Rishi Taparia - Issue #75
Happy 2019! This week we explore the increased focus of online retailers on going offline, Burger King’s killer social media strategy, fintech predictions, the unfortunate rise of ‘deepfakes’, the Trailblazer’s coffee routine and more. Enjoy!
Commerce
Online retailers like Allbirds, Warby Parker and Bonobos are opening bricks-and-mortar stores, often in the same Chicago area
In 2018 we talked a lot about online retailers moving offline, the future of retail being experience driven and the race is for personalization. Expect MUCH more of this in 2019. According to a report from real estate firm JLL, online retailers are set to open at least 850 brick and mortar locations over the next 5 years. But these stores aren’t going to be opening in the malls or strip malls that are shutting their doors. The key differentiator is going to be location, with specific cities (NYC, LA, SF and Chicago in that order) and specific neighborhoods in mind.
‘We had a response in three minutes’: behind Burger King’s record-breaking Kanye tweet
Burger King has been on a tear when it comes to their social media strategy. Not only did they create the most epic troll of McDonalds while driving massive downloads of the BK app, they also have the most liked brand tweet of all time - a troll of Kanye. The reason: a dedicated team focused on social that can jump into relevant conversations as necessary. Like with anything, it’s the commitement that counts. BK is benefitting in a big way.
Too good.
Blake Nordstrom, a Scion of Retail Dynasty, Has Died
Blake Nordstrom, the 58-year-old heir to the Nordstrom fortune who ran the department-store chain as co-president with his two brothers, died unexpectedly this week after revealing his cancer diagnosis a month earlier.
PepsiCo is rolling out a fleet of robots to bring snacks to college students
Pepsi is getting into the robot delivery game, and their first target: college kids. They announced this week they will be rolling out a fleet of snack-carrying robots on the University of the Pacific’s campus in Stockton, California. The countdown is on for a Coca Cola response…
FinTech
This year's fintech predictions, from the company powering most of the industry
Zach Perret, CEO of Plaid (the company we talked about a few weeks ago that is the underlying infrastructure for basically all Fintech apps and just raised $250m), has some predictions for 2019. Worth a read.
One-size-fits-all banking is over
Speed bumps for crypto and stock investing
The rise of fintech debit cards
Companies will ditch advertising to get new customers
More growth in gambling
Make way for Europe
Fintechs get approved as banks
Credit cards under pressure
All eyes on interest rates
Macro volatility
Finally, more fintech
Leutz: The Victims of Venmo
An unique take on how the rise of digital currencies threatens financial awareness written by a college student at Dartmouth. He makes the argument (a fair one) that the move to cashless transactions done via app lead to more frivolous spending thanks to the lack of tangibility around ‘cash’, the lack of friction.
I was astounded by how much money I spent. I didn’t recall spending much money on anything. This is likely because a very small percentage of my expenditures were done with cash. In this way, it didn’t feel like I was spending any money, leading to my shock upon checking my bank account
Financial services products for the generation of kids in or entering college now will be a huge opportunity. Done right, a company can capture an entire (massive) cohort of customers (which will continue to grow) and hold onto them for 30+ years.
A $150,000 Small Business Loan—From an App
More than a few companies have gotten into the banking and lending space, using proprietary data gleaned from things like TPV, through put, customer loyalty and basket size to determine creditworthiness. The challenge lies in being able to explain the why behind a credit decision, as the ‘black box algorithm’ becomes increasingly impersonal. The confusion for customers - why they have or haven’t been approved for a loan - and without a person to talk will need to be solved, particularly if a crash is coming.
Technology
Fake-porn videos are being weaponized to harass and humiliate women: ‘Everybody is a potential target’
Now more than ever it’s important to question what you’re reading, watching and hearing. “Deepfakes”, forged videos complete with audio, are becoming easier to create with pornographic videos being made, targets expanding from celebrities to everyday people.
Apple’s Precarious and Pivotal 2019
Apple revised earnings downward this week for the first time in nearly forever, blaming the trade war with China and slower than expected iPhone upgrades. The stock plummeted in a whacky week on Wall Street and for good reason - a lot of people trust Tim Cook’s outlook on China more than they trust Donald Trump’s. This piece by MG Siegler does a great job illustrating between the lines of Tim Cook’s 1500 word letter to shareholders.
Random Tidbits
The game-day caffeine routine keeps the Portland Trail Blazers, the NBA's most well-traveled team, running
My day doesn’t start without at least one cup of coffee. It seems like NBA players feel the same way (at least before games). The Trail Blazers’ coffee culture reflects more than their java-loving hometown. It also helps them stay sharp for their grueling schedule.
Led by Cult Bourbons, Distillers Dream of a ‘Napa-fication’ of Kentucky
Don’t call it a comeback. Whiskey (or whisky, depending on your predeliction) has never been in the same ballpark as wine in terms of prestige and following. Now the spirit is fighting for the title belt.
The Dry January Effect
To counterbalance the previous article, here’s one on the benefits of a dry January (Dryuary.,..which doesn’t really have the same ring to it as say, Movember). What was apparently a British fad is taking hold in the U.S., research shows that losing booze for a month has several health benefits—sometimes months later. Tl;dr - this is because people stop and think about whether they really want to have the drink or not. Having done a Dryuary last year (I had to provide some cloud cover for my wife who was newly pregnant and we weren’t ready to tell people so we both “weren’t drinking for the month of January”) I don’t know whether there were any lasting benefits. Worth trying though!
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Quote I’m thinking about: “Let us be grateful to the people who make us happy; they are the charming gardeners who make our souls blossom.” — Marcel Proust