Direct to consumer brands (DTC) are known for their unique and individual products that disrupt traditional markets. For traditional brands, it is a real struggle to track every challenger that comes their way. New DTC companies spring out of nowhere with a lot of Instagram attention. What all brands need is an early warning system that alerts them to compelling challengers.
We looked at Amazon review data for fashion watches ending in Q3 of 2015 to see what customers were talking about with two challenger brands, Daniel Wellington and MVMT. Seiko is the leader of value watches, with indestructible cases, mechanical movements, and precision craftsmanship. The company has been selling watches on amazon since at least 2004. From 2004 to 2015, over 45,000 people left a review on a Seiko watch they purchased. The average star rating during those 11 years was 4.35 out of 5 stars.
In 2015 two new brands were hitting the market as well, Daniel Wellington and MVMT. Daniel Wellington had 1,025 reviews and an average star rating of 4.65, and MVMT had 277 ratings for an average of 4.39 stars. So based on average star rating, there is nothing that significantly differentiates either of these challengers from Seiko.
Looking at all three brands together we created a dictionary that encompassed the watches themselves (accuracy, crowns, bezels, bracelets…etc ) as well as the buying experience (packaging, returns, descriptions…etc) and owning experience (Strong Positive Superlatives, Weak Superlatives, Gifting, Compliments…etc). Based on over 21 topics, our regression model showed Strong Positive Superlatives and Compliments as the two most important predictors of buyer satisfaction.
Digging deeper on Strong Positive Superlatives did not yield meaningful insights, as all three brands achieved high ratings and similar frequencies of occurrence. Compliments, however, told an exciting story that could have served as an early warning for Seiko.
The average rating for a customer mentioning a Strong Positive Superlative was a 4.67, which exactly matched Seiko’s score for the same topic, MVMT was a 4.66, and Daniel Wellington was a 4.80, which looks like it would give them a slight edge. The average rating score for someone that received a compliment was noticeably higher on average across the three brands(4.81), with Seiko coming in at 4.80, MVMT coming in at 4.79, and Daniel Wellington coming in at a 4.95. Based on raw averages, Daniel Wellington looks more likely to be the disrupter of Seiko than MVMT. However, the real insight lies when we look at the frequency analysis.
For Seiko, a respectable 2.95% of customers mentioned a compliment in their review. For Daniel Wellington, this percentage rose to 3.61%. A 22.4% improvement is impressive. MVMT, however, had a full 12.27% of their customer reviews mention being complimented, a 415.93% improvement over Seiko. And over triple the number of reviews on a percentage basis than Daniel Wellington produced.
This insight could have warned Seiko back in 2015 if they had an early warning system in place. For MVMT, it speaks highly - when you wear a MVMT watch, people compliment your choice.
— Data available from Amazon reviews