Rishi Taparia - Issue #49
This week we explore the future of the store including AI and VR, personal loan amounts surging to record highs, the state of AI, technology for Indian dairy farmers, where footballers should shoot their penalties and more. Enjoy!
Commerce
Alibaba launches fashion concept store using artificial intelligence
Alibaba is opening a short-term Hong Kong pop-up this week in collaboration with Guess that will highlight a range of new technologies that it says are the future of fashion retail. Leveraging technology Alibaba calls FashionAI, the concept suggests items to buy based on the latest fashion trends. The next evolution from the ‘smart mirror’ and only open for a few days, whether this concept plays out in the long term and whether it sees adoption in store remains to be seen.
WeWork Dives Into Retail With WeMRKT
WeWork is now officially into retail. Currently piloting in their NYC flagship, the store will sell products from 10 WeWork members offering DtoC products (the 10 won a pitch competition), as well as WeWork branded supplies, snacks and drinks. Great distribution for the WeWork members, turning patrons into customers, no dissimilar from startups in accelerators utilizing the other companies in the batch as customers.
Mall Vacancies Hits 6-Year High
As reported in the WSJ this week, mall vacancies have hit a 6 year high, reaching 8.6% vacant. Large retailers which have acted historically as the anchor anchor tenants have been closing stores faster than Amazon can say, “Boo!” According to Tim Grumbacher, former CEO and the grandson of the founder of Bon-Ton, “If I had had the foresight to realize I had to blow up the model, I would have.” Shoppers used to spend an average of two hours in the mall. Now it’s down to 45 minutes. Lots need to change, from anchor tenants shifting toward restaurants and gyms to mall’s private equity owners limiting the amount of debt they saddle on the businesses.
Why virtual reality won't revolutionize retail, but scan-and-go will
From robots to digital pickup towers, technology is deeply intertwined with retail. However, in my view retailers are often using technology for technology’s sake without a true experience or purpose in mind. Convenience, speed and discovery should be the three pillars driven by technology.
However retailers choose to approach point of sale, self-service methods that offer customers a quicker, more convenient route to the exit likely aren’t going anywhere. Wilwerding expects digital checkouts will eventually be spaced throughout stores, and have much more complex capabilities than they currently do — among them, a seamless way for customers to purchase some items in store and have others shipped to their house in the same transaction.
FinTech
Personal Loans Surge to a Record High
Personal, non-mortgage lending has grown incredibly fast over the last few years, thanks in part to a seemingly robust economy and lack of inflation. Fintech companies will also point out that they have contributed to greater access to capital, but this week the numbers came out and they were surprising (emphasis mine):
Personal loans surged to a record this year and are the fastest-growing U.S. consumer-lending category, according to data from credit bureau TransUnion. Outstanding balances rose about 18 percent in the first quarter to $120 billion. Fintech companies originated 36 percent of total personal loans in 2017 compared with less than 1 percent in 2010
Whether the growth in household debt is good for the economy aside, anyone shrugging off the impact that technology companies have on the market needs to reconsider their stance.
Technology
A Milk Startup Takes On 300 Million Cows
India’s sprawling agriculture industry has the world’s largest dairy herd, whose milk is distributed by a sprawling network of farmers, vendors and milkmen. One start-up aims to modernize it with technology that enables farmers to get better quality product to their end customers.
State of AI
A 156 page report that seeks to trigger informed conversation about the state of AI and its implication for the future. Worth at least a skim, particularly given the depth of the report. It goes through four aspects of AI:
Research: Technology breakthroughs and their capabilities
Talent: Supply, demand and concentration of talent working in the field
Industry: Large platforms, financings and areas of application for AI-driven innovation today and tomorrow
Politics: Public opinion of AI, economic implications and the emerging geopolitics of AI
Random Tidbits
A U.S. Cargo Ship Is Racing to China to Beat the Clock on Tariffs
The trade war officially begun this week, with the United States and China imposing retaliatory tariffs upon one another. Soybeans are among the goods seeing new tariffs in China. This week, in an effort to beat the 25% tariff, a ship carrying U.S. soybeans accelerated their schedule in a race against the clock.
American Experience: JFK
I was recommended this four part series on JFK, and it did not disappoint. A tremendous look into the President’s past, his struggle with Addison’s disease, the unorthodox approach he took to running for public office and his Great Man’s approach to the presidency. I highly encourage you to take a watch!
A practical guide to the most nail-biting part of the World Cup - Football penalties
Penalties have determined a higher than expected number of World Cup games this year, with some surprising misses and some amazing saves. What’s the optimal place to kick? Up up up!
Quote I’m thinking about: “Change is the law of life. And those who look only to the past or present are certain to miss the future.” John F. Kennedy