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FROM THE DESK OF DEBORAH WEINSWIG
Getting Your Hair Done in London… by Amazon.com Having already established a strong presence in books, convenience stores, entertainment, grocery and online pharmacy, Amazon is looking to extend into new segments with the launch of its first Amazon Salon. Spanning 1,500 square feet, the Amazon Salon is set up in London’s Spitalfields area and is replete with all kinds of technology, as would be expected from the e-commerce giant. Clients can experiment virtually with different hair colors using augmented reality (AR), entertain themselves with Fire tablets and view product information by pointing at a product (using “point and learn” technology) on a display shelf, as well as scanning a related QR code to purchase the product online for home delivery. Amazon is also guaranteeing today’s commonplace health and safety protections in its salon, including free masks and sanitizer, temperature checks and screens between each station. The launch of the physical salon follows the setup of the B2B (business-to-business) Amazon Professional Beauty Store in the UK in 2019, which offers hair and beauty businesses access to a selection of more than 10,000 salon products and supplies. Beauty professionals also receive wholesale pricing, plus all the usual Amazon ordering conveniences. [caption id="attachment_126917" align="aligncenter" width="480"]
Testing hair colors in the Amazon Salon with ARSource: Amazon.co.uk[/caption] To prospective clients: don’t fret—there are no robots cutting hair in the salon! The Amazon Salon is overseen by a professional, Elena Lavagni, who owns the regarded Neville Hair and Beauty Salon that has operated in London for 20 years. Lavagni has also styled hair for the Paris Fashion Week and the Cannes Film Festival. This all begs the question, why did Amazon open a hair salon at this time? Amazon describes the salon as “an experiential venue where we showcase new products and technology”—setting it up as a demonstration center to experiment with and highlight new technologies in AR, consumer experiences and beauty, as well as gather data. The salon also represents a sign of an increasing interest in the UK market. The salon’s launch follows Amazon’s opening of a “till-free” (i.e., automated) grocery store in April, marking its third store in the UK to use its “just walk out“ technology. It is possible that the company opened the store to test the market conditions for a larger move into beauty. Those interested will likely be disappointed to learn that the salon is only open to Amazon employees at present, although it is set to open to the public “in the coming weeks.” The company has also announced that it has no plans to open any further locations.
US RETAIL AND TECH HEADLINES
CVS Health Reports Solid First-Quarter Results (May 4) Company press release- CVS Health announced a 3.5% year-over-year increase in revenue and a 3.4% year-over-year increase in operating income for its first quarter of 2021. The revenue increase was fueled by growth in its Pharmacy Services and Health Care Benefits segments, although this was partially offset by declines in its Retail segment. The company’s net income for the same period increased by 10.5%, due to a decline in its total operating expenses and interest expenses.
- The company raised its guidance for full-year fiscal 2021 earnings per share to $6.24–$6.36 from $6.06¬–$6.22, after witnessing a rise in customer footfall caused by Covid-19 vaccinations and tests.
- Dick’s Sporting Goods has announced plans to open four new stores in May 2021. The stores will include one Dick’s Sporting Goods location, one Warehouse Sale location and two locations of a new off-price store concept, “Going, Going, Gone!.” The new format will offer deals on unique merchandise throughout the year.
- The company also plans to launch new experiential “Soccer Shops,” which will offer customer service from soccer experts and a variety of updated in-store elements, including an elevated cleat shop and an expanded selection of licensed jerseys in select locations. Soccer Shops will be located inside established Dick’s Sporting Goods stores.
- Gap Inc. has agreed to sell its upscale clothing chain Intermix to Altamont Capital Partners, a private equity firm. The move is in line with Gap Inc.’s strategy to streamline its portfolio and focus on its legacy brands, including Athleta, Banana Republic, Gap and Old Navy.
- As part of the deal, Altamont Capital will acquire the entire Intermix business, including its 31 stores and e-commerce business.
- Kroger has partnered with Drone Express, a division of networking equipment and systems company Telegrid Technologies, to test the feasibility of grocery delivery through drones.
- The company will pilot this new initiative in Ohio later this spring. Customers will be able to place online orders on kroger.com/dronedelivery and will receive their orders straight to their smartphone’s geolocation in as little as 15 minutes.
- Under Armour has reported a 35% year-over-year increase in revenues and a 370-bps increase in gross margin for its first quarter. All geographic segments reported strong growth—North America revenue increased by 32% and International revenue grew 58%. Growth was supported by the company’s supply chain initiatives, pricing strategies and channel mix. Net income during the same period amounted to $78 million—a strong improvement over its first quarter of 2020, where the company reported a net loss of $589.7 million amid the outbreak of the pandemic.
- The company expects to perform strongly in 2021 and has raised its full-year expectation—reporting that operating income is likely to reach $105–115 million, an increase on the previous range of $5–25 million.
EUROPE RETAIL AND TECH HEADLINES
Boohoo Group Reports Fiscal 2021 Results (May 5) BoohooPLC.com- Boohoo Group reported revenue of £1.75 billion ($2.45 billion) for fiscal 2021—a year-over-year increase of 41%. The company reported strong revenue growth across all geographies: UK sales grew 39% and international sales increased by 44%. International sales accounted for 46% of the company’s total sales, up from 45% last year.
- The company’s adjusted EBITDA increased by 37% from fiscal 2020 to £173.6 million ($241.2 million) in fiscal 2021. The company expects revenue growth for fiscal 2022 to be around 25% at a group level, with newly acquired brands—including Burton, Dorothy Perkins and Wallis—expected to deliver approximately five percentage points of this growth.
- IKEA has launched a “buy-back” scheme, enabling customers to sell their old furniture back to the retailer, as part of its latest sustainability initiative. The new scheme is available across Ikea stores in England.
- For each returned item, customers can earn up to £250 ($347) in the form of vouchers to spend in-store. The vouchers provided will not bear an expiry date to encourage customers to buy new items only when they require.
- German discount supermarket chain Lidl has launched a new feature, “best time to shop,” on its Lidl Plus loyalty app. This feature enables UK customers to view real-time shopper numbers to avoid crowds.
- Lidl Plus app users will need to input their local store to the app. Once the store features in the “best time to shop” tab, customers can view a bar chart showing the number of shoppers in that store at each trading hour throughout the day. The busiest times will be shown in blue and the quietest times in green, updated in real time.
- Online furniture and homeware retailer Made.com has announced plans to expand its UK warehouse logistics operations. The expansion comes as part of the company’s long-term strategy to grow sustainably and includes developing an additional 350,000-square-foot warehouse at the DP World London Gateway Logistics Park in Tilbury.
- Made.com will use the extended warehousing facility to house additional stock, reducing the time between a customer order being placed and fulfillment. The new facility will create about 100 new jobs across warehouse operative and administrative roles.
- Formal menswear retailer Moss Bros. has launched a new £65 ($90) monthly subscription service for renting men’s casual apparel, formalwear and suits. The company has stated that the service is the first of its kind for men in the UK.
- The service enables customers to select from more than 180 products, including chinos, jeans, jumpers, rollnecks, shorts, tailoring, waistcoats and other wardrobe essentials from brands such as Barberis, French Connection and Ted Baker. The customer can also purchase rented items at a discount of up to 50% off the retail price.
- German retailer REWE Group has introduced cargo bikes for last-mile grocery delivery, in partnership with bicycle logistics company VeloCarrier.
- The delivery service is available in Berlin, Cologne and Hamburg. It offers all the company’s regular items such as drinks, fresh meat and sausage products, frozen items, and fruits and vegetables.
ASIA RETAIL AND TECH HEADLINES
Adidas Launches Two Concept Stores in Indonesia (May 3) InsideRetail.asia- Adidas has launched two new concept stores in the Pandok Indah Mall in Jakarta, Indonesia. The new stores aim to offer an “on- and off-the-field” retail experience for sport enthusiasts.
- The first store, known as “Stadium Evolution,” spans 3,767 square feet and houses a complete line-up of Adidas products, including in football, basketball, running and training categories. The second store, “The Collection,” offers sports-inspired streetwear for fashion-conscious millennial and Gen Z consumers, sneaker collectors and streetwear enthusiasts.
- French luxury brand Hermès has launched a new flagship store in The China World Trade Center in Beijing, spanning two floors and 9,688 square feet. The store features a distinctive bamboo forest-inspired 36-foot-high façade engraved with double-glass panels.
- The store houses a full range of Hermès accessories, jewelry, leather goods, ready-to-wear and watches for men and women. The store also offers its home collection, including furniture, homeware and tableware.
- Singapore-based fintech platform Klub announced that it would invest ₹2.5 billion ($33.8 million) in over 350 companies in e-commerce and online consumer businesses. The company offers revenue-based funding to startups: To date, it has funded over 55 emerging digital startups, including Eat Fit, Healthy Cravings, The Man Company and Tijori.
- Klub stated that the revenue-based financing model is especially suited for brands whose revenue profile is seasonal and uncertain—making it an ideal post-Covid financing system.
- Japanese cosmetics brand SK-II has launched its first “Social Retail” pop-up store in Hainan, China, integrated with augmented reality and gamification. The store is inspired by SK-II’s brand purpose “#ChangeDestiny” and an animated anthology series developed by the brand’s film studio SK-II Studio, “VS.”
- The store launches SK-II’s new skincare counselling innovation: a personalized, contactless skin analysis called “Mini Magic Scan”, an AI-based tool which examines customers’ skin and recommends products within three minutes.
- Indonesian beauty and personal care e-commerce marketplace Social Bella has raised $56.4 billion in a fresh funding round led by US private equity firm L Catterton, in its first investment in Indonesia. L Catterton is set to join the company’s board. Other investment firms, including East Ventures, Indies Capital and Jungle Ventures, also contributed.
- In 2020, the number of users on Social Bella’s platform increased to 42 million. It also operates 21 physical stores in nine Indonesian cities and one store in Ho Chi Minh City, after its foray into Vietnam in October 2020. In July, Social Bella received $58 million in its Series E funding round from Jungle Ventures, Pavilion Capital and Temasek.