This is issue no. 221. The last issue had a 46.26% open rate with a 11.19% reading up on Warby Parker's journey to $250M.

Package/parcel volume growth is up 9% YOY (No. 65) as consumers increasingly turn to the likes of Amazon vs. brick-and-mortar stores; YOY e-commerce growth (+15%) also gets called out (No. 76). ~ the 2017 Mary Meeker report

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Today's Top Intelligence (15 Reads)
What Will Happen To All The Empty Stores?

One of the inevitabilities of retail real estate now is that it will be less valuable in the future than it was in the past. You don't need a crystal ball to see that there's more supply than demand of retail square feet. Basic economics says when that happens the price goes down. Landlords are not acting quickly to recognize that, they are not acknowledging that their asset is less valuable, they are not lowering the price of their space fast enough to generate new leases and soak up what's coming on the market.

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The Takeaway: Vox Media uses the same underlying technology for all of its sites, which is exactly what you would expect given that software can be replicated endlessly. Crucially, the same principle applies to advertising: one sales team can sell ads across any number of sites, and the more impressions the better. Presuming The Ringer ends up being not an outlier but rather the first of many similar deals, then that means that Vox Media has far more growth potential than it did as long as it was focused only on monetizing its owned-and-operated content.

The Takeaway: Yet the struggles of J.Crew, Gap, Ralph Lauren, Abercrombie & Fitch, American Apparel and many others go beyond the simple explanation that they missed the impact of technology or a specific trend. Instead, these merchandising-driven brands are caught in the middle of one of the most profound but little talked about shifts in the retail and apparel space: the shift from a supply-driven world to a demand-driven world, and the cultural change needed to thrive today.

The Takeaway: Online, brands value engagement from their ads over conversion and brand amplification, but 61 percent still find measuring return-on-investment challenging for social campaigns. Tracking efficacy may become easier, but reaching those consumers may become more difficult. Especially in developing markets, where ad-blocking is growing in popularity. 

The Takeaway: Meeker suggested this sales decline could come to a head in 2017 as shopper-deprived retail outlets close en masse. She projects thousands of retail closures are expected by the end of 2017, citing a Credit Suisse report from April that pegged the number of 2017 closures at more than 8,600 in a worst-case scenario.

The Takeaway: It's unlikely to stop Amazon's efforts to make more money in fashion retail. The company continues to experiment -- this wasn't even its first foray into fashion TV. In hardware, Amazon's Echo Look is a camera dedicated to fashion selfies, connecting to Amazon's shopping hive mind for new suggestions and wardrobe additions

The Takeaway: Mr. Simmons said in a statement: “This partnership allows us to remain independent while leveraging two of the things that Vox Media is great at: sales and technology. We want to devote the next couple of years to creating quality content, innovating as much as we can, building our brand and growing The Ringer as a multimedia business.”

The Takeaway: Even as things progress, publishers’ reliance on third parties will likely continue for the foreseeable future for two key reasons: resources and data shortage. “Well over 60 percent of a typical publisher’s audience is effectively anonymous,” said Keith Sibson, vp of product at PostUp. “The truth is that only Google, Apple, Amazon and Facebook have enough data on their users for AI to work very well.”

The Takeaway: But digital media in general is under pressure to keep marketers away from anything sketchy. Advertisers began threatening to quit YouTube if it didn't better police where their ads ran. Facebook faced similar brand outrage after disturbing incidents including a live murder were streamed on the platform. Whitelists using outside tech companies to vet websites and social media spaces are becoming a normal part of digital ad buying.

The Takeaway: The idea at the time was to siphon off shoppers from rival Coach (COH, +0.30%) by opening nearby stores at countless malls. For a while it worked, as Kors eclipsed the more established Coach a few years ago. But Coach, which had earlier opened too many stores and cheapened its brand, started closing stores three years ago, seeing this danger before Kors did.

The Takeaway: Simon Venture Group is the most active mostly due to its established venture arm which invests in new distribution channels (Le Tote), products (Helix Sleep),  platforms (Appear Here), and new ways to interact with customers in stores (Ziploop). There have not been many co-investments between retail investors, except for same-day delivery startup Deliv, which saw investments from four different property managers.

The Takeaway: Startups within the space have also experienced varying levels of success. Although Dollar Shave Club made waves with Unilever’s acquisition for $1B in Q3’16, subscription e-commerce startup BeachMint, which raised over $73M from smart money investors such as Accel Partners and NEA, went out of business at the end of 2015. Another startup, well-funded TechStyle Fashion Group (formerly JustFab), has reportedly hired bankers to explore the possibility of a sale.

The Takeaway: The companies and solutions mentioned here are far from the only ones. Each part of the e-commerce value chain is served by multiple companies with various points of differentiation. What they all share is a bet that Amazon won't devour absolutely all of retail -- the little guy will still be around, selling brands that customers can't find elsewhere and maintaining a direct connection with those customers.
The Takeaway: While Best Buy continues to strategically reduce its physical footprint, closing 12 large-format stores and 40 Best Buy Mobile locations in the past year, Joly said they remain profitable and no dramatic reductions are planned. In all the company has closed 85 stores in the past two years.
The Takeaway: The Melt’s revamped mission is telling. Before, it envisioned itself tackling ambitious and systemic world problems, much as a tech company would. Now, its goals are individualistic and basic: delivering delicious sandwiches to customers. In short, it sounds like a restaurant. And technology has been reduced to a supporting role; The Melt’s tech should be “helpful,” just as its décor should be “welcoming” and its staff “friendly.”
Graphic of the Week: Alexa's Growing Mind
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