Member Brief No. 3: The Attention Stack

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Successful commerce companies and vertical brands want to know how to generate authentic happiness with their customers. A customer kept > a customer gained. The attention stack is a buzz phrase that you’ll hear quite a bit about as brands try to solidify their standing in a quickly evolving market.

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Issue No. 254: An Open Letter to DNVB CEO’s


Pictured: Outdoor Voices, led by Founder Tyler Haney


You deserve more praise. I worked alongside one of your kind for a time. I learned a lot about the personal costs of building a product and then a brand from scratch. Frankly, the costs are high.

By the time that people know who you are and what you’ve accomplished, demand is probably already there. That $3-5M in revenue is as close to automatic as it gets. In fact, that accomplishment has lost its luster. Now it’s on to $15-25M. But people rarely see what you had to go through to get to that $1M mark.

What people don’t know is that DNVB executive teams build two products from scratch, supply and demand:

  1. The product: the shirt, or the luggage, the pants, the shades, the coats, or whatever it is that people know you for.
  2. The brand: the aura of that product, the name recognition, the association, the behind-the-scenes partners, the spokeswomen, the ambassadors, the inevitability of success.

You stressed over supply chain woes. You cried some nights. Your cofounder or your creative director drove you nuts because they didn’t realize how close the company was to crumbling.

You stressed over cash flow problems. You cried some more. Your job was equal parts: (1) innovating and (2) just figuring it out.

You stressed over the difficulties of getting Trent, the very normal VC, to see your vision early. Some DNVB’s paths were easier than others. But yours was not easy at all. Absolutely nothing was given. And still, you held it together.

And after all that, you managed your minimum viable product. You were in possession of 10,000 units that people didn’t really want because those units weren’t close to the fifth-generation products that are on the market today. That first-generation of leggings just weren’t that great. So you relied upon the brand to get you through those days. You managed to convince consumers, retail / tech media, and investors that your success would be inevitable. And that your brand will be around for 100 years. They felt the impact of those statements and they agreed with you. But everyone that reads this knows that the mirage was hard to keep it up in the beginning.

“We may not be great today but we will be. Buy in early.”

Turning a logo into a greater meaning takes a decade and you had to do it before those 10,000 units of first-gen mediocrity bled you dry.

So here we are, years later and it’s still hard – but it’s not as hard as it was. There are dozens of DNVB CEO’s, just like yourself, who understand the toils of creating supply and demand for your company. And then stressing over the balance between the both of those products.

DNVB CEO’s run brands that are relatively lean and almost always running at a deficit. You don’t have the ad budgets and marketing forces like the legacy companies or the software platform. But you survive. And once you make enough noise, retail pundits will call you on your inefficiencies and inexperience. They’ll actually root against you. That’s what retail ‘experts’ do. But please know that many of us praise what you’ve accomplished in such a short period of time.

You started your company in an age that required your retail independence. On day one, your brand couldn’t depend on wholesale purchases from Nordstrom or Target or Whole Foods or Walmart. And that independence made you more viable in the long run. And now, those retail powerhouses are now knocking at your headquarters.

So please, continue to innovate. And when you’re emotionally or mentally maxed out, remember that your companies will be the foundation upon which the future of retail is built. People will wear you, consumers will shop you, and malls will bend over backwards to work with you.

And then, the retail experts will reluctantly write that your brand successes were inevitable all along.

See more of the issue here.

Issue No. 218: Back on 🎯


Graphic of the week


An interesting look into big box tech innovation thanks to data collected by CB Insights. In one of my many conversations with LeanLuxe’s do-it-all capitan M. Paul Munford, I opined that while focusing on brands is most fun – the platforms that aid their survival are equally important to cover. These sudden shifts in distribution can affect brands in more ways than one. Ask Kevin Plank how he feels about Sports Authority, these days.

Target’s recent attraction to DNVB’s like Harry’s, Bevel, and now Casper has become an industry-wide trend. These marquee, web-first brands are flocking to retailers like Target but how much longer can Tar-jay fend off up-market threats from Wal-Mart? Don’t be surprised to see these modern luxury brands veer that way in the coming quarters.

Read: Is Target back on target? 

See more of the issue here.

Issue No. 159: Serendipity through technology

Last Word: Serendipity Through Technology

When you’re operational for a long enough time, you begin to lean on the direction and advice of others while synthesizing your own knowledge into actionable steps, less and less. The ‘why’ for passionately curating and writing a daily letter like this is broken down by Venkatesh Rao in a way that I never could. The simple enough answer? 1) Serendipity 2) Compounding knowledge. Read how this all works through the eyes of an eloquent writer, equipped to explain the nuances of leaps in knowledge – an outcome that I’ve wanted for all who read 2PML on a daily basis.

Via Breaking Smart by VGR

To parlay something into something else is to turn a small advantage into a big one via a sequence of unplanned, but not unanticipated, gambles. It is the essence of finding serendipity. In an environment shaped by exponential change — Moore’s Law or gene sequencing for example — parlaying is a survival skill. Parlaying is the opposite of planning. In planning you deliberately sequence near-certain things in advance, to create one future, and plan on breaking nothing along the way.

In parlaying, you daisy-chain bets to create an expanding range of positive possible futures. You pick the most interesting bet at each stage, and expect things to break along the way. Agility is not just the best approach to parlaying, it is the only approach. The point of operating via iterative trial and error is to predictably create parlaying opportunities, not just fix errors or “test” things.

You’ve heard the term “a rolling stone gathers no moss.” I like to think of agile parlaying as “a rolling snowball grows bigger.” Each pivot is potentially an opportunistic level-up of some sort, not just a course reset. Imagine a snowball rolling downhill. It can grow huge and even trigger an avalanche. But it also breaks and destroys things on its path. Facebook’s old slogan, move fast and break things, isn’t two statements. Where fast is calibrated at “fast enough to stay on top of an exponential environment,” the break-things part necessarily follows.

The key is to try and gain some control over where you’re making compounding gains, and where you’re breaking things. Trying to choose a locus of compounding and a locus of destruction is of course a bit like steering a snowball in which you’re trapped (I prefer this to the older metaphor of having caught a tiger by the tail). For individuals, typically you can either let knowledge potential compound and action potential fragment, or let action potential compound and knowledge potential fragment.

If you do the latter, your knowledge potential will fragment into a cloud of tweet-sized aphorisms. But your capacity for action will get very high. If you do the former, you will end up with high knowledge potential. But your capacity for action fragments, and all you can do is small things here and there. Most likely, you will swing between the two extremes. Sometimes your action potential will be very high and your knowledge potential highly fragmented, other times your action potential will be very low and your knowledge potential will be very high.

Operating in exponential environments therefore, can feel like periods of blindly swinging a sledgehammer interleaved with periods of being to see and understand everything but being bound and gagged. But so long as something, somewhere is undergoing compounding positive change, and you’re parlaying X into 3X every few years, you’re in the game. Compound interest is the most powerful force in the universe, as Einstein said, but in 2016, interest rates are heading from zero into uncharted negative territories.

It’s not obvious in 2016 how to harness compound interest. But you should probably be looking somewhere other than the financial world for your compound interest fix. If you find a compound interest dynamic to ride, you have a snowball’s chance in hell of coming out ahead in our world. If you don’t, you might well find yourself in the stagnating in the liquidity trap of your own life, if you’ll excuse the terrible mixed metaphor and pun.

Dr. Seuss described this condition poignantly as the waiting place. In this case, we’re talking waiting around for the Internet Age to offer you a “job”, instead of making one up for yourself. Non-agile change models are not capable of staying on top of exponential environments because they don’t involve serendipity parlaying.

If you can’t be agile, you just have to exit the exponential environment, hide somewhere and hope change doesn’t find you. If you’re unlucky and change finds you anyway, you’ll find yourself on the wrong side of serendipitous parlaying of gains: zemblanitous parlaying of losses all the way to doom. So if you can’t answer the question, where am I compounding, where am I fragmenting? you should be worried. Very worried.

See more of the issue here.

Issue No. 151: deep-learning in eCommerce

CB Insights on 60+ Startups That Are Enhancing A.I.


via CB Insights:

Deep learning in e-commerce was spotlighted recently by Etsy’s acquisition of Blackbird Technologies. Three startups in the private sector using AI in e-commerce raised funding rounds this year: Reflektion raised $18M in Q1’16 from investors including Intel Capital, Battery Ventures, and Marc Benioff; ViSenze raised $10.5M in Series B from investors including Rakuten Ventures, Enspire Capital, and Phillip Private Equity; India-based Staqu raised angel funds in Q2’16.

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.