2PM - Dethroned After 61 Weeks At Number One

MEMO (🔓): In December of last year, I proposed a novel concept to a returns management software company. I suggested that adding an exchange function to their technology stack would shape the industry by promoting a method of reCommerce and a post-purchase marketplace led by the company’s many direct-to-consumer clients currently using the software to simplify returns.

The idea’s crux was built on a critical issue rapidly gaining momentum: microplastics management. This environmental challenge pushes companies to reconsider their approach to product returns, recycling, and resale. The essence of my proposal was simple: companies need systems to upcycle and recycle materials, leveraging these efforts for tax incentives, public goodwill, or even profit. I ended the proposal with the following words (edited for brevity):

This idea is infinitely scalable and will be a prominent business with or without [company]. But you are positioned with several advantages and a head start to include: existing portfolio of companies to offer the service, a brand that suggests the power of upcycling, a network of potentially interested partners who can help you facilitate. I just happen to believe that this can transform [company] – moving it to a higher plane. And it can transform the industry that I love with all of my heart.

The proposal was scalable, innovative, and essential to addressing the growing microplastics crisis in the fashion industry. My proposal to the returns management company was not accepted. Fast-forward to the fourth quarter of 2024 and a better solution has been brewing for nearly three years. TipTop is a venture-backed development billed as a payments solution from Postmates founder Bastian Lehmann.

Recycled goods can be a downpayment on future purchase. Continue Reading

A landmark California bill would mandate brands recycle clothes

About The Lead / The Guardian: Since 1960, the amount of textile waste generated in the US has increased nearly tenfold, exceeding more than 17m tonnes in 2018. A shocking 85% of all textiles end up in landfills where they emit methane gas and leach chemicals and dyes into our soil and groundwater.

Shein faces greenwashing investigation in Italy

About The Lead / The Fashion Law: The latest scrutiny for Shein is coming by way of Italy’s competition and market regulator, which is probing an entity affiliated with the ultra-fast fashion titan for allegedly attempting to covey the false “image of production and commercial sustainability of its garments.” 

Biomaterials company Pact raises $12 million in seed funding

About The Lead / WWD: U.K.-based biomaterials company Pact raised $12 million seed funding for a pilot production facility for its inaugural leather alternative material called Oval.

Editor's Note: PACT is flying high at no. 48 in the DTC Power List, according to the October update. 

SUPPORTING DATA: eCommerce resale volume in the U.S. is expected to grow steadily, reaching $91.63 billion by 2027, as shown in the chart. After a slight dip of -2.5% in 2023, the market is projected to bounce back with consistent year-over-year growth rates, hitting 4.8% by 2027. This reflects the increasing consumer shift towards secondhand goods and the expanding influence of online resale platforms.

Holiday retail sales expected to increase 2.3% to 3.3%

Data / Deloitte: A key driver of overall retail sales growth in the upcoming season is expected to be e-commerce. Deloitte forecasts e-commerce will likely grow between 7% and 9%, year-over-year, during the 2024-2025 holiday season to between $289 billion and $294 billion this season.

TikTok Shop's first year in the US

"TikTok Shop A Failure..." / Marketplace Pulse: A few brands have reached millions in monthly sales, but most brands have no idea how to approach it, and it has only worked for health, wellness, and beauty brands. It has some recognizable brands, but it primarily sells unbranded low-price items. It brought social commerce to the U.S. but at the cost of “enshittifcating” itself (enshittification is a pattern in which online products and services decline in quality, coined by writer Cory Doctorow).

US port strike ends leaving huge cargo backlog to be cleared

Shipping / Reuters: U.S. East Coast and Gulf Coast ports began reopening on Thursday night after dockworkers and port operators reached a wage deal to settle the industry's biggest work stoppage in nearly half a century, but clearing the cargo backlog will take time.

Hurricane Helene aftermath prompts card, cash troubles

Cautionary Tale / Payments Dive: Consumers forced to turn to cash are likely hard-pressed to come up with it, given the decline in use of hard currency in the U.S. these days. They increasingly rely on debit and credit cards for payments, with about two-thirds of transactions made with cards.

Self-gifting messaging is set to dominate Black Friday ads

Sort of Sad / Modern Retail: Around two-thirds of shoppers in 2023 planned to shop for themselves during Black Friday or Cyber Monday, according to a Gallup survey. 

Vintage shopping is booming. Banana Republic and others get in on it.

As Projected / NYT: Goodwill has put more effort into its e-commerce business in recent years, but in-person shopping has continued to reign supreme for used goods, said David Eagles, chief operating officer of the company.

• Circular Fashion and DTC (2PM)
• Goodwill: This is True Circularity  (2PM)
• Reducing Returns Costs and Frequency (2PM)

A tailored solution to the SHEIN-Temu revelations

As Projected / National Interest: Rather than deploying a one-size-fits-all solution, the Biden administration should leverage the existing authority granted by the UFLPA to address the specific problem posed by SHEIN, Temu, and other companies that rely on forced labor.

Deep Dive This: 

• Two Parties. One Bipartisan Effort. (2PM)
• China's Influence on U.S. eCom Grows (2PM)
• Temu is Scamming America (2PM)

October Update, presented by Bold Metrics. Crumbl overtook Shein after an impressive 61-week reign due to its strategic use of a rotating weekly menu and heavy social media presence, particularly on TikTok. The cookie company’s unique approach to generating excitement with limited-time flavors, paired with an Instagram-friendly product and its iconic pink packaging, created a constant buzz.

Crumbl’s ability to quickly integrate feedback, maintain customer engagement, and lean into nostalgia also helped it leap ahead. Its hyper-localized franchise model and the scalability of its in-store experience also contributed to its rapid expansion and brand loyalty​.

This month's fastest growers: 

800+ Brands Measured

Industry minister echoes Shopify calls to boost ambition in Canada

Shopify News: Canada's industry minister has thrown his support behind a call from one of Shopify Inc.'s leaders for the country to get more ambitious.

Why BigCommerce suddenly changed CEOs

BigCommerce News: Analysts have expressed concerns about ecommerce platform BigCommerce's revenue growth and valuation under the previous CEO.

Mass retail hacks affect Adobe Commerce and Magento stores

Adobe / Magento News: Automated, mass hacks by CosmicSting-wielding attackers began July 12, when Sansec recorded three to five online stores getting hacked per hour. "The rate has slowed to about one to two per hour in the last seven days," de Groot told Information Security Media Group.