Issue No. 259: Walmart’s Next Acquisition


Over the weekend, 2PM released the first executive member brief. It covered quite a bit of ground in an in-depth report on Walmart v Amazon eCommerce called Walmart Ventures.

Here is a small excerpt:

The competition between Walmart and Amazon has never been stiffer. Consumerism has always been about the heart, until Amazon made it about efficiency and logic. But for items as intimate as what you wear and what you sleep on, is logic enough?

Walmart is betting on the heart again by focusing on brand affinity, representation, and reinvigorating consumer faith. By using eCommerce as the tip of the spear, their brick and mortar presence will innovate along with it.

It’s no secret that I tend to believe in Marc Lore’s vision for a modern Walmart. In my recent report, I focused on Walmart’s brand-equity growth by means of DNVB acquisition (Modcloth, Moosejaw, Bonobos, etc). And 2PM Executive Member Taylor Holiday called me on it:

Solid stuff as always Web. The question I have that this post ignores a little is related to logistics power. You touch briefly on the convenience element that Amazon focuses on and I wonder how Walmart will seek to combat this? The thing I believe would be super super interesting would be Walmart could combine the DNVB style slick brand launch with convenience of a logistics super power. Imagine Allswell style brand with Same Day Delivery. Now that would be interesting.

Taylor Holiday, Managing Partner of Common Thread

In my report, I made two tables available: (1) Walmart’s existing acquisitions and (2) Walmart’s target acquisitions. To Taylor’s point, in discussing Walmart’s appetite for acquiring sexy DNVB’s (or building them from scratch), it’s easy to overlook that they’ve also acquired Parcel (2017). Walmart is working on building that logistics super power. And if they can’t finish the job, another $1B+ acquisition is on the way.

Walmart on Parcel’s acquisition: 

New York City is the top market for both Jet and, and because of the density of the area – along with the proximity of our fulfillment centers – it’s the perfect place for high-impact innovation. Born and bred in New York City, Parcel has developed unique expertise delivering to customers in a distinctly challenging and essential market. This acquisition allows us to continue testing ways to offer fast delivery while lowering our operating costs. We plan to leverage Parcel for last-mile delivery to customers in New York City – including same-day delivery – for both general merchandise as well as fresh and frozen groceries from Walmart and Jet.

As further proof that logistics is on the minds of Walmart executives, look no further than last night’s Oscar’s campaign.

The star of each 60-second spot is the same as for Walmart’s current ad campaign – the retailer’s signature blue shipping box – a nod to corporate priorities in the battle to catch Amazon in e-commerce. 

Jack Neff, AdAge

And if I had to project Walmart’s war room strategy, a Postmates acquisition comes to mind. Nationally, it’s one of the most trusted of the last mile platforms and it’s proven that it can operate in many of America’s largest markets. Couple this with the company’s recent emphasis on grocery delivery and you’re looking at quite a bit of shared virtue. Walmart’s grocery business is of its highest priorities.

Assuming that Parcel’s acquisition was a test, the Postmates acquisition could be the beneficiary of Walmart’s single-market experiment. After DoorDash’s recent $535M raise, this is an acquisition that makes sense for the gritty and resourceful Basti Lehmann and company. And it’s a purchase that is in Walmart’s price range. Paging Marc Lore.

Read more of the issue here


Issue No. 249: The definitive white paper


A last word: too big to ignore 

Here is the link to the definitive white paper on Amazon’s advantages in commerce, media, retail brand growth, and ad tech.

Key excerpt:

Unlike Facebook and Google, the eCommerce giant is in the business of selling products to shoppers, not selling inventory to brands — a subtle, yet important diference.

Advertising executives are talking to Amazon’s reps about supply chains and inventory as much as ad copy or keyword strategies, which Jason Hartley, 360i’s national head of search and paid social, admitted “is very different and challenging, but absolutely necessary.

See more of the issue here.

Issue No. 225: eCommerce and middle America


A last word: Amazon v. Alibaba

The differences between Alibaba and Amazon are numerous but there is one glaring difference. eCommerce in America is increasingly marketed as a solution for the middle-to-upper class. In China, eCommerce has made progress opening channels to rural and poorer citizens. Here, it is a novelty and growth is more difficult. In China, eCommerce is an economy open to all (mostly out of logistical necessity).

At last survey, eCommerce has a 30%+ adoption rate in China vs. 12%+ in the United States.

Why the difference? eCommerce is a relative luxury in America and the cost of fulfillment is to blame. With the (1) proliferation of “free” shipping, (2) the skyrocketing costs of warehousing, (3) and the slim margins of many major eCommerce players, adoption is reduced to a smaller slice of the American population than our Chinese counterparts.

In short: in America, we only market to people that can best support our rising logistics costs.

It is through this lens that you should view Amazon and Walmart’s recent developments. While we’ve all read the strategic differences between Amazon’s acquisition strategy and Walmart’s, one similarity is that both are moving upmarket. Solid Yarn Spun Tees and Kombucha Tea anyone?

See more of the issue here.

Issue No. 145: The Slow Death? Perhaps, not.

Chart of The Week


Though the above chart is telling, the negative CAGR for newspapers does not communicate the whole truth with respect to the importance of traditional press. Newspapers across America are shaping this year’s election by cultivating an influential voice. A newspaper’s voice often communicates the importance of voting and the direction that the metropolitan area’s micro-economy should lean. This voice can hold weight that national news or cable news cannot. In cities like Columbus or Charlotte or Austin or Philadelphia, there may be no greater influence than this evolving form of old media.

See more of the issue here.

Issue No. 118: VMA’s reached 3x more on Snapchat, on Spotify’s (lack of) profitability, SpaceX destroys Facebook’s satellite

Media adopting eCommerce at a hastening pace


Expanded image here.

Yesterday, I noted that I’d feature five media groups who’ve successfully added eCommerce to their revenue arsenals. The requirement to be on this list: (1) they have an editorial team (2) the sales are direct (not affiliate) sales (3) they also maintain a thriving ad-sales revenue stream (display and/or native).

  1. Barstool Sports: has a cult following in sports. They are rumored to generate $9M / year in eCommerce sales.
  2. Monocle: is a meticulous and artful online media company and print magazine  that generates over $10M in eCommerce sales on just < 450,000 uniques per month.
  3. Hypebeast: is the queen of the throne, rumored to generate over $15M per year in eCommerce sales.
  4. Hodinkee: is my personal favorite. They are generating between $5M and $7M per year in watch and accessories sales.
  5. Goop: has figured out editorial eCommerce. Gwyneth Paltrow’s brand just raised another $10M to go full speed into eCommerce, leaving ad-based media in the dust.

Editorial eCommerce is the next wave for revenue-driven media companies. But it takes more than a pretty homepage to execute this strategy. As display ads continue to be challenged by vendors who prefer direct clicks, this type of traffic monetization will continue to thrive.

See more of the issue here.

Issue No. 115: New shifts to note, the GOAT pivot, world’s fastest

Graphic: Consumers Want Bolder Experiences, Fewer Things


Consumers are beginning to increase the consumption of trips and unique experiences while de-emphasizing their appetite for big ticket belongings. This trend is becoming more evident during a time when digital products are beginning to outpace the purchase of physical goods. Another shift to note, the continued growth of photo and video based self-expressions over social media. I do believe that improved iPhone / Samsung / LG cameras and increasingly adopted video platforms (Snapchat, Instagram, Periscope, FB Live) will continue to motivate travel to new places and the photography of picturesque moments. Memories are now just as important as things and until Total Recall becomes a reality, experiential consumerism will continue to uptick.

All in all, we will continue to see a fetishizing of travel and the commerce that is associated with it. These burgeoning categories include: tours and activities, alternative accommodations, inspiration (Frommers, Nat Geo, Travel and Leisure, Foursquare).

See more of the issue here.

No. 56: Waves and eight must reads.



An on-going joke at Mizzen+Main was the repetitive use of Kanye’s famous now-famous soundbite “it ain’t Ralph, though!” The Ralph Lauren brand has been a fixture in menswear since the 1960’s. Its timeless style has been the guide for each generation of professional women and men. In essence, no other brand compared to RL’s longevity and forward thinking.

Stories of Ralph Lifschitz hustling neck ties at Neiman Marcus once powered us through a time that was especially hard. In 2012 and 2013, convincing men to wear cotton-free formal wear was very, very difficult. The thought of it was insulting to many who preferred cotton wovens over technical knits (that appeared organic in nature). Fast forward four years and it’s clear that technical fabrics / smart fabrics / and “gym clothes as formal wear” will own at least a piece of the menswear future. Two brands helped create a wave.

The problem with the adoption of this technology at the heritage brand’s design houses is that manufacturing with dynamic fabrics is infinitely more difficult than manufacturing with cotton and other traditional textiles. So it may be early to think that Ralph Lauren is internally discussing technical DNVB’s like: Mizzen+MainMinistry of Supply and their recreational counterparts – Kit and Aceand Outdoor Voices. But hey, it’s likely that they are.

Nike and Adidas have thrived by acquiring brands for each’s unique appeal, heritage menswear brands like Ralph Lauren may have to consider it for the first time.