An ode to the wholesale channel

By Richie Jones

The brand and consumer trend of D2C is in full swing, with brands clambering for better margin and more control over where they show up. Retailers of all descriptions are piling into the channel, driven by the accelerating effect of COVID on channel switching habits.

However, contrary to some beliefs, this doesn’t mean wholesale is dead or even irrelevant. Neither should brands start treating their wholesale partners as second-class citizens. They are indeed vital parts of the retail mix and pivotal in a brand’s market positioning. Doubly so if they are new in territory or when a brand is repositioning or in transition.

Why Wholesale is Still Relevant 

Bricks and mortar, whilst bruised, is still vital to building brand equity. Especially when retailers are looking to attract more consumers shopping in discovery mode. In the age of COVID, brands have grown reliant on the algorithmic discovery engines of Instagram, Facebook, Tik Tok et el, alongside the likes of Google Shopping. However, as the new normal takes hold and traditional retail opens back up, shoppers can’t wait to return to the shopping mall. Devoid of being able to enjoy the old school act of a physical discovery engine – AKA browsing, meandering, perusing; which is all the more enjoyable following months of scrolling through feeds and getting frustrated with poor onsite filtering. 

Apple’s new website was subtly launched early in August. Guess what they added back into their top nav? That’s right, ‘Store’. As well as that, they have also finally merged the user experience to feel more like their instore experience. You know the dangerous and expensive experience of walking up to one of their solid oak tables to inspect the latest, slightly faster Apple product you don’t need, but will probably still buy. And don’t forget what makes these experiences so enjoyable. Real-life, visual merchandising; product bundle proximity; low product density; and experiential product opportunities. 

At vvast, the brands we partner with have a tendency to have created their own markets, selling to a consumer who didn’t know that if they paid three times as much for something, their day would be so much better. Or indeed, their daily coffee kept warmer that bit longer from a product twice the market price and they just bought a new gadget they didn’t even know they needed. These are all product types that benefit from being physically encountered, exactly like Apple’s product. The same is true of helmets and protection with our bike brands. An impulse buy or a purchase driven by a basic human need, be that safety and protection, or owning the latest and greatest.

Brands wised up long ago to the top tier wholesale and retail partners. They bubble to the top in their segmentation of their door portfolio with revenue and sell through rate no longer being the only variable deemed as success by a brand. The savvy retailer has a handle on the wholesale partners they can work with that don’t damage their online direct performance (ease off things like bidding on the brand for example); whilst complimenting their wider brand awareness and halo impact through physical experiences in their cathedral like shopping spaces. 

Ultimately, the trust consumers put in many retailers is down to the savvy buyers at those retailers who expertly curate product selections and keep the consumer feeling good about what they are wearing. Ensuring we are on trend and forward facing and in the case of lifestyle, delivering a genuinely long lasting, solid product. 

Remember, the consumer doesn’t see ‘channels’, they see brand and they are reassured when they see established and new brands in places they trust. Wholesale isn’t dead, it’s just as vital as ever.