led by the demographic that eschews traditional retail systems in favor of those matching their game-changing lifestyles. Along with putting mobile first, millennials vibe to social-media advertising over what they view as more antiquated models, including print ads and TV commercials. Manly Bands, a DTC ring company geared specifically to gents, recently restructured its marketing strategy by doubling advertising on Instagram and Facebook. Of its total ad budget, 90 percent is dedicated to digital, with 70 percent of funds funneled directly to those aforementioned platforms. Many modern brides are already online, Pinterest-ing inspo ideas for their dream day, so targeting them with a link to a DTC ring shop seemed like a natural next step.
Millennials crave a seamless shopping experience. Pouring a glass of wine to chat with a virtual diamond concierge from the comfort of one’s couch eliminates the need for secrecy—no more sneaking to gem stores behind a partner’s back—and nixes the possibility of being cornered by a pushy sales rep.
This population segment also competitively prices products, with 41 percent reporting that they “shop around” for identical items at different retailers before pulling the final purchase trigger. Engagement rings bought online can cost up to 50 percent less than those found in-store, due to the lack of overhead markup inherent in the DTC model. What’s more, you get more choices. A staggering 77 percent of millennials are willing to pay extra for goods that are fair trade, cruelty-free or sustainable. Companies like Couple.co offers lab-grown diamonds (read: eco-friendly, ethically sourced and always conflict-free) that look flawlessly identical to their mined counterparts. With the average cost of an engagement band ringing in close to $5,000, the future of this newest DTC venture promises to be shiny.