Twitter to begin pilot testing Fleet ads starting today

Ads are coming to Twitter’s version of Stories, known as Fleets. The company announced today it will began pilot testing Fleet ads in the U.S., which will bring full-screen, vertical format ads to Twitter for the first time, allowing it to better compete with the vertical ads offered across social media platforms, including Facebook, Instagram, Snapchat and TikTok, among others.

The new Fleet ads will appear in between Fleets from people you follow and will support both images and video in 9:16 format. The video ads support up to 30-seconds of content, and brands can also include a “swipe up” call-to-action within their ads.

For video, this is shorter than what Instagram offers (up to 120 seconds) or TikTok (up to 60 seconds), but is in line with best practices which stress that shorter ads can be better.

Twitter didn’t say how often you’ll see a Fleet ad as you swipe, saying only that it will “innovate, test and continue to adapt” in this area, as it learns how people engage.

Advertisers, meanwhile, will receive standard Twitter ad metrics for their Fleet ads, including impressions, profile visits, clicks, website visits, and more. And for video ads, Twitter will report video views, 6s video views, starts, completes, quartile reporting and other metrics.

Image Credits: Twitter

The company is launching the pilot program in the U.S. with just 10 advertisers, including those in tech, retail, dining and CPG verticals.

Twitter says the pilot will help the company to understand how well these types of ads perform on Twitter, which will inform the company not only how to better optimize Fleet ads going forward, but also other areas where it may launch full-screen ads further down the road. In addition, it wants to learn how people feel about and engage with full-screen ads, as the test continues.

Twitter had first begun experimenting with Fleets in spring 2020 as a way to offer a Stories-like product experience where users could post ephemeral content. At the time, the company hoped Fleets would encourage more hesitant users to share content to the platform, as Fleets disappeared after 24 hours, reducing the pressure to perform that comes with posting directly. They also don’t circulate Twitter like retweets and quote tweets do, nor do they show up in Search or Moments.

Image Credits: Twitter

The feature rolled out to global users in November 2020. They were initially criticized by some who felt that Fleets were yet another example of how all social apps were starting to look the same. Nevertheless, Fleets have now become a core part of the Twitter experience.

Today, people use Fleets to point to other tweets they’ve posted, or to share personal updates, photos, and commentary. However, unlike Stories on other platforms, like Snapchat or Instagram, Fleets still offer a fairly bare bones experience in terms of creator tools. You can change the background color, add stickers and text, but that’s about it.

Twitter declined to say how many or what percentage of Twitter’s active user base has now adopted Fleets, noting instead that 73% of those who post Fleets say they also browse what others are sharing. The company says it plans to roll out new updates and features to Fleets in the future, as it continues to invest in the product.

Fleet ads will launch today in the U.S. across both iOS and Android.

#advertising-tech, #android, #apps, #computing, #digital-marketing, #instagram, #online-advertising, #operating-systems, #real-time-web, #retail, #snapchat, #social, #social-media, #social-media-platforms, #software, #twitter, #united-states

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Esper raises $30M Series B for its IoT DevOps platform

There may be billions of IoT devices in use today, but the tooling around building (and updating) the software for them still leaves a lot to be desired. Esper, which today announced that it has raised a $30 million Series B round, builds the tools to enable developers and engineers to deploy and manage fleets of Android-based edge devices. The round was led by Scale Venture Partners, with participation from Madrona Venture Group, Root Ventures, Ubiquity Ventures and Haystack.

The company argues that there are thousands of device manufacturers who are building these kinds of devices on Android alone, but that scaling and managing these deployments comes with a lot of challenges. The core idea here is that Esper brings to device development the DevOps experience that software developers now expect. The company argues that its tools allow companies to forgo building their own internal DevOps teams and instead use its tooling to scale their Android-based IoT fleets for use cases that range from digital signage and kiosks to custom solutions in healthcare, retail, logistics and more.

“The pandemic has transformed industries like connected fitness, digital health, hospitality, and food delivery, further accelerating the adoption of intelligent edge devices. But with each new use case, better software automation is required,” said Yadhu Gopalan, CEO and co-founder at Esper. “Esper’s mature cloud infrastructure incorporates the functionality cloud developers have come to expect, re-imagined for devices.”

Image Credits: Esper

Mobile device management (MDM) isn’t exactly a new thing, but the Esper team argues that these tools weren’t created for this kind of use case. “MDMs are the solution now in the market. They are made for devices being brought into an environment,” Gopalan said. “The DNA of these solutions is rooted in protecting the enterprise and to deploy applications to them in the network. Our customers are sending devices out into the wild. It’s an entirely different use case and model.”

To address these challenges, Esper offers a range of tools and services that includes a full development stack for developers, cloud-based services for device management and hardware emulators to get started with building custom devices.

“Esper helped us launch our Fusion-connected fitness offering on three different types of hardware in less than six months,” said Chris Merli, founder at Inspire Fitness. “Their full stack connected fitness Android platform helped us test our application on different hardware platforms, configure all our devices over the cloud, and manage our fleet exactly to our specifications. They gave us speed, Android expertise, and trust that our application would provide a delightful experience for our customers.”

The company also offers solutions for running Android on older x86 Windows devices to extend the life of this hardware, too.

“We spent about a year and a half on building out the infrastructure,” said Gopalan. “Definitely. That’s the hard part and that’s really creating a reliable, robust mechanism where customers can trust that the bits will flow to the devices. And you can also roll back if you need to.”

Esper is working with hardware partners to launch devices that come with built-in Esper-support from the get-go.

Esper says it saw 70x revenue growth in the last year, an 8x growth in paying customers and a 15x growth in devices running Esper. Since we don’t know the baseline, those numbers are meaningless, but the investors clearly believe that Esper is on to something. Current customers include the likes of CloudKitchens, Spire Health, Intelity, Ordermark, Inspire Fitness, RomTech and Uber.

#ambient-intelligence, #android, #cloud, #cloud-computing, #developer, #device-management, #enterprise, #esper, #hardware, #healthcare, #internet-of-things, #iot, #madrona-venture-group, #microsoft-windows, #mobile-device-management, #operating-systems, #recent-funding, #retail, #root-ventures, #scale-venture-partners, #smartphones, #software-automation, #software-developers, #startups, #tc, #technology, #uber, #ubiquity-ventures

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Look out Amazon Go — A Lisbon startup plans to offer autonomous stores to other retailers

Look out Amazon Go. A Lisbon startup plans to offer the same autonomous store technology to other retailers. Lisbon-based Sensei, a computer vision startup that allows convenience stores to offer check-out-free purchasing has secured a seed round of $6.5 million (€5.4M). The funding was led by Seaya Ventures and Iberis Capital, with participation from 200M Fund.

The startup will now scale its R&D and launch new stores. Its proprietary platform uses a blend of cameras, sensors, and AI to automate stores, both new and existing. The platform means retailers can manage inventory in real-time and also access insights into the way the stores are used.

Vasco Portugal, Sensei’s CEO and Co-founder said: “Sensei’s technology will help level the playing field for retailers to compete against digital giants such as Amazon. We aim to enhance the familiar and enjoyable customer shopping experience, making it seamless, convenient, and safe.”

Sensei is designed to work mainly with grab-and-go stores, forecourts, and similar retail formats. Competitors include Trigo which has raised $89 million.

The advantages of automated stores in a pandemic are obvious: customers no longer have to queue. Plus retailers can avoid stock-outs and staff turn into customer support.

“We are delighted to invest in a business that is part of the digitalization of commerce, a trend that is currently clearly being accelerated,” said Aris Xenofontos, Principal at Seaya Ventures.

Luis Quaresma, Partner at Iberis Capital, added: “Sensei brings tremendous efficiencies and cost-savings to the retail industry, while providing a much needed seamless checkout experience for consumers.”

Sensei was founded by Vasco Portugal (CEO, ex-MIT), Joana Rafael (COO),Nuno Moutinho (CTO) and Paulo Carreira (CSO).

#amazon, #ceo, #coo, #cto, #europe, #lisbon, #marketing, #merchandising, #mit, #online-shopping, #partner, #portugal, #retail, #retailers, #seaya-ventures, #sensei, #tc, #trigo

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Location data analytics startup Placer.ai raises $50M Series B

It’s been a very tough year for Placer.ai’s core customer segments of retail and commercial real estate, to put it mildly. But the foot traffic and location analytics startup saw growth in new categories, including consumer packaged goods (CPG) and hedge funds that use its tech to perform due diligence. The Los Altos, California-based company announced today that has raised a $50 million Series B led by Josh Buckley, the chief executive officer of Product Hunt. Participants included Fifth Wall, Rahul Vohra and returning investors JBV Capital and Aleph VC.

The new capital will be used on research and development and expanding Placer.ai’s sales and marketing teams. Its last funding announcement was in January 2020 for a $12 million Series A.

Placer.ai collects geolocation and proximity data from devices that are enabled to share that information by their users, and creates anonymized and aggregated consumer profiles. Since its launch, the company’s key customers have been offline retail businesses, shopping centers, hotels and other brick-and-mortar businesses that use it to analyze foot traffic, the success of marketing campaigns and location performance. Placer.ai’s co-founder and chief executive officer Noam Ben-Zvi said he expected the COVID-19 pandemic to be challenging as people stayed away from stores and purchased online instead.

But adoption of Placer.ai’s tech increased among several new segments, including CPG and hedge funds, and it is continuing to expand in retail and commercial real estate as companies plan ahead.

The company’s CPG clients use its tools for market analysis, refining category management or promotion strategies and tracking product performance. Ben-Zvi expects its CPG customer base to continue growing as more brands, like direct-to-consumer labels, open their own stores.

Placer.ai’s hedge fund clients use it to research potential investments. “Because data is in near real-time, reliable and very granular, it allows investors to quickly identify signals that speak to the true offline health of any brand. But there is also a qualitative data element that allows strategic initiatives to be thoroughly analyzed,” Ben-Zvi said in an email.

“For example, we looked at CVS Health Hubs when they were in their pilot stage in a handful of locations. When the company announced that they would be rolling this out to over a thousand branches, investors had a strong sense of the potential,” he added. “The ability of the data to fuel both quantitative and qualitative analysis at a very high level is a powerful combination.”

For retail and commercial real estate users, “the situation ahead is going to be turbulent, and data is going to play a fundamental role in confidently navigating the changing environment and driving effective decision making,” said Ben-Zvi. Commercial real estate owners need to make sure the mix of tenants in their properties are compelling enough to draw in shoppers, and understand how they are faring against competitors. Some retailers are focused on expansion, while others are testing new concepts and formats.

In a press statement about his investment, Buckley said, “Placer allows businesses that operate offline to make data-driven decisions, fundamentally improving the way they operate. This is the same type of tooling that online businesses have used to grow, moving from hunches to definitive answers. I’m excited to be partnering with the company’s next phase of growth and product development.”

 

#foot-traffic, #fundings-exits, #location-analytics, #placer-ai, #retail, #startups, #tc

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Why some investors are excited about Ryan Cohen as GameStop’s next chairman

Struggling video game retailer GameStop announced Thursday that it intends to name Chewy.com co-founder Ryan Cohen as chairman of its board of directors following its next stockholder meeting on June 9. The move seems likely to further encourage some investors who continue to be bullish on GameStop stock and see Cohen’s plans to “transform” the retailer as a key part of its recent sky-high rise in valuation.

Cohen, who sold pet-supplies retailer Chewy to PetSmart for $3.5 billion in 2017, has traditionally been cautious with his investing strategy, putting money into big, safe stocks like Apple and Wells Fargo. But Cohen bought a roughly 10 percent stake in GameStop last August, when short sellers thought the already-depressed stock would continue to lose value. He increased that stake to 13 percent in December, earning a number of seats on the company’s board in the process.

During his time with the retailer, Cohen hasn’t been shy about pushing for GameStop to “promptly pivot from a brick-and-mortar mindset to a technology-driven vision,” as he put it in a November SEC filing. “If GameStop takes practical steps to cut its excessive real estate costs and hire the right talent, it will have the resources to begin building a powerful e-commerce platform that provides competitive pricing, broad gaming selection, fast shipping, and a truly high-touch experience that excites and delights customers.”

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#cohen, #gamestop, #gaming-culture, #retail, #stock

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Singapore-based Nimbly gets $4.6M to help businesses automate their standard operating procedures

Many work teams, especially stores and restaurants, rely on manual spreadsheets to ensure their operations are running smoothly. Based in Singapore, Nimbly develops software that automates more of that process. Its features include digital checklists, inventory management and field audits that can be accessed through a mobile app. The startup announced today it has raised $4.6 million in pre-Series A funding, led by Insignia Ventures Partners, with participation from Sovereign’s Capital and Saison Capital.

Founded in 2018 by Daniel Hazman and Jonathan Keith, Nimbly is currently used by more than one hundred organizations in seven countries, including Indonesia, Singapore, Malaysia and the United States. Most of Nimbly’s users are in the retail or food and beverage industries, and include KFC, Kopi Kenangan, 7-Eleven and Under Armour. Some clients also come from the fast-moving consumer goods and agriculture sectors, like Cargill and Wilmar.

The new funding brings its total raised to $5.7 million and will be used for Nimbly’s Southeast Asia expansion, including a new partnership with restaurant operator Express Food Group, and adding products like more analytics, mystery shopper and employee training.

Nimbly is designed to replace spreadsheets, emails and messaging apps by combining their functionalities into one app. This includes checklists, audits and live video to ensure that standard operating procedures are followed across all locations. For example, restaurants may use Nimbly to see if food safety and hygiene standards are being followed. FMCG companies can use it to track inventory at stores and share information about how their sales and promotions compare to competitors, while use cases for agriculture include verifying that suppliers are following sustainability measure at their farms.

In a statement, Insignia Venture Partners founding managing partner Yinglan Tan said, “SaaS enterprise is an emerging vertical in Southeast Asia with more businesses of all sizes and across industries seeking to transition and even upgrade their capabilities to software tools. That makes us very excited to have partnered with Daniel, Jonathan and their team at Nimbly as they lead this space in building software stack capable of serving the operational needs of companies first in Southeast Asia, and then globally.”

#agriculture, #asia, #business-operations, #fmcg, #food-and-beverage, #fundings-exits, #nimbly, #retail, #singapore, #southeast-asia, #startups, #tc

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The return of neighborhood retail and other surprising real estate trends

The pandemic made remote work and on-demand delivery normal far faster than anyone expected. Today, as the world beings to emerge from the pandemic, location doesn’t matter like it did a year ago.

As shocking as it sounds, we could be entering a much better era for small, local businesses.

Modern society produced superstar cities filled with skyscraper office and residential buildings. Now, the populations that once thrived in these urban centers are deciding how to repurpose them for a post-pandemic world.

I caught up with ten top investors who focus on real estate property technology to get a sense of how they’re betting on the future.

They are optimistic overall, because the typically glacial real estate industry now sees proptech as essential to its future. However, they are the most unsure about the office sector, at least as we knew the concept before the pandemic.

They expect remote work to be part of the future in a significant way and foresee ongoing high housing demand in the suburbs and smaller cities. They are especially positive about fintech and SaaS products focused on areas like single-family home sales and rentals. Many are continuing to invest in big cities, but around alternative housing (co-living, accessory dwelling units) and climate-related concepts.

Most surprisingly, some investors are actually excited about physical retail. I examined the latest evidence and found myself agreeing. As shocking as it sounds, we could be entering a much better era for small, local businesses. Details farther down.

(And before we dig in below, please note that Extra Crunch subscribers can separately read the following people responding fully in their own words, with lots of great information I wasn’t able to explore below.)

When the office is more of a luxury

The pandemic combined with existing trends has made office renters “more akin to a consumer of a luxury product,” explains Clelia Warburg Peters, a venture partner at Bain Capital Ventures and long-time proptech investor and real estate operator.

Landlords who have “largely been in a position of power since the 1950s” now have to put the customer first, she says. The “best landlords will recognize that they are going to be under pressure to shift from simply providing a physical space, to helping provide tenants with a multichannel work experience.”

This includes tangible additional services like software and hardware for managing employees as they travel between various office locations. But the market today also dictates a new attitude. “These assets will need to be provided in the context of a much more human relationship, focusing on serving the needs of tenants,” she says. “As lease terms inevitably shorten, tenants will need to be courted and supported in a much more active way than they have been in the past.”

The changes in office space may be more favorable to the supply side in suburban areas.

“Companies are going to have to offer employees space in an urban headquarters,” Zach Aarons of Metaprop tells me. But many will also want to offer ”some sort of office alternative in the suburbs so the worker can leave home sometimes but not have to take a one-hour train ride to get to the office when needed.”

“If we were still purchasing hard real estate assets like many of us on the MetaProp team used to do in previous careers,” he added, “we would be looking aggressively to purchase suburban office inventory.”

Most people thought that remote work was here for good and would impact the nature of office space in the future.

Adam Demuyakor, co-founder and managing director of Wilshire Lane Partners, is generally bullish on big cities, but he notes that startups themselves are already untethering from specific places. This is a key leading indicator, in TechCrunch’s opinion.

“Something that has been interesting to watch over the past year is how startups themselves have begun to evolve due to newfound geographic flexibility from the pandemic,” he observes. “Previously, startups (especially real-estate-related startups) felt pressure to be ‘headquartered’ near where their customers, prospective capital sources and pools of talent were located. However, we’ve seen this change over the past few months.”

In fact, a recent report by my former colleague Kim-Mai Cutler, now a partner at Initialized Capital, highlights these trends in a regular survey of its portfolio companies. When the pandemic began, the Bay Area was still the number one place that founders said they’d start a company. Today, remote-first is in first place. Meanwhile, the portfolio companies are either going toward remote-first or a hub-and-spoke model of a smaller headquarters and more far-flung offices. Those who maintain some sort of office say they will require significantly less than five days a week. Nearly two-thirds of respondents said they would also not adjust salaries based on location!

That’s a small sample but as Demuyakor says, “Startups (a) are frequently the most adept at utilizing the types of technology necessary for effective remote work and (b) simultaneously have to compete ferociously for talent. As such, I think we may be able to infer what the ‘future of work’ may look like as we observe what startups choose to do as the pandemic passes.”

Some landlords (with big loans) and large cities (with big budgets) are making a push to repopulate their offices quickly, and some large companies are loading up on office space or reaffirming their commitments to current locations.

Maybe efforts like these, plus the natural desire to network live, will bring back the industry clusters and pull everyone back to the old geographies? Maybe something close to 100% of what we saw before? What does that look like?

In such a scenario, some pandemic-era changes will persist, says Christopher Yip, a partner and managing director at RET Ventures. “A populace that has become sensitized to public health considerations may well gravitate toward solo forms of transportation (cars and bicycles) instead of mass transit, and parking-related and bike-sharing tech tools may likely thrive. From a real estate management perspective, technology that makes high-density living more comfortable and healthier will also increase, as consumers will become increasingly attracted to touchless technology and tools that facilitate self-leasing.”

Here’s the other scenario that he lays out “if a large number of jobs remain fully remote.”

“In theory, retail and office properties could structurally continue to suffer, and there has been some talk from government officials in certain regions about converting office properties into affordable housing,” he details. “If market-rate vacancies in cities remain high, there will be increasing demand for short-term rental platforms like Airbnb and Kasa, which enable landlords to gain revenue from hotel-type stays even in a market where residential demand is not strong.”

Vik Chawla, a partner at Fifth Wall, sketches out a middle-of-the-road scenario. “We believe that major cities will continue to attract knowledge workers and top talent post-pandemic,” he says, “though we expect remote work to become an increasingly critical component to the work economy, meaning that there will be increased flexibility in terms of time spent in the office versus elsewhere.”

This would still mean some sort of long-term price decline. “At a city level, this means that rents should taper relative to pre-pandemic levels due to lesser demand,” he believes. “That said, the real estate ecosystems in cities that have experienced growth throughout the pandemic will enter a period of innovation, and with it, see an increase in housing density, ADUs and modular building techniques.”

Andrew Ackerman, managing director of UrbanTech for DreamIt Ventures, also sees a gentle deflation of commercial office prices over time, followed by some complex space-management questions.

“[T]he return to work will likely result in more flexible work arrangements rather than the demise of the office which, as leases renew over the next 5-10 years, will lead to a gradual meaningful-but-not-catastrophic reduction in the demand for office space. The question is, what then happens to the excess office space?”

“Office to residential conversion is tricky,” he elaborates. “Layout is a major constraint. Many modern offices have deep, windowless interior space that is hard to repurpose. But even with narrow layouts, the structural elements are often in the wrong place. Drilling thousands of holes in structural concrete so you can move plumbing and gas to the right places is a heavy lift.”

This might just lead to new types of still-valuable uses? “One of the areas that I’m still investigating is whether co-living or microunits might be a more attractive conversion option. Turning an office break room and interior bullpens into a shared kitchen, dining area, and recreation or work flexspace may be a better way to repurpose deep interior space without a very costly retrofit. And if you don’t have to reroute too much plumbing, it may even be possible to convert (and convert back!) individual floors as market demand for office and residential space fluctuates over time.”

All respondents saw proptech being a core part of the next era of big cities (of course), however bullish or bearish they may be about the office itself.

A new equilibrium for residential

Housing availability has become even more limited in most places during the pandemic, with many more people looking to buy and fewer people wanting to sell. This is even though the previously hottest cities have seen major rental price drops.

Demuyakor of Wilshire Lane is staying focused on the housing problem, and solutions to it like co-living. “Despite the pandemic, it is still difficult for millennials and Gen Z to afford to live in the most expensive cities (New York, San Francisco, Los Angeles, etc.) at current wage levels,” he says. “As such, we believe that we will continue to see demand for products and solutions that can continue to help alleviate costs and burdens of living in major cities. For example, we think that at its core, co-living is an economic decision. Solutions that continue to help people live where they want to live more easily (ADUs are another example of this) will continue to thrive.”

Casey Berman, managing director and general partner of Camber Creek, thinks that “cities will continue to attract people to live, work and play because they offer density and opportunities for experiences that people crave even more now. To the extent all of this is true, there will be renewed demand for urban spaces and properties to take advantage of that demand.”

He says that the firm has been investing in products to make dense living safer and more convenient and “we expect those solutions will become increasingly popular. Flex allows tenants to pay rent online in easier-to-manage installments and in the process makes it more likely that landlords will receive payment on time. Latch’s access control devices are in one out of 10 new multifamily buildings. A lot of people purchased a pet over the past year. PetScreening makes it easy to manage pet records and confirm when a pet is a service or support animal.”

Robin Godenrath and Julian Roeoes, partners at Picus Capital, generally share this viewpoint and describe how new living arrangements in cities could allow for more radical changes to how people live.

“Flexible living solutions will allow remote workers to spend time across different cities with a fully managed, affordable and safe rental option for short-to-long-term urban living,” he says, “while commercial conversion to residential will play a key role in driving down per square foot prices enabling long-term returning residents to afford less densified space. Although co-living densifies multifamily buildings, we believe it will remain an interesting sector as the continued shift to remote work will make living communities increasingly important considering the reduced social interaction on the job.”

But modern proptech is also making the suburbs and beyond more appealing in the long run, according to many. Great new technologies for living can exist anywhere you are.

Proptech has also helped fuel the new suburban boom. “There is an ongoing trend of reverse urban migration causing an uptick in the demand for suburban-style living,” he says. “Proptech companies have played a significant role in enabling this shift, specifically via digitizing the home buying, selling and renting transaction processes (e.g., iBuyers, alternative financing models and tech-enabled brokerages). Additionally, proptech companies have played a key role in reducing physical interactions through remote appraisals, 3D/VR viewings and digital communications thus enabling homebuyers and sellers to efficiently and safely transact throughout the pandemic.”

Ultimately, the same technologies that could make cities more affordable will also help out in the suburbs. “We strongly believe that the acceleration of the digitalization of the home transaction process coupled with the significant increase in demand for suburban-style housing and evolving buyer profiles (e.g., tech-savvy millennials) opens up a multitude of opportunities for proptech to significantly impact suburban living across construction, access and lifestyle. This includes companies focusing on built-to-rent developments, modular homebuilding, affordable housing, community building and digital amenities.

Many investors who we talked to highlighted the single-family rental market trend. Here’s Christopher Yip again from RET.

“One of the unheralded trends of the past decade has been the rise of the single-family rental (SFR) market,” he says “with a significant number of major investors moving into this asset class. The SFR space is poised to benefit from the migration from cities, and the tech that supports SFR will likely have positive ripple effects across the industry.”

“SFR portfolios are particularly challenging to operate efficiently and at scale; compared with a multifamily property, they have more distinct unit layouts and are more spread out geographically,” he explains. “Technology has the ability to streamline operations and maintenance for SFR operators, with smart home tools like SmartRent facilitating self-touring and management of these distributed portfolios. We’re bullish on this space and are keeping a close eye on proptech tools that serve this market.”

Andrew Ackerman of DreamIt agrees. “Single-family has been neglected, slowly growing more interesting both from an asset and proptech perspective for some time. For example, we invested in startups like NestEgg and Abode who service this ecosystem … prior to the pandemic. COVID has been good to these startups and brought more attention to the opportunities in single-family in general.”

Stonly Baptiste and Shaun Abrahamson, co-founders of Urban.us, already see a world of options unfolding across geographies, with choices like co-living and short-term rentals letting people find new lifestyles. “Portfolio companies like Starcity are really thriving as co-living doesn’t just solve for cost, but also for a key overlooked issue — access to community. We also see room for more nomadic lifestyles. A lot of the discussion about Miami is about people moving there, but it seems like a more interesting question for a lot of places is maybe whether or not people will spend a few months of the year there. So for remote workers this might mean places near specific activities like mountain biking, surfing, snowboarding etc. Starcity makes it easy to move between city locations and Kibbo takes this far beyond the city by building communities around van life.”

Here’s how all these changes are adding up for the suburban market, as mapped out by Clelia Warburg Peters of BCV.

“The residential transaction disruption is now settling in three core categories: iBuyers (who buy homes directly from sellers and ultimately hope to own the sell-side marketplace), neobrokers (who generally employ their agents and use secondary services such as title mortgage and insurance to increase their revenue) and elite agent tools (platforms or tools focused on the top agents).”

This combination of innovations are changing residential real estate as we know it. “[C]onsumers are increasingly open to alternative financing tools, including home-equity-based financing models (where you sell a stake in your home, or you buy into full ownership in a home over time). The growth and proliferation of these new models are consolidating the whole residential market so that brokerage sales commissions and commission from the sale of mortgage, title and home insurance are now functionally one large and intertwined disruptable market.”

The surprising revival of neighborhood retail

Humans seem to love the concept of a traditional Main Street full of bustling, walkable local businesses. But the hits have kept coming to the people trying to successfully operate independent retail storefronts.

E-commerce began cutting into traditionally thin margins with the rise of Amazon and the 90s wave of “e-tailers.” More recently, art galleries, high-end restaurants and boutiques became a harbinger of gentrification in many cities. Many commercial retail landlords in these locations aggressively priced rents as more residents moved in who could afford higher prices, ultimately contributing to gluts of empty storefronts in prime locations.

The pandemic seemed to be the final blow, with even the most loyal shoppers turning to order online while local businesses stayed closed.

And yet, a range of investors are strangely optimistic. Even though the pandemic upended social and economic activity for more than a year, most agreed that IRL retail experiences are an essential aspect of modern life.

“Humans are fundamentally social animals and I think we will all be hungry for in-person experiences once it is safe to return to them. Additionally, I think the shift away from working five days a week in the office is going to create a greater desire for ‘third spaces’ — not home, not a formal office environment,” said Peters.

“I do think we will continue to see more ‘Apple store’-type retail experiences, where the focus is less on selling inventory and more on creating an environment for customers to physically interact with goods and experience the brand ethos beyond a website. Because I anticipate that retail rents are going to be meaningfully lower at the end of the pandemic, I actually think we will see even more experimentation than we did pre-COVID. It will be a very interesting period for retail.”

Many others held views in this direction, whether they are investing specifically in retail-related tech or more generally in third-space ideas.

“It’s true that retail has been in flux for more than a decade; the list of common e-commerce purchases has expanded from books and clothing to prepared meals and groceries. It’s also true that the pandemic has accelerated e-commerce’s growth, to the detriment of brick-and-mortar retail,” says RET’s Yip. “But people are still human and crave in-person experiences. Even if cities never bounce back fully, major metropolises will still have enough foot traffic to support a fair amount of retail, and innovative models like pop-up shops can be brought in to help address vacancies. It should also be noted that the public markets still have some confidence in the retail space. While the major REITs struggled in early to mid-2020, many have recovered substantially, and several have actually surpassed their pre-pandemic figures. It has been a bad decade for retail — and a very bad year — but it is just too soon to close the book on the sector.”

Godenrath and Roeoes of Picus say movie theaters are just one example of a retail sector poised for success when public life resumes at scale post-pandemic.

“Cinemas, many of which are key shopping center anchor tenants, were already reinventing the traditional theater experience by offering a more holistic experiential solution (e.g., reserved seating, 4DX visuals, in-theater restaurants, cafes and bars) and the pandemic has led to an expansion of these offerings (i.e., private theater rentals and events). We have the opinion that this trend will continue to expand across the entire retail real estate industry from restaurants (immersive culinary experiences) to traditional retail (integrated online and offline shopping experiences) and believe that proptech will play a defining role in helping retail real estate owners identify potential tenants and market properties as well as in helping retailers drive in-store customer engagement and gain key insights into the customer journey.”

The internet is also a friend these days, surprisingly! “We also see a lot of potential for hybrid models combining online and offline experiences without friction,” they say. “Taking the fitness sectors as an example we can imagine a new normal where in-studio courses are broadcasted to allow a broader participant group and apps tracking fitness and health progress throughout in-studio visits and at-home workouts.”

I have a few additional reasons to believe in the future of retail that I didn’t hear from any of the investors I interviewed.

You can also see how retail intersects with many other solutions investors are betting on, particularly to improve the appeal of cities and solve for macro problems like climate change.

“Cities have some massively underutilized assets, perhaps the biggest being public spaces that are allocated to cars,” Baptiste and Abrahamson say. “So one change we think will become permanent is reallocating parking spaces away from private vehicles to micromobility (bike/scooter/board lanes, parking, etc.). We’re seeing a lot of demand for portfolio companies like Coord (manages curb space starting with commercial vehicles and smart zones), Qucit (manages bike and scooter share operations in many large cities) and Oonee (secure bike/scooter/board parking).”

That’s just the start of the virtuous cycle they foresee.

“As [car removal] happens, the use cases like logistics can shift to electric micro-EVs. Similarly, parklets or seating areas increase social spaces. The EU is setting the pace for banning cars, but overall reduced access to streets for cars is going to be a big change. And likely will make cities attractive — yes, you give up private living space, but you’re going to get a lot more common/social space. This is also likely to drive more co-living so you can decrease the cost basis for being in a city, but get a lot more from shared spaces, which have no real comparison in lower density communities.”

Demuyakor of Wilshire Lane is betting in the same direction.

“One of the key tenets of our overall strategy has always been a focus on space utilization and identifying the best ways technology can monetize underutilized spaces. This can be seen clearly with many of our newest investments: Stuf and Neighbor (monetization of basements, parking garages and other vacant spaces), MealCo (monetization of vacant kitchens), WorkChew (monetization of restaurant seating areas, hotel lobbies and conference rooms), and Saltbox (monetization of empty warehouses). We believe that landlords can certainly use these types of strategies to help mitigate increased levels of vacancies that we’re seeing across the real estate industry today in the medium term.”

If this thesis pans out, retail may become more about shared spaces. “With WorkChew in particular, which just announced funding this week, we’re seeing a ton of demand for their product both on the demand side and the supply side. Hotels and restaurants are excited to partner with them to monetize their less-utilized spaces and infrastructure,” said Demuyakor. “And of course, employers and companies love [it] as an easy amenity that can be offered to their hybrid workforces that increasingly want to spend more time out of the HQ office.”

I have a few additional reasons to believe in the future of retail that I didn’t hear explicitly from the investors I interviewed.

  • First, millions of new businesses have been created during the pandemic, to the surprise of even economists and policymakers. A large portion appear to have a very local angle, whether food delivery (cupcakes) or services (on-site haircuts) or internet-first products with strong local followings (much of Etsy). These entrepreneurs went internet-first and now, as commercial rents plummet, they have sufficient revenue to support a physical presence.
  • Second, most local business that have sustained themselves during the COVID-19 era figured out how to succeed on the internet. To see which ones in your vicinity are weathering the storm, just open one of your preferred on-demand delivery and services apps and place an order.
  • Third, as noted by respondents and available data, landlords are already starting to drop prices, creating a renter’s market for the first time in decades.
  • Fourth, there are whole new types of financing opening up to more traditional businesses that could enable any company with a successful online side hustle, hobby (or perhaps larger project) to get funding for expansion. (This reason is perhaps the most speculative, but we are trying to figure out the future here at TechCrunch.) For example, Shopify has just invested in Pipe.com, a new “platform for trading recurring revenue.” Although the companies are not saying much now about the relationship, it’s possible to imagine a bunch of successful small(ish) businesses on Shopify suddenly getting a new kind of capital infusion right as the math is suddenly much better for a storefront location.

If you roll all of this up with other broader shifts in how we think about cities, like making them more climate-friendly through allowing density and bike lanes, you can start to see a world emerging that sounds a lot more like the fantasies of a New Urbanist than the world before the pandemic.

At the same time, these concepts are being deployed across smaller cities, suburbs and towns: All will compete to offer the highest quality of living — unless the old network effects of industry clusters return miraculously.

And let’s say the industry clusters don’t cluster like they used to. It’s possible that many landlords, lenders and city budgets will have to retrench soon, creating a drag on the economies of otherwise-attractive cities.

Even in this case, you can imagine a rebirth for places like New York and San Francisco focused around housing, retail and amenities. Maybe one day, we’ll look back at recent decades as the bad old days before we collectively bottomed out during the pandemic and had to decide on the right answers for the long-term.

And with that, I invite readers to go check out the full sets of responses from the investors I interviewed. Each person offered a lot more than I was able to fit into this already-too-long article and is worth reading in detail. Extra Crunch subscription required, so you can support our ongoing coverage of these changes.

I’ll be covering the future of proptech and cities more soon. Have other thoughts about all of this? Email me at eldon@techcrunch.com.

#commercial-real-estate, #covid-19, #ec-investor-surveys, #ec-market-map, #proptech, #real-estate, #retail, #small-business, #smart-cities, #smbs, #tc

0

GameStop (the stock) and GameStop (the retailer) continue to be worlds apart

It may take more than one bad earnings report to pop this bubble...

Enlarge / It may take more than one bad earnings report to pop this bubble…

The last time GameStop announced its quarterly earnings, in early December, the stock market valued the video game retailer at about $1 billion. Following a worse-than-expected earnings report released Tuesday night, the company now has a market cap of just under $10 billion as of Wednesday morning.

Sure, that’s down roughly 18 percent from Tuesday’s closing price, and off roughly 44 percent from a January peak that saw the stock offering become a poster child for the retail investor-driven “meme stock” phenomenon. Still there’s not much in this week’s report to suggest that GameStop as a company is worth ten times as much as it was just three months ago, much less the higher valuations it briefly enjoyed in the interim.

Signs of a turnaround?

Overall, GameStop’s latest earnings report shows a company still struggling to turn itself around. For the full fiscal year, the company lost $215 million on net, improving on a net loss of just over $470 million the year prior. Net sales for the year were down over 21 percent, to $5.09 billion, a decline GameStop blamed in part on its “de-densification efforts” (i.e. closing nearly 700 stores). Even taking that move into account, though, sales for comparable stores were down 9.5 percent for the year.

Read 8 remaining paragraphs | Comments

#earnings, #gamestop, #gaming-culture, #retail, #stock, #value

0

All US Apple stores are open for the first time in almost a year

Masked people mill about the glass walls adorned with the Apple logo.

Enlarge / NEW YORK, June 17, 2020 – Staff workers serve customers outside an Apple store on Fifth Avenue. (credit: Xinhua News Agency | Getty Images)

For the first time in just a few days shy of a year, all Apple Store retail locations in the United States are open this week, reports 9to5Mac.

Apple first closed all retail locations outside of China on March 13, 2020 in response to the COVID-19 pandemic. The company originally planned to reopen its stores by the end of that month, but history had other plans.

Apple has periodically reopened and reclosed certain locations in the United States and elsewhere based on local case levels and government guidance—for example, a major push was attempted to reopen on May 31 as the virus’s spread slowed as a result of lockdown measures. But that was before COVID cases began rising sharply again. The last locations to reopen in the US this week were located in Texas.

Read 6 remaining paragraphs | Comments

#apple, #apple-store, #covid-19, #pandemic, #retail, #tech

0

Atlanta startups have another venture fund to tap as Silicon Road Ventures closes on $31 million

Atlanta startups can now add another name to their rolodexes of venture firms operating out of the Big Peach with the close of Silicon Road Ventures new $31 million fund.

Silicon Road invests across the U.S. from its base in Atlanta, the firm said with a focus on e-commerce, retail, and consumer packaged goods.

The firm said it’s focused on in-store retail and technology for shoppers, the multi-channel commerce world, supply chain and logistics technologies and financial technologies and payments.

Founded two years ago, the fund invested in ten startups over the course of 2020 and is targeting another twenty for its first fund.

The firm hopes that entrepreneurs find its “corporate connect” program to be a key differentiator, which relies on founder and managing partner Sid Mookerji’s experience in e-commerce, retail and consumer packaged goods to link corporations to relevant startups and research, according to a statement.

Silicon Road is already working with the upstart retail chain Citizen Supply, which provides a highly curated marketplace to showcase new consumer brands.

Mookerji previously founded Software Paradigms International Group, which was one of the first retail IT companies offering a suite of products designed to optimize omni-channel strategies. The company’s clients included Macy’s, Walmart, Carrefour, and NAPA.

Joining Mookerji is managing director and partner, Ross Kimbel, a former co-founder of Be Curious Partners and a global director of innovation and entrepreneurship at The Coca-Cola Company. curated engagements between portfolio companies and major retailers and brands.

The company’s current portfolio includesPerchToucan AIWeStockSoftWear AutomationPatronPull LogicTurnSymTrainEveryware, and Wripple.

#atlanta, #carrefour, #co-founder, #e-commerce, #entrepreneurship, #macys, #managing-partner, #private-equity, #retail, #retailers, #startup-company, #supermarkets, #supply-chain, #supply-chain-management, #tc, #united-states, #walmart

0

Amazon expands its biometric-based Amazon One palm reader system to more retail stores

Last fall, Amazon introduced a new biometric device, Amazon One, that allowed customers to pay at Amazon Go stores using their palm. Today, the company says the device is being rolled out to additional Amazon stores in Seattle — an expansion that will make the system available across eight total Amazon physical retail stores, including Amazon Go convenience stores, Amazon Go Grocery, Amazon Books, and Amazon 4-star stores.

Starting today, the Amazon One system is being added as an entry option at the Amazon Go location at Madison & Minor in Seattle. In the next few weeks, it will also roll out to two more Amazon Go stores, at 5th & Marion and Terry & Stewart, the company says. That brings the system to eight Seattle locations, and sets the stage for a broader U.S. expansion in the months ahead.

As described, the Amazon One system uses computer vision technology to create a unique palm print for each customer, which Amazon then associates with the credit card the customer inserts upon initial setup. While the customer doesn’t have to have an Amazon account to use the service, if they do associate their account information, they’ll be able to see their shopping history on the Amazon website.

Amazon says images of the palm print are encrypted and secured in the cloud, where customers’ palm signatures are created. At the time of its initial launch, Amazon argued that palm prints were a more private form of biometric authentication than some other methods, because you can’t determine a customer’s identity based only on the image of their palm.

But Amazon isn’t just storing palm images, of course. It’s matching them to customer accounts and credit cards, effectively building a database of customer biometrics. It can also then use the data collected, like shopping history, to introduce personalized offers and recommendations over time.

The system raises questions about Amazon’s larger plans, as the company’s historical use of biometrics has been fairly controversial. Amazon sold biometric facial recognition services to law enforcement in the U.S. Its facial recognition technology was the subject of a data privacy lawsuit. Its Ring camera company continues to work in partnership with police. In terms of user data privacy, Amazon hasn’t been careful either — for example, by continuing to store Alexa voice data even when users deleted audio files. 

What’s more is the company doesn’t just envision Amazon One as a means of entry into its own stores — they’re just a test market. In time, Amazon wants to make the technology available to third-parties, as well, including stadiums, office buildings and other non-Amazon retailers.

The timing of the Amazon One launch in the middle of a pandemic has helped spur customer adoption, as it allows for a contactless way to associate your credit card with your future purchases. Upon subsequent re-entry, you just hold your hand above the reader to be scanned again and let into the store.

These systems, however, can disadvantage a lower-socioeconomic group of customers, who prefer to pay using cash. They have to wait for special assistance in these otherwise cashless, checkout-free stores.

Amazon says the system will continue to roll out to more locations in the future.

#amazon, #amazon-one, #biometrics, #computer-vision, #ecommerce, #palm-reader, #retail, #shopping, #technology

0

Mind the gap: E-commerce marketers should revise their TAM and SAM estimates

2021 is going to be another glorious year for e-commerce.

It is that time of the year when most of us are looking back at the “total addressable market” estimates to plan for specific campaigns. Unlike us, if you had your 2021 kick off in Q3, bless your soul. You are an enlightened being.

For the rest of you, for whom e-commerce is a strategic market, I have a question — have you built your total addressable market (TAM) and serviceable addressable market (SAM) estimates for 2021 considering how things evolved in 2020?

It’s important to understand the underlying business model dynamics of companies and visualize TAM from those perspectives.

For most of us, research is a mind-numbing, repetitive exercise of clicking through links on Google until they all turn purple — at which point we start seeking the simplest possible explanation. For e-commerce, addressable market estimates come in the form of headlines from platforms like Shopify. The company quotes a merchant count number in its earnings calls and that becomes the basis for guesstimating the current TAM of e-commerce companies.

The other, rather simplistic approach is to look at the user-base count from several databases that publish tech platform-level user stats.

In reality, the simplest answer is not the right answer.

Mind the gap

Let’s take e-commerce shopping cart installations. Shopify, Magento, WooCommerce, BigCommerce and others publish installation numbers that run into millions.

Here is the dichotomy that should frame your TAM discussions.

E-commerce is long-tail heavy. Yes, there are millions of merchants, but e-commerce revenue is a fat-tail phenomenon — meaning, a disproportionate amount of e-commerce revenue comes from a few tens of thousands of companies.

PipeCandy publishes bottom-up TAM estimates with detailed data cuts by technology, logistics and payment system adoptions by firms across revenue tiers across all major markets. One of the common misconceptions we see in how firms misinterpret TAM estimates is that they equate revenue to spend potential.

#amazon, #column, #ec-column, #ec-ecommerce-and-d2c, #ecommerce, #online-shopping, #retail, #shopify, #total-addressable-market, #web-applications

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Snoop Dogg’s Casa Verde Capital closes on $100 million as the cannabis industry bounces back

Casa Verde Capital, the investment fund co-founded by cannabis connoisseur Snoop Dogg (also known as Calvin Broadus), has closed on $100 million for its second investment fund, according to documents filed with the SEC.

The fund, whose managing director, Karan Wadhera declined to comment for this article, has managed to raise more cash just as the market for cannabis-related products seems poised for another period of expansion.

“What happened to the public perception of the cannabis industry is not too dissimilar to the dotcom bubble of the late ’90s, where there was a lot of hype — a lot of it driven by public companies — and a lot of speculative trading and valuations that weren’t really founded in reality. [We’re talking about] projections multiple years out into the future, and then crazy revenue multiples on top of that,” Wadhera said of the last bust when he spoke to TechCrunch in July. “Things just got really frothy, and that eventually burst, and last April or May was sort of the apex of that moment. It’s when things started to trade off. And it’s been those names, the public names in particular, that have been hit particularly hard.”

Since then, the industry has come roaring back.

“Sitting here today, four-plus months into COVID, cannabis has really proved itself to be a non-cyclical industry. Cannabis has been deemed an essential business everywhere across the U.S. We had record sales in March, April and May, and the trend has continued,” Wadhera said in July. “And now that we are getting into an environment where governments are going to be looking for additional sources of tax revenue, the potential urgency around cannabis legalization is going to be there, which is going to be massively positive for the industry.”

There’s no indication of the target for the new venture capital fund, but with the new fundraising, Casa Verde more than doubles the size of its initial investment vehicle.

Since Broadus, Wadhera and a third partner and the founder of Cashmere Agency and Stampede Management Ted Chung launched their debut fund in 2018, weed businesses have endured a roller-coaster business cycle of boom and bust.

In spite of those market vagaries, Casa Verde has managed to build a portfolio that is now worth at least $200 million, according to people with knowledge of the firm. That money has come through several special purpose vehicles and other fundraising mechanisms raised alongside the flagship fund.

The overall market for cannabis and cannabinoid derivatives is expected to hit $34 billion by 2025 according to an analyst report seen by TechCrunch from the investment bank Cowen.

With Arizona, Montana, New Jersey, and South Dakota all passing adult-use cannabis legalization measures in their states, the investment bank predicted roughly 30 percent growth to their total addressable market estimates.

For its part, Casa Verde has always taken a broad view on the potential addressable market that cannabis and its chemical compounds could capture.

Nowhere is that more on view than in the firm’s latest investment in the sleep company, Proper.

 

“[Cannabis] is an input as well and its use case will go beyond how people think of cannabis stigmatically,” Wadhera said. “At its core, [Proper] is a company that’s helping us target this sleep epidemic. We think CBD and cannabis at large can play a big role in addressing that in a way that traditional products haven’t been able to.”

And what’s true for sleep is true for a number of other different applications as well, Wadhera has said in the past.

Casa Verde has already invested heavily across the pure-play opportunities in cannabis, with investments spanning delivery, supply chain logistics, brands, and retail.

But the health benefits that cannabinoids could have for all kinds of ailments open up a much larger market — as do the broad consumer opportunities should Congress accede to the wishes of more than 60 percent of the American electorate and legalize recreational cannabis use nationally.

And, as Wadhera told us in July, a Biden administration presents a potentially much more positive regulatory environment for the industry than the previous Trump administration did.

“I think Biden will be very helpful. He has laid out many of the things that he wants, and [while] he isn’t taking it as far as full-scale legalization, he’s certainly in favor of full-scale decriminalization, [meaning] letting states have full authority over what happens with their businesses, and also the rescheduling of cannabis down from the current Schedule 1 level,” Wadhera had said. “So all of that will be incredibly helpful and will bring a lot more players who will feel comfortable investing in the space and, potentially, acquiring some of these businesses, too.”

 

#analyst, #arizona, #biden, #biden-administration, #calvin, #casa-verde-capital, #congress, #cowen, #karan-wadhera, #montana, #musicians, #new-jersey, #proper, #retail, #securities-and-exchange-commission, #snoop-dogg, #tc, #ted-chung, #trump-administration, #united-states, #venture-capital

0

Extra Crunch roundup: ‘Nightmare’ security breach, Poshmark’s IPO, crypto boom, more

The rest of the world may be slowing down as we prepare for Christmas and the new year, but we are not taking our foot off the gas.

Alex Wilhelm keeps a close watch on the public markets in his column The Exchange, but this week, he branched out to look at some of the metrics underpinning soaring cryptocurrency prices and turned his gaze on StockX, the consumer reseller marketplace that just raised $275 million in a Series E that values the company at approximately $2.8 billion.

“Selling a tenth of your company for north of a quarter-billion may be somewhat common among late-stage software startups with tremendous growth,” he says, but “don’t laugh — the round actually makes pretty OK sense.”

Our staff continues to file their end-of-year stories: We ran a post this morning by Manish Singh that studies India’s massive total addressable market for retail. The nation has more than 60 million mom-and-pop neighborhood stores, and companies like Walmart and Amazon are eager to offer help with payments, logistics and inventory management — as are hundreds of native and foreign startups.

In an interview with author and MIT professor Sinan Aral, Managing Editor Danny Crichton discussed some of the debates currently swirling around the desire in some quarters to regulate social media platforms. In “The Hype Machine,” Aral explores topics like neuroscience, economics and misinformation before offering potential solutions for resolving what he calls “a full-blown social media crisis.”

The stories that follow are an overview of Extra Crunch from the last five days. Complete articles are only available to members, but you can use discount code ECFriday to save 20% off a one or two-year subscription. Details here.

Thank you very much for reading Extra Crunch this week; I hope you have a safe, relaxing weekend!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist


Unpacking Poshmark’s IPO filing

How did fashion marketplace Poshmark go from posting regular losses in 2019 to generating net income in 2020?

After the company filed a public S-1 last night, Alex Wilhelm pondered the question this morning in The Exchange.

Like many e-commerce platforms, Poshmark saw a surge in activity during the COVID-19 pandemic, but it also slashed its marketing spend, which helped boost profits. As the cash-rich company prepares its road show, “Poshmark is valuable,” Alex concluded.

“How valuable the market will decide. But who will it enrich with its final pricing decision?”

Just how bad is that hack that hit US government agencies?

WASHINGTON, D.C. – APRIL 22, 2018: A statue of Albert Gallatin, a former U.S. Secretary of the Treasury, stands in front of The Treasury Building in Washington, D.C. The National Historic Landmark building is the headquarters of the United States Department of the Treasury. (Photo by Robert Alexander/Getty Images)

The breach of FireEye and SolarWinds by hackers working on behalf of Russian intelligence is “the nightmare scenario that has worried cybersecurity experts for years,” reports Zack Whittaker.

The intrusion began several months ago, but news of the breach wasn’t made public until this week.

“Given that potential victims include defense contractors, telecoms, banks, and tech companies, the implications for critical infrastructure and national security, although untold at this point, could be significant,” said Erin Kenneally, director of cyber risk analytics at Guidewire, an industry platform for insurance carriers.

In his analysis for Extra Crunch, Zack breaks down the rippling effects of supply-chain attacks that can compromise platforms like SolarWinds, which is used by more than 420 of the Fortune 500.

From startups to Starbucks: The embedded API opportunity

contactless payment with QR code

Image Credits: dowell (opens in a new window) / Getty Images

Embedded finance connects services like payment processing with everyday activities like grabbing a coffee before unlocking an e-scooter.

“The ability to be at the right place at the right time, supporting consumers and merchants alike, where they want it, how they want it and when they want it — cannot be understated,” says Simon Wu, an investment director with Cathay Innovation.

In a post that identifies embedded finance’s top providers and enablers, he offers advice for startups and established brands that are hoping to “earn and build customer loyalty while generating new revenue streams.”

Is rising usage driving crypto’s recent price boom?

Bitcoin is at an all-time high.

CoinMarketCap reports that crypto market values have reached almost $659 billion; that figure was just $140 billion in March 2020.

“These gains have created a huge amount of wealth for crypto holders,” Alex Wilhelm wrote yesterday.

To get a better handle on why crypto values are sky-bound, he parsed some basic industry metrics, including the number of unique bitcoin addresses, fees paid and transactions per day.

“Do the price gains make sense in the short term? Who knows,” he wrote, “but they are not based on nothing.”

2020 was a disaster, but the pandemic put security in the spotlight

Stage Light on Black. Image Credits: Fotograzia / Getty Images

For his year-end Extra Crunch story, security reporter Zack Whittaker looked back at the myriad security challenges and vulnerabilities COVID-19 brought to the fore.

The hacks of Fire Eyes and SolarWinds were just one link in the chain: How well is your company prepared to deal with file-encrypting malware, hackers backed by nation-states or employees accessing secure systems from home?

“With 2020 wrapping up, much of the security headaches exposed by the pandemic will linger into the new year,” says Zack.

Inside Zoox’s six-year ride from prototype to product

Zoox Fully Autonomous, All-electric Robotaxi

Zoox Fully Autonomous, All-electric Robotaxi. Image Credits: Zoox

After six years of research and development, autonomous vehicle company Zoox this week unveiled an electric robotaxi that can carry four people at a maximum speed of 75 miles per hour.

Automotive writer Kirsten Korosec interviewed Zoox co-founder and CTO Jesse Levinson to learn more about the vehicle’s development and how the company overcame a series of technical and legal challenges.

“I would say that if you have a big idea and you’re confident that it makes sense, you should at least explore the idea, rather than giving up because the current regulations aren’t designed for it,” said Levinson.

Kirsten only had 15 minutes to interview Levinson, but this comprehensive interview covers topics like regulatory compliance, Zoox’s relationship with parent company Amazon and the highest (and lowest) moments he experienced along the way.

Pluralsight $3.5B deal signals a matured edtech market

Fairy dust flying in gold light rays. Computer generated abstract raster illustration

Fairy dust flying in gold light rays. Computer-generated abstract raster illustration. Image Credits: gonin / Wikimedia Commons

In one of the largest enterprise acquisitions of 2020, Visa Equity Partners this week purchased Utah-based edtech startup Pluralsight for $3.5 billion.

According to the entrepreneurs and investors reporter Natasha Mascarenhas spoke to, this deal “shows the strength of edtech’s capital options as the pandemic continues.”

“What’s happening in edtech is that capital markets are liquidating,” a major change from “the old days where the options to exit were very narrow,” says Deborah Quazzo, a managing partner at GSV Advisors and seed investor in Pluralsight.

Dear Sophie: How did immigration change for startup founders in 2020?

Image Credits: Sophie Alcorn

Dear Sophie:

I’m on an F1 OPT and am about to incorporate a startup with my two American co-founders.

What were the biggest immigration changes in 2020 affecting us?

—Ambitious in Albany

How to pick an investor in good or bad times

High angle view of young man walking towards white doorways on blue background

High angle view of young man walking towards white doorways on blue background Image Credits: Klaus Vedfelt / Getty Images

Founders and the VCs who back them may not be friends, but they’re usually friendly.

Investors are on a first-name basis with entrepreneurs from their portfolio companies and frequently have candid conversations with them about life, work and the world in general. In the before times, they might even have shared a meal or attended a baseball game together.

But make no mistake, it is a top-down relationship — the investor will always have the upper hand. When an entrepreneur accepts a check, they are hiring their next boss.

In an Extra Crunch guest post, Quiq CEO and founder Mike Myer poses two questions for founders who are considering a new relationship with a VC:

  • How can the investor help the business?
  • What’s the risk that the investor will hurt the business?

From India’s richest man to Amazon and 100s of startups: The great rush to win neighborhood stores

https://techcrunch.com/2020/12/18/from-indias-richest-man-to-amazon-and-100s-of-startups-the-great-rush-to-win-neighborhood-stores/

NEW DELHI, INDIA – 2011/12/18: Rice is sold at a night market in Paharganj, the urban suburb opposite New Delhi Railway Station. (Photo by Frank Bienewald/LightRocket via Getty Images)

In India, about 90% of consumers buy their everyday goods from neighborhood-based kirana stores instead of supermarkets.

As a result, U.S. retail giants like Walmart and Amazon have adopted an “if you can’t beat them, join them” approach, offering the nation’s 60 million mom-and-pop shops software for inventory control, payments and e-commerce.

India’s retail market will be worth an estimated $1.3 trillion by 2025, but e-commerce represents just 3% of that activity today, reports Manish Singh.

For his final Extra Crunch story of 2020, he looked at the startups and major players who are hoping to carve out their niche in one of the world’s largest retail ecosystems.

ClickUp CEO talks hiring, raising and scaling in the white-hot productivity space

Line of differently sized pink ceramic piggy banks in ascending size order on white surface, green background

Image Credits: PM Images / Getty Images

Earlier this year, business productivity software startup ClickUp raised a $35 million Series A.

Now, just six months later, the company has closed a second round of $100 million that values the San Diego-based startup at $1 billion.

Lucas Matney interviewed CEO Zeb Evans this week to learn more about how the company was buoyed by pandemic-based behavior shifts that doubled its customer base and multiplied revenue by a factor of nine.

“I think that the biggest thing that we’ve always focused on is shipping a new version of ClickUp every week. That is our differentiation,” he said. “We’ve kind of created these iterative cycles called natural product-market fit and it’s been hard to keep up with that.”

2020’s top 10 enterprise M&A deals totaled a staggering $165B

Multi Colored Bling Bling Dollar Sign Shape Bokeh Backdrop on Dark Background, Finance Concept.

Multi Colored Bling Bling Dollar Sign Shape Bokeh Backdrop on Dark Background, Finance Concept. Image Credits: MirageC / Getty Images.

In 2018, the total value of the year’s 10 top enterprise mergers and acquisitions reached $87 billion; last year, that figure fell to just $40 billion.

But in 2020, 10 M&A deals accounted for $165.2 billion.

“Last year’s biggest deal — Salesforce buying Tableau for $15.7 billion — would have only been good for fifth place on this year’s list,” notes enterprise reporter Ron Miller. “And last year’s fourth largest deal, where VMware bought Pivotal for $2.7 billion, wouldn’t have even made this year’s list at all.”

#asia, #cryptocurrency, #e-commerce, #ecommerce, #embedded-finance, #entrepreneurship, #extra-crunch, #finance, #hack, #india, #payments, #retail, #startups, #tc, #transportation, #venture-capital

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Despite limitations, 3D and AR are creating new realities in retail

In North America, shoppers are increasingly turning to online orders to buy their products.

National postal services have seen a significant uptick in parcel volumes; so many that the number matches those sent during the Christmas surge — minus the wrapping paper. But although the pandemic has acted as a catalyst for online shopping, it’s part of a continuing trend.

The online sector has slowly been eating up the percentage of sales from retail stores. Virtual shopping’s total share of the global market has doubled between 2015 and 2019, with the U.S. Department of Commerce reporting that online retail sales overtook general merchandise stores in the country for the first time in February 2019.

As customers have turned to their web browsers, shop vacancies are on the rise around the world, with big brands deserting even New York’s Fifth Avenue.

“Within the next five years, I think we’re going to see that having AR and 3D on your dot-com and beyond will be mandatory.”

The high street has been forced into a period of transformation. Now, forward-thinking companies are finding ways to adapt.

New realities in retail

In 2019, Charles Bergh, the CEO of Levi’s, proclaimed that stock sizes for clothes would be gone within a decade. Body scanning and made-to-order items would replace the letters and numbers found on the labels of clothes, and products would no longer be found by scrolling through images or browsing shop floors. Instead, customers would select their products — a pair of shoes, a new coffee table, a snapback hat — and customize it to their own specifications. These clothes or items would be tried on or placed within a virtual scan of their room, all without leaving the couch.

Using 3D modeling and augmented reality (AR) — a technology that places computer-generated images onto the real world — Bergh’s vision is already possible.

One of the first sectors to take advantage of the nascent technology was the furniture industry. Leading retailers like Wayfair and IKEA invested early into 3D and AR, allowing customers to physically visualize their products inside their spaces. For Shrenik Sadalgi, the director of Research and Development at Wayfair Next — the arm of the furniture giant that uses technology to make shopping more seamless — adding the two technologies to its sales arsenal was an obvious choice for the company.

Wayfair’s customers can take advantage of two AR experiences. The first, View in Room 3D, lets users place an accurately sized piece of furniture into their room, twist and move it in the space, and even walk around it in real time. Room Planner 3D goes further, allowing customers to visualize the piece of furniture in their home even when they’re on the go.

“We’re letting customers capture the space first,” Sadalgi says of Room Planner 3D. “So you take a photo, and that photo is a very piece of rich information about your room. At a later point in time — maybe you’re on the subway, or maybe you’re at a friend’s house or whatever — you can pull up your room, and then you can add furniture as if you were there. So you don’t have to actually be in the space to plan your space.”

It’s not just homeware companies that have embraced the digital option. Augmented reality has found a natural fit in the beauty industry, and like major furniture retailers, bigger brands have been using the tech for several years. The experiences they offer continue to be refined as the technology improves. Leading players like L’Oréal, Sephora, Procter & Gamble, and more have been honing their version of the AR over time, offering customers a more interactive shopping experience.

For Lynda Pak, senior vice president at beauty powerhouse Estée Lauder, AR lets shoppers gain a familiarity with many of the products within its portfolio of 29 brands.

“AR is becoming a way for a consumer to be able to engage with a beauty advisor or makeup artist,” she says. “It may be tied in with, let’s say, a digital consultation. But if the consumer wants no live consultation whatsoever, [they] can just try the various shades on their own as well.

“The AR experiences that we have right now are really around virtual try-on for makeup,” she continues. “That encompasses eye, it encompasses foundation, it encompasses lip, and we also have skin diagnostic capabilities. The calibration that we’ve done is able to note if you’ve got some dry patches or red flares, or if you’re looking a little tired — it will highlight some of those skin concerns. When we go into haircare, we’re able to view the scalp and the condition of the hair close to the scalp, as well as further down to the ends. You’re able to see what you look like as a blonde, of what you may look like with an ombre. It’s a great way to get a sense of what the shade will look like.”

In both of these industries, as well as a number of others that rely on customization or fit, consumers are beginning to shop differently. Companies like Facebook have invested heavily in online transactions, encouraging more purchases in the digital realm.

Instagram now boasts its Shopping and Checkout options to allow businesses to advertise and complete transactions through the app, offering an alternative to website- or brand app-based shopping platforms — all with a potential customer base of over a billion. As buyers continue to explore new ways to make their shopping decisions, brands are increasingly focusing on how they present their products digitally.

Making the digital feel physical

Changes in retail have always been tied to developments in technology. The advent of the postal service inspired mail-order catalogs. Televisions created shopping channels. The internet ushered in the possibility of online shopping, and mobile phones — with their cameras — have been the launchpad for AR and 3D. Each leap creates more opportunity for shoppers to see the product how it really is — as if it was already on their body or in their homes.

#ar, #augmented-reality, #column, #ecommerce, #marketing, #online-shopping, #retail, #wayfair

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Chicago’s ShoppingGives gets served a seed round from Serena Williams’ VC firm, Serena Ventures

ShoppingGives, a Chicago-based startup pitching retailers a service that can integrate non-profit donations into their sales and shopping platforms, has raised an undisclosed amount from Serena Williams’ venture capital firm, Serena Ventures, the company said. 

ShoppingGives allows retailers to offer a donation on behalf of a shopper to any of over 1.5 million nonprofits that are on its list — all without leaving the retailer’s website.

The company said that retailers can use the donation data to create a more authentic and personalized engagement with customers based on the causes they support.

“ShoppingGives aligned with my values of investing in businesses and entrepreneurs who are making a difference. By creating opportunities to grow social impact with a seamless approach for retailers and brands, ShoppingGives is charting the course for all businesses to stand forth as agents of change in our society,”said Williams in a statement. 

The company’s technology helps retailers manage and report donations and is already recommended by Shopify as one of a collection of apps for merchants setting up their online stores. Its service integrates with ecommerce content management systems and is already a partner for the PayPal giving fund.

ShoppingGives has already donated to over 6,000 non-profit organizations selected by customers, according to the company. Brands like Kenneth Cole, Natori, White + Warren, Margaux, Solstice Sunglasses, Tomboyx, Fresh Clean Tees, Blind Barber, Huron, and Neighborhood Goods use the service already. 

Image Credit: ShoppingGives

#business, #chicago, #content-management, #e-commerce, #economy, #kenneth-cole, #marketing, #merchandising, #online-shopping, #online-stores, #partner, #paypal, #retail, #serena-ventures, #shopify, #supply-chain-management, #tc, #venture-capital, #warren, #williams

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Walmart+ takes on Prime by dropping $35 minimum on Walmart.com purchases

Walmart+, the retailer’s lower cost alternative to Amazon Prime offering same-day delivery of groceries and other items, is making its service more appealing with today’s launch of a new perk. The company says that starting on Friday, December 4, it will remove the $35 shipping minimum on orders from Walmart.com for its members. However, this doesn’t apply to the same-day orders of groceries or other items fulfilled by Walmart stores, but rather online shopping where orders are placed through Walmart’s traditional e-commerce channels.

That means there’s no longer a minimum order requirement on the next-day and two-day shipping that’s offered on items shipped from Walmart.com, no matter the basket total. The change, arriving only a couple of months after Walmart+’s launch, positions the new program as more of a true alternative to Amazon Prime, as Prime’s biggest perk has always been its free fast shipping service that encourages consumers to shop online without worrying about minimum order sizes.

Meanwhile, Walmart+’s biggest perk until now had been its same-day delivery service, with a particular focus on groceries — similar to Instacart or Amazon Fresh. The service didn’t charge fees on same-day grocery if the orders were at least $35, and this aspect continues today.

The Walmart+ program itself grew out of Walmart’s Delivery Unlimited, an earlier version of the service that had also involved having Walmart store staff pick orders which are handed off to delivery partners. In the past, those partners have included Postmates (now acquired by Uber), DoorDash, Roadie, and Point Pickup, among others. More recently, Walmart acquired last-mile delivery operation JoyRun, to bring more of its delivery logistics business in-house. 

Unlike some grocery delivery services, Walmart’s advantage in same-day is that it could also fulfill orders of other everyday items from its store shelves, not just food and household goods. When Walmart+ launched in mid-September, it promised same-day delivery of over 160,000 items.

The program also includes a small handful of other perks like fuel discounts at nearly 2,000 Walmart, Murphy USA and Murphy Express stations and access to Scan & Go to skip the checkout lines when shopping in-store.

Today, Walmart said it’s also expanding the fuel savings to over 500 Sam’s Club gas stations, too.

While Amazon Prime has expanded over the years to include all sorts of benefits, like free music and streaming video, e-books, audiobooks, gaming perks, and more, Walmart+ so far remains focused on its core features — like shipping benefits and cost savings. And coming in at $98 per year (or $12.95/mo), it’s cheaper than Prime’s $119 per year membership, which could appeal to consumers only interested in free delivery.

Walmart, like many large retailers, has benefitted by the acceleration of e-commerce driven by the pandemic. The company, in its third quarter earnings, reported U.S. e-commerce sales were up by 79% in the quarter, with earnings of $1.34 a share on revenue that was up 5.2% year-over-year to $134.7 billion.

So far, Walmart has declined to share how many customers have signed up for Walmart+ much to investors’ dismay. (One third-party estimate puts it at 19M members, however). The retailer notes the program is available at over 4,700 stores, including 2,800 stores that offer delivery — the latter which reaches 70% of the U.S.

#amazon-prime, #e-commerce, #ecommerce, #online-shopping, #retail, #retailers, #sams-club, #united-states, #walmart

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Who’s building the grocery store of the future?

The future of grocery stores will be a win-win for both stores and customers.

On one hand, stores want to decrease their operational expenditures that come from hiring cashiers and conducting inventory management. On the other hand, consumers want to decrease the friction of buying groceries. This friction includes both finding high-quality groceries at consumers’ personal price points and waiting in long lines for checkout. The future of grocery stores promises to alleviate, and even eliminate, these points of friction.

Amazon’s foray into grocery store technology provides a succinct introduction into the state of the industry. Amazon’s first act was its Amazon Go store, which opened in Seattle in early 2018. When customers enter an Amazon Go store, they swipe the Amazon app at the entrance, enabling Amazon to link purchases to their accounts. As they shop, a collection of ceiling cameras and shelf sensors identify the items and places them in a a virtual shopping cart. When they’re done shopping, Amazon automatically charges for the items they grabbed.

Earlier this year, Amazon opened a 10,400-square-foot Go store, about five times bigger than the largest prior location. At larger store sizes, however, tracking people and products gets more computationally complex and larger SKU counts become more difficult to manage. This is especially true if the computer vision AI-based system also must be retrofitted into buildings that come with nooks and crannies that can obstruct camera angles and affect lighting.

Perhaps Amazon’s confidence in its ability to scale its Go stores comes from vertical integration that enables it to optimize customer experiences through control over store format, product selection and placement.

While Amazon Go is vertically integrated, in Amazon’s second act, it revealed a separate, more horizontal strategy: Earlier this year, Amazon announced that it would license its cashierless Just Walk Out technology.

In Just Walk Out-enabled stores, shoppers enter the store using a credit card. They don’t need to download an app or create an Amazon account. Using cameras and sensors, the Just Walk Out technology detects which products shoppers take from or return to the shelves and keeps track of them. When done shopping, as in an Amazon Go store, customers can “just walk out” and their credit card will be charged for the items in their virtual cart.

Just Walk Out may enable Amazon to penetrate the market much more quickly, as Amazon promises that existing stores can be retrofitted in “as little as a few weeks.” Amazon can also get massive amounts of data to improve its computer vision systems and machine learning algorithms, accelerating the speed with which it can leverage those capabilities elsewhere.

In Amazon’s third and latest act, Amazon in July announced its Dash Cart, a departure from its two prior strategies. Rather than equipping stores with ceiling cameras and shelf sensors, Amazon is building smart carts that use a combination of computer vision and sensor fusion to identify items placed in the cart. Customers take barcoded items off shelves, place them in the cart, wait for a beep, and then one of two things happens: Either the shopper gets an alert telling him to try again, or the shopper receives a green signal to confirm the item was added to the cart correctly.

For items that don’t have a barcode, the shopper can add them to the cart by manually adding them on the cart screen and confirming the measured weight of the product. When a customer exits through the store’s Amazon Dash Cart lane, sensors automatically identify the cart, and payment is processed using the credit card on the customer’s Amazon account. The Dash Cart is specifically designed for small- to medium-sized grocery trips that fit two grocery bags and is currently only available in an Amazon Fresh store in California.

The pessimistic interpretation of Amazon’s foray into grocery technology is that its three strategies are mutually incompatible, reflecting a lack of conviction on the correct strategy to commit to. Indeed, the vertically integrated smart store strategy suggests Amazon is willing to incur massive fixed costs to optimize the customer experience. The modular smart store strategy suggests Amazon is willing to make the tradeoff in customer experience for faster market penetration.

The smart cart strategy suggests that smart stores are too complex to capture all customer behaviors correctly, thus requiring Amazon to restrict the freedom of user behavior. The more charitable interpretation, however, is that, well, Amazon is one of the most customer-centric companies in the world, and it has the capital to experiment with different approaches to figure out what works best.

While Amazon serves as a helpful case study to the current state of the industry, many other players exist in the space, all using different approaches to build an aspect of the grocery store of the future.

Cashierless checkout

According to some estimates, people spend more than 60 hours per year standing in checkout lines. Cashierless checkout changes everything, as shoppers are immediately identified upon entry and can grab products from the shelf and leave the store without having to interact with a cashier. Different companies have taken different approaches to cashierless checkout:

Smart shelves: Like Amazon Go, some companies utilize computer vision mounted on ceilings and advanced sensors on shelves to detect when shoppers take an item from the shelf. Companies associate the correct item with the correct shopper, and the shopper is charged for all the items they grabbed when they are finished with their shopping journey. Standard Cognition, Zippin and Trigo are some of the leaders in computer vision and smart shelf technology.

Smart carts and baskets: Like Amazon’s Dash Cart, some companies are moving the AI and the sensors from the ceilings and shelves to the cart. When a shopper places an item in their cart, the cart can detect exactly which item was placed and the quantity of that item. Caper Labs, for instance, is pursuing a smart cart approach. Its cart has a credit card reader for the customer to checkout without a cashier.

Touchless checkout kiosks: Touchless checkout kiosk stations use overhead cameras that verify and charge a customer for their purchase. For instance, Mashgin built a kiosk that uses computer vision to quickly verify a customer’s items when they’re done shopping. Customers can then pay using a credit card without ever having to scan a barcode.

Self-scanning: Some companies still require customers to scan items themselves, but once items are scanned, checkout becomes quick and painless. Supersmart, for instance, built a mobile app for customers to quickly scan products as they add them to their carts. When customers are finished shopping, they scan a QR code at a Supersmart kiosk, which verifies that the items in the cart match the items scanned using the mobile app. Amazon’s Dash Cart, described above, also requires a level of human involvement in manually adding certain items to the cart.

Notably, even with the approaches detailed above, cashiers may not be going anywhere just yet because they still play important roles in the customer shopping experience. Cashiers, for instance, help to bag a customer’s items quickly and efficiently. Cashiers can also conduct random checks of customer’s bags as they leave the store and check IDs for alcohol purchases. Finally, cashiers also can untangle tricky corner cases where automated systems fail to detect or validate certain shoppers’ carts. Grabango and FutureProof are therefore building hybrid cashierless checkout systems that keep a human in the loop.

Advanced software analytics

#amazon, #amazon-go, #artificial-intelligence, #cashierless-checkout, #column, #ecommerce, #facial-recognition, #food, #grocery-store, #inventory-management, #labor, #payments, #point-of-sale, #real-estate, #retail, #robotics

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Despite pandemic, forecasts predict U.S. online holiday sales increase of 20%-30% or more

Strong e-commerce sales are predicted to help lift overall holiday retail spending in the U.S., according to forecasts released today by the National Retail Federation (NRF) and eMarketer. Both firms expect to see overall retail sales growth during November and December, though the market may be impacted by slowing brick-and-mortar sales.

Of the two, NRF had the more optimistic forecast. It estimates U.S. holiday sales during November and December will increase between 3.6% and 5.2% year-over-year, for a total between $755.3 billion and $766.7 billion. That’s compared with a 4% increase in 2019 to $729.1 billion, and an average of a 3.5% increase over the past five years.

Image Credits: NRF

Growth will come from online and other non-store sales, which are included in the total, which will increase between 20% and 30% to reach between $202.5 billion and $218.4 billion. That’s up from $168.7 billion last year.

NRF’s takeaway is that consumers are willing to spend — perhaps because of the challenging year that 2020 has been, rather than despite it.

“After all they’ve been through, we think there’s going to be a psychological factor that they owe it to themselves and their families to have a better-than-normal holiday,” noted NRF Chief Economist Jack Kleinhenz. “There are risks to the economy if the virus continues to spread, but as long as consumers remain confident and upbeat, they will spend for the holiday season,” he added.

The firm also noted Americans may have reduced their spending in other categories, like personal services, travel and entertainment due to the pandemic, which could increase the money they have for retail spending.

eMarketer, on the other hand, paints a less rosy picture when it comes to overall sales.

The firm predicts that total holiday season retail sales will see the lowest growth rate at just 0.9% year-over-year. This growth will come from the e-commerce sector, which will see its highest growth rate — 35.8% — since the firm began tracking retail sales in 2008. Brick-and-mortar sales, on the other hand, will decline 4.7%.

The discrepancy between these two firms’ estimates have to do with how they calculate “retail sales.”

eMarketer’s estimates include auto and gasoline sales, but exclude restaurants, travel, and event sales. NRF’s figures, on the other hand, exclude auto, gasoline and restaurants.

However, both agree on an e-commerce surge. NRF notes online sales were already up 36.7% year-over-year in the third quarter — in part, due to early holiday shopping. This year, some 42% of consumers had started shopping earlier than usual, it recently found. Plus, retail sales were up 10.6% in October 2020 versus October 2019, in aggregate, its forecast noted.

But whether it’s 20% to 30% growth or 35.8%, depending on the firm, it’s clear e-commerce is saving the day here.

NRF also expects seasonal hiring to be in line with recent years, as retailers hire between 475,000 and 575,000 seasonal workers compared with 562,000 in 2019. Some of that hiring may have already taken place in October, due to early shopping, it said.

Though Black Friday may not see the same levels of in-person shopping as in years past, brick-and-mortar retailers have made it easier to shop digitally, then either have items shipped home, picked up in-store, or even curbside. Outside of Amazon, Walmart and Target have particularly benefited from investments in e-commerce, as both retailers easily beat Wall St. expectations in their latest earnings reports, released just ahead of the holiday quarter.

Online, however, Cyber Monday will continue to rule, however, eMarketer says.

Image Credits: eMarketer

Of the five big online shopping days in 2020, eMarketer says Cyber Monday will again beat out Black Friday in terms of overall e-commerce sales, at $12.89 billion compared with Black Friday’s $10.20 billion. But Thanksgiving Day will see the most year-over-year growth in e-commerce sales, at 49.5%, followed by Black Friday, Small Business Saturday, Cyber Sunday and Cyber Monday.

Image Credits: eMarketer

In a mobile forecast, analytics firm App Annie predicted Americans would spend over 110 million hours in shopping apps on Android devices during the two-week period consisting of Black Friday and Cyber Monday weeks. It noted the pandemic had already accelerated mobile device usage to 4 hours, 20 minutes per day, and Americans spent over 61 million hours shopping during the week of Prime Day.

#black-friday, #cyber-monday, #e-commerce, #ecommerce, #emarketer, #retail, #shopping, #tc, #thanksgiving, #united-states

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CVS becomes first national retailer to offer support for PayPal and Venmo QR codes at checkout

PayPal announced this morning that its customers can now use either PayPal or Venmo QR codes when checking out at over 8,200 CVS retail stores across the U.S. This is the first national retailer to integrate PayPal’s QR code checkout technology at point-of-sale, the company noted. The additional checkout option will also expand the number of ways customers can pay “touch-free” at CVS — a way to transact that’s become increasingly popular as the coronavirus outbreak continues to spread across the country.

CVS and PayPal announced their plans to cooperate on a point-of-sale solution back in July. At the time, they pegged the timeframe for the rollout as sometime in Q4 2020.

The QR code checkout process itself will pull the funds needed for the purchase from the customer’s existing PayPal or Venmo account balance, bank account, or from a debit or credit card, just as it would if the transaction was taking place online. Venmo users will additionally have the option to utilize their Venmo Rewards.

Image Credits: PayPal

The transaction does not include any fees, PayPal says. Plus, CVS’ ExtraCare Rewards Program members will still be able to redeem and apply savings using their ExtraCare account when using PayPal’s QR code checkout.

The entire transaction can be touch-free, as it involves QR code scanning as opposed to using a card that has to be swiped or inserted into a terminal or numbers punched into a keypad.

The new option arrives at a time when CVS says it’s seeing increased demand for contactless payments.

Since January, CVS has seen a 43% increase in touch-free transactions, according to data from Forrester. In addition, 11% of the U.S. population says they’re now using a digital payment method for the first time as a result of the pandemic, PayPal noted. The company’s own research also indicated that 57% of consumers said merchants’ digital payment offerings impacted their decisions to shop in their stores.

To use the new QR code checkout option, customers will first launch either their PayPal or Venmo app, click the “Scan” button, then select the “show to pay” option.

The new checkout experience was made possible through PayPal’s partnership with payments technology provider InComm, which distributed the PayPal QR code technology through its cloud-based software updates to make the feature available at point-of-sale.

While CVS is the first national retailer to rollout PayPal’s QR code checkout, PayPal said it has 10 other major retailers signed up for a similar rollout, including Nike, Tumi, Bed Bath & Beyond, and Samsonite, among others. It’s in discussions with well over 100 large retailers about the technology, as well.

“The launch of PayPal and Venmo QR codes in CVS Pharmacy stores will not only provide health-conscious customers with a touch-free way to pay at checkout, but also brings the safety and security of PayPal and Venmo transactions into the store with shoppers,” said Jeremy Jonker, PayPal Senior Vice President Head of Consumer In-Store and Digital Commerce, in a statement. “We are thrilled that PayPal and Venmo QR codes will help to maintain the safety of CVS customers and employees, especially in the essential pharmacy retail environment as we go into the winter months.”

In addition to the CVS news, PayPal today also noted that its recently announced “Pay in 4” option for splitting purchases across four installments is now fully live across millions of retailers.

#commerce, #cvs, #cvs-pharmacy, #finance, #financial-technology, #incomm, #money, #online-payments, #online-shopping, #paypal, #qr-code, #retail, #retail-stores, #shopping, #venmo

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Walmart’s new test stores will experiment with AR, mobile, revamped checkout and more

Walmart over the years has been working to turn its physical retail stores into online fulfillment centers, and now, with its latest set of test stores announced today, the retailer will try out ideas to make that transition more seamless. Walmart says it will deploy personnel to four test stores across the U.S., where they’ll prototype and iterate on new technology and tools that will serve the needs of Walmart’s in-store shoppers and online shoppers alike, including changes involving augmented reality, handheld mobile devices, new apps, in-store signage, omni-assortment, and revamped checkout stations.

The idea is to turn these four test locations into rapid prototyping environments, where teams can test solutions in real-time, make changes, scale what works and scrap what doesn’t. Some of the changes being put into place will be visible to the customer, while others will be more behind-the-scenes.

At launch, Walmart has identified four areas where it’s looking to test new ideas across assortment, inventory, picking and checkout process.

In one store, it will test moving the majority of the in-store apparel assortment online — meaning the same exact items can be found both in the store and online. This isn’t always the case today, as not everything stocked in the stores are also on the Walmart website, and vice versa. This test will focus on determining what has to take place to make all the eligible items in a store “omni-available,” Walmart says, a reference to its desire to be a true “omni-channel” retailer.

Image Credits: Walmart

A second test will involve a new app that aims to speed up the time it takes to get items from the back room to the sales floor, using augmented reality (AR). In this test, instead of scanning the barcode on boxes that are ready to go, the app will use AR technology to highlight those boxes. The hope is that this will help to move the product to shelves, and in front of customers, faster than before.

Image Credits:

Another experiment uses a combination of handheld devices and in-store signage to help associates better navigate to the right locations when picking items for online orders. In early tests, Walmart says the percentage of time it takes associates to find the items has already gone up by 20% in some of the categories that tend to be more difficult to find.

The fourth test will expand and build on an experimental checkout experience Walmart previously announced in June. In this store, Walmart does away with individual checkout lanes, and transitions cashiers into the role of “hosts” in a new area of the store that resembles a self-checkout destination. Here, customers can opt to check out themselves or have a “host” offer full-service checkout. In either case, store staff are around to help with any issues that arise.

Image Credits: Walmart

The expectation is that checkout lanes will move more quickly than the old style of individual checkout lanes. With the latter layout, a surge of new customers coming to the registers could cause bottlenecks if there weren’t enough lanes staffed. In the long run, the new layout could free up cashiers to help with other tasks in store as a checkout station may not need as many “hosts” on hand to run things.

The four stores may test other technology and digital solutions in the future, as well, but Walmart didn’t expand on its roadmap plans. Two of the stores in Northwest Arkansas, including a Bentonville location, are up and running. Two more are planned to be up and running soon.

Each store will have four new employees staffed to aid with the prototypes — a product manager, a technologist, a business owner, and a designer.

“We’re moving quickly to use our physical retail stores to not only serve in-store shoppers, but to flex to meet the needs of online shoppers, too, in ways that only Walmart can,” said John Crecelius, Walmart U.S. SVP of Associate Product and Next Generation Stores, in a statement. “That’s where our new test stores come in. Their purpose is to find solutions that continue to help our stores operate as both physical shopping destinations and online fulfillment centers in a way that has yet to be seen across the retail industry,” he added. 

#e-commerce, #ecommerce, #fulfillment, #mobile-devices, #omnichannel, #online-shopping, #point-of-sale, #retail, #retailers, #shopping, #walmart

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Postmates is launching a new retail delivery feature as brick and mortar stores face 14% drop in sales

Postmates is now rolling out what could be the biggest update to the company’s service in a long time — adding a retail option for users to shop local stores and for local merchants to set up a virtual on-demand storefront in the app.

Starting in Los Angeles — and building on yesterday’s test run pop-up shop with the Los Angeles Rams — Postmates users will be able to shop local merchants listed in the company’s new retail tab in the Postmates app called, appropriately, “shop”.

It’s the first public launch of a new initiative headed up by Mike Buckley, a veteran Nike exec who Postmates poached in August to become the company’s senior vice president of business. At Nike, Buckley served as the vice president of digital commerce operations and new business models.

While Postmates has made some small steps in retail delivery (primarily electronics), Buckley said the new service greatly expands that footprint. Shops available to willing Los Angeles customers to cover everything from home goods, cosmetics, and clothes to even vinyl records.

Buckley said the company decided to launch its efforts in Los Angeles, because it was a market where Postmates had a good penetration of delivery workers and big market. “We wanted to create an experience where, as a consumer, if you went there you would feel there’s good coverage,” Buckley said. “Most of the LA metro area will have access to the tab. We started the test in Venice Beach in Abbott Kinney… that’s where you’d find the best coverage.. We have reasonable coverage throughout broader urban LA.”

Postmates new senior vice president of retail, Mike Buckley. Image Credit: Postmates

At launch, there will be nearly fifty retailers on the site including shops like Buck Mason, Le Labo, Parachute Home, the Venice Beach boutique, Coutula 12th Tribe, Timbuk2, Zadig & Voltaire, Supervinyl and Urbanic.  

Retailers can decide how many products they want to sell through the app, and the main goal, according to Buckley is to see what kind of products resonate with consumers for delivery.

For local merchants who have been hit hard by the lockdown orders put in place as a response to the COVID-19 pandemic, on-demand delivery options from Postmates could create a new line to wary would-be shoppers that still don’t feel like braving the checkout line at a small boutique.

As case counts spike in the U.S. the prospect of a return to lockdown looms large for some regions. That could have an impact on retail sales that were already projected to be dismal.

In fact, the online analytics service eMarketer projected a 10.5% decline in total US retail sales this year, and a 14.0% drop in brick-and-mortar sales… even before the second wave of the pandemic began surging in the U.S. earlier this month.

The new on-demand option could also provide retailers with another avenue to lure customer through timed flash sales, exclusive “drops” to Postmates users, and other retailing tricks that were Buckley’s stock and trade at Nike.

“That’s absolutely one of the ways we think we can drive engagement to these merchants and create calls to action with these merchants,” Buckley said. 

In some ways, the move into consumer retail shopping takes Postmates back to its earliest days, when the service allowed users to demand delivery of almost anything. “I think about this continuing… the company’s original vision of anything anytime anywhere… They had an aspiration to deliver all kinds of different products and food became the killer app given the frequency,” Buckley said. 

The ‘Shop’ button is going live for Los Angeles residents and will be restricted to Los Angeles throughout the fourth quarter before a wider rollout in the first quarter of 2021. Buckley expects the new service to be phased in at other big metro areas across the Southwest first before hitting markets on the East Coast. 

Within the Postmates ‘Shop’ tab shops will be able to sell their inventory and showcase products with configurable catalogues including high resolution images. Shops can also offer customers a choice between on-demand delivery, in-store pickup, or non-contact curbside pickup.

Delivery and service fees will apply to the shopping experience, but Postmates unlimited subscribers will get free delivery, according to the company.

“This year, COVID really changed the landscape of how we purchase essentials, spend time recreationally, and even how we treat ourselves,” said Heather DeLeon, Director of Sales, Anastasia Beverly Hills, one of the retailers using the new service, in a statement. “Shop is such an interesting opportunity because it lets people get their hands on our products in a completely new and exciting way.”

#electronics, #food, #los-angeles, #nike, #online-shopping, #postmates, #retail, #shopping, #tc

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Tiliter bags $7.5M for its ‘plug and play’ cashierless checkout tech

Tiliter, an Australian startup that’s using computer vision to power cashierless checkout tech that replaces the need for barcodes on products, has closed a $7.5 million Series A round of funding led by Investec Emerging Companies.

The 2017-founded company is using AI for retail product recognition — claiming advantages such as removing the need for retail staff to manually identify loose items that don’t have a barcode (e.g. fresh fruit or baked goods), as well as reductions in packaging waste.

It also argues the AI-based product recognition system reduces incorrect product selections (either intentional or accidental).

“Some objects simply don’t have barcodes which causes a slow and poor experience of manual identification,” says co-founder and CEO Martin Karafilis. “This is items like bulk items, fresh produce, bakery pieces, mix and match etc. Sometimes barcodes are not visible or can be damaged.

“Most importantly there is an enormous amount of plastic created in the world for barcodes and identification packaging. With this technology we are able to dramatically decrease and, in some cases, eliminate single use plastic for retailers.”

Currently the team is focused on the supermarket vertical — and claims over 99% accuracy in under one second for its product identification system.

It’s developed hardware that can be added to existing checkouts to run the computer vision system — with the aim of offering retailers a “plug and play” cashierless solution.

Marketing text on its website adds of its AI software: “We use our own data and don’t collect any in-store. It works with bags, and can tell even the hardest sub-categories apart such as Truss, Roma, and Gourmet tomatoes or Red Delicious, Royal Gala and Pink Lady apples. It can also differentiate between organic and non-organic produce [by detecting certain identification indicators that retailers may use for organic items].”

“We use our pre-trained software,” says Karafilis when asked whether there’s a need for a training period to adapt the system to a retailer’s inventory. “We have focused on creating a versatile and scalable software solution that works for all retailers out of the box. In the instance an item isn’t in the software it can be collected by the supermarket in approx 20min and has self-learning capabilities.”

As well as a claim of easy installation, given the hardware can bolt onto existing retail IT, Tiliter touts lower cost than “currently offered autonomous store solutions”. (Amazon is one notable competitor on that front.)

It sells the hardware outright, charging a yearly subscription fee for the software (this includes a pledge of 24/7 global service and support).

“We provide proprietary hardware (camera and processor) that can be retrofitted to any existing checkout, scale or point of sale system at a low cost integrating our vision software with the point of sale,” says Karafilis, adding that the pandemic is driving demand for easy to implement cashierless tech.

The startup cites a 300% increase in ‘scan and go’ adoption in the US over the past year due to COVID-19, as an example, adding that further global growth is expected.

It’s not breaking out customer numbers at this stage — but early adopters for its AI-powered product recognition system include Woolworths in Australia with over 20 live stores; Countdown in New Zealand, and several retail chains in the US such as New York City’s Westside Market.

The Series A funding will go on accelerating expansion across Europe and the US — with “many” supermarkets set to be adopt its tech over the coming months.

#ai, #artificial-intelligence, #asia, #cashierless-tech, #computer-vision, #investec-emerging-companies, #retail, #tiliter

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Here are four areas the $311 billion CPPIB investment fund thinks will be impacted by COVID-19

The Canadian Pension Plan Investment Board, an asset manager controlling around $311 billion in assets for the Canada’s pensioners and retirees, has identified four key industries that are set to experience massive changes as a result of the global economic response to the COVID-19 pandemic.

The firm expects the massive changes in e-commerce, healthcare, logistics, and urban infrastructure to remain in place for an extended period of time and is urging investors to rethink their approaches to each as a result.

“It really ties into the mandate that we have in thematic investing,” said Leon Pedersen, the head of Thematic Investments at CPPIB.

There was a realization at the firm that structural changes were happening and that there was value for the fund manager in ensuring that the changes were being addressed across its broad investment portfolio. “We have a long term mandate and we have a long term investment horizon so we can afford to think long term in our investment outlook,” Pedersen said.

The Thematic Investments group within CPPIB will make mid-cap, small-cap and private investments in companies that reflect the firm’s long term theses, according to Pedersen. So not only does this survey indicate where the firm sees certain industries going, but it’s also a sign of where CPPIB might commit some investment capital.

The research, culled from international surveys with over 3,500 respondents as well as intensive conversations with the firm’s investment professionals and portfolio companies, indicates that there’s likely a new baseline in e-commerce usage that will continue to drive growth among companies that offer blended retail offerings and that offices are likely never going to return to full-time occupancy by every corporate employee.

Already CPPIB has made investments in companies like Fabric, a warehouse management and automation company.

The e-commerce wave has crested, but the tide may turn

Amid the good news for e-commerce companies is a word of warning for companies in the online grocery space. While usage surged to 31 percent of U.S. households, up from 13 percent in August, consumers gave the service poor marks and many grocers are actually losing money on online orders. The move online also favored bigger omni-channel vendors like Amazon and Walmart, the study found.

The CPPIB also found that there may be opportunities for brick and mortar vendors in the aftermath of the epidemic. As younger consumers return to shopping center they’re going to find fewer retailers available, since bankruptcies are coming in both the US and Europe. That could open the door for new brands to emerge. Meanwhile, in China, more consumers are moving offline with malls growing and customers returning to shopping centers.

Some of the biggest winners will actually be online entertainment and cashless payments — since fewer stores are accepting cash and music and video streaming represent low-risk, easier options than live events or movie theaters.

LOS ANGELES, CA – MAY 30: General views of tourists and shoppers returning to the Hollywood & Highland shopping mall for the first weekend of in-store retail business being open since COVID-19 closures began in mid-March on May 30, 2020 in Los Angeles, California. (Photo by AaronP/Bauer-Griffin/GC Images)

Healthcare goes digital and privacy matters more than ever

Consumers in the West, already reluctant to hand over personal information, have become even more sensitive to government handling of their information despite the public health benefits of tracking and tracing, according to the CPPIB. In Germany and the U.S. half of consumers said they had concerns about sharing their data with government or corporations, compared with less than 20 percent of Chinese survey respondents.

However, even as people are more reluctant to share personal information with governments or corporations, they’re becoming more willing to share personal information over technology platforms. One-third of the patients who used tele-medical services in the U.S. during the pandemic did so for the first time. And roughly twenty percent of the nation had a telemedicine consultation over the course of the year, according to CPPIB data.

Technologies that improve the experience are likely to do well, because of the people who did try telemedicine, satisfaction levels in the service went down.

DENVER, CO – MARCH 12: Healthcare workers from the Colorado Department of Public Health and Environment check in with people waiting to be tested for COVID-19 at the state’s first drive-up testing center on March 12, 2020 in Denver, Colorado. The testing center is free and available to anyone who has a note from a doctor confirming they meet the criteria to be tested for the virus. (Photo by Michael Ciaglo/Getty Images)

Cities and infrastructure will change

“From mass transit to public gatherings, few areas of urban life will be left unmarked by COVID-19,” write the CPPIB report authors.

Remote work will accelerate dramatically changing the complexion of downtown environments as the breadth of amenities on offer will spread to suburban communities where residents flock.  According to CPPIB’s data roughly half of workers in China, the UK and the US worked from home during the pandemic, up from 5 percent or less in 2019. In Canada, four-in-ten Canadian were telecommuting.

To that end, the CPPIB sees opportunities for companies enabling remote work (including security, collaboration and productivity technologies) and automating business practices. On the flip side, for those workers who remain wedded to the office by necessity or natural inclination, there’s going to need to be cleaning and sanitation services and someone’s going to have to provide some COVID-19 specific tools.

With personal space at a premium, public transit and ride hailing is expected to take a hit as well, according to the CPPIB report.

New York City, NY is shown in the above Maxar satellite image. Image Credit: Maxar

Supply chains become the ties that bind in a distributed, virtual world

As more aspects of daily life become socially distanced and digital, supply chains will assume an even more central position in the economy.

“Amid rising labor costs and heightened geopolitical risk, companies today are focused on resilience,” write the CPPIB authors.

Companies are reassessing their reliance on Chinese manufacturing since political pressure is coming from more regions on Chinese suppliers thanks to the internment of the Uighur population in Xinjiang and the crackdown on Hong Kong’s democratic and open society. According to CPPIB, India, Southeast Asia, and regional players like Mexico and Poland are best positioned to benefit from this supply chain diversification. Supply chain management software providers, and robotics and automation services stand to benefit.

“Confined to their homes for months and subjected to a rapid reordering of their perceived health risks and economic prospects, consumers are emerging from a shared trauma that will change their priorities and concerns for years to come,” the CPPIB study’s authors write.

#amazon, #asset-manager, #canada, #canada-pension-plan, #china, #e-commerce, #economy, #europe, #fabric, #finance, #germany, #head, #healthcare, #india, #manufacturing, #mexico, #online-entertainment, #poland, #retail, #southeast-asia, #tc, #telecommuting, #telemedicine, #united-kingdom, #united-states, #urban-infrastructure, #walmart

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