STRATEGY

Supply guys

Plenty of parents can’t wait to ditch Zoom school. Neither can Newell Brands.

The company behind essentials including Elmer’s and Sharpie (2020 net sales: $9.4 billion) helps fuel the annual back-to-school rush. It’s now ready to return to the classroom.

“Honestly, parents and kids are excited to get back,” Laurel Hurd, who heads Newell’s learning and development group, told Retail Brew. And they’re eager to spend.

By the numbers: Back-to-school spending is expected to reach $32.5 billion for K-12 students, or $612 per student, per Deloitte—its highest level in years. 

• While a good portion tilts towards tech, $$ for school supplies will still total $5.5 billion in 2021. 
• Parents want to re-create “fun back-to-school shopping experiences,” Katherine Cullen, senior director of industry and consumer insights at the National Retail Federation, told us earlier this summer. 

Old school

The pandemic was all about screen time, but parents are “more comfortable shopping in store this year,” per the NRF. 

Strategizing the store: Newell’s key to success? Working with retail partners to make sure its brands are properly showcased—from prominent shelf placement to stand-alone displays.

• “We're spending more time making sure we've got assortments that are easy to shop,” Hurd said. 
• It’s about making the in-store experience seamless and attractive, even if customers are just popping in to pick up an online order. 

“We know that a lot of kids didn't buy supplies last year, so people have more of a need to replenish. When parents are buying for their child, they tend to buy more branded products and spend a little bit more,” Hurd told us.

Write on: Sharpie, for one, is tapping into a growing gel pen trend with its S-Gel line, a new product initiative that expands “beyond the brand’s core platform” to include “fashion design” colors and metal barrels.

• Sharpie S-Gel is on track to rack up more than $40 million in sales per year, Hurd noted.

Expo, the dry-erase marker, is another top performer. Elmer’s is proving to be sticky as well (pun intended), but not for the reason you think. Once just an adhesion brand, back in the glue stick days, Elmer’s is now at the center of the slime trend. “It’s really become more of a kids’ activity brand,” Hurd explained.

Looking ahead: It turns out that hybrid models aren’t just for the workplace. Hurd said Newell has “spent a lot of time on how our brands can play a role” in blended learning models (but would not comment on those plans just yet).—JG

EARNINGS

(Way)faring well

A 10% drop in YoY revenue would typically prompt mad side-eye from investors. But that’s not the case for Wayfair. 

Everyone knew it would be tough to re-create the boom the online furniture company enjoyed last year, but Wayfair hung in there in Q2. 

• Revenues reached $3.86 billion—above pre-pandemic levels—indicating the company was able to retain many of its new customers from 2020. 
• Wayfair’s active customers (aka shoppers who ordered more than once) grew to 31.1 million, an almost 20% YoY increase. 

“We believe we are leaving the pandemic period with an even stronger repeat customer base than when we entered it. We should have long-lasting benefits, given it cost us relatively less to drive repeat purchases than initial orders,” CEO Niraj Shah said during a Thursday earnings call.

Zoom out: Keeping customers will be key, as home spending shifts back to in-person shopping, according to Earnest Research. “Even if online growth supercharges again, the majority of Home sales remain in traditional brick-and-mortar, highlighting the sector’s reliance on consumer foot traffic,” per the report.

• This year, online spending for home purchases decreased to 70% of its 2019 level, from a pandemic high of 130% over 2019, Earnest noted.—KM 

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DELIVERY

Ship-shop-shape

Last-minute shoppers rejoice: One year after introducing same-day delivery, Amazon is expanding the service to six more cities, bringing the total to 12. 

• Prime members in Baltimore, Charlotte, Chicago, Detroit, Houston, and Tampa can now receive a selection of three million Amazon products within five hours. 
• To facilitate same-day delivery, Amazon built new mini fulfillment centers closer to where customers are located. 

Amazon is leaning into same-day to compete with the likes of Walmart and Target and their expansive store fleets, TechCrunch noted. 

• “If they don’t keep innovating on behalf of the customer, they will lose customers to hungry competitors,” Andrea Leigh, VP of strategy and insights at Ideoclick, told Retail Brew.

Need for speed: Shoppers want their stuff, and they want it now: 36% of consumers chose same-day delivery from an online-only retailer, per a February Digital Commerce 360/Bizrate Insights survey. 

But, but, but: Drivers are unhappy about the pressures that come with all those deliveries; one worker told Insider this week that “managing proper breaks is impossible.” 

• An Amazon spokesperson told the publication it “support[s] drivers taking the time they need to take breaks.”

+1: One place Amazon is slowing down? Returning to the office—which has been postponed to 2022.—KM

WHAT ELSE IS BREWING…

• Walmart is offering weekly bonuses to warehouse workers to skip vacations and work through August. 
• Panera Bread, Caribou Coffee, and Einstein Bros.—just call them Panera Brands from now on.
• Levi’s will stretch into activewear after agreeing to buy Beyond Yoga.
• Frasers Group CEO Mike Ashley is thinking about stepping down. 
• Depop will sell rented clothes in a new partnership with Hurr. 

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SWAPPING SKUS

Today’s top retail reads. 

Inbox overload: What’s behind the daily onslaught of emails from every brand you’ve ever interacted with? (The Atlantic)

S#it out of luck: Why diapers—which have already seen prices increase ~12%—are going to get even more expensive. (Wall Street Journal)

Denim dreams: For North Korean defectors, jeans symbolize rebellion and progress. (New York Times)

ICYMI

Catch up on the Retail Brew stories you may have missed.

• How ice cream chain Bruster’s is scooping up workers
• Walmart, Target, and CVS will test reusable bags in California
• Poshmark to expand into India

FRIEND OR FAUX?

Three of the stories below are real...and one is most definitely not. Can you spot the fake? 

1. Oscar Mayer will give away 10,000 Dogecoin in one hot dog pack.
2. Kylie Cosmetics is packaging lip gloss in faux syringes for a “Swipe the Vax” campaign.
3. LaGuardia’s $28 beer caused an audit of its food and drink prices.
4. Ikea will release a meatball-scented candle.

FRIEND OR FAUX? ANSWER

No, Kylie didn’t redesign your Lip Kits.