备忘录即时需求行业

Whether we are post-pandemic or not, some behaviors are beginning to return to the way things were. Of them, quick delivery grocery appears to be one of the pandemic practices that may not reach the zenith that was once predicted. And now, the fall out. On the heels of a recent report by the New York Post, Petition published a deep dive on a struggling sector. From the NY Post:

Investors in Gopuff — a Philly-based delivery service that’s backed by Softbank — were eyeing a valuation of up to $40 billion in January as the company enlisted Goldman Sachs to help prepare for an IPO. But investors have lately been scrambling to unload their stakes at valuations as low as $15 billion — and have still been unable to find buyers, The Post has learned.

Petition places GoPuff in the same category as the 15 minute competitors that are competing in a crowded market. In addition to GoPuff, Petition rattles off Getir, Jokr, Gorillas, Just Eat, Fridge No More, Buyk and Food Rocket in the lengthy list of upstarts wanting to compete alongside DoorDash, Uber Eats and GrubHub.

The category has seen massive growth padded by venture funding, but the smoke is starting to clear, and market capitalizations have plunged as investors look to cut their losses. The problem, at its core, is that grocery retail is an industry built atop of stubborn customer habits – people fall back to their old ways, especially when prices rise. But larger competitors are not faring much better. Instacart has been marked down and Amazon has yet to find profitability in grocery delivery, according to sources. If Amazon can’t figure it out, it’s bad news for the VC-backed category. Petition sees the entire category “going puff.” Investors are turning their backs, legislative forces are cracking down, and customers may be realizing that hefty delivery fees and tips aren’t worth paying for in exchange for quick service.

Petition’s insights are rarely wrong. But as we discussed in Consumer Trends 2022, there is potential for GoPuff to separate itself from the likes of Gorillas, UberEats, DoorDash, Getir, and Jokr. The quick delivery service recently launched its own private label and has begun the process of verticalizing its business (with one critical fault that may hinder margins for the foreseeable future). In Consumer Trends, we explained:

榜单中最引人注目的是 Gopuff，该公司在建立了以超快送货为基础的业务后，将其一些微型配送网站变成了客户网点。据路透社报道，Gopuff 已聘请银行帮助其上市，估值接近 150 亿美元，预计将于今年首次公开募股。实体店可以把顾客带到配送点，缩短工人把商品送到顾客家中的时间，从而使 Gopuff 的配送速度更快。这些商店不是典型的便利店，而是订货中心，顾客使用数字亭下订单，然后由仓库发货。为了推动这一全渠道战略，GoPuff 通过抢地盘的方式收购了多家公司，目前已收购了 161 家 BevMo 商店和 23 家 Liquor Barns。

This is a timely separator between GoPuff and the other brands that rely on the storefronts of convenience stores and small retailers. To further circumvent any potential legislation, GoPuff will have to further invest in its physical real estate. This is a recent point on regulatory scrutiny made in a recent report by Vice:

Ultrafast delivery companies like Gorillas, Jokr, and GoPuff are facing increasing government scrutiny at the same time as profits for their services are failing to materialize. The Information reported Jokr is looking to sell its New York operations to a competitor in the face of losses of some $150 per order, which Jokr denies. And GoPuff, in an attempt to prove its storefronts are not warehouses and avoid regulatory scrutiny, have claimed its New York locations will also sell directly to walk-in customers, although the New York Post found even such “retail” locations are unmanned and have no prices listed on items.

GoPuff wants to be less reliant on third-party vendors by using its warehouses like retail stores, but it will likely find that operating retail stores is by no means an easy fix to future-proofing its business in an unstable market for pureplay delivery services. By layering delivery on top of the stores, GoPuff wants to do both. But does that really put it in a position to compete with the likes of Amazon? Or by splitting its attention, is GoPuff undermining both sides of its business without successfully pulling in customers to its stores? As Seeking Alpha reported:

The goal is to make GoPuff more like Amazon than like Uber. That was the elevator pitch captured in a recent Axios profile, with vertical integration that hasn’t even occurred to its competitors. Whereas the aforementioned companies rely on someone else to provide the goods, Gopuff has almost 600 micro-fulfillment centers, up from 380 in 2020, filled with the staples of daily life. Cutting out the third-party vendor, Gopuff ships directly to its customers who are saved a trip to 7-11 or the corner grocery store.

So what we are beginning to see is that the service side of the quick delivery business may not make it with a solid vertical operation attached. As Amazon has learned, this gives the advantage to the grocery retailers whose foundations are built atop physical retail penetration.

Whether it is for margin protection or product availability (after publishing Consumer Trends 2022, it was noted that GoPuff sources some products through Instacart to maintain stock), big grocery’s eCommerce pioneers will be the traditional companies who’ve built the technology atop their existing storefronts. This mirrors the world’s of GPG and digitally native brands. Though eCommerce began as a digitally-native sport, its accelerated adoption means that the old guard is employing many of the tactics pioneered by modern brands. In this respect, the grocery industry is no different.

Petition was correct in a number of its statements. The funding and the IPO markets for such services seems to be drying up for now. But if there is one exception to the quick delivery rule – it may end up being GoPuff. They are steps ahead of impending legislation in New York, its biggest market. But in the longer term, they will have to contend with the same reality that Instacart and others are now contending with – the advantage goes to the delivery company with the inventory on hand. Refer to the graph above. True digitally native vertical brands don’t always begin online. In grocery, it appears quite the opposite.

作者：Web Smith | 编辑：Hilary Milnes，美术：Christina Williams 

备忘录苹果与效果营销

Though founded in the 1960s, Walmart came into its own as a “mom and pop” store killer by the late 1970s. Overnight, independently-owned stores folded as Walmart sold products with greater efficiency and lower prices. Product marketers worked tirelessly to place their products on Walmart shelves. Sixty years later, the company’s grasp over physical retail remains.

We will remember the Apple iOS privacy changes as a similarly transformative moment for retailers. Like then, it is beginning to separate the haves from the have-nots.

For a small, small selection of brands, performance marketing is not essential. This essay is about two of those companies and everyone else who seems to be playing a different game all together.

Two digitally-native brands are in the press for their growth; their founders are two of the most visible human beings on the planet. First, Robyn “Rihanna” Fenty is floating a $3 billion IPO for her brand Savage x Fenty.

Savage x Fenty was launched in 2018 and has since collected a healthy stash of venture capital to support its growth. The brand has raised $310 million to date. Most recently, it raised $125 million in January in a round led by Neuberger Berman and other existing investors L Catterton (LVMH’s investment arm), Avenir, Sunley House Capital and Marcy Venture Partners. Positioning itself as an anti-Victoria’s Secret by embracing all body types, genders and customers who have felt excluded by the mainstream lingerie giant, Savage x Fenty has become a formidable industry force. Owned by TechStyle Fashion Group, the brand built up hype around its eCommerce store with annual fashion shows airing on Amazon Prime. Last year, Savage made moves into physical retail, with five stores now open and plans to hit 10 this year. Though IPO plans are not confirmed, as reported by Bloomberg, they’re on the table for 2023.

Meanwhile, Kim Kardashian is expanding the Skims brand to include swimwear. In a recent report in Business of Fashion, she and co-founder Jens Grede (also behind brands including Frame and Good American) eschew performance marketing for a brand like hers:

Skims’ brand work, plus Kardashian’s promotion on social media, have made performance marketing all but unnecessary.

“[Performance marketing] would be very ineffective for us because we’re always running out of stock,” Grede said. Besides, he doesn’t believe it suits Skim’s long-term goals.

Instead, the report says, Skims spends on “brand-building” marketing efforts that include billboards, high-profile photographers and Kardashian tagging the brand in her own Instagram posts. Skims is on track to add 2 million customers by the end of this year, and it’s biggest restraint is fulfilling orders and keeping items in stock as supply chain disruptions drag on. It’s a problem and a curse, but overall, the brand’s in a healthier position than other DTC brands that are now trying to grow outside of paid marketing.

But most brands do not have the visibility or influence of a Kardashian on their cap tables. That leaves two options for many: partner with a celebrity that reduces the cost of marketing and improves cash conversion cycles or build systems to reevaluate how the brand measures marketing conversions.

A recent report by Catherine Perloff of AdWeek covered the strategies employed by Ben-Zvi, an agency-based performance marketer with brands like e.l.f. Cosmetics, Etsy, and Revlon. The report explained how he built strategies around third-party tools (and his agency’s proprietary technology) to identify correlations between active campaigns and conversion outcomes.

Before identifier deprecation, measuring a campaign’s effectiveness depended a lot on statistics from Meta, said Ben-Zvi, who works with brands such as e.l.f. Cosmetics, Etsy and Revlon. “It was all about figuring out what is the proper attribution window based on what Facebook is telling me,” he said.

Now Ben-Zvi relies on various tools, including looking for correlations between when a campaign was active and certain conversion outcomes, leveraging his agency’s proprietary technology. For example, when the campaign was active, did the advertiser see a lift in direct sales on its website or an increase in branded search via Google? Ben-Zvi said he has also looked to third-party tech, such as Blackcrow.ai, which helps brands build their own audiences to target without Meta.

Another strategy mentioned in this AdWeek report was the collection of first-party data:

Ashley Karim-Kincey, vp of media at creative agency Dagger, said she uses tech such as floodlight tags on the brand’s website to track who has visited and double-click tracking tags within their ads to cross-reference the data, both of which are Google ad-tech products.

In a series of essays devoted to the likelihood of this type of disruption, in April 2021 we highlighted the utility of first-party data as iOS changes were due to disrupt the performance marketing industry. From On First Party Data and Media:

第一方数据将引领下一波广告和销售浪潮。美国企业现在正处于一场竞赛中：他们将建立、收购或营销拥有这些数据的受众。独立媒体行业很快就会讨论结果，但我们很少对早期步骤进行剖析。随着越来越多的人追求第一方数据，受众开发将成为市场上最令人垂涎的技能之一。

To acquire targeted customers, first-party audiences are replacing third-party collections.

In our follow up on content fortresses, I continued:

First-party data was well on its way to becoming the key asset for advertisers; Apple’s decision further moved advertisers to prioritize its collection, refinement, and monetization. Apple will eventually eliminate data sharing across vendors, a long-time complaint of many of its users. In doing so, walled gardens will take the place of the open web funded by this data practice. Media companies and commerce companies will become indistinguishable, in many ways. The law of linear commerce is no longer just about brands and their content strategies or publishers and their eCommerce development.

But how did we get here? Wayne Ma of The Information published an inside look into Apple’s decision to “blow up the digital ads business.” Apple’s pivot to privacy has had serious implications for Meta, Facebook’s parent company, which “ expects the changes to shave $10 billion off its revenues this year because of their impact on the company’s prodigious data collection practices,” according to Ma.

But in interviews with The Information, people with direct knowledge of Apple’s privacy deliberations stressed that Meta wasn’t the primary target of the company’s changes, despite a long history of thinly veiled rhetoric from Cook viewed as critical of the company’s practices. Instead, Apple was going after the most egregious forms of abuse—for example, weather apps that sold data about users’ locations to brokers, the people say.

Apple is now trying to close the “Pandora’s box” it opened with its data sharing that was upholding entire surveillance and advertising industries. While one is more nefarious than the other, they are inextricably linked. And performance marketing is in the crosshairs of the crackdown. Already, marketers have become aware that over-reliance on Facebook and Instagram ads spelled bad business. But weaning off of the platforms has gained a new urgency thanks to Apple’s decision. With it, Meta has learned its own lesson in reliance on outside businesses. And while Apple’s driving motivation is eliminating bad actors who abuse its user data, something else is true at the same time: it no longer serves Apple to prop up Meta and other platforms’ ad businesses. Google is now following Apple and will introduce similar privacy changes for Android. Brands that relied on performance marketing are now at a disadvantage in a way that the Skim’s and Fenty’s of the world are not.

So here we are, two worlds represented within the same category of brands. One is highly dependent on the advertising methods of the last decade or so and the other seems to scoff at them as if they were never necessary. Skims’ Grede told Alexandra Mondalek of BOF:

You cannot advertise your way to success. Advertising is certainly important as a part of it, but sales-driven marketing has never built brands.

Meanwhile, a founder of a venture-funded brand that, itself, is nearing a potential IPO chimed in on the report published by The Information:

What this [The Information] article doesn’t do is analyze the downstream implications for DTC brands and small businesses, which have been catastrophic.

It is unlikely that Apple reverses course on its ATT changes and its diminishing of the IDFA but an entire industry is in need of a middle ground. For many founders and executives, their livelihoods are on the line and it isn’t Facebook that will be remembered as the culprit. Apple must either resolve its decision in favor of the advertisers reliant on sales-driven marketing. Or the company needs to partner with major social media platforms and media companies to offer its own advertising network (fueled by Apple’s first-party data, coincidentally). In either situation, Apple will face pushback for hypocrisy. But the digitally-native brand industry, as it stands, may not survive the privacy changes attributed to Apple. That is unless, a global icon is on the brand’s founding team.

There’s never been a greater disparity between the haves and the have nots for brands growing in the age of Apple’s privacy power moves.

作者：Web Smith | 编辑：Hilary Milnes，美术：Alex Remy 和 Christina Williams 

备忘录泰-哈尼归来

Much can happen in two years. She was the face of an industry and then – fairly or unfairly – she was one of its many whipping posts. She’d later return to Outdoor Voices to reclaim her role as its creative driver. In doing so, Outdoor Voices regained its footing. It’s in a much better position than it was before. In 2020’s Evolving Brand of DTC, I wrote:

Surely, with Ashley Merrill at the helm, Tyler Haney back in an active role, and a new CEO search in process: a positive outcome is more likely than it was with Mickey Drexler involved.

With her next project, Haney takes another leap away from retail’s old guard (represented by the likes of Alex Mill CEO Mickey Drexler) and into the new. Is an NFT a conduit to a new era of customer loyalty? Haney thinks so. Her new venture, called Try Your Best (TYB), got the New York Times profile treatment this week as Haney makes the pivot from her past dealings. She’s making the pivot from leading a workout revolution through accessible athletic apparel to her next one in the world of Web3. TYB essentially trades access for brand engagement and the concept has been covered at 2PM. From the New York Times:

Though she is no longer with Outdoor Voices, Ms. Haney, 33, is hoping to bring its tenets of community building and consumer engagement into a new sphere: the blockchain-based future of the internet known as web3. She’s betting that in the next phase of online retail, “minting things” will be the new “doing things.”

TYB seems to be the product of keen observation and opportunity. We’ve seen recent successes with DAOs, NFT-based communities, and metaverse product drops – Haney is betting that this is the natural progression. Right now, the fervor and hype surrounds branded NFT drops. Brands like Nike, Adidas, Gucci, Balmain, Champion, and Clinique have released their own NFTs. Depending on the brand, the use cases vary. Some are marketing tools meant to test the waters. Some drive purchases via in-game partnerships. Some are tied to loyalty programs. Starbucks has made moves to tokenize its loyalty program. In a recent 2PM memo, we make the point that this type of project is a natural progression in retail. In this way, Starbucks would be the best candidate for a parallel corporate structure built atop a DAO. The potential is a shift in ownership and influence, providing more input from the company’s best customers. From November:

Starbucks has an enormous, built-in community. There are few major retailers that could achieve what Starbucks can with its existing infrastructure. A loyalty DAO would mean new product ideas, governance over potential marketing tactics, and rewards based not only in short-term gain but long-term upside. The Starbucks loyalty program, with the help of the mobile app that totals 28.4 million quarterly users, could precede a fundamental shift in how Starbucks uses one of its most valuable assets. If Starbucks does tokenize its loyalty program, corporate governance would be tiered: traditional C-suite, stock-based premium shareholders, and the loyalty DAO.

The common thread across these projects that they are designed to grant exclusive membership into a sort of “club” for brand fans. That’s one reason luxury brands and sports brands have taken to NFTs so quickly – brand affinity is high in those fields. In this way, NFTs are more than collectibles, they are corporate status symbols or declarations of rank.

What TYB wants to do is pull this sort of one-off-NFT-drop brand engagement into one platform. On the How It Works page on the site, the company uses a brand called Joggy as an example (Joggy is a new brand also led by Haney that sells CBD products). Users who participate in customer feedback loops by weighing in on decisions like packaging colors (one example seen on the site) receive collectibles in return. These unlock access to things like exclusive or early-access products, event invitations and private channels, according to the site description.

The concept of branded community has been heralded in the DTC era, when companies recognized that loyal customers – or the community – were the most valuable assets. Especially in an era where brands lived and died by lifetime value and retention rates. Community is both marketing jargon and a survival tool. TYB pushes the concept of community forward by laying “what’s in it for me?” on the line. Customers who opt in know what to expect in return, and that the more they put in, the more they’ll get out. At least that’s the high level theory in practice.

This is common among NFT drops. Brands like Gucci are rewarding top fans with their NFTs. To qualify to receive one, you have to have jumped through multiple hoops like joined the brand’s Discord server and followed past updates. NFTs then become a badge of belonging in an inner circle. That works for some brands with enough of a halo – and not to mention, it’s far from Gucci’s main business proposition.

Haney’s concept raises further questions. Can a platform manufacture it for brands looking for customer feedback? Do customers care enough about the typical brand to spend time on Try Your Best? And do brands – who pay to appear on the platform – want to outsource something as valuable as customer feedback and loyalty to an outside company? Haney used Glossier as an example of a brand that has drawn an engaged millennial and Gen Z audience, and Glossier’s strategy was defined by how much it included customers in its product development. Tokenization formalizes the arrangement.

The challenge will be for TYB to become a must-have for customers. Whether or not the perks will be remarkable enough to devote time to the app stands in the way. But regardless of whether Try Your Best takes off, one of the industry’s top performers is betting the next stage of her career on Web3. This time, there is much less of retail’s past to stand in her way (or the future’s).

By Web Smith with editing by Hilary Milnes