• by Lux Narayan , Columnist, April 5, 2018

You may not have heard of a DNVB (digitally native vertical brand), but If you ever listen to podcasts, you’ve probably heard ads for them.

Whether it’s Blue Apron promising to ship you dinner ingredients, Dollar Shave Club’s razors-by-mail offer or Blue Bottle’s coffee subscriptions, a good chunk of the “word from our sponsor” on podcasts comes from one of these direct-to-consumer brands.

That choice of media makes sense for many reasons. Just as consumers have rejected the idea of waiting for terrestrial or satellite radio to deliver them a limited choice of talk radio options, consumers are also searching for a new range of brands and services that they can’t get at their local supermarkets or mall.

Much of the appeal comes from these brands being time savers. Ads from Stamps.com, for instance, play up the hassle of waiting in line at the post office. Similarly, Dollar Shave Club’s pleas revolve around the inconvenience of having to summon a rep at your local drugstore to unlock a display and fetch your razor. It’s not all about convenience though. In a short time, DNVBs have built real brands that in some cases are worth billions. Here are four things they do that incumbent brands usually don’t:

1. They rely on word of mouth. Another reason that these brands love podcast advertising is that it fuels word of mouth. When a podcast host you like queues up a pitch, it sounds like a friend talking up a brand they like. But most take it further. Glossier, a beauty-focused DNVB, built its brand on Instagram with posts from real-life, actual users.

Lesson for incumbents: Use down-to-earth influencers who have credibility with your target audience.

2. They are purple cows. To take a page from marketing guru Seth Godin, successful DNVBs are purple cows in that they offer something remarkable that people will want to talk about. For instance, if you get coffee every two weeks from Blue Bottle and are very happy with it, chances are you will mention it to your coffee-enthusiast friend. If you have trouble finding time to shop for clothes, then Bombfell might be such a help to you that you might mention it to your brother-in-law during a family get-together. 

Lesson for incumbents: Ask yourself, “What’s remarkable about this product or idea?”

3. They outsource consumers’ cognitive loads. During the 1950s, devices like dishwashers and washer/dryers helped relieve consumers of the need to perform physical labor. In the late 2010s, many of us are burdened instead by cognitive “work.” Choosing new clothes, finding new luggage or a new pair of glasses — these are all chores that tax our finite capacity for daily decision-making. That’s why consumers don’t mind waiting a couple of days for the items to come in the mail. 

Lesson for incumbents: Look into educating your sales staff to provide helpful suggestions. Don’t give your consumers too many choices and offer good suggestions so they trust your judgment.

4. They provide more choice. Ever buy a sweater from Gap and then see a bunch of other people wearing the same one? There are only a few major retailers and in turn each only has so many offerings. But DNVBs open up a new world. If you live in rural Vermont, you can still get gourmet food or top-quality bedding. 

Lesson for incumbents: Look into ways to offer more selection either in store (with a “cloud shelf” — a screen that lets consumers order anything in stock) or online.

DNVBs have disrupted several businesses that everyone thought were boring or safe. No matter what business you’re in though, you can learn from their new approach to get more in tune with how consumers are interacting with brands in 2018.