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Fearing a holiday email onslaught, DTC startups turn to text messaging to promote sales

There's no shortage of "last chance" sales hitting email inboxes these days, as desperate retailers like Gap and Macy's are trying to squeeze some much-needed revenue out of shoppers. But that also makes it harder for younger startups to grab customers' attention, when every retail company in the world is trying to email them. So, some startups are turning to text message instead to promote sales or key events. Thinx, used text messaging to promote its 30% off sale in August, while Lensabl is encouraging customers to get their first-time discount via text message instead of email.

By Anna Hensel

Why Party City’s scaled back pop-up plan is a foreboding holiday bellwether

Party City’s annual October Halloween pop ups have been scaled back by about 90% this year. It also plans to hired 20% fewer seasonal workers. The party supply chain's decision, which counts on the holiday's sales for 20% of its annual revenue, could signal a similar fate for other seasonal pop-ups this year.

E-Commerce

'There will be failures across every carrier': E-commerce companies are bracing for more shipping delays over the holidays

E-commerce companies are preparing for a huge surge in online orders over the holidays, as people remain hesitant about visiting stores. While the extra revenue may be welcomed, it could also put a strain on their ability to get products to customers on time. In a recent survey of 63 merchants by CommerceNext, an event series and community for retail marketers, respondents said that their biggest logistics concern leading up to the holidays was that carriers like FedEx and UPS would cap deliveries during peak demand.

DTC Era

'Give your community what they want': DTC brands are increasingly leaning on merch

The days of tossed over branded swag seem long gone, thanks to young brands making branded apparel a core part of their marketing strategy. In recent years, brands like Glossier and SoulCycle proved a community of enthusiastic fans can act as walking billboards. Now, the awareness-growing tactic is being deployed even by new companies. Now, with in-person events out the window, merch is becoming even more important to DTC startups.

Other news to know

As retailers gear up for the holiday season, they are hiring fewer cashiers and more workers to fulfill online orders. Target is the latest such example, announcing that it plans to hire 130,000 seasonal workers, who will focus mostly on staffing curbside pickup, and filling orders in distribution center.
Ulta Beauty said in an SEC filing that it will delay its planned expansion in Canada, to instead focus on its U.S. business as it is navigating through the coronavirus pandemic. The move will cost Ulta between $55 million and $65 million this year, due to lease obligations and some money it had already spent on store build outs.
CNN has a feature on why Costco is still holding off on offering grocery pickup and delivery, despite the growth these two services have seen over the past several months.

90%

Number of online orders Target fulfills at its stores

Video

ModernRetail Talks

E-Commerce

Modern Retail Talk: Move over e-commerce, here comes ‘headless commerce’

Retail Revolution

Modern Retail Talk: Forrester’s Sucharita Kodali on why retailers should be experimenting

DTC Era

Modern Retail Talk: How Instagram darling Fly By Jing handled an unprecedented demand surge

Thrive Market CTO Sasha Siddhartha on supercharged growth and the grocery website's future

Thrive Market, which first launched in 2014, had been growing at a rate of 40% a year before the pandemic. Now, with new customers joining the membership-based online grocery service, that growth rate has more than doubled to 90% a year, according to the company's co-founder and CTO Sasha Siddhartha. "We were already a digital native experience, so there were lots of parts of the business that scaled naturally," Siddhartha said on the latest episode of the Modern Retail Podcast. He spoke about how the company has adapted to the new e-commerce heavy environment.

DTC Era

How cereal nostalgia gave Magic Spoon a coronavirus boost

Consumer packaged goods, especially those consumer mostly at home, have experienced a resurgence in interest in the past few months. Much like meal kits and alcohol, breakfast cereal lends itself to being consumed at the kitchen table rather than on the go. DTC brand Magic Spoon, which aims to reinvent the cereal category, has been an example of this demand.

The need for quick pivots are prompting a shift to ‘headless’ e-commerce

The nature of e-commerce has shifted, as consumers demand a more fluid and personalized online shopping experience. Customers now expect to be able to purchase products straight from their initial touchpoints, whether it be directly through Instagram, via personal voice assistants such as Alexa or Google Home, on wearable devices or even from their cars.

How to boost conversions and cut costs with improved website experiences

Seventy-three percent of shoppers now use multiple channels to research and shop before making a purchase. And 90 percent expect consistent interactions across all of those channels.

Earnings

Nike's sales almost return to pre-coronavirus levels thanks to digital growth

During its fiscal first quarter earnings, Nike reported that sales were down 1% year-over-year. In today's retail environment, that's a success. The athletic apparel reported that while it's still not seeing the same in-store traffic that it was a year ago, it's digital sales are up 82%, even as more than 90% of its stores were reopened. Nike's benefitted from seeing a huge increase in downloads of its apps, which include its main Nike shopping app, Nike Train Club, and Nike Run Club.

Retail Revolution

With new fashion line, Walmart's private label apparel strategy emerges

On Monday, Walmart launched Free Assembly, a new private label line of men's and women's clothing with pieces ranging from $9 to $45 in price. It's not the only fashion move that Walmart has made as of late, as the big-box retailer has been looking for ways to get customers to buy more higher-margin items like clothing in order to make its e-commerce and store businesses as profitable as possible. But Walmart has a unique opportunity to grow apparel sales right now as people people are making fewer trips to stores, but looking to buy more in a single trip.

Retail Revolution

Office clothing brands face a bleak future where nobody goes to offices

Rent The Runway just announced plans to end its Unlimited rental option. This was a core part of its offering and hints at pain felt throughout the workwear and formalwear space. Fewer people are going to work and attending large events. As a result, demand -- both for department stores and platforms like Rent The Runway -- is cratering. In the middle of a pandemic with an unknown timeline ahead, the future of many of these companies looks ominous.

How brands are using automated budgeting on Amazon

One thing is true for nearly all conversions on Amazon: They’re captured by products on page one of the search results. And a significant share of purchases go to just the top few results.

E-Commerce

Why Boxed is doubling down on its private label program

Private labels have been on the rise for the past five years and show no sign of stopping. With consumers giving non-national brands a second look and a shortage of essential supplies, retailers are focusing on growing their in-house labels more than ever. One example is online bulk grocery delivery service Boxed, which launched Prince & Spring five years ago. Now, the line is expanding it at a rapid pace.

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