August Five

We now share an additional midweek Fix, going deeper on core topics. Today Merchant and we alternate with newTV. We will get this onto a separate database - but if you want to unsubscribe but not lose Fix / Friday let me know. And I would love your thoughts on how we make this better  - hit reply.

Supported by our Friends at Salesforce, Datorama
Fast Fashion
One of the first green shoots for ecommerce and covid was when Next reopened their website and had to close after an hour as they were overwhelmed by demand. Their Q2 results show this wasn't a freak occurrence- online sales were up 9% and store sales declined but by a lower amount than in Q1. But their CEO cautions;
“As yet the real pain has not really been felt,” he said. “The furlough scheme is coming to an end which means unemployment may become more of an issue.”
Business of Fashion looks at foot fall in fashion retail and sees most people struggling - only dramatic discounting and sales are drawing customers to stores - JCrew have dropped prices 80%. We should remember many stores were suffering before Covid - JCrew had lost its lustre and whilst there is a lot of goodwill, they have a lot to do.
At the higher end of the market the digital fashion shows by the top menswear brands are judged to have flopped.
The problem here is one of customer experience and as we said in our Kanye focused piece someone needs to reinvent the online experience. Maybe it will be Gap and Kanye - this long read gets into the new thinking needed - a mono channel built around what you know about the customer. 
More about this space in a great new report by HighSnobiety on Brand Universes
Go deeper with their new report ( with Boston Consulting Group) - Culture Culture Culture 

Action? Do you need to rethink your customer experience? Are you leveraging the insights you have into your most valuable customers?

Time to pay
In the absence of a new strategy we see tactics getting adopted. In these tough times the option to pay in instalments makes sense to customers and the fintech firms providing this are doing well. Klarna out of Sweden popularised the concert in Europe but Affirm - ran by Paypal mafia - will be the first to IPO - with a valuation of as much as $10bn. A new deal with Shopify will help.
Some background on the key players from BoF here. Other finance firms are benefiting from the move to ecommerce too. Paypal CEO said

“People are jumping in with both feet, and not just dipping their toes in the water,”. “It’s not hyperbole that we’ve seen a three- to five- year acceleration. That’s the math.”

Action? If you haven't yet tried Klarna /Affirm etc its definitely worth a test
The other tactic that has everyone excited is Livestreaming. The Telegraph asks if it could change online retail for good? Growth in the west seems to be driven by the luxury firms who have seen its success in China but some fear it’s hitting its’ ceiling. The debit by a top Chinese influencer has underperformed.
But so far none of the Western platforms has really championed it and I think we will see more experimentation. Snap have the Drop scheduled for later this year and Facebook bought Packgd to play in this space.
The main challenge seems to be aggregating the audience at a specific time - similar to how HQ Trivia worked - and I think the platforms can resolve this.
The Q2 results from Shopify were - as we all expected - really good. Gross Merchant Volume was up 119% on the previous year and it's worth flicking through the investor presentation - as this chart shows there is still so much potential. . This interview with the Shopify COO gets into more detail on the results.
That potential makes the space attractive to others and Big Commerce is a key competitor that plans to IPO. Analysis of their IPO documentation highlights a different approach. BI is more about Enterprise and seems to be focused on non US markets. The Spotify deck shows they are attracting big brands as well as start ups and this may become the area where they compete with BI. Does their more malleable platform give them an advantage over Spotify?
The healthy results for Spotify have enabled Big Commece to increase their IPO share price by over 10%

Action? Is your online store on the right platform? Many people on Magenta could benefit from a switch to Shopify.

Black Friday
Is one of the lasting effects of the Covid Crisis the death of Black Friday? Walmart went first and said they would not open for Thanksgiving and Target and others have followed suit. But with Amazon being coy about when they run their Prime day everyone is facing uncertainty. With most people carrying high stock levels from summer items will see more heavy discounting/? Or have people reduced their stock levels for winter and Christmas? The push to shop early from Target and others might work but the retail industry has trained people to wait for even better prices.
Amazon Grocery
We still haven’t seen the hundreds / thousands of Go stores that Amazon announced but now we see a UK rollout. The Times tell us that 10 are planned, with 20 more under discussion, and the first could open this year. I love Amazon but their strategy of Working Backwards and writing the press release at the start of a project does lead to some misinformation. 
Their stake in Deliveroo got final clearance but with a note that a full takeover may trigger an enquiry. And along with their plans for Grocery we covered last week, they are going to shake up the high street. Two other key players are Ocado and M&S and this Founders Forum  interview with their two CEOs is a must listen if you are interested in this space.
You don't have to be a tech firm to thrive as a Merchant - I love the fact that Greggs will continue to invest in their digital plans

Action? Modern shopper marketing is needed to ensure all your products are optimised for each retailers online service. What works on Tesco may not be right for Ocado. Or Amazon.
Burberry is experimenting with Social retail in its new Shenzhen store, developed in partnership with Tencent. They use Wechat to better connect online with offline and have a Mini programme to reward interactions with the brand - 
As customers earn more currency by interacting with the brand, an animal character “evolves”, starting from an unhatched egg. In addition to new characters and outfits for their characters, customers can receive exclusive cafe menu items and access to the “Trench Experience”, a digitally enhanced room designed to help customers create content to share on social media, including the ability to try on a trench coat.
China was the one positive note when LVMH and Kering published their Q2 results - this article looks at how their strategy is developing. Its luxury focused but has relevance for many sectors.
And more investment in Chinese grocery - Yipien raises $359m 
With Covid accelerating the adoption of digital by people and by businesses there is some interesting thinking around what’s next for Merchants.
Understanding and shaping consumer behavior in the next normal - McKinsey
Memo: The Next Industrial Revolution – 2PM
A new approach to Food and Beverages
Media 2020: Rise of the Renaissance Creator and the Next Media Model
Smart thinking on communities Come for the network. Pay for the tool

Web Smith of 2PM on eCommerce and DTC in a podcast with Howard Lindzon
The BBC on The curious origins of online shopping.
The Uber Brand Story. Did you know their mission is; We ignite opportunity by setting the world in motion.
eBay pins hopes on back-to-roots strategy
The Strategist - great example of how publishers can add value and earn revenue from DTC
In Bangladesh, everything is bought and sold through Facebook
Facebook launches commerce and connectivity-focused accelerator programs
From Landlord to curator. Legal & General to be more flexible when leading retail and leisure space
I Am a Model and I Know That Artificial Intelligence Will Eventually Take My Job - new project from Facebook labs
Slice App - Reclaim Your Data and Get Paid  a new attempt to have people monetise their own data
Good interview with the CEO of Native - the DTC deodorant brand bought by P&G is 2017
How to Generate Data-Driven Copy for Ecommerce Category Pages with GPT-2

Smart thinking on how to measure DR activity (properly)  from my former team at Media Kitchen
Long term, short term, wrong turn: how the 'consumer journey' metaphor is leading marketers up the garden path 
Action? There is so much opportunity for smart Merchants right now - I have expertise, experience and an extensive network. Lets talk about how I might help you - hit reply
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