According to recent data from Modern Retail, traditional brands saw solid growth in 2021.
Modern Retail asked brands and retailers about their financial performance over the past year as well as what they expect to see in the year ahead. More than two-thirds of self-proclaimed traditional brands, as opposed to those who consider themselves primarily direct, said they saw increased revenue from a variety of channels.
While not necessarily surprising, it does provide some context on how traditional retailers and brands are performing in 2021. Some of the largest traditional retailers posted strong year-over-year gains last year. . Nike’s revenue for fiscal year 2021 (which ended in May 2021) was up 19% year-over-year. Target, meanwhile, reported comparable sales growth of 12.7% year-over-year for 2021.
Of the traditional brands we surveyed, 76% said they had increased their wholesale revenue in the past year. Additionally, 71% of those same brands said direct revenue had also increased.
Indeed, businesses of all types saw big gains in 2021. Retail sales as a whole grew 14% last year.
Still, some brands haven’t seen the same results. According to an earlier Modern Retail study of 88 self-proclaimed direct brands, only 54% saw direct revenue increases — and 48% reported wholesale revenue gains. Meanwhile, 59% of those same direct brands we surveyed said they had increased their marketing budgets.
According to the traditional brands surveyed, only 55% say they have increased their marketing spend.
Looking ahead, traditional brands also have high hopes for the coming year. Eighty-five percent said they expect an increase in direct retail revenue, and 76% believe wholesale will also see an increase. Meanwhile, 76% said they plan to increase their marketing budget in 2022.
While these brands may have an optimistic outlook, reality can make things more difficult. Inflation continues to rise, which means some brands are raising their prices. Whether or not that will impact the outlook for 2022 remains to be seen.