2PM - No 673: Introducing "Ad Rem"

eCommerce / Business of Fashion: This is a  valuable deep dive by Executive Member Doug Stephens of Retail Prophet. He writes: "Today’s global online marketplaces are, in essence, the retail version of iTunes, providing a fast-track through the universe of choice to acquire only those things we already know we want. While this has made it easier to find and buy these things, it has endangered almost all of the organic discovery that actually made shopping enjoyable. Amazon, in essence, is not a collection of brand stories, but rather an endless well of disembodied products without context." But the question becomes, with the pandemic extending the carnage for brick and mortar stores: what is the alternative? I discuss below.

Editor's Note: with updated data from Placer.ai, we've republished a part of Friday's member analysis on why Saks is separating its online marketplace from its struggling fleet of stores. Traditional marketplaces like Saks, Neiman Marcus, Nordstrom, and JCPenney are struggling to rebound from years of decline. The pandemic has only made matters worse.

Saks is betting on eCommerce being the long-term future for luxury shopping based on a year that saw more people going online. When rumors floated in January about this move, Executive Member Rebekah Kondrat of Kondrat Retail offered that Saks could be moving backward, not forward, if it fails to understand the true meaning of omnichannel. From Polymathic: "Stores need eCommerce, but eCommerce doesn’t not necessarily need stores. I would argue that even the mom and pop shops now have websites and some ability to sell from them. There must be some connection between the physical store and digital presence. It seems that this setup might keep the connection as they are saying nothing changes for customers operationally."

HBC, the ownership group behind the decision to split has assured analysts like Kondrat that the strategy is forward-thinking. In a recent report in the WSJ: "Shoppers will be able to buy online and pick up in stores. They will also be able to make returns and exchanges and use their Saks credit cards either at the stores or online. The online business will oversee the marketing and merchandising for both channels."

Saks’ bet on online luxury eCommerce is far from misguided: The past year has seen big gains for companies like MyTheresa, which IPOed earlier this year, and Farfetch, which inked a major deal with Richemont and Alibaba. Saks’ next chapter could look more like the online pure plays than the department stores, and isn’t that a good thing? The retail store is now secondary to the online marketplace and improved discovery is likely the next priority. 

How LeBron James and Maverick Carter's SpringHill Company became the envy of Hollywood

Media / Fast Company: Their partnership has strengthened as each has matured—Carter as a thoughtful and strategic CEO; James as a professional athlete whose brand and identity extends into social justice. Together, they’ve built the SpringHill Company into a multipronged entertainment empire that furthers their goals to build a movement, empowering communities while striving for the excellence of Disney, Nike, and Apple.

Jason Stein, 2PM Executive Member: In the context of the last five years, they’ve been doing all the things that everyone in all of corporate America realized in 2020 that they should start doing,” says Jason Stein, a media and advertising entrepreneur turned investor who participated in SpringHill’s 2020 funding round. “Direct to consumer, streaming video, eCommerce, being community first, diversity, social justice, empowering your communities and all of your partners. They were ahead in all of these things.

When you're a small business, eCommerce is tougher than it looks

eCommerce / New York Times: For brick-and-mortar stores considering eCommerce, success isn’t always as easy as posting a website and watching orders flow in. Even at Holiday Market, there were significant logistical challenges — like where to store all those online orders and keep them cool. Mr. Violante had to gut one of the prep kitchens to make room for new freezers and refrigerators dedicated to storage. In addition, he has to pay employees to shop the order, organize items and bring them to the curb.

How eight DTC brands are preparing to scale their teams

DTC Brands / Retail Brew: Retail Brew spoke with eight brands that are 1) on upward growth trajectories and 2) operating with the leanest of headcounts. In 2021, they face choices more critical than picking a logo font: when and where to staff up their teams.

The real reason we're breaking up with subscription brands

DTC / Thingtesting: Nearly 40% of eCommerce subscribers have canceled subscriptions, usually for one of two reasons: they don’t have the product when they need it, or they accumulate too much. So in a business built on direct relationships, online brands are getting more creative to win us back.

Can the death of skinny jeans save retail?

Trends / Bloomberg: Several big names in denim have recently noted a migration away from this era-defining silhouette. Abercrombie & Fitch Co. Chief Executive Officer Fran Horowitz told investors on Tuesday that “the skinny jean is becoming less important.” At American Eagle Outfitters Inc., chief creative officer Jennifer Foyle spoke the next day on an earnings call of a “shift into looser denim” for women.

A beverage company's computer honored Michael Jordan before the NBA did

Data / SBNation: In 1974, Seagram began issuing its “Seven Crowns of Sports Award” — a computer-generated measure of the best individual performance in each major sport. As statisticians kept more and more detailed records, Seagram endeavored to analyze, weigh, and collate all those discrete play-by-play stats into a single “efficiency” number that would help them determine the best overall individual athlete, even allowing them to compare athletes from different leagues, if not different sports.

Will social commerce disrupt retail?

Linear Commerce / Practical: Alibaba and Tencent, own 90-percent of ecommerce, pretty much the whole market, 85-percent of social media, 85-percent of [the] internet payment [market]. They also own a large volume of digital content,” Wang said. This combination makes it possible for China’s style of social commerce. If you want to sell grocery baskets while someone is thumbing down a social feed and deliver those baskets in 30 minutes, you need to be integrated — from attention to payments to fulfillment.

Chewy's Ryan Cohen to lead Game Stop eCommerce shift

eCommerce / CNBC: Cohen invested in GameStop last year to push the video game retailer to focus on online sales and turn away from physical stores. His involvement with the company helped spark the stock’s wild ride earlier this year. Shares of GameStop have surged 880% so far in 2021, giving the company a market value of $12.8 billion.

Having a uniform like Wes Anderson

Fashion / Sprezza: Even as a young, budding director, Wes always had his go-to’s. Some staples worth noting: clear eyeglasses, lots of blue/navy, short hair, and New Balance kicks. Also, The North Face puffer was ahead of its time. Wes Anderson and corduroy might as will be synonyms.

The future tends to resemble the past. Railroads, bridges, and highways democratized the American economy; eCommerce infrastructure will do the same.

When considering the impact of eCommerce, look beyond the brands, marketplaces, blanding, and pixels. Instead, see railroad planks and westward tent towns as far as the eye can see. Commerce is what happens when infrastructure meets opportunity.

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