Say hello to the HomePod by Apple. Of all of today's WWDC advancements, this is the most interesting to me. Voice Commerce and audio advertising are both on the rise. As such, it should be interesting to see how Apple competes with Google's "Home" (the superior ad business) and Amazon's "Echo" (the superior commerce business). For a device like this, entertainment may not be enough to make it an essential home tool. Advantage, Amazon?
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Capstone: As at other retailers, the private-label business at Amazon allows the company to offer low-priced alternatives to major brands as customers become increasingly comfortable with in-house brands. Retailers can keep prices on in-house brands low — in part because they don’t have to spend money on big traditional marketing campaigns to get them in front of shoppers.
The Takeaway: And make no mistake: Under Armour’s brand remains strong. Athletes know it, and young kids like it. But to catch up to the athleisure trend, which is not going away, “I think we’re going to see them add a layer of fashion to everything they do,” says Powell. “I think we’re going to see them do a lot more product that doesn’t look like it’s meant for the gym, but does have performance characteristics. And that’s a hard shift to make, but it’s not impossible. Every brand has had to do this."
The Takeaway: The answer is two-fold. First, this eventually constructs a small “in-group” cluster of Facebook friends and topics that dominate your feed; and as you grow accustomed to interacting with them, this causes your behavior to change, and you interact with them even more, reinforcing their in-group status … and (relatively) isolating you from the rest of your friends, the out-group.
The Takeaway: That’s right: For many fashion brands, fashion is a loss leader. And it’s one that offers less and less benefit proportional to its cost to produce, the report suggests, especially as shoppers can easily find variations of the same trendy styles across the price spectrum, including knockoffs at cheap fast-fashion chains.
The Takeaway: One development that could help fill this gap is how leading ad platforms are rapidly improving back-end data and front-end measurement tools to deliver targeted ads that users increasingly want, a trend highlighted by the results that Google, Facebook and Pinterest are seeing with efforts to merge browsing and buying.
The Takeaway: Its architect, John Graham Jr., pioneered the dumbbell, big-box shape for malls, in which two rows of stores face each other and a department store anchors each end. Graham also gave Northgate a grocery store — which later became a food court — and a huge parking lot. In the decades that followed, malls around the country copied Northgate's layout. It became the model for most American malls through the late 20th century.
The Takeaway: Nike Chief Executive Mark Parker has said that the U.S. retail landscape is "not in a steady state." Kevin Plank, CEO of Under Armour, has acknowledged it is "a difficult time for many retailers out there." But Laurent Potdevin, Lululemon Athletica's chief executive, isn't nearly as dour about the industry as brick-and-mortar players face continued pressure from e-commerce giants like Amazon.com.
The Takeaway: Steve Stoute, the chief executive of the marketing firm Translation, said: “I think what Dap did, he actually taught an entire generation how to engage with luxury brands. Luxury brands, at that point, were not for us. They didn’t even have sizing for black people. So every time I walk into Louis Vuitton to buy a pair of sneakers, or buy a pair of pants in my size, I know they’re only doing it because of Dapper Dan.”
The Takeaway: Les Wexner, founder of Limited Brands, defined the skill of merchants as having a nose for finding latent demand and knowing what’s next. “Sometimes market research is like giving radar to a hunting dog. It makes him dumb,” he added. It should go without saying that fashion isn’t reducible to a spreadsheet or a database. But our era’s obsession with data-driven decision making demands it be said. Data can never predict what is next, only what has been.
The Takeaway: I don’t know how to pin this down exactly, but when I say, “What is the Chinese dream?” I think the Chinese dream is the American dream plus 10%. It’s not the European dream of restraint and conservation. I think they’re closer to Americans. They want even more, bigger, better—as a generalization of course.
Graphic of the Week
This about more than athletic shoes. In many ways, this race between the three largest American athletic brands will signify how all brands must evolve to compete in a rapidly changing market. If you missed out, read the latest by Yahoo's Daniel Roberts with great quotes by 2PM reader and seasoned retail analyst, Matt Powell.
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