January 20, 2020
From Deepak’s neuroscience desk, new research finds that our brains can detect songs in a matter of milliseconds.
BRAND & MARKETING
- Business leaders at CES spoke to how they’re preparing for an end to the longest period of growth in recent times. Double clicking on this, eMarketer shares what’s top of mind for CMOs in this moment.
- Mastercard has developed its first single, which strategically incorporates the brand’s sonic logo.
- Several developments in digital media last week, as Hulu debuted new ad formats oriented around letting users make choices and transact with advertisers; one industry voice cited Kantar research in warning against overlooking the true brand impact of ads and chasing vanity metrics; Patrick Fagan suggested that we’re measuring online ads “all wrong” and with a double standard; and WARC reported that advertising is the primary source of revenue for only 14% of publishers.
- AdWeek explores the onset of retailer media networks, as recently evidenced by Amazon’s, Walmart’s, and Target’s offerings on this front.
- There’s no debating that brand purpose can be a driver of growth, a key to unlocking new partnerships and a way of signaling modernity, but it was notably prominent in headlines last week:
- JAR research reveal that Facebook ads would benefit from providing users with a mix of “intrinsic” and “social” value.
- Airbnb will begin thinking of all stakeholders – not just investors – when it comes to corporate governance to build a valuable business and better help society.
- JetBlue is striving to be more sustainable by going carbon-neutral on all domestic flights, and also offering ways for customers to connect with these carbon offsetting products.
- BlackRock’s future investment decisions will be rooted in impacts on climate change because it believes that climate change is “reshaping the world’s financial system.”
- Morning Consult’s latest “State of Consumer Trust” report reveals today’s most trusted brands. Despite nuances across generations and categories, USPS, Amazon and Google are the most trusted brands across generations.
- The case for customer-based corporate valuations continues, with Emory professor Dan McCarthy arguing for a shift from consumer equity.
RETAIL, SALES & SHOPPER
- Our Bryan Gildenberg joined CNBC’s “Power Lunch” to discuss retail sales after the holiday shopping season.
- Consulting POV – That guy again? In all seriousness, the season played out much as we forecasted it would.
- New research revealed at the NRF’s annual “Big Show” last week find that while there is clear appeal, consumers see room for improvement in self-checkout, including the ability to automatically identify items being purchased. Speaking of the Big Show, many companies debuted in-store technologies that have the potential to boost stores’ operations and future performances.
- Consulting POV – NRF is a giant technology show masquerading as a retail conference. Self-checkout will undoubtedly get better as technology improves and a big story of the 2020s will be sorting the work of retail into “robot-able” and “non-robot-able” – designing processes to allow technology to do as much as possible.
- Microsoft’s Satya Nadella reiterates the power of data in retail, the parameters which make that data actually useful, and the applications most valuable to consumers.
- Consulting POV – Nadella’s basic point here is to harness the data you collect as a retailer and make it more commercially valuable. Makes sense. The part of the speech where he makes fun of retailers for just “partnering with the cool kids” in technology to make themselves look more tech-savvy was a little rich, given that Microsoft issues a press release a day for retailers doing exactly that.
- Mark Ritson tears into the mirage of DTC, citing Casper as a case in point, while Allbirds, a DTC itself, shares what it’s learned about Chinese eCommerce, consumers, and its feedback culture.
- Consulting POV – Mark Ritson can be pretty reactionary when he wants to be, but his basic point is that DTC is a tool. If it doesn’t solve a problem, that’s a failure of management, not an indictment of the tool. Applied to a business problem it makes sense to solve (like reaching consumers in a monopoly-constricted value chain like eyeglasses for Warby Parker) it can be super effective. It also solves a problem of brands that have to start small to become big – this difference (between just building big brands and growing small ones) will be a big theme of our conversation in 2020 (see Bryan Gildenberg’s Insight Forum presentation).
- China’s Luckin Coffee is embracing “unmanned retail”, which includes smart vending machines, in an effort to densify its network and get closer to customers.
- Consulting POV – See above on “robot-able” vs. “non-robotable.”
- The Gap has cancelled its plans to spin off Old Navy, citing the cost, complexity, and lower expected ROI of such an effort. This comes as Bose plans to close over a hundred stores around the world given the “dramatic shift to online shopping.”
- Consulting POV – The Old Navy spinoff cancellation has a lot to do with the weakness of the business it would leave behind. Bose simply failed to create a reason to go to its stores.
- One company saw a real opportunity in the $369 billion “returns boom,” capitalizing on the unwanted items sent back to some of retail’s biggest players.
- Consulting POV – Anything that helps solve the reverse logistics issue in retail should be taken seriously.
- Ben Evans shares a thoughtful perspective on the size and scale of Amazon – specifically, whether its market share is 35%…or 5%.
- Consulting POV – Ben makes a point we’ve made quite often, which is that retail in general and US retail in particular is still a deeply fragmented industry.
ON THE HORIZON
- Marketing Dive identifies six marketing trends that will drive innovation in 2020.
- JWT has just released its annual forecast of 100 trends, some more surprising than others, to watch in the year ahead.
- West Elm is teaming up with DTC plant company Bloomscape “to make plant parenting easier for our customers” by bringing together fresh foliage with the retailer’s planters and related accessories.
- PepsiCo is aligning with Quibi, the new mobile streaming platform launching later this spring, to stay at the forefront of culture via unique approaches to brand storytelling.
- Anheuser-Busch has added four new craft beers to its growing low-alcohol / non-alcoholic beverage (LABNAB) portfolio amid this sector’s projected growth, and the need to offer variety to consumers increasingly mindful about what they’re drinking across occasions.
- Funnel, a startup that helps businesses prepare their marketing data for better reporting and analysis, has raised a Series B to fund its growth in the US.
- Kantar’s Bill Pink speaks to using connected data intelligence (e.g. a measurement system to connect sales and brand data at a consumer level) to uncover hidden opportunities for growth.
- And, the $1 trillion club got a new member last week: Alphabet.