The first generation of digitally native fashion brands promised a cleaner way to build retail businesses. Online distribution would remove middlemen. Direct customer relationships would make brands more efficient. Values-led messaging, from transparency to sustainability, would give customers a reason to buy into the company, not just the product.
More than a decade later, that promise looks more complicated. Everlane, one of the defining brands of the millennial DTC era, was sold earlier this year to Shein in an $80 million deal, according to Reuters. Outdoor Voices closed stores in March of 2024 before being acquired by Consortium Brand Partners. Parade sold to Ariela & Associates International in 2023. Allbirds, once a public-market poster child for sustainability-led DTC, has also been forced through a strategic reset.
The pattern raises a sharper question: If online distribution, values-led messaging and direct customer relationships are not enough, what did the DTC brands that have survived do differently?
Leather accessories brand Cuyana and heritage fashion brand Faherty are fitting counterpoints. Both were founded in the early 2010s, both started with values-led propositions, and both have spent the years since building businesses that look less like pure-play DTC companies and more like disciplined omnichannel retail operations. Cuyana has maintained a 90% sell-through rate since inception, with nearly 60% of business coming from repeat customers and average customer lifetime value exceeding $500, according to the company. Faherty has tripled revenue over the past three years, opened 78 stores in the past five years and now sells through 700 wholesale locations, according to a representative from the brand. The brands recently collaborated on a late summer capsule centered on Cuyana’s System Tote.
“The brands that endured understood that DTC is a channel and distribution model, and not just a business strategy,” said Liza Amlani, principal and co-founder of retail advisory Retail Strategy Group. “The brands that are still standing have a clear brand DNA, curated assortments and a disciplined product creation process that gives them healthy margins.”
For Cuyana, which is celebrating its 15th anniversary this year, that discipline starts with inventory. The accessories brand was built around the idea of “fewer, better,” and Wendy Yu, Cuyana’s CEO, said the phrase is used internally as much as externally. It guides product assortment, inventory buying and the company’s effort to avoid heavy discounting.
“We want to make sure we are designing and creating products that our customers want and need,” Yu said. “But we’re also really thoughtful about how much we buy.” The goal, she said, is to avoid ending a season with enough excess inventory to require heavy liquidation.
Yu said Cuyana’s high repeat-customer rate is tied to the way the company uses customer feedback to inform product development. For example, Cuyana’s System Tote, now at its five-year anniversary, was developed after customers said in customer reviews and feedback sessions that they wanted more organization and versatility — the bag features removable components that can move between bags or be used separately throughout the day. As customers have moved through different life stages, the brand has increasingly focused on functionality, organization and work bags that can support “all the different parts of her life throughout the day, throughout the weekend,” Yu said.
Cuyana moved beyond e-commerce early. Yu said the brand started digitally native but opened its first store around 2013 or 2014, before many DTC brands had changed their view on physical retail. Everlane opened its first permanent store in New York in 2017, after years of saying it would remain online-only, and Allbirds opened its first U.S. store the same year. Parade, by contrast, did not open its first standalone store until late 2021, shortly before its 2023 sale.
“We leaned into stores early on,” Yu said. “We didn’t have the belief that retail was a dead channel.” Now, as more brands move into stores and wholesale, Yu said the goal is to meet customers where they shop while easing pressure on digital acquisition.
In-store shoppers have an average order value about 10% higher than online shoppers, Yu said. She owed that to the fact that associates can more effectively explain leather quality, styling and the brand’s modular product systems. Store teams also feed insights back to the e-commerce team on how to better present products online, like showing how the System Tote works with other products on its site.
Amlani said that this kind of control has become essential to DTC-first brands. “You can’t scale your way out of too much inventory or an over-SKUed product mix,” she said. “In fashion, complexity is expensive.”
That distinction matters because a values-led brand can lose its edge in different ways. Everlane’s sale to Shein created an obvious tension: A company built on “radical transparency” and responsible basics is now owned by a fast-fashion giant facing scrutiny over supply chains, regulation and low-cost production. Outdoor Voices, meanwhile, showed how a community-led proposition can weaken when the business underneath starts to wobble. The brand closed its stores in 2024 after months of markdowns before being acquired by Consortium Brand Partners. Faherty’s route has been more controlled: The family-founded apparel brand has scaled through stores and wholesale while trying to keep its values embedded in sourcing, product, and operations, rather than treating them as a layer of marketing.
“Sustainability was never a marketing decision for us,” co-founder and CEO Alex Faherty told Glossy. “It was baked into the first two products we ever made.” As the company grew, it added formal measurement, traceability and third-party verification to its sustainability initiatives, including B Corp certification. Faherty said the company does not spotlight each sustainability change in its marketing because greenwashing has made the category harder to communicate. “We’ve always erred on the side of caution about seeming self-promotional,” he said.
That choice comes with margin pressure. “Our materials run meaningfully higher because of how we source them,” Faherty said. “Durability and quality do some of the work back. Better materials mean fewer returns and a product that holds up, which supports the price rather than fights it.” Faherty said the company’s next phase is about “going deeper rather than louder” on materials, including expanded water-risk assessments, product-level supplier mapping, resale through Second Hand September and alignment with newer E.U. reporting frameworks.
For Amlani, the lesson is that the values that led DTC founders in 2010 are now table stakes. “A brand still has to answer much harder questions: Why this product? Why this brand? And why this price? Customers don’t see channel; they see brand. The strongest brands are moving from channel loyalty to channel discipline.”
