Last month, my colleague Maeghan Thompson wrote about how consumers and retailers are planning to cope with what could be a recessionary Holiday season. In the meantime, forecasters have now given their predictions of Holiday sales. At first sight, the estimates seem rather jolly, but the fuller picture shows Scrooge in the background.
To provide context, overall Holiday revenues represent approximately 20% of total annual sales. These revenues are critical to retailers because they are associated with greater profitability: incremental sales without a proportional increase in costs and expenses.
Over the last ten years, Holiday sales have grown on average 4.9% annually. The largest of these annual growths came last year at a very merry 14.1%, generating total sales of $887 billion. Santa was not prepared for this. Estimated sales growth last year ranged from 7% to 10% among the prognosticators. Further, this was on top of 8.2% growth in 2020. Last year’s growth came despite inflation (albeit mild compared to today), logistical disruptions and the ongoing COVID pandemic. Positive factors included strong wages, record savings and most importantly a spirited consumer. The sectors with the highest growth rates included apparel (33%) and sporting goods (21%). It should also be noted that online Holiday sales grew 11% in 2021 to $206 billion, representing 23% of total Holiday sales. Digital penetration of total Holiday sales has grown from 15% just five years ago, but the rate of growth has moderated recently.
This year, prognosticators are estimating Holiday sales growth ranging from approximately 4% to 8%, which is the rather jolly part. However, with inflation currently at 8.3%, the real growth is much less, which is the Scrooge part.
Bain & Company is forecasting growth of 7.5%. However, given the impact of inflation, the firm is forecasting real growth of 1.1% to 2.1%. Interestingly, the Bain Consumer Health Index shows lower consumer confidence this year compared to last year across all income levels: Low, Middle and High. Notwithstanding this, all income levels are expected to increase their Holiday spending over last year.
Mastercard is expecting a 7.1% increase in Holiday sales. Its report stated, “Consumers may find themselves looking for ways to navigate the inflationary environment – from searching for deals to making trade-offs in their budgets. However, rising wages and lingering savings should have many consumers ready and able to spend.” Regarding online sales, Mastercard believes this channel will grow more modestly at 4.1%.
AlixPartners projects a Holiday sales increase from 4% to 7% with a theme of affordability. The firm reported, “What we’ve dubbed as today’s ‘me-centric’ consumer—a consumer who holds all the power—is right now not only empowered but also worried—worried about inflation and worried about recession. As a result, consumers will be holding out for deals this year, even as retailers themselves struggle with their own inflation and with massive inventories.”
Deloitte predicts Holiday sales will grow between 4% and 6% this year, with online sales growing at a faster rate of 12.8% to 14.3%. The firm’s opinion is consistent with others in that inflation will fuel overall growth, but they believe that the search for bargains will have e-commerce poised for outsized gains.
Beyond inflation, sales growth, and the dynamic between in-store and online sales, another common topic among prognosticators is when consumers will shop. In short, earlier than ever. With excess inventories and concerned consumers, retailers are likely to be more promotional this Holiday season. To wit, Amazon is hosting its first ever second Prime Day within a year, October 11th and 12th. Not to be outdone, Target has already announced that Holiday promotions will begin October 6th. A BankRate survey showed that 50% of consumers will begin their shopping by October.
There may be 82 days left until Christmas, but it always comes faster than you think. Particularly this year.
Headline of the Week
Bed Bath & Beyond on Thursday said sales plunged by 28% in the fiscal second quarter, as the home goods retailer struggled to draw customers. Its shares bounced around in premarket trading, as investors assessed the report. The company’s stock has been volatile, fueled in part by the meme stock frenzy as well as drastic changes to its business. Bed Bath reiterated its full-year outlook, saying it anticipates comparable sales to decline by about 20% as its business improves in the back half of the fiscal year. Here’s how the retailer did in the three-month period ended Aug. 27 compared with what analysts were anticipating, based on Refinitiv data: Loss per share: $3.22 adjusted vs. $1.85 expected; Revenue: $1.44 billion vs. $1.47 billion expected. Comparable sales declined 26% in the second quarter. One of the bright spots of Bed Bath’s business, Buybuy Baby, also posted a sharp drop in the quarter.
Apparel & Footwear
Eddie Bauer named Tim Bantle as its new CEO, replacing Damien Huang, who stepped down earlier in 2022 after a year on the job. Bantle most recently served as the general manager of The North Face and Timberland-owner VF Corp.’s Canadian business. Bantle has also worked in leadership positions at Black Diamond Equipment and Patagonia. He will report to Marc Miller, CEO of Sparc Group, a co-venture between Authentic Brands Group and Simon Property Group that operates Eddie Bauer along with Forever 21, Brooks Brothers, Reebok, and other brands and retailers. Bantle brings with him plenty of experience in outdoor retailing, as did his predecessor. Huang worked for more than a decade with Eddie Bauer before taking on the chief role. Huang stayed on after the outdoor seller joined Authentic Brands and Sparc Group, but not for long. Prior to the acquisition, the more than 100-year-old Eddie Bauer had been mashed up with teen apparel brand PacSun as part of a single operating company under then-private equity owner Golden Gate Capital. When Sparc took over, the plan was to expand Eddie Bauer into new outdoor categories and distribution channels. Last year, the company expanded its retail presence with a partnership with Kohl’s to sell Eddie Bauer products.
Athleta is expanding its customer reach via partnerships with resale site ThredUp and online discount site Shop Premium Outlets, according to a press release. The resale program, still a pilot and dubbed “Always Athleta,” uses ThredUp’s resale-as-a-service platform. As of Wednesday, a limited group of randomly selected online customers are able to choose “Preloved” from the website’s navigation bar and shop gently used Athleta items for up to 90% off. The Gap Inc. brand debuted its first outlet stores earlier this year and in early October will bring value pricing online via Shop Premium Outlets, a joint venture between Simon Property Group and Rue Gilt Groupe, per the release. Athleta said it pursued these two partnerships to bring in new customers, something it needs more than many observers may have thought a few years or even months ago. The athletic and athleisure brand had been growing swiftly, set to achieve its $2 billion revenue goal next year, and even stirring some talk of a spinoff. But it’s been stumbling lately as consumers turned to occasion and work-based clothing and spurned some of the brand’s spring/summer merchandise. In its most recent quarter sales edged up 1% but comps fell 8%.
A live willow tree stands 12-feet tall inside Beyond Yoga’s first brick-and-mortar store. In some ways, the tree epitomizes the Beyond Yoga collection of athleisure and activewear. It is strong but soft enough to bend when faced with a wind that requires strong resistance, said Michelle Wahler, the cofounder and chief executive of the Los Angeles, California-based company acquired by Levi Strauss & Co. last year for $400 million. Softness and strength are some of the main features of the stretchy Beyond Yoga clothing made primarily in L.A. and, until now, sold only online and through wholesale partners including REI and Nordstrom. That collection will be on full display at Beyond Yoga’s first company-owned store opening Wednesday in Santa Monica, California. The new store opens just weeks after the brief appearance of a Beyond Yoga pop-up store that debuted June 25 for one month at The Grove shopping center a few miles away.
The pandemic-triggered exodus of millions of workers from offices to homes created a bit of an existential crisis for M.M. LaFleur, but like others the professional woman’s outfitter has redefined its purpose. In a matter of months — by the fall of 2020 — customers were asking for Zoom-call-appropriate clothing. Wondering what role M.M. LaFleur plays if people are not going back to offices — or at least not in the same capacity as before — was a glaring question and one the New York-based company is meeting head on. Opening a new Upper East Side store in a heavily trafficked area of the well-heeled neighborhood, enlisting New York City Ballet principal dancer Tiler Peck to trumpet the brand, planning for more stores and aligning styles with shoppers’ changing lifestyles are some of the company’s objectives. Located at 1225 Madison Avenue at East 88th Street, the 900-square-foot outpost is the company’s first ground-floor retail location, having previously relied on showrooms (along the lines of the Tesla model). The company is counting on retail to further growth, due partially to the success of pop-up stores that served as great marketing to bringing in new customers.
Athletic & Sporting Goods
Peloton will begin selling its bikes, treadmills and other products in Dick’s Sporting Goods stores, marking the struggling fitness equipment maker’s latest push to expand its customer base. The collaboration will make Dick’s the first brick-and-mortar retailer outside of its namesake stores to carry Peloton equipment. Peloton had long been an exclusively direct-to-consumer business before it began selling its products on Amazon in August. The companies do not yet have a launch date, but said they are aiming to have Peloton products in more than 100 Dick’s stores in time for the holiday shopping season. Dick’s has more than 700 stores in the U.S. Dick’s will carry Peloton’s Bike, Bike+, Tread and Guide, a training system that uses a camera to track a person’s movements, as well as bike shoes and exercise mats, the companies announced.
LeBron James, the king of basketball courts, is one of the newest owners of a professional pickleball team. Major League Pickleball announced that James and his business partner, Maverick Carter, will join its ownership ranks, along with NBA champions Draymond Green and Kevin Love and others. In recent months, the sport’s popularity has attracted several celebrity investors and become a big business. The all-star ownership group’s interest in the sport came from playing it together over the past couple of years, according to MLP. James and Carter will own the team through their family office, LRMR Ventures. Other investors include investment firm SC Holdings; Paul Rivera, chief marketing officer of the SpringHill Co.; and Relevent Sports Group co-owner and CEO Daniel Sillman.
At its Investor Day last week, Sportsman’s Warehouse announced plans to double the pace of new store openings over the next three years to grow sales on average by 10 percent annually through 2025. The meeting was closed to the media but an updated investor presentation posted on the retailer’s website outlined details of its growth strategy. The meeting comes as Bass Pro and Sportsman’s Warehouse, in December 2021, called off plans to merge when it became evident FTC anti-trust approvals could not be attained. Bass Pro had agreed to purchase Sportsman’s Warehouse for $18 per share in cash, equating to approximately an $800 million purchase price. SPWH cited four factors driving its market share (1) resurgence of outdoor participation, (2) fragmented and reduced competition, (3) increased brand reach and awareness, (4) entrepreneurial culture, driving go-to-market strategies.
Vancouver-based fitness giant Nautilus announced that the company’s board of directors was reviewing strategic alternatives, including the potential sale of the company. The review, which has the support of company management, will also look for chances to speed up Nautilus’ “digital transformation under its previously announced North Star plan and enhance shareholder value,” read a press release. “We have made tremendous progress executing our North Star strategy and transforming Nautilus from a product-led hardware company to a consumer-led, digitally connected company,” Nautilus Board Chair Anne Saunders said in Monday’s statement. “Given the dynamic market environment and growth of the home fitness sector, as well as the potential we see to accelerate North Star, the board felt the time was right to review strategic options.”
Cosmetics & Pharmacy
With a reduction in COVID-19 vaccine and testing revenue as well as store closures, Rite Aid swung to a loss in its fiscal second quarter. Rite Aid reported a net loss of $331.3 million, or $6.07 loss per share, adjusted net loss of $34.4 million, or 63 cents loss per share and adjusted EBITDA of $78.5 million, or 1.3% of revenues for its second fiscal quarter ended Aug. 27, 2022. Revenues for the second quarter were $5.9 billion compared to revenues of $6.11 billion in the prior year’s quarter. The company attributed the loss to a reduction in revenue from COVID-19 vaccines and testing, store closures and a planned loss of covered lives at Elixir.
Shiseido Europe S.A., a subsidiary of Shiseido Company, Limited, is acquiring all outstanding shares of Gallinée Ltd., the London-based, microbiome-focused beauty brand. The acquisition exemplifies Shiseido’s commitment to the skin beauty category and is part of its “WIN 2023 and Beyond” strategy to become the world’s No. 1 company in the category by 2030, the Japanese beauty giant said in a statement released today. Gallinée was founded in 2014 by Marie Drago. The brand offers a range of science-backed beauty products featuring a patented complex of prebiotics, probiotics and postbiotics that nourish and strengthen the skin’s microbiome. Gallinée’s roster includes 17 products across skincare, body care, hair care and supplements, which are primarily sold in the UK and France. According to Shiseido, Gallinée will deliver a complementary yet unique addition to its existing portfolio given its focus on beauty and wellness as well as its differentiated positioning within the emerging field of skin microbiome.
Nécessaire is eyeing expansion — with a helping hand from another round of financing. The Los Angeles-based body-first brand founded by Randi Christiansen, a former marketing and strategy executive at The Estée Lauder Cos., and editorial veteran Nick Axelrod has received financing from Cavu Consumer Partners, although it did not disclose terms. It previously gained investments from Imaginary Ventures, Forerunner Ventures, Maveron Ventures and VMG Catalyst. Nécessaire is expecting to make $35 million in retail sales this year from selling around 1.5 million units, and the company has big goals for the future with aggressive plans to broaden its product range and retail strategy.
Discounters & Department Stores
Making good on an initiative announced late last year as part of its revamped Polaris turnaround, Macy’s on Wednesday launched a third-party digital marketplace run by marketplace platform Mirakl. The effort allows the department store to offer a wider assortment than it currently sells in stores or online, including more than 20 product categories and 400 new brands, according to a company press release. Macy’s said the marketplace also furthers its goals for sustainability, diversity, equity and inclusion, noting that this fall, “20% percent of marketplace sellers and brands will be from underrepresented enterprises.”
After introducing same-day delivery with Instacart, Five Below has launched a buy online, pick up in store option across its more than 1,250 stores, the retailer announced on Tuesday. Shoppers can order items ranging from games and beauty products to snacks and craft items. Customers can access the service on the retailer’s website or the Five Below app for iOS and Android, per the announcement. The retail chain also said the service may be used for its relatively new Five Beyond section, which has items priced at more than $5. The company has rolled out the Five Beyond section at select stores across the U.S.
Walmart is working to shift perceptions of its business among Gen Z with the launch of two Roblox experiences ahead of the holidays. The interactive spaces mark the first time the world’s largest retailer has shown up virtually and are part of a series of experiments that leverage emergent digital channels to nudge young consumers closer to commerce. “We’re really manifesting the brand in a way that we think is going to excite the next generation of consumers and get them to think of Walmart differently,” said Justin Breton, director of Walmart’s brand experiences and strategic partnerships.
Dollar Tree Inc. has hired a new chief operating officer following a deep shakeup in its C-suite in June. Filling the role is Michael Creedon, who most recently served as executive vice president of stores in the U.S. for Advance Auto Parts. Creedon is set to start Oct. 3, with a $500,000 signing bonus, $850,000 base salary and incentive awards. Creedon replaces Thomas O’Boyle, who left Dollar Tree this summer with a group of four other executives that either left or announced they were leaving following an activist investor-led board revamp this year.
Emerging Consumer Companies
Sexual wellness brand Cake announced that it has secured $8 million in a Series A funding round led by investment partner Silas Capital. The round was completed entirely with existing investors, including Lerer Hippeau, Bullish, Selva Ventures, and Finn Capital Partners. Total funding has now surpassed $16 million, making it one of the highest-funded startups in its category. Cake’s product line including specialty lubricants, condoms, toys and more are currently available at hellocake.com, with select products available at major US retailers, Amazon, Thrive Marketplace and UrbanOutfitters.com.
Caraway, a home and lifestyle brand leader in non-toxic, design-forward kitchenware and home goods, announced that it has raised a $35M investment led by McCarthy Capital. Launched as a DTC brand in November 2019 with the first high design, non-toxic and non-stick cookware product on the market, Caraway has since amassed a strong following and over 35k 5-star reviews. The company has also partnered with retailers like Crate & Barrel, Amazon, Nordstrom, Zola, West Elm, Williams Sonoma and others. The funding will support Caraway’s product development and innovation pipeline, having recently launched a new tea kettle line and a collection of “Minis,” which includes smaller sizes of its non-toxic ceramic cookware pieces. Bakeware and linens round out the Company’s current product offerings.
Maev, the first human-grade raw dog food brand, announced $10 million in fundraising. The milestone round was led by VMG Partners with participation from BFG Partners, Willow Growth Partners, Springdale Ventures, DX Ventures, Contrary Capital, Good Friends, and 1st Course Capital. Since its 2020 founding, Maev has served over 7 million meals and has tripled its subscriber base in 2022 alone. The new funding will be used to support Maev’s growth, including product expansions, veterinarian-backed research and recipe development, and more. The round will also bolster team growth and hiring across all functions of the company.
Food & Beverage
A jury sided with Monster Energy Co. in its false advertising lawsuit against Bang producer Vital Pharmaceuticals (VPX) in California federal court this week, awarding the company nearly $293 million in damages. The nine-person jury found that VPX violated the Lanham Act by wrongfully marketing its “super creatine” supplement as a functional ingredient in Bang energy drinks. During the trial, Monster argued that super creatine did not increase creatine levels in the body and that the dose included in a single can of Bang is too small to provide any significant functional benefits. The jury also found that VPX violated state law by stealing trade secrets from Monster and by interfering with the company’s retail contracts. The verdict marks a climax in the four-year long lawsuit first filed by Monster in 2018. The jury awarded $271.9 million to Monster for the Lanham Act violation – the full amount requested by the company – with additional damages tied to the state law violations. During the trial, Monster’s case relied heavily on a survey claiming that one-in-five sales of Bang would have gone to Monster if super creatine had not been falsely advertised.
Bottled water brand PATH has raised $30 million in a Series A funding round led by Altos Ventures aimed at expanding its nationwide distribution footprint and supporting a new East Coast manufacturing facility. PATH co-founder and CEO Shadi Bakour acknowledged that Altos Ventures – a Silicon Valley fund that has invested primarily in tech companies such as DigitalPath and Chowbus – may not have been an obvious partner for a CPG brand, but that PATH and the venture group aligned on their shared ethos around sustainability and market disruption. The firm will gain a seat on the brand’s board of directors, and will likely help PATH to unlock doors in the sports, tech and restaurant spaces through their network, Bakour said. Additional investors in the round include Blue Investment Group; celebrities such as Ryan Seacrest, Guy Fieri and Ninja; and HartBeat Ventures, a venture fund founded by comedian Kevin Hart, among others. Founded in 2015, PATH has positioned itself as an eco-conscious water brand – offering still, sparkling and flavored varieties – by promoting its aluminum bottles as being reusable.
Impossible Foods founder Pat Brown transitioned from his role at the company he started to lead a new venture affiliated with the company. The transition, first reported by Business Insider, was announced in two planned emails to Impossible Foods employees — one from CEO Peter McGuinness and one from Brown, a company spokesperson said. The new venture, which the company said will exist in addition to Impossible’s current R&D team, is tentatively known as Impossible Labs, Business Insider reported.
John R. Tyson will take over as chief financial officer of Tyson Foods, Inc., on Oct. 2. Stewart Glendinning, the current CFO, will transition to group president of Prepared Foods, according to the company. Mr. Tyson joined Tyson Foods in 2019 as executive vice president of strategy and chief sustainability officer. He will keep those responsibilities after Oct. 2. Mr. Tyson also led Tyson Ventures, the company’s venture capital fund. It is unclear if he will continue in that role. He is a member of the family that founded Tyson Foods.
Grocery & Restaurants
After months of tense communications, Starbucks and SBWorkers United seem to finally be ready to negotiate union contracts. This week, SBWorkers United announced that it is drawing up a list of non-economic proposals for its parent company, while Starbucks published a press release on its union voting website “urging” workers to begin bargaining at the 234 unionized Starbucks stores. According to its press release published on Monday, Starbucks sent out letters to each unionized store hoping to begin good faith negotiations at individual stores and offering a “three-week window in October to ensure that members of each bargaining committee, in addition to any other Workers United representative from that store, have ample opportunity to participate.” Starbucks stated that letters were sent on Sept. 23 looking for individual contracts from each unionized store. SBWorkers United announced the same day that the union is working on its list of proposals for Starbucks, first by introducing a list of non-salary-related asks (which is typical for union negotiations). Union negotiations will likely spill over into the transfer of power to incoming Starbucks CEO, Laxman Narasimhan, a former PepsiCo executive, who will be taking the helm from interim CEO Howard Schultz in April 2023. While Schultz has been known for his blatant anti-union stances, it is unknown whether that culture will continue with Narasimhan’s tenure.
Restaurant operators are rethinking their real estate strategies in a challenging market, where top sites are in short supply and costs are rising for both new construction and leased locations. Some operators that have long focused on building sites from the ground up have shifted instead to a strategy centered on acquiring closed locations and remodeling them to accommodate their own concepts. Others have been taking a closer look at nontraditional locations, such as travel plazas and hotels, or at other sites they might not have considered just a few years ago. Many operators are also taking consumers’ ongoing interest in off-premises dining into account in their site selection, as they downsize their dining rooms and boost their takeout options with more drive-thru and pickup windows. David Orkin, restaurant practice leader at real estate firm CBRE, said high construction costs, onerous lease terms, and delays in the supply of equipment and building materials are all impacting operators’ development plans. Landlords are seeking to pass along their construction cost increases in the form of higher rents for operators who lease their sites. In some cases, landlords that had previously increased rents by about 10% every five years or so are pushing for bigger hikes because inflation is driving up their costs at a faster rate, Orkin said. Operators are likewise facing cost increases on multiple fronts, including not only their own construction expenses but also the amount they are paying for labor, food and other supplies. As a result, landlords and their restaurant tenants are clashing over how they can maintain their profit margins.
Home & Road
Furniture design company MillerKnoll posted first quarter 2023 consolidated net sales of $1.08 billion, reflecting an increase 12.3% compared with the prior year, for the quarter ended Sept. 3. “First quarter results are a testament to our diversified, global business,” said Andi Owen, MillerKnoll CEO in a statement. “Our multi-channel, multi-brand collective is designed to sustain shifting economic conditions and drive growth.” Owen added that following a strong first year as the consolidated MillerKnoll, the company entered fiscal year 2023 well-positioned to leverage its unique combination of business channels. “During the first quarter, we launched our MillerKnoll sales organization and dealer network in North America, introduced more than a dozen new products at the company’s first Design Days and continued to capture synergies through our integration work,” Owen said in a letter to shareholders.
Office and contract furniture giant Steelcase will cut 180 salaried positions in the third quarter, citing reduced orders and lower-than-expected return-to-office trends in North America. The company will also reduce its annual budget by $20 million. “In response to inflation and supply chain challenges throughout this year, we have been pulling back on our planned level of incremental spending while staying invested in our most critical strategic initiatives,” said Dave Sylvester, senior vice president and chief financial officer. “Due to the recent volume decline in our incoming orders and lower than expected return-to-office trends in the Americas, we are planning to implement additional actions in the third quarter, which target further reduction of our planned level of spending.”
Lowe’s Cos. has unveiled an interactive virtual model, or “digital twin,” of two of its stores. The home improvement giant is leveraging technology from Nvidia to create photorealistic digital replicas of the stores to enable store employees to visualize and interact with nearly all of a store’s digital data. Built by Lowes Innovation Labs team and leveraging Nvidia’s Omniverse metaverse environment, Lowe’s digital twin is currently live in two stores (in Mill Creek, Wash,. and Charlotte, N.C.). Lowe’s digital twin solution is a completely virtual replica of the physical home improvement store. It fuses spatial data with other Lowe’s data, including product location and historical order information, and unites it all into a visual package that associates can gain access to on a range of devices, including desktop computers and Magic Leap 2 augmented reality (AR) headsets. “We’re thrilled to pioneer retail digital twins and elevate experiences for both our associates and customers,” said Seemantini Godbole, Lowe’s executive VP, chief digital and information officer. “Through emerging technology, we are always imagining and testing ways to improve store operations and remove friction for our customers.”
Jewelry & Luxury
Most people who wear a ring have a story about that one time they caught their metal wedding band on a piece of gym equipment or lost a sentimental ring because they took it off for safety—it tends to be a memory that’s hard to forget. Enso Rings founder and CEO Aaron Dalley knows these stories, having lost many a wedding band himself. His partner once forgot to take off his ring while rock climbing. That rock mangled the ring and his hand as well. Those stories and countless others inspired Dalley to launch Enso Rings in 2015 to create a better silicone ring replacement option. Dalley added his own spin, producing premium bands that are both stylish and sophisticated. That led him to Zales, and now the two are partnering to offer Enso Rings at Zales online and in stores nationwide, a major landmark for his company, Dalley says.
French luxury brand Cartier has been watching the appetite of European luxury brands grow across America during the pandemic. The company is ready to capitalize. The jewelry and watch-making company is planning to expand its presence in the United States, Bloomberg reported. The company is eyeing the addition of 10 stateside stores in the coming years. Cartier seems to be taking notice of the pandemic-era trend of wealthy US residents expanding their horizons from traditional coastal enclaves like New York City and Los Angeles. The company is considering opening stores in Seattle and Austin, even Troy, Michigan. It won’t be abandoning its roots, though, potentially opening stores close to some of their existing locations. Early next year, the Richemont-owned brand is opening a store in Soho, adding to the company’s presence in New York City, where a flagship lives at 653 Fifth Avenue.
It was the second Paul Newman Daytona that David Silver had sold for £275,000 in less than two weeks that proved decisive. Silver owns the Vintage Watch Company, a Rolex specialist dealer that sits in tony Burlington Arcade, that two century-old strip of luxury boutiques in London’s Mayfair. Despite his British base, many of Silver’s customers are Americans—including both the Newman collectors. “They were clients who’d always hovered around wanting that watch, and never quite done it,” he says, of the much-prized model that he’d usually sell once every six months or so, perhaps, “But they saw they could save 15 percent just because of the dollar exchange rate right now, and that made them feel good about finally buying one.”
Office & Leisure
Fans of the cult classic movie “The Hudsucker Proxy” will remember that the main character kept describing his invention of the hula hoop as being, “you know, for kids.” But top toy companies are looking beyond the youth demographic this holiday season and plan to pitch more of their products to a demographic with more spending money: grownups. The toy giants realize that many adults aren’t just looking to buy toys for their children, grandkids, nieces and nephews. Companies like Hasbro are increasingly looking to adults (and not just parents) as buyers for nostalgic products, whether its gifts for older loved ones, friends or for themselves. “Our principal approach is serving the adult fan with the best collectibles,” said Kwamina Crankson, senior vice president and general manager of Hasbro Direct, the division that runs the Hasbro Pulse site. “These are fans of brands, stories and characters.” Toy companies and other collectibles makers clearly recognize that grown-up shoppers are still invested in the brands that they played with as kids. “It’s all about nostalgia,” said Andrew Perlmutter, CEO of Funko, which makes the Pop! brand of vinyl figurines.
Paperless Post wants to do more than supply online invitations. It wants to supply people with dinner plates, party favors and balloons too. The company, which built a 13-year-old business around sending online invitations, has expanded its offering to physical party goods. Paperless Post launched an online marketplace stocked with goods for events, called Party Shop, in July. The shop offers products that fit various themes and even items suited for special occasions like bridal showers and baby showers. Paperless Post said it wanted to win a larger share of the party market after learning how its customers spend an estimated $5 billion on events each year. By introducing Party Shop, the company hopes to facilitate the next step of the party planning process, especially now as in-person events make a comeback. Paperless Post users hosted about 2 million events in 2021 alone. And it joins other digital invitation businesses trying to grow revenue via commerce. Paperless Post boasts a total of over 175 million invitation senders and receivers since its founding in 2009 and has received over $50 million in funding to date.
Technology & Internet
Apple said Monday it is assembling its flagship iPhone 14 in India as the U.S. technology giant looks to shift some production away from China. “The new iPhone 14 lineup introduces groundbreaking new technologies and important safety capabilities. We’re excited to be manufacturing iPhone 14 in India,” the company said in a statement. Apple’s main iPhone assembler, Foxconn, is manufacturing the devices at its Sriperumbudur factory on the outskirts of Chennai. The Cupertino, California, giant has been manufacturing iPhones in India since 2017 but these were usually older models. This time with the iPhone 14, Apple is producing its latest model in India for the first time, close to the device’s launch. Apple’s focus on manufacturing in India highlights the tech giant’s desire to diversify production away from China and boost customers in India, which is currently a small market for the company. Apple still relies heavily on China for the majority of iPhone production.
Since Amazon introduced the Echo smart speaker in 2014, it’s remained the biggest and fastest-growing player in the smart home market. Its most recent expansion includes four new Echo devices, a new Fire TV, two new Ring cameras with features like radar-triggered motion detection, and the Halo Rise contactless bedside sleep tracker that can sense your breathing and movement to determine sleep stages. The new devices were all introduced Wednesday at Amazon’s annual smart home event. Last month, Amazon made moves to enter a new segment of the smart home, with a $1.7 billion offer to buy iRobot, the maker of the smart Roomba vacuum. Now, the Federal Trade Commission is requesting more information from both iRobot and Amazon before deciding whether to approve the deal. Earlier this month, 20 privacy and labor groups sent a letter to the FTC asking it to block the acquisition. The letter cited concerns about privacy and Amazon’s growing dominance of the smart home market.
Finance & Economy
Initial filings for unemployment claims fell last week to their lowest level in five months, a sign that the labor market is strengthening even as the Federal Reserve is trying to slow things down. Jobless claims for the week ended Sept. 24 totaled 193,000, a decrease of 16,000 from the previous week’s downwardly revised total and below the 215,000 Dow Jones estimate, according to a Labor Department report. The drop in claims was the lowest level since April 23 and the first time claims fell below 200,000 since early May. Continuing claims, which run a week behind, fell 29,000 to 1.347 million.
Consumer confidence rose for a second straight month in September, as moderating gas prices and the hope that inflationary pressures might be easing helped lift the nation’s collective mood. The Conference Board reported that its baseline index rose to 108 from a revised 103.6 in August, the highest it has been since April. The monthly survey found that Americans are feeling less pessimistic in both their assessment of current conditions and their outlook for the future. The reading comes as welcome news, since the consumer outlook lately has been buffeted by the growing fear of an economic downturn. Last Thursday, the Conference Board said its Leading Economic Index notched its sixth consecutive drop, which the organization’s senior director of economics said is “potentially signaling a recession.” The index provides visibility into a range of economic activity, ranging from jobs to manufacturing to markets.