Nº 339: Em defesa de Tim Armstrong

DTX - DTC DIA

Tim Armstrong não está errado. O "DTX" em DTX Company é a abreviação de "Direct to Everything" (direto para tudo); o fundo espera fornecer uma faísca proverbial para esta era de varejo on-line. Ex-CEO da Oath, Tim Armstrong anunciou o lançamento de seu mais recente empreendimento com a seguinte declaração de missão:

Investimos em fundadores orientados por missões que são líderes na economia da marca direta. Estamos construindo a infraestrutura para a economia da marca direta, criando experiências, projetando plataformas e investindo em fundadores e talentos. [1]

O DTX é em parte um fundo de risco e em parte um amplificador para marcas de DTC. O fundo já investiu em seis marcas nativas digitais bem estabelecidas com uma tese de investimento que se concentra em seu apelo a consumidores DTC influentes da geração do milênio. Voltarei a falar sobre a importância da influência no final.

Em 6 de novembro, sua empresa DTX entrou em contato com 120 marcas diretas ao consumidor, fazendo o convite para que elas se juntassem à DTX como parceiras oficiais na primeira DTC Friday, o mais recente evento de varejo criado pelo homem. Armstrong se junta a Jack Ma e Jeff Bezos nesse aspecto. O evento de um dia contou com a participação das empresas do portfólio da DTX e mais cerca de 110 que Armstrong recrutou. Apenas sete dias depois, o dia foi anunciado e, na sexta-feira seguinte, o ex-CEOda Oath foi à CNBC para explicar sua visão das marcas digitalmente nativas.

Trata-se, na verdade, de ter uma alternativa às plataformas [FAANG]. [...] Queremos levar tudo para as bordas.

A promessa do evento de varejo era bastante simples: o DTX anunciaria para 150 milhões de consumidores em potencial. No entanto, isso não funcionou para muitos dos parceiros da marca. Fred Perrotta, da Tortuga Backpacks, relatou:

A partir das 10 horas, horário do Pacífico, o dtcfriday.com nos enviou 14 visitantes, quase o mesmo número que o Duck Duck Go. Tivemos resultados melhores quando a Bitcoin Black Friday ainda estava ativa.

Liderada pelo cofundador e CEO Matt Bahr, a Enquire é uma empresa de SaaS que realiza pesquisas de atribuição para centenas de lojas do Shopify. A plataforma de Bahr trabalha com 15 das 120 marcas que fizeram parceria com a DTX Company. No total, essas marcas obtiveram dez vendas atribuídas aos esforços da DTX Company.

Analisamos a resposta anônima da pesquisa e os dados dos parâmetros UTM das marcas da DTC Friday com as quais trabalhamos. Várias delas foram destacadas no site da DTC Friday e descobrimos que menos de uma dúzia de pedidos foram atribuídos à campanha. Com base em nossa experiência de trabalho com marcas diretas ao consumidor, isso não é muito surpreendente. A abordagem de mídia abrangente normalmente não é eficaz para gerar conversões em janelas de tempo tão curtas.

Nik Sharma, um dos 29 "Young Influentials in branding" da AdWeek, também trabalha com uma seleção de marcas apresentadas pelo DTX. Em suas palavras: "Eu não tive nenhuma marca que tenha alcançado algum pico". No entanto, houve um feedback positivo. De acordo com a fundadora da Andie , Melanie Travis, "[a DTX Company] me pediu para não compartilhar nenhum número ainda, mas estou definitivamente animada com os primeiros resultados". De acordo com o Google Trends, o interesse de pesquisa da Andie Swim estava em um mínimo de sete dias na sexta-feira DTC.

Para aqueles que estão acompanhando a trajetória da DTX Company, tem havido uma abundância de ceticismo. Já mencionei a composição da equipe de Armstrong. Dos 29 funcionários, nenhum deles foi fundador de marcas digitalmente nativas. Há pouca ou nenhuma experiência prática dentro das paredes de uma empresa encarregada de revolucionar a aquisição de clientes para DTC. Há pouco do instinto que levou certas marcas a avaliações e saídas superdimensionadas.

Por outro lado, para preparar a Rimowa , concorrente da Away, para a era DTC, a LVMH contratou o ex-fundador da Raden, Josh Udashkin, logo após o fechamento de sua marca de malas. Sua experiência prática tem informado as decisões táticas da Rimowa há mais de dois anos. Foi essa falta de experiência prática que convenceu o fundador da Lean Luxe , Paul Munford, a fazer esse comentário contundente:

Pelo que sei, o DTC Friday foi um fracasso. Se estou chocado? Não. Eu me encolhi quando soube que estava chegando, e isso certamente não parece se encaixar no espírito do espaço da DNVB. Parece haver uma grande dose de arrogância em pensar que, apenas por decretar esse novo feriado, ele se tornaria instantaneamente um evento massivo como a Black Friday para DNVBs, o que, por si só, já é uma motivação terrível.

Entendo a necessidade atual de um mercado centralizado para esse espaço. E acredito que a DTC Friday foi planejada para desempenhar esse papel. Porém, a execução pareceu falha, não houve um esforço coeso no lançamento e ouvi comentários conflitantes das pessoas que participaram.

Na minha opinião, não foi um fracasso. Apesar do feedback ruim de várias operadoras de marcas, a DTC Friday provavelmente teve seu objetivo. Tim Armstrong não está errado, ele está adiantado. O esforço da DTX para lançar a DTC Friday 2019 não foi projetado para priorizar as marcas anunciantes. O objetivo era anunciar o Flowcode, uma marca supostamente avançada do conceito de código QR que foi descartado nos Estados Unidos há vários anos. A estrela de cada um dos anúncios de TV, cartazes de rua e esforços de whitelisting de influenciadores do feriado de varejo não eram roupas de banho, roupas masculinas de tecido técnico, roupas infantis ou uma bebida relaxante. As estrelas também não eram os próprios fundadores.

Em cada caso, a propriedade mais proeminente em cada anúncio era o Flowcode da Armstrong - uma maneira mais fácil de vincular o marketing visual a uma propriedade on-line. A DTX foi criteriosa em seus investimentos em publicidade. Embora algumas marcas tenham experimentado pouco ou nenhum aumento, há evidências que me levam a concluir que uma seleção de marcas recebeu o tratamento real. E elas se beneficiaram com isso. O pedido de silêncio de Andie faz mais sentido, tendo isso como contexto.

Estimativa de gastos de Armstrong com a Rockets of Awesome: US$ 35.000

Estimativa de gastos de Armstrong com Andie: US$ 45.000

Estimativa de gastos da Armstrong com o Rhone: US$ 27.000

Estimativa de gastos da Armstrong com o Recess: US$ 65.000

Flowcode, cultura QR e penetração do varejo on-line

Captura de tela 2019-11-19 às 12:50:49
Usuários da carteira móvel: Estados Unidos da América (2019)

O comércio foi democratizado e, graças a plataformas como Facebook e Google, a atenção se tornou centralizada. De acordo com o presidente e COO da Loop Returns:

Com a descentralização da atenção, as marcas terão a oportunidade de criar canais de comunicação DTC com os consumidores. A DTX e a Flowcode parecem ser um experimento inicial nesse gênero. Pode não dar certo (provavelmente não dará), mas isso não significa que eles estejam errados.

Vale a pena mencionar que, quando Tim Armstrong fez os comentários (abaixo), eles foram mal interpretados por muitos.

A estrutura de distribuição de redes sociais, pesquisa, YouTube e seus formatos de anúncios permitem que essas empresas coloquem tudo em seu catálogo de produtos diretamente na frente dos consumidores. O espaço de pagamentos, embora complicado atualmente, está prestes a se tornar muito mais fácil. E os sistemas que estão sendo construídos agora permitem que as empresas estabeleçam relacionamentos diretos e em tempo real com os consumidores.

Armstrong mantém um notável desdém pela influência da FAANG na mídia e no comércio, um fato que transparece em cada frase de efeito ou artigo sobre seu trabalho com a DTX. Suas soluções são sólidas, mas ainda estão no início. Embora tenhamos visto grandes melhorias nos sistemas de pagamento na América do Norte com a adoção do Apple Pay, Android Pay, Square Cash, Venmo, o advento do Amazon Go e a expansão de outras soluções digitais: os EUA continuam atrás da China e de outros países asiáticos.

Captura de tela em 19/11/2019 às 12:56:52
Comércio eletrônico da China como % do varejo

Como indicador de atraso, o comércio eletrônico ainda representa apenas 12% de todo o varejo nos Estados Unidos. Em comparação, esse número beira os 39% na China. A principal diferença entre as duas taxas de penetração pode ser atribuída à adoção da carteira móvel. Na China, quase todos os cidadãos usam pagamentos móveis no dia a dia. No país, o WeChat Pay e o AliPay são tão comuns que pode ser difícil para os turistas fazerem transações sem eles.

Os viajantes tiveram mais sorte com o Alipay, que introduziu um processo de sete etapas na semana passada que exige que os visitantes enviem informações sobre passaporte e visto ao Alipay, antes de carregar dinheiro usando um cartão estrangeiro em um cartão pré-pago. [2]

E aqui está o motivo pelo qual os dados são importantes. A atribuição off-line para on-line tem sido difícil para os profissionais de marketing. Nos Estados Unidos, a atribuição off-line é principalmente manual para outdoors, folhetos, malas diretas e ativações físicas. As marcas fazem pesquisas ou solicitam dados de atribuição. Na China, entretanto, os códigos QR impulsionam as vendas e a atribuição em escala. [3] Dado o fluxo de inovações no varejo da China para os Estados Unidos, fica claro que, quando Armstrong fala sobre pagamentos "cada vez mais fáceis", ele prevê a adoção de carteiras móveis e sistemas de pagamento simplificados. Por quê? A prevalência desses sistemas está correlacionada com a adoção em massa do uso de códigos QR na China.

No início desta década, a maioria dos chineses ainda carregava dinheiro em todos os lugares e os cartões de crédito raramente eram usados fora das grandes cidades. Mas, à medida que as pessoas começaram a ganhar mais, ficou claro que precisavam de uma nova maneira de pagar sem carregar maços de dinheiro. [3]

O DTC Friday pode não ter sido um dia de vendas bem-sucedido de acordo com a maioria dos padrões, mas foi uma maneira eficaz de recrutar marcas populares para comercializar um conceito do qual os Estados Unidos riam apenas alguns anos antes.

Nos Estados Unidos, há barreiras para o futuro que Armstrong imagina. Aqui, os Estados Unidos têm excesso de varejo. Há mais lojas de tijolo e argamassa per capita do que em qualquer outro lugar do mundo. O setor de desenvolvimento imobiliário é tão predominante que o tijolo e a argamassa se tornaram o maior obstáculo do comércio eletrônico. Estamos menos propensos a adotar pagamentos móveis e quando podemos usar cartões de débito na maioria das lojas físicas.

Portanto, enquanto isso, as marcas digitalmente nativas são mais bem servidas aproveitando os métodos dos varejistas tradicionais para alcançar escala. Mas, eventualmente, a hipótese de Armstrong se mostrará correta. O tempo dirá se será a DTX Company que viverá para levar o crédito por essa mudança no comportamento do consumidor. A curva de difusão da inovação não favorece Armstrong. Caberá à DTX e ao seu grupo de fiéis da DTC, como Andie, Recess, Rockets of Awesome e Rhone, persuadir a geração do milênio a mudar seu comportamento de compras. Caso contrário, o Flowcode de Armstrong poderá ser o Webvan para o DoorDash ou o UberEats de outro inovador. O tempo e a velocidade de adoção determinarão quem receberá o crédito pela venda. E esse pode ser um problema de atribuição que nem mesmo Armstrong pode resolver.

Pesquisa e relatório de Web Smith | About 2PM

No. 338: UpWest and Hygge

Hygge-2PM

A publicly-traded retailer launched a DTC brand. This is a deep dive into their reasoning, the build, and their internal expectations. 

Middle-class retail is at an impasse. Since the beginning of 2019, there have been 19 bankruptcies to include Forever 21, Gymboree, Charlotte Russe, Payless ShoeSource, Diesel, and Destination Maternity. And there are another eight retailers at risk to include: J.C. Penney, Neiman Marcus, J. Crew, and Hudson’s Bay. In Gilded Age 2.0, I explain that our current retail era signals a casualty of the middle class consumer; a class that once emerged in response to the industrial and financial booms of the late 19th century and the governmental reforms of the mid-20th century.

With a flailing gig economy, stagnant wages, and rising personal debts, 2019 presents a break from the mid-century momentum that defined the 20th century. We are beginning to hear faint echoes of an earlier time of boom or bust and feast or famine. Rather than appealing to pure luxury consumers or fast fashion-loving millennials, the “long middle: erroneously remains the bullseye of the target. Retailers have been slow to optimize for a new market of coveted consumers.

In a recent report by Business of Fashion proclaimed that America still doesn’t have an answer to LVMH. They explain:

Spoilt for choice, consumers are less interested in mid-priced products available at scale: they want dangerously affordable fast fashion or pure luxury. (And preferably at a discount.) It’s harder for consumers to see the value in something that is not cheap but not that expensive, either. Especially if it’s not utterly unique. That’s a problem for Tapestry in particular, which deals exclusively in accessible luxury. [1]

Against the backdrop of abundant choice and a bifurcating market, Ohio retailer Express launched a new brand. Express is currently trading at a $265 million market cap with north of $2b in sales. The cost of that revenue is extraordinarily high compared to healthier retailers. Trailing twelve months, Ralph Lauren Corporation earned north of $6.5 billion with a $2.45 billion cost of revenue.

In contrast, Express earned (TTM) north of $2.1 billion with a $1.5 billion cost of revenue. A 25% gross profit margin heading into a crucial holiday season, the Columbus-based retailer hopes to use the DTC initiative to improve their long-term outlook. The effort has been met with a mix of pessimism and optimism. 

Pierre Kim of Away: 

For years, retailers have been criticized for not evolving quickly enough to meet the demands of their customers, so what do they have to lose with this new strategy? Their core labels may be faltering, but they still have brand equity. Why not use it to experiment and launch new businesses?  [2]

Paul Munford of Lean Luxe: 

There’s baggage associated with being under a legacy retailer’s umbrella—it decreases the value of the brand to the savvy consumer,” he said. “However, execution will always ultimately be the key here. Spinoffs need to feel like their own entity, as opposed to a sub-brand of the legacy retailer. [2]

There are merits to both arguments. And a little bit of digging provided more clarity for this report. Under the umbrella of Les Wexner’s Limited Brands, Express launched as women’s clothier “Limited Express” in 1980 Chicago. Led by CEO Michael Weiss, the brand expanded to eight stores in 1981 and by 1986, Express began a test for menswear in 16 of its 250 stores. The men’s line spun out as Structure in 1989.

I remember the brand very clearly. As a twelve year old in 1995, the halls of my middle school were split between the haves and the have nots. For the ones with, shirts by Polo and Structure were the daily wears and all I could remember is the sensation of having neither.

4
Remember this?

The advancements that Express made during that 20 year run are astounding to think about. In 2001, Express became a dual gender brand – a pivot that Madewell is currently attempting to execute. Structure “sold” to Express, or at least that’s how I remembered it. Because immediately, I became a fan of Express. In actuality, the brand was owned by the same holding company. It funneled its mens business to a brand that provided more opportunity. L Brands then, quietly, sold the mark to Sears in 2003. The Structure brand was never heard from again.

Express is no longer owned by L Brands, one of the most prolific builders of retail brands in history. It was sold to Golden Gate Capital Partners, a private equity firm with $15b in assets under management. And then, in May of 2010, the retailer went public.

Demographic vs. Psychographic | Part Two 

In 2016, Express made its first play for the direct-to-consumer era by acquiring a minority stake in HOMAGE, the Columbus Ohio retailer led by founder Ryan Vesler. It’s a genuine brand, one where the founder-product fit is as valuable as its product-market fit. The minority investment with vintage t-shirt company meant that Express bought a new audience of a key demographic: the college-aged millennial.

Homage President Jason Block said in an email that Express will consult with the company on an ongoing basis and the investment will allow Homage to expand both its digital and brick-and-mortar presence. [3]

Aside from investing in a growing company,  Express gained the rights to include a limited selection of HOMAGE products in store. The investment was intended to bolster foot traffic while, potentially, benefitting from the long-term flip – if and when the HOMAGE brand grew with the help of Express. It’s unclear whether or not this initiative was successful for either of the brands. The company is currently trading below the price it maintained during the period that Express began its partnership with HOMAGE. The publicly-traded retailer’s missteps over the past two years were due, in part, to a number of macroeconomic shifts.  The launch of UpWest represents a strategy shift of its own.

In Psychographics in Focus, I explain the difference between a demographic and psychographic. Consumer psychology involves the interest in lifestyle, behavior, and habit. It’s an encompassing measure that considers our idiosyncrasies, our temperament, and even our subtle personality traits. These are the variables that influence our behavior as consumers. Psychographic segmentation is the analysis of a consumer cohort’s lifestyle with the intent to create a detailed profile. [4]

Taking a community-building approach, UpWest plans to connect with new customers through experiential events, including a regional tour across the US that features the UpWest Cabin, a mobile pop-up exhibit featuring relaxation-focused experiences like yoga and meditation classes. Slated stops include Columbus, Chicago, Nashville, Denver and Austin.  [2]

From the typeface, to the story-telling, to the merchandising – the UpWest brand is designed to attract fans of the digitally-native industry. Rather than a specific demographic, Express pursued an interest (DTC) and is building a brand atop of that engaged audience.

DTC As A Psychographic

Web Smith no Twitter

DTC, 2012: a tech stack strategy. DTC, 2016: a logistics strategy. DTC, 2020: a brand strategy.

In a span of three days, I received multiple emails and texts from contacts close to the launch of UpWest. Kaleigh Moore, Forbes writer and 2PM collaborator had a story in queue by then. In the Lean Luxe Slack, it was a topic of conversation. Rather than building in-house with Express’ existing engineering group, UpWest contracted Shopify agency BVAccel to handle the design and development work. This was a nod to several of the most successful digitally native brands in the space to include Untuckit, Cubcoats, Chubbies, and Rebecca Minkoff. 

Comparison-Upwest

The site’s architecture communicates a desire to be mentioned in the DTC conversation, this includes UpWest’s partnership with Klaviyo and its new-age loyalty program. It would appear that UpWest chose to focus on the DTC psychographic for the sake of earned media and brand positioning. As far as the nuts and bolts are concerned, the site’s build communicates that the desired target demographic is millennial-aged women. On day zero, the brand has an explicit purpose: to provide comfort for body, mind, & spirit. The clothes, are priced similar in design and price to Marine Layer – its next closest competitor.

Identifying Waves: Importing Hygge to America

In the past year, this concept of Scandinavian coziness has made inroads with an international audience. [5]

Imagine a whiteboard in one of Express’ suburban Columbus boardrooms; the word “hygge” would have been at the center of it in big and bold lettering. You can picture the brand’s chief comfort officer (and Express’ SVP of Strategic Initiatives) standing in the corner of the room, jamming as Cody’s It’s Christmas plays on the room’s four Sonos speakers. The brand wants you to feel a feeling. Analysts agree. Emily Singer, founder of the DTC newsletter “Chips and Dip” had this to say:

There’s something very boring about it. Maybe that’s intentional. This line feels a little too on the nose: ‘Welcome to curated comfort. For those who are seeking peace and calm in a stressful world.’ Brands tap into emotional states, but it’s rarely laid out so explicitly.

It’s this perceived boredom that is viewed as an understated luxury in American culture. To the Danes, hygge is free of economic status. The culture’s entire focus is on practicality, movement, wellness, and mindfulness. It’s this underlying culture that Express hopes to import with the help of some obvious visual cues from well-known DTC retailers.

The UpWest typeface is nearly identical to the typeface of Outdoor Voices and Marine Layer’s. Ironically, both retailers have references to Scandinavian hygge throughout their brand messaging. But for UpWest, there’s no understatement. Every message is turned to maximum volume. Like the primary header of Express.com: UpWest’s primary menu is a throwback to “Limited Express”, a retailer for women-first and men-second. There are elements of luxury abound. Upwest’s blog features new-age terms like: nourish, mindfulness, tranquility, and sanctuary. The traveling pop-up is a “cabin.” These are all symbols of wealthier millennials with time and resources to spare. As is the concept of philanthropy and sustainability (though UpWest sells products that are made with synthetics).

It starts with our cozy apparel, home and wellness products. We want to surround you with calm and give you balance. But it’s not just the tangible things. It’s also about slowing down. Diving deeper. And giving back.

Not to be outdone, UpWest wants consumers to help them donate $1 million to the Mental Health Association. The Express-borne retailer plays the entire DTC hand of cards. This report began with a simple statement: middle-class retail is at an impasse. To the average consumer, this DTC play is akin to Structure being launched as Express Men. Like a sheep, the seventeen year old me bought from Express as soon as my adolescent wallet would allow. The mechanics are similar here. Express is attracting an existing audience (the DTC psychographic) and using it to invigorate a brand that is plateauing.

Conclusão

The UpWest bet is that the retailer can earn the business of the upwardly mobile DTC audience by engineering a product-market fit. One with heavy branding, ideal-alignment, and market messaging. This is one of the first upmarket attempts that we’ve seen from a specialty retailer. It’s one that deserves praise. Their management team engineered a brand with contemporary pricing and luxury messaging – void of pricing promotions (for now). They’ve acknowledged that the data shows a middle-class at an impasse. They have the supply chain, the logistics, the distribution, and a snapshot of a brand. But do the executives at Express truly understand what makes the top DTC brands work? That remains the question that could move the market.

Time will tell if Express can duplicate the brand architecting of their L Brands era – a time defined by face-less brands, clever signage, billboards, and foot traffic. My guess is that Express will find an audience that is more sophisticated and critical than the young adults of the 80’s, 90’s, and 2000’s. Messaging, distribution, and customer acquisition methods will evolve with this realization. And if that’s the case, their hygge may be tested for quite some time.

Pesquisa e relatório de Web Smith | About 2PM

No. 337: Stick To Sports

For as long as there has been athletic competition, there has been a narrative that permeates from the field of play. Gladiators of Rome were commonly first-generation slaves, bought and sold at the whim of their owners – the sporting promoters of their day. Like today’s gladiator sports, cruelty was a part of the spectacle. And the minds of the time contrasted in their approval or disapproval of their era’s proudest spectacle. Great minds like Seneca disapproved of the competition. Marcus Aurelius once abolished a tax on gladiator-based taxes and commerce; he wanted nothing to do with the capitalism of it all. And still, he couldn’t resist hosting lavish games from time to time. The spectacle of cruelty was insatiable to the average man and the great one – alike.

As it was, as it will always be. Sports was never without its social commentary. Jesse Owens’ olympic showing wasn’t just impressive because of the speed of his feet; he beat the myth of German superiority with a foot race. Jackie Robinson wasn’t just a baseball player, he was remembered as a hero. That was the narrative that was formed about the man, even while his involvement lacked the popular sentiment that it is awarded today. Janet Guthrie was a media fixture, not just because of her precedent off of the track but because of her accomplishments on it. Before Danica Patrick, there was her. And with a little more support from sponsors and officials, she could have accomplished much more.

Since when has sports been about athletic accomplishment alone?

On a November evening after the Baltimore Ravens’ decisive victory against the undefeated New England Patriots, ESPN National NFL Writer Kevin Seifert made a statement with a simple tweet. He listed three quarterbacks, each of whom are considered candidates to win the league’s coveted most valuable player award. The quarterbacks that Seifert listed: Russell Wilson, Deshaun Watson, and Lamar Jackson are what veteran industry analysts would call: unconventional, mobile, dual-threat. However, they’re more than that. In each case, whether these quarterbacks pass or rush, they lead from the front. More than anything else, that’s their common thread.

Kevin Seifert on Twitter

If we’re doing the MVP now, I’m going: 1. Russell Wilson 2. Deshaun Watson 3. Lamar Jackson

Here is a selection of quarterbacks drafted before 2019’s MVP candidates: Ryan Tannehill, Brandon Weeden, Brock Osweiler, Mitchell Trubisky, Baker Mayfield, Sam Darnold, Josh Allen, and Josh Rosen. To the casual observer, this thought may as well be morse code. So consider the following: the National Football League has never had three African-American quarterbacks in the front running for most valuable player. And certainly not in an era of the sport’s greatest quarterbacks, namely Tom Brady and Aaron Rodgers. We’re still in a period of firsts in this 150 year old sport. Brigham Young University started their first African-American quarterback in the year 2019. The sentiments of the 1950’s still linger. So what Seifert was doing was making a statement without controversy. To the untrained eye, it was merely the fact of the matter. But to those who understand the historical significance, it was a dog whistle of sorts.

“If you ask me is there a false narrative out there, I will tell you ESPN being a political organization is false,” he said. “I will tell you I have been very, very clear with employees here that it is not our jobs to cover politics, purely.” [1]

But even with the mandate by new ESPN President Jimmy Pitaro, Seifert found a way to toe the proverbial line. Wilson, the 75th pick of the 2012 draft is now the highest paid quarterback in the league. Bears quarterback Mitchell Trubisky was drafted before Watson. And Ravens quarterback Lamar Jackson was publicly and privately coaxed to convert to wide receiver by many in the media. He didn’t fit the image. His chorus of detractors included former Indianapolis Colts GM Bill Polian [2].

After this historic game, Bleacher Report took a muted approach as to avoid the conversation altogether. In the NFL, running backs don’t win MVP over transcendent quarterbacks. In the last 20 years, just four have won. Sixteen quarterbacks have been selected in that time. Just the same, here was their take:

And [Jackson] a clear MVP candidate. This game firmly planted him in that discussion, along with Panthers running back Christian McCaffrey, Seahawks quarterback Russell Wilson and Texans quarterback Deshaun Watson.[3]

Meanwhile, at Deadspin, the two lead stories are written by a generic “Deadspin.” A sign that no one is behind the wheel. The reports were merely a collection of embedded tweets. There’s one on the Ravens surprise victory. The one where the quarterback (that should have played receiver) trounced the greatest of all time. As the two shook hands upon leaving the field of play – battered and bruised – Jackson uttered “You’re the GOAT.” As if Brady needed a reminder. The other Deadspin “story” featured the Cleveland Browns latest off-the-field issue.

The only report with any personality was written by Karu F. Daniels of The Root, another property of G/O Media. It was repurposed into Deadspin content. One can only wonder what Deadspin would have written about a unique moment in the sport’s vaunted history. But the site is currently a shell of its former self. The staff quit en masse after being told to by G/O Media management to “stick to sports.” A common refrain in today’s corporate media.

G/O Media is the product of Great Hill Partners’ acquisition of the former Gizmodo Media Group. The all-equity transaction was facilitated with Jim Spanfeller, best known for his leadership at Forbes.com. Perhaps, it’s his lack of experience in sports media that permitted such a fatal miscalculation.

The Irony of The “Stick to Sports” Mandate

Google Search interest for “Stick to Sports” peaks in September 2017

On its merits, the nature of the phrase is divisive. When ESPN’s Rachel Nichols spoke out in September of 2017, the peak of its interest, she raised questions around the hypocrisy of it. It was around that time when J.J. Watt was rightly praised for raising $20 million for hurricane relief while other athletes faced pushback for highlighting other extracurricular causes – most often around social justice issues. With the current state of American politics at a relative boiling point, the separation of societal politics and corporate entertainment have never been more difficult to parse. ESPN found ways around its “stick to sports” mandate by elevating intelligent and nuanced figures like Pablo Torre, Stephen A. Smith, Max Kellerman,and Bomani Jones. Deadspin wasn’t as forward thinking and they ultimately paid for that.

“Stick to sports” is, of course, a fault line in 2019’s culture wars. [4]

But as the state of our political machine continues to polarize Americans, the mandate becomes harder and harder to follow. Yet, it becomes more important to disobey. In fact, at some point, the mandate becomes bad business. This is especially true for digital media where Deadspin rival and The Chernin Group-owned Barstool Sports has thrived by using sports as a platform to enter adjacent conversations. And I am using the word “adjacent” liberally here. Several of the top stories on Barstool Sports currently include an Instagram influencer questioning his history syllabus, a feature on the “Watchmen” series, and a woman that tattooed her eyeballs.

The banner of Barstool’s homepage features a link to the media group’s famed Chicks podcast. And all of this is to say, it seems to be working for Barstool. This includes its cozy relationship with Fox News, including regular appearances by founder Dave Portnoy on Tucker Carlson. And this isn’t an argument against their approach. Rather, it was an acknowledgment that Barstool Sports has thus far succeeded by understanding the property’s psychographic. The Chernin Group seems to have avoided the stick to sports conversation with CEO Erika Nardini.

Ringer, Deadspin, B/R, Barstool and Psychographics

Consumer psychology involves the interest in lifestyle, behavior, and habit. It’s an encompassing measure that considers our idiosyncrasies, our temperament, and even our subtle personality traits. These are the variables that influence our behavior as consumers. Psychographic segmentation is the analysis of a consumer cohort’s lifestyle with the intent to create a detailed profile.

The Ringer is jovial and care-free. Bleacher Report is dead-pan with the occasionally dry humor. Barstool is edgy and offensive as a strategy. And so was Deadspin.

While largely focused on sports, Deadspin for years had delved into a broad range of topics in a voice that was sometimes rude, often funny and always conversational. On Tuesday, the site’s top editor, Barry Petchesky, was fired after refusing to go along with the order. The departures shocked fans of the site, which put a new spin on sports coverage for a generation of digital natives. But they were the result of a long buildup of resentment between the journalists and their new bosses, according to interviews with 13 current and former employees of Deadspin and G/O Media.[5]

Nov 4: Barstool’s Homepage

For Deadspin, the majority of their sensationalism involved topics that were completely unrelated to sports in substance, this report isn’t necessarily about the history of those articles. Bill Simmons’ The Ringer shares a similar narrative with Barstool. On the homepage, you’ll find stories about Mr. Robot, Jeopardy, AppleTV+, and The Watchmen. Bleacher Report contrasts the three. The publication leans heavily towards strict sports coverage, a methodology that works for them. But even B/R featured an epic story on Colin Kaepernick written by Rembert Browne. And most recently – a story about Jared Lorenzen, the former Kentucky quarterback who died prematurely. Which brings me to the point: where do you draw the line when your publication covers sports? Collegiate and professional sports represent a layer of American life, not the totality of it. Sports is merely a dimension, not the whole.

No Code and The Business Case FOr: Stick To Sports

OM on Twitter

Let me rewrite this tweet from Jason. 1/ Deadspin writers are immensely talented and have a huge following. They have a lot of goodwill at present and as a result they should Marshall their collective resources and start a new publication. Let’s call it SpunOut. https://t.co/161I1HkInj

The editors and writers who resigned from Deadspin had a basis for their frustration. Sticking to sports is a nearly impossible proposition in today’s media. Given how rare it is to see a media company stick to their original charter, it’s understandable that Deadspin’s former employees saw the charge for what it really was: a euphemism for staying away from covering athletes who’ve immersed themselves in left-leaning causes.

But we’re in an ever-expansive era of digital media. Companies are rewarded for reaching. Complex Media is developing television shows and consulting third parties on commerce and audience development. Barstool Sports has a podcast starring two employees who discuss their friendship and sex lives, and Bleacher Report successfully collaborated on soccer kits with top hip hop artists.

Whatever happens moving forward, the Deadspin that was is no longer. It was one machine of a blog with nearly 30 million monthly visits and a penchant for engaging and re-engaging their loyal readers, many who’d visit the site multiple times per day. But it begs the question, if Deadspin was still Deadspin, what might they have written of Kevin Seifert’s idea? How would it have covered a tweet that should have been more than inconsequential. It’s doubtful that Deadspin may have told the story in the same ways that Barstool, Bleacher Report, ESPN, and The Ringer relayed theirs. To those platforms, the MVP race was not a story at all. But take it from NFL veteran and commentator Cris Collinsworth. As the Ravens led the Patriots, with the crowd in disbelief, Collinsworth quipped:

We’re going to be able to point to quarterbacks in the NFL that got a chance because of this night.

But in 2019, for many digital publishers, that’s too loaded of a statement. But many understood what it meant. And that understanding is part of the story too. The market has a need and the opportunity rests on the journalists who decide to forge their own paths. It’s only right that Deadspin alumni launches a Substack with the call sign of their mandate: Stick to Sports. Used ironically,  of course, as one last jab at the man they called an herb. The publication would almost instantly lead the Substack board.

With that model, Deadspin’s former writers and editors would have the freedom to do it the right way. Anyone who’s ever played the game knows that sports doesn’t end when you step off of the field of play. A sport is America’s pastime, it’s the most watched television event, it’s the most expensive event ticket, it’s the basis of a nation’s network of country and athletic clubs. Across America, hotels are built solely to support a thriving youth sports cultures of areas that would otherwise be barren without its expensive field complexes. Young people wear jerseys and the shoes of sporting legends. And adults bet and cry and yell and travel to watch their teams. It’s the irrationality of it all that reminds us that sticking to sports is an impossible task. And media should reflect that impossibility. Seifert knew the significance of his tweet, America should have known it too.

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