7 Growth Busters & How To Fix Them

Struggling To Grow? It's Probably One Of These 7 Reasons

Fashion is a challenging industry. Heidi Klum was right: “one day you’re in, and the next you’re out.” Our products have a limited lifecycle–you’re only as good as your last best-seller.

But that's not the only reason so many fashion brands struggle to grow the DTC channel. Most of the brands I’ve worked with run into at least one of seven roadblocks that prevent the business from breaking through to its next phase of growth.

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If your business feels stuck–you’ve been trying to grow, but hovering around the same revenue number for two or three years–see if any of these resonate with you.

1. Product/Market/Channel Fit

Some products and brands are a better fit for the eCommerce channel than others. The same holds true for individual digital marketing channels like Google, Meta and TikTok.

Products that are expensive for their category are hard to sell online. The luxury audience is niche, their purchase journey is complex, and trust and authority play a big role in closing the sale.

Launching a luxury brand in the eCom channel without support in the “real world” is nearly impossible. Not even Rihanna could make it work. Phoebe Philo is partnering with Bergdorf Goodman less than one year into launching her eponymous brand online.

Conversely, products priced at the bottom of their category can be challenging to sell via mono-brand eCom. It’s hard to make the unit economics work. Fast fashion success stories like Shein and Temu serve as marketplaces for overseas factories, so their cost base is lower than a US-based brand.

Finally, a lot of brands use eCom and Meta advertising as a “go to market” strategy. When you do this, you have to accept the possibility that there is no market for your brand within Meta’s audience.

The Solve:

  • If you’re launching a brand from scratch, consider a go to market strategy that puts you in direct contact with the customer, like trunk shows.
  • If you plan on using a paid channel like Meta ads as a go to market strategy, set a maximum budget for validating the brand. Be willing to pause and pivot once the budget is spent.
  • If you plan on selling at the top or bottom of the price range in your category, model the unit economics of the business carefully.
  • Brands with luxury positioning need support from multiple sources to succeed with eCom.


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2. Channel Conflict

Wholesale is still the go to market channel of choice for many of today’s biggest fashion brands. These brands may launch with an eCom site, but the bulk of their turnover comes from major department stores and online retailers.

When wholesale-first brands decide it’s time to focus on eCom growth, they can hit a wall. This is often due to channel conflict: wholesale accounts dominating the brand in organic and paid search, dictating the brand’s promotional calendar and offering lower prices for the same styles.

If you want consumers to choose your brand over your wholesale accounts, you need to provide a distinct value prop, cater the experience to impulse shoppers, or build a brand so strong that shopping DTC becomes a status symbol. Your wholesale accounts will probably have you beat in terms of cost, convenience and overall selection.

Navigating channel conflict means trading maximum wholesale sales today for maximum omnichannel sales tomorrow. There is a reason that many of today’s strongest luxury brands pulled back on wholesale 5-7 years ago to invest in owned stores and ecom.

The Solve:

  • Lay out your 1-3 year growth targets for wholesale and eCommerce side by side. Decide if these goals are realistic given your current level of channel conflict.
  • Get feedback from “on the ground” employees in both lines of business (performance marketers, sales reps): ask if your goals feel realistic.
  • Your wholesale partners’ eCom businesses are typically your top source of channel conflict. Build your strategy thoughtfully here.
  • Strong eCom demand can give you negotiating leverage with wholesale accounts.

3. Overlooking The Details

The “first principles” of retail are channel-agnostic. A good merchant and a strong brand will shine in eCom, wholesale or in owned retail stores.

But the devil is in the details, and eCom has a lot of them. There are many small ways you can sabotage your eCom and digital marketing efforts.

I’ve audited a number of brands where the only thing holding back growth was a few poor decisions regarding web design, SEO or Meta campaign setup. (PS, click here for my Meta Ads playbook for fashion brands).

If you want to avoid this fate, you need to hire folks who have an accurate and up-to-date understanding of the technology you’re using. The best way to hire qualified experts is to know enough about the landscape to vet them (ie. subscribe to this newsletter 😊). The second best way is trusted referrals.

The Solve:

  • Learn the basics of web user experience design, SEO, eCom operations and popular digital marketing channels. If possible, spend some time hands-on working with these tools.
  • If you don’t have time for the hands-on approach, pay experienced experts for a few hours to provide an overview and answer your questions.
  • Referrals are a great way to find quality eCom and marketing talent, but make sure the brands you’re sourcing referrals from are thriving.
  • If some aspect of your business feels “off” or stuck, pay for 2-3 outside experts to audit it and share what they would do differently.

4. Merchandising Strategy

This is the mirror image of issue #3. Yes, good merchandising and product design can overcome a lot of technical issues. But the reverse isn’t true–you can’t market or “hack” your way out of merchandising fumbles.

Many brands produce a hit product or “hot item”, then struggle to manage the surge in demand and sales growth that follows. Others shift design direction so dramatically from season to season that they’re unable to build a repeat customer base. Still others stock the eCom site based on production overruns from the wholesale buy, or use eCom to sell styles that none of the wholesale accounts would buy.

None of these approaches will lead to sustainable growth. Strong eCom businesses build up a base of repeat customers over time. To build that customer base you have to balance consistency and newness.

The Solve:

  • Build a strong cross-functional relationship between your merchandising team and the 2-3 team members most directly responsible for driving new customer sales for eCom.
  • Study what styles and price points your repeat customers purchase. Make sure those are represented in each seasonal buy.
  • Avoid the “digital flagship” strategy of showcasing the entire collection unless the brand is driving strong awareness and demand “IRL”.
  • If you’re planning a sharp pivot in styling, brand positioning or pricing, project the impact on repeat customer sales and reflect that in your sales forecasts.

5. Underestimating The Need For New Customers

Most eCom businesses only retain 20-30 of every 100 new customers they acquire. If your brand isn’t selling a subscription product (most fashion brands aren’t), new customer acquisition is critical to growth.

The most successful eCom businesses orient their financial strategy, reporting KPIs and marketing investments around new customer acquisition. Unfortunately, many brands are working within a “legacy” framework that makes this challenging.

If your benchmark for digital marketing spend is a 4x ROAS or higher…If you’re not properly measuring the impact of all marketing activities on eCom sales…If you’re not regularly reporting on the number of new customers acquired and CAC:AOV…It will be hard to grow your eCom channel consistently and profitably.

The Solve: Read this if you want to launch your first Meta prospecting campaign. Read this if you're running Meta ads, but aren't sure if they're acquiring new customers.

I'm going to cover KPI setting in an upcoming members-only issue. Become a member now to make sure you get it.

6. Misuse Of The Luxury Strategy

The Luxury Strategy is a set of counter-intuitive marketing principles that have shaped some of the biggest, most valuable brands in the world. Many of us look up to these brands and envy the resources and creative freedom their teams enjoy.

Unfortunately, the authors of the Luxury Strategy left something out: today’s most successful luxury brands lost money for decades. Or those brands spent generations as obscure local craftsmen serving the needs of a small, wealthy client base.

Time is the secret ingredient in the luxury strategy. A brand needs time to establish the credibility required to speak from a position of cultural authority. Achieving the title of “status symbol” can happen faster, but the shelf life is shorter.

Christian Lacroix was one notable attempt at condensing the luxury brand timeline, and it didn’t work. Short term cash flow simply isn’t compatible with much of the luxury strategy. If a brand needs to make money, it needs to balance three stakeholders: customers, sales channels and the founder’s vision.

The Solve:

  • Decide if you’re going “all in” on the luxury strategy. If so, set realistic goals for sales growth and profitability, and determine how you’ll fund the gap.
  • Determine which aspects of your brand are the most critical–on what points do you refuse to compromise? Pick a go to market strategy that will allow you to draw those lines in the sand.
  • As you explore new growth channels, be up-front about the creative and strategic moves you are/aren’t willing to make. Ask experts if your goals for the channel are realistic given those constraints.
  • Be thoughtful about the competitors you look at for guidance. If they’ve been in the market longer, have more sales turnover, or have greater consumer awareness, their strategies may not work for you.

7. Maxing Out “In Market Demand”

Sometimes a brand avoids all six issues listed above and still hits a growth plateau. Typically, this happens when the brand maxes out the in-market demand it is able to capture at the price it is willing to pay.

There are several ways this can play out, but brands who lean on paid digital media for new customer acquisition experience this issue frequently. The brand maxes out the growth potential of conversion-focused Meta and Google ads, reaching everyone on those platforms who will convert at a specific CPA.

At this point, the brand has two options: it can increase the price it’s willing to pay to acquire a customer (higher CPA target), or it can invest in marketing activities that generate more in-market demand. The efficacy of these activities is harder to measure and the payback window can be longer and less certain.

The Solve:

  • Run some analysis before deciding that this is really your problem.
  • There are a number of paths you can take to generate more demand. Pick a path that aligns with the capabilities of your current team or hire experts outside your team to pilot a new channel.
  • Set up a measurement framework that shows you how the new channel drives a lift in eCommerce sales.
  • Treat these activities as marketing investments that need to drive demand. Don’t assume that they’re working based on metrics like impressions or engagement.

I'm publishing an in-depth guide to "moving up the funnel" + how to run profitable Middle of Funnel campaigns starting on 7/9.

113 Cherry St #92768, Seattle, WA 98104-2205
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