Morning Brew - ☕ Wine of the times

Luxury brands snap up vineyards in Napa.
April 11, 2023

Retail Brew

Bolt

Good afternoon! Between a slew of highly anticipated earnings calls (including Bed Bath & Beyond, Albertsons, and Rent the Runway), the Modern Retail DTC Summit kicking off in New Orleans, and the start of Sephora’s Beauty Insider sale, this week is a big one for retail. Hang in there!

In today’s edition:

—Jeena Sharma, Andrew Adam Newman, Katishi Maake

FOOD & BEV

Take a Nap-a

Chateau Montelena vineyard Chateau Montelena

If you’ve ever perused the wine list at an American restaurant, you’ll find the cheaper wines often fall under the New York or California section (aka the section I naturally stick to).

Meanwhile, European wines tend to be priced higher, or so seems the general perception. So, when the likes of LVMH and Chanel started slowly ramping up their acquisitions of wineries in Napa, California, (the go-to place for a fairly drinkable $11 bottle of Chardonnay) starting about six to seven years ago, it came as a surprise.

Just last year, LVMH acquired acclaimed Napa winery Joseph Phelps Vineyards. But why is the French luxury conglomerate—that already owns 20+ wine and liquor brands—betting on Napa?

Next in line: Douglas McKenzie, partner in the leadership, change, and organization practice at Kearney, believes it could be part of succession planning for the founders or owners of wineries who might be ready to retire.

“There’s an opportunity for succession to happen with professional management to apply to a traditional industry,” he told Retail Brew. “There’s just tremendous opportunity to make these businesses more successful.”

For the luxury brands and conglomerates doing the investing, an additional benefit is that “the business climate in Napa is considerably better” than a lot of other parts of the world, Matt Crafton, the head winemaker who oversees production at Chateau Montelena, a historic luxury and independent winery in Napa, told Retail Brew.

“If I’m a conglomerate looking to invest in wine in Napa, and in America, in general, our markets are more fluid,” he explained. “Direct consumer shipping has increased profitability considerably in the last 20 years. So Napa is a good investment just from a business climate standpoint.”

Keep reading here.—JS

     

TOGETHER WITH BOLT

One click away

Bolt

Brutal e-commerce stat incoming: 77% of online shopping carts are eventually abandoned. And one of the leading causes for that are long, drawn-out checkout experiences. 

But here’s one of the best things you can do for your e-commerce conversion rate: Streamline your checkout experience. Take a look at Bolt’s latest case study, showcasing how Benefit Cosmetics saw a huge boost in their conversion rates by cutting clicks. Bolt helped Benefit Cosmetics achieve stats like:

  • a 24.2% increase in site conversion rates
  • an 82% increase in checkout rates

Like the look of those numbers? It’s all thanks to Bolt’s One-Click Checkout, which helps you provide a quick and seamless one-click checkout experience to returning and guest shoppers alike—and level up your numbers, too.

Get all the details and see how you can boost your conversion rates with just one click.

RETAIL

Sounds like a plan

A Zippo lighter open and lit. Peter Dazeley/Getty Images

Here in the city that never sleeps (but occasionally naps), a sign of spring has returned: the jingle from the Mr. Softee ice cream truck. Whether you love it or it’s slowly driving you insane, after a couple of notes, both the truck and swirled vanilla ice cream are imprinted in your brain.

While jingles are the most familiar form of sonic branding, another type can be more beguiling: the sound of a product being used, like the pop of opening Pringles or breaking and eating a KitKat.

But when should you play up a sound that a product makes, and when should you just…let it be?

Greta Dirsel, executive creative director at branding and design agency Landor & Fitch, told us that a brand like Velcro would not necessarily want to play up the sound it makes. It “might be like nails scratching on a chalkboard for some people,” Dirsel said.

Here are some brands that have made the most of how they sound:

Pringles

The stackable potato chips are packaged in a vacuum-sealed can for freshness, but that also means opening them can be oddly delightful.

“It’s satisfying, like popping Bubble Wrap,” Dirsel said, adding that connecting a sound to that first whiff of the chips and then crunching away can combine to make consumers feel more attached to the brand.

“Having all those positive, powerful associations with the sound, the smell—it imprints heavier in our minds,” she said.

Keep reading here.—AAN

     

STORES

Let’s go to the mall

Dollar bill getting inflated by a bike pump Francis Scialabba

Malls and shopping centers aren’t dead yet, Retail Brew has previously reported. Although their role has shifted over the past few decades, they continue to play a key role in the American retail landscape.

Historically, malls and shopping centers have been community hubs, but foot traffic declined during the pandemic. Rising costs of consumer goods, gas prices, and inflation fears haven’t helped.

But a recent report from foot traffic analytics firm Placer.ai has found that “states with lower-than-average inflation are also experiencing stronger-than-average YoY visits” to shopping centers, Jesse Kent of real estate agency Derring-Do told Retail Brew.

States with lower-than-average inflation, like Vermont, experience stronger year-over-year visits to their shopping centers, according to the report, and “a dissipation of inflationary impact could signal a rapid rise in consumer foot traffic.”

Keep reading here.—KM

     

SWAPPING SKUS

Today’s top retail reads.

Cultural relic: Inside the uncertain future of Distractions, one of San Francisco’s most iconic consignment stores, known for Victorian dresses, steampunk costumes, and trinkets. The store doesn’t have a website or any online sales capabilities, and despite the support of Burning Man enthusiasts, will close without a buyer. (San Francisco Chronicle)

Not so sweet: California’s chilly weather and slew of atmospheric rivers had a big impact on an important but often overlooked population: the state’s honeybees, which pollinate almonds, avocados, cherries, and other commodities, and produce, of course, honey. (Associated Press)

Contracting out: FedEx is making some major changes to its labor model, and a future without drivers on the payroll is on the table. (Bloomberg)

WHAT ELSE IS BREWING

  • Whole Foods is reportedly exploring commercial kitchens to fill its food bars and refrigerated cases, a move away from its current outsourcing model.
  • Tyson Foods workers in Arkansas went on strike over the shutdown of a chicken plant.
  • Tupperware says it may go out of business, and is exploring layoffs and other money-saving ventures.
  • Sriracha maker Huy Fong Foods says its popular hot sauce is facing a shortage due to drought conditions in Mexico.
  • Walmart sued Capital One in an attempt to end a credit-card partnership in which the retailer says the bank came up short.

SOCIAL GATHERING

A roundup of our favorite retail multimedia content from across platforms this week—from TikTok to Twitter. We’re keeping you hip, and you’re welcome.

RT: Social media consultant Rachel Karten channeled her inner Sherlock Holmes to break down Reformation’s influencer approach, which apparently involves re-creating viral videos while wearing the brand’s clothing. Her investigation led to this story from Insider, and a comment from Reformation itself. (@milkkarten on Twitter)

Double tap: Documentary filmmaker Johnny Harris weighs in on Liquid Death water’s powerful branding. “Liquid Death is about signaling to others and maybe yourself a little bit that you are anti-establishment. And that’s freaking brilliant.” (@johnny.harris on Instagram)

Make your day: The co-founder of hard kombucha brand JuneShine shares his founding story, which includes Whole Foods, surfing, and a San Diego garage. (@drinkjuneshine on TikTok)

Keep making your day: Once you see Lululemon’s top product recommendations for capybaras, you’ll understand why we had to include two TikToks this week. (@Lululemon on TikTok)

Tune in: New York Times columnist Ezra Klein weighs in on the business models of AI and the future of regulation: “I do not want to see more personalized systems that are tuned to make human beings feel like they have a direct relationship with them but actually make their money by getting you to buy Oreos,” Klein said. (Hard Fork from the New York Times)

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Written by Jeena Sharma, Andrew Adam Newman, and Katishi Maake

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