This is issue no. 240. The last issue had a 🙄 40.10% open rate with 5.78% of you reading up on the the black market for Instagram verification. You can officially question that #inspirational #influencer in your feed. Mr. Porter teams with The Kingsman film franchise for this unique pop-up activation.
Did a colleague forward this letter to you? Thank them and subscribe here.
DNVB feature: “You’re seeing what would be considered ‘failures’ in tech, but in the retail industry, they’re called sales. Venture investors don’t make investments hoping to sell for $50 million, $100 million or $200 million,” says Ari Bloom, founder of A2B Ventures and chief executive of Avametric, a San Francisco-based fashion and retail technology firm. “They’re looking for companies to sell for a billion or go public. Otherwise, it’s not a good use of a venture capitalist’s time or money.”
Brand: Consumers’ shift away from brand-name products is creating a “sphere of despair,” Barclays said in a note this May. Retailers are "more willing to invest in 'store brands,'" because the stigma of "generic" goods has lifted. In fact, they’ve opened up to generic items so much that a startup selling unadorned goods raised $50 million in venture capital funding. Both Amazon and Whole Foods have been playing up their own in-house brands in recent years.
Retail: You don’t need to multiply a small number by a big number too many times before the result is a huge number. Online retail is currently compounding globally at a rate somewhere between 12 and 35 percent, depending on where you do business. In the US, for example, even if nothing else changes, e-commerce will comprise 25 percent of total retail within 6 short years. In the UK that figure may exceed 30 percent. Perhaps most staggering of all is that within 3 years, three companies — Amazon, Alibaba and eBay — will control 40 percent of planet earth’s e-commerce.
eCommerce: Amazon is taking a risk of sorts with Find. The obvious route to attract the everywoman who shops on Amazon might have been grown-up clothes of the kind found in Marks & Spencer, say, or John Lewis: sensible purchases that form a sort of sartorial add-on item on the main site. Instead, this is closer to River Island or Miss Selfridge and speaks of the influence of a fashion insider team rather than that of an algorithm.
eCommerce Finance: But after raising close to $1 billion in capital over 10 rounds of venture financing, I’ve come to realize that raising money at a high valuation is usually NOT the right decision. It’s short-sighted and risky. Taking a discount on the valuation will help create positive momentum and scarcity for your stock—both of which dramatically improve your chances of getting funded in subsequent rounds.
Retail: All three chains are considering even more closures as they battle declining sales, largely due to changing consumer habits and the rise of online shopping. But these iconic stores weren't always hurting. Over the latter half of the 20th century, they defined and anchored the American shopping mall. Take a look at the rise and fall of three formative department store retailers.
eCommerce: Amazon has been rumoured as a white knight for underperforming retailers in the past, although several of the bankers contacted by clients are pushing back. Their advice has been instead to focus on improving margins by restructuring the business or cutting costs by merging with rivals, rather than banking on the idea of Amazon saving them.
DNVB: Allbirds cofounder Tim Brown told Business Insider the company will use the cash to open new physical store locations. Allbirds currently has one store under the company's headquarters in San Francisco, and another is opening this month in another undisclosed city in the US. Brown says others are planned.
DNVB: In the battle of the online mattress brands, Leesa Sleep has been something of a below-the-radar player as it has built up a brand with sales expected to reach at least $150 million this year. The company’s move today to sell its mattresses in West Elm’s furniture and home décor stores, replacing Casper’s, augurs in a new, louder era.
Retail Real Estate: The Chinese company also seems to be creating an e-commerce infrastructure that is more social and interactive, as well as capable of absorbing shopping and data collection in physical retail. CEO Daniel Zhang told investors that the company has essentially grown into an economy unto itself, fueled by Chinese consumers’ comfort with interacting with retailers on mobile.
Voice Commerce: For example, Amazon began to make more of an effort to build an ecosystem around Alexa last year by doing things like starting its Alexa Accelerator program for conversation commerce start-ups. That effort has continued into this year, as the company has sought to create a series of developer events aimed at broadening Alexa’s skill range. More recently, it has been reported that Amazon is revamping the original Echo device with a new look, as well as some new technology specifications.
Graphic of The Week
Global Sports Market's By Size
How big is the global sports market for retail? Which sports are moving the most product? You can follow through with NPD for the full report by clicking here.
It's 2 PM · West 54th Street · New York New York 10019 · USA