Many of us have watched with awe as Amazon’s Prime Day has gone from a new holiday conjured from thin air in 2015 to one of the largest annual ecommerce shopping events in the U.S. This year’s 48-hour Prime Day, which wrapped up last Tuesday, generated over $11 billion in total U.S. ecommerce sales (including the revenues captured by Amazon and the many other major retailers who now host their own competing sales over the same timeframe), according to Adobe Analytics. This is larger than last year’s Cyber Monday, which was the busiest ecommerce sales day on record at the time (of course, Cyber Monday is only 24 hours). However, analysts pointed out last week that this year’s Prime Day announcement from Amazon appeared muted compared to the event’s explosive growth in 2020. While Amazon has never disclosed total Prime Day sales, it usually touts the holiday as its “biggest day ever” or its largest “event in Amazon history,” but it did not make any such claims this year. It also chose not to report the amount that its third-party sellers sold this year, while it had announced that number last year ($3.5 billion). Given the absence of these disclosures, among other factors, Bank of America ecommerce analysts Justin Post and Michael McGovern wrote in a note to investors “we believe this was a relatively lower growth Prime Day vs. prior years.” Why might Prime Day have registered softer growth this year? And does this mean anything for the future of Prime Day, Prime, or Amazon in general? There are a number of reasons why Prime Day likely grew more slowly this year. Most of those reasons likely do not indicate anything meaningful or worrisome for Amazon over the long term, but a couple factors might.
Four possible reasons why Prime Day growth likely wasn’t as explosive this year that shouldn’t worry Amazon are the timing of the event, the global supply chain, and participating countries. First, during Prime Day in 2020, many more physical retail stores were closed or otherwise limited due to COVID-19, which reduced the event’s competition and helped fuel its estimated 54% jump in gross merchandise volume. With such performance in 2020, slowing growth was probable in the first place. The timing of the event was likely another factor mitigating Prime Day’s growth this year. Last year, the event was held in October, which gave consumers a reason to begin shopping for the Holidays early. This year’s event in June may have been too early even to effectively tap into back-to-school shopping. Additionally, current disruptions in the global supply chain likely interfered with at least some sellers’ ability to secure inventory this year, limiting their ability to offer deep discounts and drive volume. Lastly, Canada and India did not participate in the event this year due to Covid. In the future, each of these factors should either return to normalcy or can be planned for.
However, there may be other factors that could weigh on Prime Day’s growth in the future. First, Amazon has long used Prime Day as a way to attract new subscribers to the Prime program, and those new subscribers have made lots of purchases. Unfortunately (or fortunately) for Amazon, the program has been so successful in adding members that there are fewer potential new subscribers to add these days. Consumer Intelligence Research Partners estimated that there were 147 million Prime members in the U.S. as of April. With nearly half of all Americans already subscribed, Amazon may have attracted fewer new Prime members this year than it has in the past, and this may be a building challenge going forward as even more of the country’s population joins. And, new members may not be as affluent and thus as productive purchasers as those that came into the program in the beginning.
Adding to that point, certain analysts expect Amazon to hike membership fees for Prime in the future as a way to deliver more revenue. In a recent note to investors, J.P. Morgan analysts Christopher Horvers and Doug Anmuth predicted that Amazon could raise Prime prices as soon as the second half of this year to offset investments in grocery, one-day shipping, and fulfillment centers. If Prime membership becomes more expensive (it is currently $119/year), it would make it even harder for lower income Americans to join the program. Amazon currently offers discounted Prime membership for people receiving government assistance, but such consumers have lower spending power by definition.
One last datapoint that may hint at Amazon’s limitations going forward is unrelated to Prime Day, but was also in the headlines this past week. A Change.Org petition to not allow Jeff Bezos to return to earth when he goes to space in late July on board a Blue Origin rocket ship had acquired over 125,000 signatures as of this past weekend. The petition is a joke, of course, but it underscores the fact that many people plainly do not like Amazon and its sprawling apparatus of consumerism. It’s funny to wonder how many of those 125,000 signees may also be Prime members, but nevertheless, the point stands: Prime may have a harder time attracting its next 140 million members than it had attracting its first.
Headlines of the Week
GameStop is again cashing in on its high-flying stock. The videogame retailer said Tuesday it has raised more than $1 billion in its latest share offering. The company said it’ll use the proceeds for general corporate purposes and invest in growth initiatives as it tries to pivot to e-commerce. This offering adds to the half a billion dollars it had raised in late April. The trading frenzy over GameStop began in January when retail investors began piling into stocks that were hyped on social media, driving up their share prices and trading volumes. GameStop shares have catapulted almost a thousand percent this year. It became the poster child of the “meme stock” phenomenon that pitted small-time traders against big hedge funds that were betting the stock price would drop. GameStop – as a company – faces an uphill battle as more consumers download or stream games. The company’s sales have fallen for nine straight quarters.
The New York fashion company PVH said on Wednesday that it agreed to sell four prominent clothing brands – Izod, Van Heusen, Arrow and Geoffrey Beene – for $220 million to Authentic Brands Group. The move enables PVH to focus on its Calvin Klein and Tommy Hilfiger brands, the company said. PVH said it would use the proceeds from the deal to buy back stock. It also said it would reinstate its dividend. PVH also affirmed its earnings estimates for the second quarter. “This was a difficult decision,” PVH Chief Executive Stefan Larsson said in a statement. The four brands, which make up the Heritage Brands division of PVH, “provided the resources that laid the foundation” of PVH, he said. The company has been focusing more resources on businesses with wider profit margins, he said.
Apparel & Footwear
Iconic shapewear-brand Spanx is reportedly looking for a buyer. The New York Times’ Dealbook reported early Friday that the company was in talks with Goldman Sachs to explore a sale, citing multiple sources familiar with the situation. A deal could value the company at $1 billion, it reported. Spanx is a private company, so it is not required to report its financials. It pulled in between $300 million and $400 million in revenue over the past year, the sources told The Times. The deal could see Spanx founder and CEO Sara Blakely keep some of her ownership stake, The Times reported. Blakely was once named one of Time’s 100 most influential people in the world. Blakely set up Spanx in 2000, and it became the best-known shapewear brand on the market.
The summer of the disruptive IPO is in full swing. Top financial and industry sources are buzzing about Allbirds, which is said to have taken the plunge and filed confidentially for an IPO, looking to cash in on the hot market by leveraging its strong niche in sustainable footwear. This follows Warby Parker, which said Tuesday that it had submitted its papers for review, and brand powerhouse Authentic Brands Group, which sources said is expected to make its registration statement public next month with an offering to follow shortly. Rent the Runway has also been reported to be considering an offering. These companies and others — like Figs, the medical scrubs brand that is valued at $7.4 billion after its IPO last month — are looking hard at the still hot-stock market. Also jumping into the market this year were resale experts ThredUp, Poshmark Inc., clean beauty pioneer The Honest Co. as well as Dr. Martens and Mytheresa.
In an effort to build its burgeoning U.S. business, Gymshark has announced fulfillment expansion plans through its partnership with Radial. Gymshark founder Ben Francis was only 19, and was still working at Pizza Hut, when he started the company in the U.K. with a few friends in 2012. The direct-to-consumer performance-oriented fitness apparel brand has shoppers in more than 180 countries. In addition to its socially connected consumers, the brand has gotten a boost from unofficial supporters like Kendall Jenner. ”When I tell people that we are 100 percent e-commerce and we did over half a billion dollars last year [in sales], people are instantly surprised.” he said. “Ben, our founder, is relatively young, so we’re not very hierarchy-based. We really support this idea of best idea wins.” Globally, the company employs 550 people and that base is expected to increase significantly.
L Brands last week took its final steps in separating Victoria’s Secret into an independent, public company, by filing the necessary paperwork with the Securities and Exchange Commission, according to an announcement. The business will be called Victoria’s Secret & Co. and will include Victoria’s Secret Lingerie, Pink and Victoria’s Secret Beauty. The separation is expected to be completed in August. “Today’s filing is an important step toward creating two independent, public companies designed to thrive in an evolving retail environment,” Andrew Meslow, CEO of L Brands, said in a statement. “We believe Victoria’s Secret and Bath & Body Works will achieve new levels of success and unlock significant value for all stakeholders by pursuing growth strategies best suited to each company’s customer base and strategic objectives.” L Brands plans a spinoff of its Bath & Body Works business some time next year, CEO Andrew Meslow said during a Morgan Stanley Virtual Global Consumer & Retail Conference Wednesday.
Athletic & Sporting Goods
Nike reported fiscal fourth-quarter earnings and sales that topped analysts’ estimates, fueled by record revenue in its largest market, North America. It also offered a better-than-expected sales outlook for the upcoming year, driven by optimism around its women’s category, apparel business and Jordan brand. Nike continues to benefit from consumers seeking out comfortable clothing to wear for workouts but also around the house. Even as people return to schools, offices and other social settings, many are still searching for relaxed options such as sneakers and stretchy pants. Nike also saw a boost to its wholesale business — something that was largely inactive a year earlier during the Covid pandemic, when shopping malls and department stores had to temporarily shut their doors and put orders for merchandise on pause. Some of Nike’s key wholesale partners include Dick’s Sporting Goods, Foot Locker and JD Sports.
The golf boom is continuing this year as people look for fun, socially distanced outdoor activities during the pandemic. And that has caused executives at Dick’s Sporting Goods to reach into their cash coffers to upgrade the shopping experience at their important Golf Galaxy stores so they keep pace with rivals such as the PGA Superstore. Somewhat under the radar, Dick’s said on an earnings call it would spend $20 million to bolster its Golf Galaxy stores in a bid to capture market share in the red-hot golf equipment market. Among the investments, Dick’s is installing Trackman technology (essentially large digital screens that one can hit balls into and receive data feedback on ball flight, etc.). The technology is now available in 80% of Golf Galaxy’s nearly 100 locations. Meanwhile, the company has gone live with online booking for lessons and club fittings — which has become the industry standard.
Academy Sports and Outdoors, Inc. announced its financial results for the first quarter ended May 1, 2021. Net sales increased 39.1% to a first quarter record $1.58 billion, while comparable sales increased 38.9%. Sales grew 46.8% compared to the first quarter of 2019. The growth was driven by continued strong, double-digit consumer demand across all product categories, notably in Apparel, Footwear and Team Sports, as well as across the entire geographic footprint. E-commerce sales declined 21.0%, as the website anniversaried triple-digit growth in the first quarter of 2020, as consumers shifted to online ordering at the beginning of the pandemic last year. Over the last two years, E-commerce sales have increased 300.0% during the first quarter.
Cosmetics & Pharmacy
Rite Aid’s fiscal year is off to a solid start. The company delivered against Wall Street estimates on earnings — posting a net loss of 24 cents per share — but fell short on revenue, even as it rose 2.2% year over year to $6.16 billion. The Camp Hill, Pa.-based chain delivered $138.9 million in adjusted EBITDA, or roughly 2.3% of revenues.
The Beauty Health Company, parent entity of The HydraFacial ® Company, a global category-creating beauty health company, announced the expansion of its global footprint, with the pending or completed acquisitions of four international, third-party distributors for HydraFacial. The total purchase price for the four distributors will be approximately $35 million, consisting of approximately $28 million in cash and $7 million in shares of the Company’s Class A Common Stock. This represents an average of 20% seller equity rollover across the four transactions. The Company will also be required to issue up to 7.5 million shares of Class A Common Stock to the former owners of HydraFacial pursuant to the earnout provision in the merger agreement related to the Company’s May 2021 business combination.
KKR, a leading global investment firm, and Vini Cosmetics, a leading branded personal care and beauty products company in India, announced the signing of a definitive agreement pursuant to which the Company’s Founder Group – led by Darshan Patel, Chairman & Joint-Managing Director, and Dipam Patel, Joint-Managing Director – and Sequoia Capital will sell a majority stake in the Company to KKR for approximately US$625 million (INR46 billion). The Co-Founders will continue to hold a significant stake in Vini and collaborate with KKR in the next phase of the Company’s growth. In addition, existing investor WestBridge Capital will acquire a further stake from the Founder Group to increase its shareholding in Vini.
Discounters & Department Stores
Walmart launched its new Gap-branded line with a livestream shopping event. The collection — Gap’s first-ever line of home products — is now available to shop on Walmart’s website. The most popular items are expected to be available in the discounter’s stores at some point.
Walmart has seen shopper acceptance of substitutions increase to more than 95% since it started using deep learning artificial intelligence for online grocery orders, Srini Venkatesan, executive vice president of Walmart Global Tech, wrote in a blog post on Thursday. Deep learning is a function of AI that imitates how brains process data and can learn without human supervision. Walmart is using the technology to consider hundreds of factors, like size, type, brand and price, to make substitution recommendations, according to the post. Walmart has switched from relying on a manual process for identifying substitutions to employing deep learning AI to improve customer satisfaction and streamline order picking, Venkatesan said.
The pandemic last year may have thrown a wrench into Macy’s best-laid turnaround plans, but CEO Jeff Gennette appeared undaunted during a video keynote address Thursday at NRF Retail Converge. “2020 was an unprecedented year,” he said. “And I think the headline is that Macy’s is a healthier business coming out of the pandemic than we were going into it.” Certainly, the extreme circumstances ushered in by the disease outbreak led many companies, including Macy’s, to slash operating costs at a level that might otherwise seem drastic. The retailer last year cut its corporate workforce by nearly 4,000, along with other staff reductions, for example, engendering some $630 million in annual savings — $365 million of that in the last fiscal year alone.
In a move that brings its custom apparel to “nearly every major market” in the U.S., Indochino on Wednesday announced that it is opening 21 shop-in-shops in Nordstrom stores nationwide, according to information sent to Retail Dive. Shoppers work with Indochino salespeople to choose fabrics and customization options, including lapels, buttons, pockets, lining and monogramming. Apparel is then made to measure and sent directly to customers within two to three weeks. Nordstrom will offer complimentary alterations for all Indochino customers. Ten Indochino locations are currently open in Nordstrom stores, and 11 more are scheduled to open between June 25 and July 2.
As Target refines its assortment with up-and-coming brands and new private labels, the big-box retailer has partnered with two more DTC brands: Jinx, a dog wellness startup, and Stojo, a sustainable homewares brand, the companies announced via email to Retail Dive. Jinx currently has partnerships with Petco and Rover online, but Target is the pet wellness brand’s first brick-and-mortar partner. Jinx entered Target stores Monday, and listed singer Halsey, actor Will Smith and rapper Nas as part of its cohort of high-profile backers. Stojo is debuting in Target stores and on its website on July 1. The brand touted that the launch coincides with “Plastic-Free July,” a month-long event focused on decreasing the use of single-use plastic. Target will feature Stojo’s bowl, box, cups and bottle, and will also get exclusives on Stojo’s aquamarine colorway and the company’s sandwich box, which will be restocked on Stojo’s DTC site later in the summer.
Emerging Consumer Companies
GOAT, the Los Angeles-based sneaker and streetwear brand, raised $195 million in a Series F raise valuing the fashion giant at some $3.7 billion. The raise was led by Park West Asset Management, Franklin Templeton, Adage Capital Management, Ulysses Management, and T. Rowe Price. GOAT has now raised just shy of $500 million in total. This round more than doubles the $1.8 billion valuation the company reached in its Series E fundraise last year. Like other online marketplaces, GOAT saw major growth last year, expanding its audience of buyers and sellers while seeing 100% year-over-year growth in its sneaker business and 500% year-over-year growth for its newer apparel business.
Tiny Organics, a New York-based childhood nutrition brand, raised an $11 million Series A. The funding was led by Springdale Ventures, with participation from InvestEco, Silas Capital, Human Ventures, VegInvest, Babylist, Gaingels, XFactor Ventures, Natureza and Howard Morgan. Funds from the Series A round will go toward scaling the team, building customer awareness and developing new product categories and sales channels, as well as accelerating the company’s mission-aligned partnerships.
Oros, the Portland, Oregon-based apparel brand, announced that it had raised a $14.5 million Series A. The funding round was led by Elizabeth Street Ventures and Enlightenment Capital, with participation from Thomas Tull, the Chairman of Snap Inc., and other strategic angels. Equal parts materials technology company and performance apparel brand, OROS is using first-to-market insulation technology to transform advanced thermal materials into technical fabrics. The company created its patented SOLARCORE® insulation in 2015. It aims to create streamlined silhouettes that keep you warm in below freezing temperatures.
Grocery & Restaurants
Famous Recipe Group LLC has agreed to sell its 130-unit quick-service fried chicken chain Lee’s Famous Recipe Chicken to a subsidiary of Artemis Lane Partners, the Shalimar, Fla.-based franchise company said Thursday. It also named a new CEO, Ryan Weaver, who is a former principal for private equity at Apollo Global Management and partners in Artemis Lane with Sam Kaplan and Kyle Tucker, who he also worked with at Apollo. The subsidiary, LFR Chicken LLC, plans to provide capital to expand the chain, which is why Lee’s Famous CEO Chuck Cooper decided to sell the brand, according to a release announcing the deal. He said that quick-service operations now require more investment, enhanced data collection and more efficient processes to support franchisees than they have in the past. He indicated that the new LFR might also open company-owned units. The release also said the new owner ship would “provide an opportunity for maturing restaurant owners to have a solid exit strategy in place.”
Luby’s Inc., which is winding down operations and liquidating, has agreed to sell its Luby’s Cafeteria business to an affiliate of entrepreneur Calvin Gin, the company announced Monday. The Houston-based company said the newly formed affiliate will be renamed Luby’s Restaurants Corp. upon the closing of the deal, which includes 32 of the existing Luby’s locations, all in Texas, and ownership of the Luby’s Cafeteria brand. Luby’s said the cafeteria business sale was valued at about $28.7 million, with “all but a nominal amount of which will be derived from the purchaser’s assumption of Luby’s liabilities and the purchaser’s issuance of notes to Luby’s.” Gin’s family established The Flying Food Group by Sue Gin, which has grown to a large airline catering company in North America and provides food preparation services for other companies, including Starbucks.
Luby’s Inc, which is in the process of winding down operations and returning proceeds to shareholders, has agreed to sell its Fuddruckers business to Black Titan Franchise Systems LLC, the companies said late Thursday. The Houston-based Luby’s, which has been working on the shareholder-approved liquidation since last November, said the sale would make North Carolina-based Black Titan, a newly formed affiliate of Nicholas Perkins and Black Titan Holdings LLC, the largest Fuddruckers franchise operator as well. The Fuddruckers sale would provide Luby’s with about $18.5 million, including a Black Titan-issued note and assumption of certain liabilities, the company said. They expect the deal to close within 90 days. Luby’s said the Black Titan deal includes the master ownership of the Fuddruckers brand worldwide.
Pilgrim’s Pride Corp. has reached an agreement to acquire the Meats and Meals business of Kerry Consumer Foods in the United Kingdom and Ireland for approximately $952 million. The purchase amount represents an 8.5x multiple on implied expected standalone EBITDA for 2021. “We are pleased to have the opportunity to position Pilgrim’s as a leading prepared foods and branded products player through the acquisition of Kerry Consumer Foods’ Meats and Meals business,” said Fabio Sandri, chief executive officer of Pilgrim’s. “The transaction enhances our value-added portfolio by adding market-leading brands such as Denny, Richmond and Fridge Raiders, which we expect to deliver a higher and more stable margin profile.” Kerry makes branded and private label meats, meat snacks and food-to-go products in the United Kingdom and Ireland, while Kerry Meals provides ethnic chilled and frozen ready meals in the United Kingdom. The combined businesses generated more than $1 billion in annual sales during the year ended Dec. 31, 2020.
Home & Road
Epiris has acquired fitted bedroom furniture producer Sharps from Sun European Partners, ending the GP’s 10-year holding period. The deal is Epiris’s eighth investment from Epiris Fund II, which held a final close in October 2018 on £821m. The fund was 54% deployed as of March 2021, according to Unquote Data. The vehicle makes equity investments of £40-150m and offers co-investment opportunities of £30-100m, targeting UK-based companies with enterprise values of £75-500m. The fund is more than 70% deployed following the acquisition of Sharps. Epiris said in a statement that it intends to explore new marketing, product and operational initiatives as part of the company’s ongoing growth.
Used-car retailer CarMax Inc topped Wall Street estimates for quarterly profit and revenue as people used their stimulus checks to buy personal vehicles, with public transport losing favor due to pandemic-driven health concerns. Shares of the company were up 7.2% at $128 in morning trade on Friday, after it said retail used-unit sales doubled to 270,799 units in the first quarter.
Jewelry & Luxury
A few days after Lucara Diamond discovered yet another 1,000-plus ct. diamond at its Karowe mine in Botswana, the company announced it has received 38 million Canadian dollars (about $30.9 million) in new funding. There were two streams for this new funding. The first came from a group of underwriters, led by BMO Capital Markets, that agreed to buy 29.4 million common shares of the company, at CA$0.75 per share, for gross proceeds of CA$22 million (or approximately $17.9 million). The underwriters also have the option to purchase additional shares of this public offering.
Pandora has hired model Ashley Graham as a spokesperson for its new lab-grown diamond brand as it goes “all in” behind the product line, company CEO Alexander Lacik told Bloomberg Quint. Lacik pledged to put unprecedented “muscle” behind the new fashion line, called Pandora Brilliance. And he hinted that while the product is currently being tested in the United Kingdom, it may soon be offered worldwide. “There have been a lot of small players putting their fingers into the pot,” he said, “but no one with the muscle. So let’s see. We are applying the marketing muscle. We’re going all in.”
More than a year after WD Lab Grown Diamonds and Carnegie Institution of Washington filed suit against six competitors for purportedly infringing on Carnegie’s diamond-growing patents, a New York judge tossed their claims against the sole remaining defendant, Fenix Diamonds. On June 16, Judge Jed S. Rakoff granted Fenix’s motion for summary judgment, ruling that there were “readily apparent” differences between the growing method outlined in the patent WD licensed from Carnegie and the method used by Fenix’s diamond grower, Nouveau. In his ruling, Rakoff relied heavily on testimony from Bakul Limbasiya and his son, Chirag, who are both executives of Mumbai, India–based Nouveau, the successor company to New Diamond Era.
Kering has taken an undisclosed stake in a luxury rental company, making it one of the biggest names in luxury to get behind the increasingly pervasive sharing economy. In a statement on Thursday, Kering announced that it has invested in Cocoon, a London-based startup that specializes in facilitating rentals for luxury handbags – including offerings from upwards of 30 brands, such as Kering-owned Gucci, Balenciaga, and Bottega Veneta – with the investment coming as part of a larger $3.5 million round that also included participation from resale platform Depop’s founder Simon Beckerman, among others. Kering’s chief client and digital officer Gregory Boutte said the deal is part of a larger strategy by the conglomerate to invest in innovative young companies.
Office & Leisure
AT&T and WarnerMedia are selling Playdemic, the mobile games studio behind Golf Clash, to Electronic Arts for $1.4 billion in cash. It’s the latest in a stream of deals to come from the AT&T and Warner fold — culminating in last’s month’s news that the giant telco is divesting WarnerMedia after just three years. The film and TV powerhouse will merging with Discovery in a $43-billion deal to create a separate standalone media and entertainment company. That deal is expected to close sometime mid-next year. The remaining Warner Bros. Games portfolio will be included in the WarnerMedia-Discovery transaction and become part of the new company, the companies said. The acquisition of Playdemic is part of EA’s mobile growth strategy.
A UK esports company has big expansion plans for the United States. Belong Gaming Arenas, owned by global esports and technology company Vindex, said it plans to open 500 locations in malls and shopping centers in the United States. The first one will be at Pearland Town Center, just outside of Houston, owned by CBL Properties. Additional venues are planned for Dallas; Columbus, Ohio; Chicago; and Nashville in the coming months as the company looks to open 500 gaming centers in the United States during the next five years. Belong has prospered with 25 locations in the United Kingdom that program daily team competitions for amateurs and aspiring pros. The locations offer snacks and drinks and also sell a range of console hardware, games and “gaming lifestyle” merchandise.
Paragon subsidiary OT Group has acquired part of the Office Depot business from Aurelius and Office Depot Europe. The deal was confirmed yesterday (22 June) and follows Paragon Group’s purchase of various businesses and assets from Spicers Office Team (SPOT) last year, when Paragon Data Analytics was subsequently renamed OT Group as part of the takeovers. OT Group trades as OfficeTeam. It has now agreed to take over Office Depot’s larger mid-market, major and public sector contract customers in the UK and Ireland. As part of the deal, which is expected to be finalized “in the near future”, OT Group will also take on print, marketing and comms business Vital Communications in Dartford, and Office Depot Europe’s distribution centre in Ashton-under-Lyne. Investment group Aurelius said the disposal was part of Office Depot Europe’s “ongoing transformation”, to focus on ecommerce brand Viking in core European markets. The group has sold off five non-core businesses since November 2019.
Lego is to create “storytelling tables” at its stores for adult superfans where they can have virtual meetings with set creators and pore over early product designs and prototypes. Adult brick fans, called AFOLs (adult fan of Lego) in Legospeak, are an increasingly important demographic for the Danish toymaker, as – freed from the constraints of pocket money – they spend hundreds of pounds on kits ranging from technical builds, such as supercars and space shuttles, to ones based on TV shows such as Friends and Stranger Things. The new feature makes its debut in Lego’s new flagship store in New York, which opens on Thursday. The 666-sq-metre (7,175-sq ft) two-storie shop on Fifth Avenue also has an interactive ticketed attraction called “the Brick Lab” which promises to bring “physical Lego builds to life”. Models made by visitors are scanned, enabling them to appear in an animated space or New York-themed adventure.
Technology & Internet
Britain’s competition regulator on Friday launched a formal probe into Amazon and Google over concerns they haven’t done enough to tackle fake reviews. “We are investigating concerns that Amazon and Google have not been doing enough to prevent or remove fake reviews to protect customers and honest businesses,” Andrea Coscelli, chief executive of the CMA, said in a statement. “It’s important that these tech platforms take responsibility and we stand ready to take action if we find that they are not doing enough.” Misleading consumer reviews have proven to be a big problem in e-commerce, and Amazon is a prime target for brands looking to hype up their products online with fake, favorable write-ups.
Total online retail sales in the United States during Amazon’s 48-hour Prime Day surpassed $11 billion — 6.1% higher than overall e-commerce transactions generated by the 2020 event, according to Adobe Analytics data. The total was slightly more than last year’s Cyber Monday, which was the busiest digital sales day on record, Adobe said. However, the Prime Day event was for 48 hours rather than the 24-hour Cyber Monday splurge after Thanksgiving. The index Adobe Analytics tracked looks at more than 1 trillion visits to U.S. retail sites and over 100 million items across 18 product categories. Online retail sales amounted to $5.6 billion on Monday, the first day of Prime Day, and $5.4 billion on day two, Adobe said. That made Monday the biggest day for digital sales this year and Tuesday the second-busiest, according to Adobe. By comparison, the 48-hour Prime Day 2020 generated $10.4 billion in overall U.S. digital revenue, according to Adobe.
Finance & Economy
A key inflation indicator that the Federal Reserve uses to set policy rose 3.4% in May from a year ago, the fastest increase since the early 1990s, the Commerce Department reported. Though the gain was the biggest since April 1992, it met the Dow Jones estimate and markets reacted little to the news. The stock market posted mostly solid gains, while government bond yields were moderately higher.
Initial claims for unemployment insurance remained elevated last week as employers struggled to fill a record number of job openings. First-time filings totaled 411,000 for the week ended June 19, a slight decrease from the previous total of 418,000 but worse than the 380,000 Dow Jones estimate, the Labor Department reported.
The U.S. economy grew at a yearly pace of more than 6 percent in the first quarter of 2021, according to data released by the Commerce Department. U.S. gross domestic product (GDP) grew at a seasonally adjusted annualized rate of 6.4 percent in the first three months of 2021, according to the Bureau of Economic Analysis’s (BEA) final estimate of first quarter growth. The BEA’s previous two estimates of first quarter growth were also 6.4 percent, up from a lackluster 2 percent in the fourth quarter of 2020.