The Chinese shopping festival of Singles’ Day, also known as 11.11, is set to conclude this week, and indications are that this year it will again be the biggest shopping event on the planet. Originally created in the 1990’s to celebrate single people, the holiday took a commercial turn in 2009, when Chinese ecommerce retailer Alibaba began offering promotions and discounts on Singles’ Day over its Tmall shopping platform to drive traffic and sales. Since then, the holiday has grown steadily, now spanning most of early November, and reaching $131.1 billion (USD) in gross merchandise value (GMV) across all shopping platforms last year, making it bigger than the U.S.’s Black Friday and Cyber Monday combined. However, this year there is a tension between two of the biggest trends related to the holiday, which may make it feel different than it has in the past.
On the one hand, a standout trend for Singles’ Day this year is the event’s continued growth and multifaceted expansion. First, the event is likely to be bigger than ever this year. A recent survey by Bain & Company found that 52% of likely shoppers expected to spend more than last year, while only 8% expected to spend less. At least part of this growth is fueled by the holiday’s continued spread across the calendar. 11.11 was a simple one-day holiday in 2009, but in 2020, Alibaba extended Singles’ Day into an 11-day promotional shopping period. This year, the company kicked off the event on October 20th.
11.11 is spreading geographically as well. The Bain Singles’ Day survey predicted that the event will pick up more new customers this year from smaller Chinese cities than it does from tier-1 and tier-2 cities. Additionally, Alibaba and other Chinese retailers are also hoping that the holiday will continue to spread outside of China. Alibaba announced a number of investments in expansion in Europe in the weeks ahead of this year’s holiday, and several retailers, including Asos, are offering Singles’ Day discounts across the U.K., U.S., and other countries to appeal to Chinese and south-east Asian communities living in foreign markets. Lastly, Singles’ Day is spreading to more retailers within China. While Alibaba and JD.com remain the biggest players during the festival, other shopping platforms in China and elsewhere such as Pinduoduo and Douyin (the Chinese version of TikTok) are positioning this year to gain market share.
On the other hand, Alibaba’s messaging around Singles’ Day is decidedly different this year. The company’s public statements about the holiday have downplayed sales figures and stressed 11.11’s importance to all brands and merchants, and have made inclusivity and environmental sustainability into talking points. In years past, Alibaba focused more on the size and spectacle of Singles’ Day, often highlighting a rolling figure counting the event’s total sales. The change is likely the result of recent pressure from Chinese regulators on the technology sector to adhere more to the government and Xi Jinping’s vision of “common prosperity” for the Chinese economy. Such pressure has pushed Alibaba cofounder Jack Ma to pull back from the public limelight much of this year. Alibaba may also still be stinging from a $2.8 billion fine that was handed down by the government in April for monopolistic practices. Further, regulators’ call to ecommerce retailers to pull back on spam marketing just two weeks ago was another reminder that they are still watching.
There are many other Singles’ Day dynamics worthy of note, including live selling’s continued popularity and growth, Chinese consumers’ changing attitudes about domestic versus foreign brands, and clean beauty’s strong growth trajectory. However, the tension between Singles’ Day’s relentless commercial growth and the Chinese government’s priorities may be the most intriguing.
Headlines of the Week
Allbirds (BIRD), the sustainable footwear brand, surged 90% on its IPO day, closing at $28.64 per share on Wednesday. The stock had opened at $21.21 per share, well above its $15 initial public offering price. Allbirds calls itself a global lifestyle brand “that innovates with naturally derived materials to make better footwear and apparel products in a better way.” The San Francisco-based company says its footwear has a 30% lower carbon footprint than standard sneakers. Since it was founded in 2015, the company has sold more than 8 million pairs of shoes to over 4 million customers globally, according to its S-1 filing. Allbirds markets directly to consumers digitally and through the 27 physical stores it has as of June 30, 2021. Last year, 89% of sales came through the company’s digital channels. Stores accounted for the other 11% of sales. The company’s net revenue grew from $126 million in 2018 to $219.3 million in 2020. It generated an adjusted EBITDA loss of $15.4 million in 2020, up from a loss of $1.3 million in 2019. Allbirds offered 20.2 million shares in its IPO, raising more than $300 million.
Black Rifle Coffee Company (BRCC), a coffee seller that focuses on military veterans, said on Tuesday it will go public through a merger with a blank-check acquisition firm, SilverBox Engaged Merger Corp, in a deal that values the combined company at about $1.7 billion. BRCC said its consumer business, which includes both subscription and non-subscription sales, saw a 92% jump in 2020 to $126 million. It also generates sales through wholesale retail from grocery chains such as 7-Eleven, Sam’s Club, and Walmart, as well as company-operated and franchised retail coffee shops. The deal is expected to close during the first quarter of 2022, after which the combined company will be named Black Rifle Coffee Inc.
Apparel & Footwear
Fashion’s headlong rush to Wall Street is continuing with the data-savvy Lulu’s Fashion Lounge Holdings Inc. The Chico, Calif.-based digital native has set its initial public offering range at $16 to $19 a share — valuing the women’s fashion brand at $595 million to $706.6 million. Lulu’s plans to sell 5.8 million shares to the public, which translates to proceeds of about $89 million at the offering’s midpoint of $17.50. The company plans to use that money to pay off a $71.4 million term loan and redeem $17.9 million in preferred stock. The process, underwritten by Goldman Sachs & Co., BofA Securities and Jefferies, will put the company out into the open market trading on the Nasdaq under LVLU. Lulu’s offering will count as something of an introduction for many people in the industry since the company, founded in 1996, has largely operated below the radar.
American Eagle Outfitters is adding Quiet Logistics to its portfolio. The retailer has agreed to purchase the logistics firm for $350 million in cash, building upon its acquisition of logistics firm Airterra earlier in the year as it continues to enhance its supply chain capabilities. “We continue to be extremely pleased with the pace of our business and are executing well against our Real Power, Real Growth plan,” said Jay Schottenstein, American Eagle Outfitters’s executive chairman and chief executive officer. “Quiet Logistics has provided significant benefits to AEO over the past year and we are leveraging our healthy cash position to ensure ongoing advantages. Also, as we continue to expand these services to other brands and retailers, we believe the business will scale, generating incremental value for our shareholders.” Quiet Logistics has locations in Los Angeles, Dallas, St. Louis, Mo., and Jacksonville, Fla., that provide same-day and next-day delivery options to consumers and stores alike. The company will be a wholly-owned subsidiary of American Eagle Outfitters and will continue to run its business independently.
Vera Bradley closed its SoHo store at the beginning of the pandemic, but has reclaimed the site, at least temporarily, for a good purpose. It’s now a pop-up store for GoodMrkt, a cause and socially driven, multibrand concept recently launched by Vera Bradley. The first GoodMrkt store opened last April in a former Williams Sonoma location in Fort Wayne, Ind., where Vera Bradley is based. GoodMrkt in SoHo, at 411 Broadway, opened last month. With just the two stores operating, GoodMrkt is a start-up reflecting Vera Bradley’s intent to grow and make more money while expanding its philanthropic endeavors. In 2019, the $400 million, publicly traded Vera Bradley purchased Pura Vida, an online retailer of handmade bracelets, anklets, stackable rings and other items supporting artisans in Costa Rica, effectively bringing Vera Bradley into the jewelry business. Last January, Vera Bradley introduced its first sustainable fashion collection, called ReActive, for luggage, bags and accessories, furthering efforts to be more of a lifestyle brand while being environmentally responsible.
Windsor Fashions is accelerating its store expansion. The Southern California-based young women’s apparel and accessories retailer, best known for its affordable prom dresses and special occasion outfits, said it plans to open an additional 28 retail stores by the end of 2021, bringing its total store footprint to 294 stores. Windsor expects to open approximately 35 new stores in 2022. “With events and celebrations coming back in full force, we continue to see extremely strong demand across all of our shopping channels and remain confident in the future of brick-and-mortar as a cornerstone of our business, which is enhanced by our e-commerce and omnichannel offerings,” said Leon Zekaria, CEO of Windsor. Founded with a single location in 1937 by the Zekaria family, Windsor is run by the second generation of Zekaria brothers, Leon and Ike. The brothers, who took the helm in 1998, have expanded the chain nationwide and developed an integrated e-commerce business.
Athletic & Sporting Goods
Callaway Golf Company announced that it has completed a $30 million minority investment in Five Iron Golf, an emerging, privately-owned, urban indoor golf and entertainment company offering simulator rentals, golf lessons, custom club fittings, social events and a curated food and beverage menu. Callaway will be accounting for the investment on a cost basis. Other terms of the transaction were not disclosed. Five Iron Golf was co-founded in 2017 in New York City and has rapidly expanded to nine domestic venue locations operating in seven cities and one international franchise venue location in Singapore. Seven additional venue locations are currently under development, including Chicago’s The Loop neighborhood and Seattle’s Capitol Hill neighborhood, which are projected to open in December 2021 and January 2022, respectively.
Nike and Dick’s Sporting Goods are stepping up efforts to work together at a time when a number of athletic apparel brands, including Nike, are relying less on wholesale partners. In a first step, Nike’s loyalty program will link to Dick’s membership offering to allow customers to shop for exclusive Nike shoes and apparel on Dick’s website, the companies announced. The partnership will evolve over time to include in-person workout events at Dick’s locations. And the two hinted at another perk that could be coming: Allowing Nike customers to drop off their returns or pick up online orders at Dick’s stores. For Nike, the move solidifies the sneaker giant’s commitment to Dick’s amid an industry upheaval. Nike, along with peers such as Under Armour and Adidas, has been proactively pulling merchandise out of wholesale channels including off-price stores and other footwear retailers in a bid to sell more goods directly to customers at higher prices.
True linkswear is looking to accelerate its growth, and a new round of $11.25 million in funding from KarpReilly will help in that effort. The Washington-based footwear company, founded by Jason Moore and multi-time PGA Tour winner Ryan Moore, believes the investment will help reach more golfers with their products focused on comfort and versatility. True has positioned itself as a shoe for golfers who consider themselves purists and passionate, walking golfers, making shoes with ethically sourced materials and an earth-first ethos. Since 2017, the company has double revenue year over year. The current True portfolio features five core designs with a minimalist aesthetic, with several models crafted from entirely recycled materials. Since 2019, True has eliminated shoe boxes and shipped using reusable shoe bags. The company is largely built on a direct-to-consumer business model that also includes strategic partnerships with select golf courses and destination pro shops.
Golf is surging at the moment, and that goes well beyond the course. New and returning golfers are buying equipment at a breakneck pace, which has caused many of the sport’s biggest brands to expand in specific areas to keep up with the ever-growing global demand. With its worldwide golf ball market share increasing, TaylorMade made a strategic acquisition with the purchase of Korean-based Nassau Golf Co. Ltd for an undisclosed amount. Nassau has been a key cog in TaylorMade’s ball supply chain for 15-plus years, making urethane and ionomer balls, as well as mantles for the TP5 and TP5x facility in South Carolina. TaylorMade’s deal for Nassau comes six months after financial sponsor KPS Capital Partners signed a definitive agreement to sell the equipment company to Centroid Investment Partners, a Korea-based private equity firm.
Cosmetics & Pharmacy
While continuing to play a role in battling the pandemic, CVS Health’s third quarter brought increased revenue and earnings. The Woonsocket, R.I.-based company saw third-quarter revenues up 10% year over year, totaling $73.8 billion and posting earnings per share of $1.20 — an increase of 29% over the prior-year period. Total revenues year to date increased to $215.5 billion, an increase of 8.2% compared with the prior-year period. GAAP diluted earnings per share were $4.98 and adjusted earnings per share were $6.43.
E.l.f. Beauty posted another quarter of net sales growth, and has raised its guidance. The beauty business, which owns E.l.f. Cosmetics, W3ll People and Alicia Keys’ Keys Soulcare, posted a 27 percent gain for the quarter ended Sept. 30. E.l.f. Posted $91.9 million in net sales for the quarter, compared to $72.4 million in the prior-year period. Net income was $5.7 million, compared to $447,000 in the prior-year period. E.l.f. raised its financial guidance, and is now projecting net sales between $364 million and $370 million for fiscal 2022. For the six months ended Sept. 30, E.l.f. posted $188.9 million in sales, up 38 percent year-over-year, from $136.9 million. Net income for the period was $14 million, compared to nearly $2 million in the year-ago period.
Discounters & Department Stores
Dollar Tree has extended same-day delivery in as little as an hour via Instacart to 7,000 additional stores, the companies announced Thursday. The expansion brings Instacart’s delivery service to almost 13,000 Dollar Tree and Family Dollar locations in the contiguous United States and Washington, D.C., representing the majority of the retail chain’s approximately 15,500 stores. Dollar Tree’s announcement adds a significant online presence in the discount retail space as more consumers are turning to delivery for convenience orders.
Walmart and Sam’s Club have teamed up with award-winning singer Elton John to release an exclusive eyewear collection, the latest among a slew of other celebrity partnerships in recent years. The Foundations Collection includes 60 frames, 36 exclusive to Sam’s Club and 24 exclusive to Walmart, that retail for between $95 and $100. The eyewear line, dubbed Elton John Eyewear, is available at Sam’s Club on Monday and at Walmart later this week, according to a press release. Elton John Eyewear is expected to release more frames and be available in more Walmart locations next year. With Elton John Eyewear, the singer worked with the retailers to develop frames inspired by his style and music career, according to the release. John gave the frames names like “Rocketman,” “A-List” and “Prodigy.”
CBL Properties has emerged from Chapter 11 after filing for bankruptcy a year ago. As part of its reorganization, the mall operator reduced its debt load by some $1.7 billion. Following a planned note redemption, the company will carry more than $1.4 billion on its post-bankruptcy balance sheet, including a term loan and new notes. In a statement, CEO Stephen Lebovitz called the completed restructuring “a huge day for CBL” and said the company would use its newfound financial flexibility to pursue opportunities in the market.
In preparation for the holiday season, Target is building on its “What We Value Most Shouldn’t Cost More” campaign with a new ad featuring a rendition of “Best of My Love” by The Emotions produced and performed by the Black Pumas and Sofia Reyes, the retailer announced. Target Creative, in partnership with its creative agency Mother, tapped women-owned production companies Little Minx and Merman to create the campaign, which it said is its largest of the year. The retailer also teamed up with Essence to increase its spending across diverse media partners, per the announcement. The campaign is meant to showcase the company’s “commitment to diversity and inclusivity.”
Emerging Consumer Companies
Thirteen Lune, an online, inclusive beauty marketplace, raised a $3 million round. The investment was led by Fearless Fund, the venture capital firm from Arian Simone, Keshia Knight Pulliam and Ayana Parsons that focuses on women of color founders. Capstar Ventures, Fab Ventures, Swiftarc Beauty Fund and Gaingels participated in the round. Thirteen Lune has raised a total of $4.5 million over two rounds since its December 2020 launch. Previous friends and family investors include Gwyneth Paltrow, Sean Combs, Naomi Watts, and Beautycounter CEO and founder Gregg Renfrew. 90% of the brands featured on Thirteen Lune today are by Black and brown founders. The other 10% are so-called “ally” brands that Thirteen Lune deems as having consistently shown inclusivity in products and messaging.
Martie, a new online grocery store for discounted brand name pantry staples, launches with $3 million in funding from Upfront Ventures. By saving perfectly good packaged food destined for landfill, Martie can offer discounts of 40-70% off on an ever-changing selection. Launching with over 400 SKUs from over 300 brands, Martie offers shoppers 9 stocked categories of shelf-stable goods such as coffee and tea, nut butters, cereal, pastas, soups, and more from brands such as Annie’s, Heinz and Kettle. With no memberships or subscriptions, and 40-70% off always, Martie is committed to make foods more accessible through pricing and distribution.
Food & Beverage
Brazil-based plant-based meat company Future Farm received $58 million in a Series C investment round. The round was led by BTG Pactual and Rage Capital, and brings the company’s total funding to $89 million. Future Farm will use the funds to accelerate its international expansions and on R&D for new and improved products. It plans to bring Future Chick’n and Future Tuna to the United States, expand into plant-based drinks and dairy in North America and European markets, and continue to work toward its goal of 100% sustainable and plant-based packaging made from sugar cane. The company is currently in more than 20 countries in Latin America, Europe, Canada and the Middle East. It launched in the United States in July, and U.S. CEO Alexandre Ruberti said this summer the company believes it will get about 65% of its sales here within the next couple of years.
Grupo Bimbo SAB de CV, through its Barcel USA subsidiary, has acquired Popcornopolis LLC from private equity firm NexPhase Capital, LP. Financial terms of the transaction were not disclosed. Founded in 2003 by entrepreneurs Wally and Kathy Arnold, Popcornopolis is a manufacturer and marketer of indulgent, ready-to-eat popcorn snacks, including Zebra, Unicorn and Double Drizzle varieties. To complement its indulgent products, Popcornopolis recently launched a line of everyday snack products. This acquisition highlights the continued interest among large food manufacturers in the high-growth snacking segment.
The Gellert Global Group has purchased specific assets of Mitsui Foods, Inc., a subsidiary of Mitsui & Co. (U.S.A.), Inc. Since 1953, Mitsui Foods has been importing fine grocery and specialty food products from around the world under various brands. These brands, including the EMPRESS® brand, will be integrated across the Gellert Global Group divisions, including Atalanta Corporation and Camerican International, and will add to the company’s already strong lineup of brands in retail and foodservice such as Del Destino® and Celebrity™.
Grocery & Restaurants
Fat Brands announced Tuesday its intention to acquire fast-casual Italian chain Fazoli’s for $130 million. The purchase from Sentinel Capital Partners is expected to be finalized by mid-December 2021. This will be the growing restaurant group’s third acquisition in 2021 alone, following the purchase of the Twin Peaks ‘breastaurant’ sports bar chain in October and Global Franchise Group in July, which includes mainly snack and dessert brands like Hot Dog on a Stick, Marble Slab Creamery, Pretzelmaker, and Great American Cookies. Before that, Fat Brands’ last major purchase was 50s diner-themed Johnny Rockets, which was completed in September 2020. Fazoli’s currently has 200+ stores open with of development pipeline of 100 units set to open in the next few years. With the acquisition, Fat Brands will increase its store portfolio to 2,300 franchised and corporate-owned restaurants globally, with expected 2022 sales topping $2.1 billion.
Southeastern Grocers has formally withdrawn plans for an initial public offering, marking the second time in seven years it has pulled an IPO. In a Securities and Exchange Commission filing on Friday, Southeastern Grocers requested that the agency consent to its withdrawal of the S-1 registration statement filed Oct. 19, 2020, for an IPO of common stock by certain shareholders. The Jacksonville, Fla.-based retailer had announced in late January that it was postponing the IPO — only about a week after its launch — but didn’t give a reason for the move. The canceled IPO represents a redux for Southeastern Grocers, which previously had explored going public but pulled its stock offering. Bi-Lo Holdings, the former parent of Winn-Dixie and Bi-Lo, filed for an IPO in September 2013 under the name Southeastern Grocers LLC. Eleven months later, in August 2014, the company withdrew the registration. Facing stiff competition, Southeastern Grocers in recent years has worked to restructure its business — focusing primarily on Winn-Dixie — and scale back its store base.
Home & Road
Despite record demand, supply chain issues are hurting Ikea’s profits, which fell 16% to €1.4 billion for the year ending in August. The privately held Inter Ikea Group, which leads the furniture giant’s supply and franchising, attributed the loss to supply chain challenges in a financial report released Wednesday. The company also said it would be forced to raise prices. “The pandemic affected our operating income in FY21,” the company said in the release. “The biggest cause was the steep increase in transport and raw material prices in the second half of the financial year. “The global transport crisis challenged us to keep Ikea stores well-supplied throughout the year. Costs rose for recruiting additional staff to handle a complex transport and shipping environment in efforts to secure the availability of products. “Keeping Ikea stores and warehouses stocked has been a challenge. Supply chain disruptions led to a substantial drop in the availability of products that we have yet to recover from. We expect this will continue far into FY22.” Ikea did see some gains though. Retail and online sales increased in 2021.
Bed Bath & Beyond Inc. has made a series of moves as part of the reinvention of its business under president and CEO Mark Tritton. The company said it would launch a digital marketplace that will expand its assortment of key products in the home and baby categories from a curated selection of third-party brand partners that will be seamlessly integrated into the Bed Bath & Beyond digital platform. The retailer gave no other details about the marketplace. In a separate release, Bed Bath & Beyond unveiled an in-store and online pilot with supermarket giant Kroger Co. The company also announced two new C-suite additions, including the appointment of Anu Gupta to the newly created role of chief growth officer. She previously served as Bed Bath & Beyond’s chief strategy and transformation officer. The new position will focus on internal and external growth opportunities.
Jewelry & Luxury
Stéphane Bianchi has been appointed president of LVMH’s watch and jewelry division, so he will now oversee not only the company’s watch brands but also retailers such as Bulgari and Chaumet, the luxury giant announced. Bianchi will also become a member of LVMH executive committee, the company said. In 2018, Bianchi was tasked with heading LVMH’s watch division, as well as directly lead TAG Heuer. The watch division consists of TAG Heuer, Zenith, and Hublot. In addition to the watch business, Bianchi has lately taken jewelry brands Fred and Chaumet under his wing. This new reshuffle adds Bulgari to the mix.
In the third quarter of 2021, the Jewelers Board of Trade’s (JBT) regular industry statistics showed something that they hadn’t in years: more businesses entering the jewelry business than exiting it. The Providence, R.I.–based credit rating group’s annual figures showed that in the third quarter of 2021, 125 new jewelry businesses were formed in North America: 101 retailers, 10 wholesalers, and 14 manufacturers. All but two of those new businesses were formed in the United States; the others were formed in Canada. By contrast, JBT registered 117 business discontinuances in North America over the third quarter—including 87 retailers, 14 wholesalers, and 16 manufacturers. JBT uses discontinuances as a catchall term for companies that have ceased operations (88 companies), merged and/or consolidated (29 companies), or filed for bankruptcy (zero). All but four of those discontinuances occurred in the United States.
Pandora plans to start introducing its much talked about lab-grown diamond brand, Pandora Brilliance, to different global markets over the next year. It did not specify when the brand will start appearing in stores in the United States, its largest market. On a conference call following the release of its financial results, Pandora CEO Alexander Lacik said the brand is keeping the specifics of different market rollouts under wraps for “competitive reasons.” The fashion-oriented lab-grown line was originally introduced last year in the United Kingdom.
De Beers’ parent, Anglo American, has appointed Duncan Wanblad to be its new CEO. Anglo American owns 85% of De Beers, with the other 15% held by the government of the Republic of Botswana. Wanblad will assume the role on April 19, 2022, when he’ll succeed Mark Cutifani, who will retire after holding the job for nine years. Cutifani, whose tenure with the company is generally considered successful, will remain with Anglo American until June to assist with the transition.
The online luxury fashion brand Net-a-Porter has entered the resale fashion market, Green Queen reported. The company is working with the B2B secondhand market technology provider Reflaunt on a service that lets customers resell designer goods, according to the report. The project will ultimately cover all Net-a-Porter’s platforms, including Mr. Porter and The Outnet, and marks the company’s first major effort at entering the resale sector, the report stated. Net-a-Porter will launch the service first, adding it to its other companies later next year. Net-a-Porter will collect customers’ items from their homes or pick them up at drop-offs, then handle everything from photographing the products to listing to pricing, according to the report. Customers just need to pick how they’ll get paid once their products sell: bank transfer or Net-a-Porter store credit.
Office & Leisure
Bagdasarian Productions, owner of the Alvin and the Chipmunks franchise, is seeking a buyer, according to people with knowledge of the matter. It looks to cash in on the premium prices that media companies and private equity investors have been willing to pay for intellectual property. The company, owned and operated by Ross Bagdasarian Jr. and his wife, Janice Karman, has held talks with several potential buyers, including ViacomCBS, but hasn’t come to an agreement on terms, said the people, who asked not to be named because the negotiations are private. Bagdasarian Productions is working with a financial advisor and has been looking for a price of about $300 million, two of the people said. Streaming services such as ViacomCBS’ Paramount+, WarnerMedia’s HBO Max, and Netflix have been on the hunt for intellectual property to bulk up their subscription offerings. Netflix said in September it acquired the catalog of Roald Dahl, author of children’s books including “Charlie and the Chocolate Factory,” “James and the Giant Peach” and “Matilda.” Bloomberg reported the deal cost more than $700 million. Private equity firms including Carlyle, Providence Equity, Apollo Global and Blackstone have also expressed interest in acquiring content.
GameStop Chief Operating Officer Jenna Owens has left the company, according to a securities filing. The company and Owens, a former Amazon executive who joined GameStop in March, entered into a separation and release agreement, effective as of Oct. 25. GameStop didn’t disclose a reason for her departure. Owens will receive six months of base pay and the remaining chunk of her sign-on bonus. The COO’s duties will be absorbed by other members of GameStop management, the company said without elaborating. GameStop has already been through a significant executive shakeup this year that began with Ryan Cohen’s appointment to the board in January, following the Chewy founder’s purchase of an activist stake in the gaming retailer. Not long after Cohen joined the board, GameStop’s chief financial officer left. A smattering of hires was announced, including Owen, who had previously been director and general manager for distribution and multi-channel fulfillment at Amazon. The company announced in April then-CEO George Sherman would leave, just days after GameStop signaled Cohen would become board chairman. The company would go on to tap former Amazon executives to fill its CEO and CFO slots.
Technology & Internet
Meta, formerly known as Facebook, is discussing opening its first retail stores as it looks to break into the metaverse, according to The New York Times. The stores, which have no slated opening date, will allow the company to showcase devices like virtual reality headsets and teleconferencing gadgets that allow people to video chat through Facebook, the Times reported. It would be the social media company’s first physical store. News of the company’s vision comes about a week after Facebook changed its name to Meta. It said it’s shifting focus to building a virtual world or metaverse where users can socialize, work and play. The company sells several products that it could let customers try in person. Its Oculus Quest virtual reality headsets, which will be rebranded Meta Quest, could give people a chance to see its vision for a metaverse before they decide to buy. The company also sells Facebook Portal video chat devices, which are being rebranded Meta Portal. Both have already been sold in some retail locations like Best Buy.
Etsy shares closed up 13.21% after soaring more than 15% on Thursday, less than a day after the company reported third-quarter earnings that beat Wall Street estimates on the top and bottom line. The earnings and outlook show consumers are still buying from Etsy even after the pandemic-driven mask sales boom. “What it shows is people had to turn to Etsy over the past year, they are choosing to come back even more as we move forward, and we think that’s frankly remarkable,” CEO Josh Silverman told CNBC’s “Squawk Box” on Thursday. “The whole conversation since then has been, ‘once the world reopens, how much of that will you lose, how much of that will you give up?’, and that was a fair thing to ask,” Silverman said. “Here we are entering the fourth quarter of 2021, people have multitudes more choice, they’re moving all around and shopping anywhere they want.”
Finance & Economy
The U.S. unemployment picture improved again last week, with initial filings for unemployment insurance falling to another pandemic-era low. American businesses have been hit with a chronic labor shortage that has caused a number of ills, including shorter hours, less product on shelves and escalating inflation. Responding in part to the rising price pressures, the Federal Reserve said it would begin reducing the amount of support it is providing for the economy by slowly tapering its monthly bond purchases.
The impact of the pandemic on the nation’s economy will be a key factor in retail sales during the 2021 holiday season, but the National Retail Federation is confident in its forecast for record growth, according to Jack Kleinhenz, chief economist of the National Retail Federation. The trade group also expanded on the reasoning behind the robust growth predicted for this holiday between 8.5% and 10.5% over a year ago. Even at the low end of the forecast of $843.4 billion in sales for November through December, the growth will eclipse last year’s record $777.3 billion in holiday sales, Kleinhenz said. Holiday sales forecast by NRF excludes automobile dealers, fueling stations and restaurants and focuses on core retail including online sales. NRF predicts online sales will rise between 11% and 15% and total between $218.3 billion and $226.2 billion this holiday season. NRF’s forecast model looks at consumer spending habits along with disposable income, past retail sales, employment, wages, weather, energy prices and other variables.