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Arielle Feger (00:00):

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(00:24):

Hello, listeners. Today is Wednesday, August 27th. Welcome to Behind the Numbers, Reimagining Retail, an eMarketer podcast made possible by Awin. This is the show where we talk about how retail collides with every part of our lives. I'm your host for this week, Arielle Fager. Today we're covering our unofficial most interesting retailer of the month list for August. But first, let's meet our guests. Joining me for today's episode, we have Emmy Liederman, the newest member of our committee. Welcome, Emmy.

Emmy Liederman (00:58):

Hello. Thanks for having me.

Arielle Feger (00:59):

Thanks for being here. We're also joined by Blake Droesch. Hi, Blake. Great to have you.

Blake Droesch (01:06):

It's good to be back.

Arielle Feger (01:07):

Awesome. And last but not least is Sky Canaves. Thanks for being here, Skye.

Sky Canaves (01:12):

Thanks for having me. And welcome, Emmy.

Emmy Liederman (01:14):

Thank you.

Arielle Feger (01:15):

Yay. Okay, let's jump into the list. As most of you already know, the committee, aka Emmy and myself will present our lists in the first half of the episode. Then in the second half, Blake and Skye will have the opportunity to make some changes.

(01:37):

Here's what we've come up with this month. Number eight is Warby Parker for two reasons. First, as part of its ongoing expansion into brick and mortar, Warby has officially opened its Target shop-in-shops. Though Target is struggling to drum up foot traffic at the moment, it does give Warby at Parker another touch point to reach new and existing customers. The second reason is the company has ended its at-home try-on service, which I think is a little risky. It's one of the things that made Warby Parker so popular in the beginning and distinguished it from its competitors. I guess now that they're all in on physical storefronts, they're looking for a way to stir up traffic, which I think makes sense. But again, a little interesting to go back on something that made you so popular in the first place.

Blake Droesch (02:24):

Yeah, I think that that was sort of the most unique use case that they had as a business, and I don't know how many Target locations they're going to be operating inside of, but it would have to be a lot in order to really make up for the fact that they're eliminating that offering. I mean, I think for me as a Warby Parker customer, I don't know if they have a Starbucks... I mean, it's a Starbucks. I'm getting my store in stores confused with Target. I don't know if they have a nearby that I'll actually be able to replace that service for me personally.

Arielle Feger (03:04):

Yeah. And also there's just nothing more convenient than getting something delivered to your house. Even if a Target is five minutes down the road, it's still not the same. So I don't know. I am not sure how people are going to feel about it.

Sky Canaves (03:18):

Yeah, I'm a little worried about this because I get that the try-on at home can be very expensive because you have to build in all those reverse logistics costs into your business. But Target is really struggling, as we saw from the recent results. Store sales are still falling. The Ulta Beauty Store in-store partnership, which was probably the most prominent one that they have, has now been announced will be no more as of next year. It's being wound down. And I think a big part of that is that the Ulta shop-in-shops just weren't bringing in enough business for Ulta. I've heard reports that they only accounted for about 4% of Ulta's sales, so ultimately not worth it. And Warby Parker may also struggle to find meaningful growth through a Target partnership. Now, if they went into Starbucks, that would really be something. Fill some of those glass cases with glasses next to the croissants.

Arielle Feger (04:22):

Honestly, not a bad partnership idea. Let's keep that in mind. Number seven is Best Buy. This is another shop-in-shops play Best Buy is going to launch IKEA shop-in-shops that feature products from both retailers. Apparently, this is the first time IKEA's products going to be available through another US retailer, and then it kind of makes sense. You're shopping for a new washing machine, you look over, you see an IKEA display for a laundry room, and it gives you ideas of how to update your space or organize it. So I think it makes sense. Also, note, Best Buy's third party marketplace has officially launched, which more than doubles its products available online. So I think between those two things, that earned it its spot on the list.

Blake Droesch (05:07):

It's interesting. I think consumer electronics sales have really struggled, and it's been going on a long time now. I think really, you had this really strong growth during the pandemic where everybody replenished all their big purchases, and even as demand has sort of come back a little bit, Best Buy has not really reaped the benefits of it. It's really gone primarily to Amazon, at least in terms of e-commerce growth. So I think it makes sense to see Best Buy trying to branch out a little bit, but when you're a retailer, particularly a specialty retailer, you always want to be careful about how broad your reach becomes because you also run the risk of losing your core identity as well.

Arielle Feger (05:58):

Number six is Anthropologie. Emmy, tell us why does this make the list?

Emmy Liederman (06:03):

So Anthropologie just decided to open up stores that exclusively carry its in-house line, clothing line called Maeve. I thought this was interesting because Anthropologie is owned by Urban, which is a holding company that owns its Urban Outfitters, Anthropologie, Free People, and Nuuly, which if you're not familiar, is the wing of the company that does clothing rentals. And I think because of Nuuly's popularity, it actually has given more of a spotlight onto the brands within anthropology. So maybe someone wouldn't have known Maeve by name if they were just shopping already at Anthropologie, but because you're using this app to rent clothing, people have become a little bit more familiar with the brands themselves. And I also thought Anthropologie has such a wide range of products within their store. You can buy puzzles, you can buy a lamp, you can buy all these different types of furniture. So I think maybe to have more of a curated experience for a consumer that says, "Okay, I'm just going to shop for jeans today." It might be a smart move, but also it depends on whether it has that brand recognition and connectivity.

Sky Canaves (07:22):

I think it really highlights the power of private label brands when done well and how far they can go. We've seen a couple of other private label brands have been spun off into independent entities. The most prominent one is Boots, the UK pharmacy. They have a skincare brand, No7, and it is now a separate company, a separate beauty brand. It's been very successful. Target took a first step with this with its kids wear brand, Cat & Jack. When Hudson's Bay in Canada was still around, it was starting to sell Cat & Jack clothing at Hudson's Bay and looking at that as a route to international expansion for the brand. Because that's a very well-known brand, it's good quality, affordable kids' clothing. And so I thought another interesting part of this announcement was that they're kind of launching Maeve's brand identity on its own with social media accounts to capitalize on the following that it's already generated on social. And that's something I think other retailers can explore as well, even if not launching private label brands as standalone brands, giving them more of an identity on social and digital.

Arielle Feger (08:38):

Onto number five, which is Crocs. Emmy, tell us more.

Emmy Liederman (08:43):

Yes, so Crocs decided to basically bring New York to New York by creating a 4,000 square foot store. That's the length of a city block. And their whole concept here is to, I think they have a bodega station, all these things that kind of pay homage to New York in New York. And a lot of it is about customization because they're leaning into Jibbitz and how they have very Jibbitz with designer brands and also just Disney themed everyday person. I think they're trying to rebrand Crocs as something that can be adaptable to every consumer and every price point. And they're also trying to create a very interesting in-store experience and I don't know, keep people in for longer by making it 4,000 square feet, I guess. Yeah, I just thought the size and the fact that we were talking about the fact that it seems like something that's supposed to be, oh, feel a piece of New York when you're not in New York, but you can go outside and be there. So that was fascinating to the committee.

Arielle Feger (10:00):

Yeah, the location's a bit interesting to me of. I'm like, oh, maybe if you put this somewhere, maybe a Mall of America or somewhere where you're not able to directly step outside and be in New York City could have made a little more sense to me. But also I like what they're doing with the customization and kind of getting people in and spending time with the brand.

Sky Canaves (10:23):

And it sounds like Soho is now becoming the mall of New York City with all of the teen brands and traditional mall brands that are moving into the neighborhood. I think that's really interesting. I saw some photos of this Crocs store or the concept and it looks amazing. It's completely the opposite of my experience buying Crocs in-store, which tends to be an outlet shops that are incredibly crowded and small and tiny and a little bit claustrophobic, because there are too many colors and not enough space.

Emmy Liederman (10:55):

I feel like we always hear that it's dangerous to try to be a brand for everybody because you lose your identity. But I actually think that Crocs is an example of a brand that has sort of figured that out, because they have stylish wedges that I love and I would never consider myself a Crocs person for the standard shoe. So it seems like they have a pretty good grasp on how to be the right fit for a lot of different consumers.

Blake Droesch (11:27):

It's a good brand to have a flagship store in New York, if you think about because of the fact that it is a brand for everyone, it's a national brand. People who come here that want to really get a good retail experience in the same way that they go to the M&M store in Times Square. It's a great brand for that.

Arielle Feger (11:47):

I think I did compare it to the M&M store. On to number four, Bath & Body Works. Emmy, again, please take it away.

Emmy Liederman (11:57):

Yes, so Bath & Body Works is expanding to over 600 college bookstores across the country. The reason I think this is interesting is I think that a lot of brands are figuring out how to become relevant among college consumers, particularly women. I think that a lot of brands that were going after the typical lifestyle influencer are realizing that these people are actually not relatable at all and you want to go for a college student who's maybe going to recommend this product to all of their friends, and there's just this tight-knit community of people sharing recommendations.

(12:37):

I saw an article a while ago about how college campuses need to expand the size of their mail rooms because so many people are getting PR packages, which was really interesting. And I think, yeah, Skims and Unwell, which is Alix Earle's drink brand, are both kind of leaning into that collegiate angle with their marketing. And I saw a quote that was just, "College girls love sweatshirts," which is so true. College girls love going to their college store and getting a sweatshirt, a hat, sweatpants, et cetera. So I just think the bookstore is a good place to target.

Sky Canaves (13:19):

Yeah. I think this is such a great opportunity for more retailers like Bath & Body Works to move into the college bookstore space because those stores now have more shelf space available for different kinds of merchandise like sweatshirts, like home goods, because they're not selling quite as many books as it used to now that a lot of the textbooks are digital, and at the same time they have a wide enough range of products in all sorts of different colors. They can tie their offerings very closely to the college colors on a school-by-school basis.

Emmy Liederman (13:55):

Yeah. And I think one last thing is that because there's such declining foot traffic at malls, I think this is a good move for that reason because I think Bath & Body Works was kind of like a quintessential mall brand and something that was more social to go in with your friends and pick things out. So another reason why I think this was good.

Arielle Feger (14:15):

In spot number three, we have Rare Beauty. This is something you were really passionate about, Emmy. I'd love to hear more.

Emmy Liederman (14:25):

Yes. Well, I just love Selena Gomez. I feel like she does no wrong in this life, but her beauty brand, Rare Beauty, they just came out with their first perfume. They did an out-of-home billboard that was all scented billboards, which I thought was an interesting experiential choice. They also launched a perfume that's designed to be adaptable for people that have limited mobility and dexterity. It's a rounded bottle, so it's easier to hold and use and it just does a twist to lock cap opposed to the whole taking the cap off the bottle thing. So I think this is good because it was an example of a brand that is typically very values oriented. It's just a brand that's always donated to mental health initiatives and different social initiatives, doing something in-house that actually proves that they care about it opposed to just going out and donating. They're actually changing how they run their business. So I thought that was a cool alignment.

Blake Droesch (15:31):

When you said smellable out of home, I had this idea of just a highway billboard and just every minute and a half it just releases a giant cloud of perfume on the highway.

Arielle Feger (15:44):

Oh, some brand did that with... Not a perfume brand, but is it McDonald's or something that did a french fry scented... It wafted a french fry scent?

Emmy Liederman (15:55):

I was thinking that would be a great idea for something like McDonald's to do.

Arielle Feger (15:58):

I'm pretty sure someone did it.

Sky Canaves (16:02):

Krispy Kreme. I know their doughnut smells always get you.

Arielle Feger (16:05):

They do have good smells. In spot number two, we have Walmart, what would our list be without a Walmart mention? And it made the list this month for Your FYP on Wheels Tour. So a fleet of Walmart delivery trucks is traveling around the country, parking at concerts, live events to offer photo ops, free merch and opportunities to shop a curated selection of goods. It's interesting, they've got a few different kind of experiences. There's a K-pop truck, there's one that's outfitted with iconic retro video games, and there's a rodeo truck where people can customize their own rodeo belt and purchase Western themed accessories. I love the idea of taking your FYP and bringing it to life. I think the FYP is such a notable TikTok thing. And so I think kudos to Walmart for taking the trends off the app and bringing them to real life and just getting the notoriety out there that they could be cool.

Emmy Liederman (17:09):

I just hate this because they're not cool. But then again, I guess you have to do these things to become cool.

Sky Canaves (17:18):

And it's all relative. I think there is a trend more on TikTok where younger Gen Zers and maybe even Gen Alpha are seeing Walmart as cooler, especially now that Target has lost some of its magic and is really struggling to get that back. I think Walmart is seizing on that opening. It's already winning at e-commerce and winning at grocery. So the next step is to get customers or potential customers to come to it for more.

Arielle Feger (17:46):

Yeah, yeah, absolutely. Number one on our list is Dick's Sporting Goods for launching its own in-house production studio. I thought this was really, really cool. Dick's has been creating content for a while. Its first feature documentary won an Emmy in 2014, and I think creating this in-house studio just really doubles down on its content and enables the retailer to be more efficient and agile. It also, I feel like has a really good tie in with its content creator and influencer program, which I believe it launched earlier this year.

Blake Droesch (18:21):

Yeah, I think this is one of our retail trends for 2025 in a report that we wrote back late last year, and it was sort of coming off the heels of Starbucks doing the same thing, and just this idea that as brands and retailers have these owned and operated digital channels and access to reach an audience via social media, the idea for creating your own content, whether it's something that is very easy, low budget stuff, going all the way up to premium video or a documentary, it seems like a no-brainer to really help build your brand and produce your own content and just at a really high level, invest in the ethos that you want to have associated with your brand.

Arielle Feger (19:19):

Okay. So our list as it stands is number one, Dick's Sporting Goods. Number two, Walmart. Number three, Rare Beauty. Number four, Bath & Body Works. Number five, Crocs. Number six, Anthropologie. Number seven, Best Buy. And number eight, Warby Parker. We also have two honorable mentions. At number nine, we have Trader Joe's for opening its first store in New Orleans. And at number 10 we have Amazon for launching same day grocery of fresh foods in over a thousand cities. Now it's time for our second half, where Blake and Sky will tell us where we went wrong. Both of them will have a chance to move a branch up or down our rankings and to add a new company entirely.

(20:10):

Blake, what's your move?

Blake Droesch (20:13):

I think want to get rid of Warby Parker because I think we've sort of firmly established that that's a bad move, and I am going to run the risk of being really boring here, but I do want to put Amazon in that slot because I think that the same day delivery of fresh foods is a really big deal for Amazon, which has been struggling to figure out a way that they can grow their market share in the digital grocery business for a long time. And it feels like they've really gone all in with this offering, is like they've chalked up what is the best possible way to increase our market share at all costs. And I think this is the idea. But then again, Amazon has tried and failed to make inroads into grocery as it competes with Walmart, as it competes with Instacart. So I'm not going to put them up at the top of the list, so I'll just swap them out with Target and Warby Parker.

Arielle Feger (21:18):

I am leaning towards saying I agree. Emmy, what do you think? What are your thoughts?

Emmy Liederman (21:22):

I guess I want to clarify the prompt, because interesting could be bad.

Arielle Feger (21:28):

Every month I feel like we have this conversation where it is very hard to define interesting could be bad for sure.

Emmy Liederman (21:36):

Sometimes things are bad and also not that interesting, which I would say is probably the case with Warby Parker. So I agree, I approve of this change.

Arielle Feger (21:45):

Okay, so Blake's move is we'll move Warby Parker to Honorable Mentions and then we'll put Amazon in number eight. All right, now Skye, what move will you make?

Sky Canaves (21:58):

Yeah, I'm glad Blake picked Amazon, because I was struggling between moving Amazon and picking a new candidate for the list. So mine is going to be to take Best Buy off, because while the shop in shop is interesting, it's still pretty untested and limited. And I want to add a new brand to the list. In Best Buy's Place, it would be this accessible, quasi luxury fashion brand known as Quince. Their big news this month was that they raised nearly 200 million from VC private equity types and put their valuation at 4.5 billion. And this is a lot because they've only raised around 250 million to date. They've been around since around 2018, but they're really capturing the mood of the moment, which is luxury is struggling, but consumers still want value.

(22:52):

And I think of them a little like if Temu and Prada had a baby, it could be Quince. Their claim to fame is a $50 cashmere sweater that claims to be the same quality as a $500 cashmere sweater. They have a lot more to offer than that. They do their manufacturing in a Temu type of model where it's sourced from China. So they work direct with factories and the goods are shipped from China for the most part, and they follow similar digital marketing strategy. Their ads are kind of inescapable. They know I have a daughter, or Meta knows I have a daughter, so I see ads for their dresses for kids on Facebook and Instagram, and probably only a matter of time before I crumble because they are very pretty and very affordable.

Arielle Feger (23:42):

I do think it's interesting that that description gave this what Temu and Prada, I think that's kind of the hit, right? That's going to satisfy everyone. Everyone wants a high quality looking product for a low price. I have been hearing a lot about Quince, so I'm likely to also add it, but I don't know, what do you think?

Emmy Liederman (24:08):

Now, I'm honestly just thinking about what it would be like to have Temu and Prada as parents. And would they get along? Would they ever see eye to eye? What would their parenting styles be like? Yeah, I like it.

Arielle Feger (24:23):

You like it?

Emmy Liederman (24:23):

That's all I have to say.

Arielle Feger (24:26):

And so how we feel about... So Sky wanted to take Best Buy off, which is okay. I think we'll put Quince in the same place, which is number seven. So our Honorable mentions would still be Trader Joe's and Warby Parker, and then eight would be Amazon and seven would be Quince. We feel good about that, Emmy?

Emmy Liederman (24:47):

Yeah.

Arielle Feger (24:47):

Okay. Okay, so here's our final list. Our honorable mentions are 10 Trader Joe's and nine Warby Parker. Then for eight we have Amazon, seven Quince, six Anthropologie, five Crocs, four Bath & Body Works, three Rare Beauty, two Walmart, and number one is Spawning Goods. That's all the time we have for today. Thank you Sky, and thank you Blake, and thank you Emmy. Thank you. This was so fun.

Blake Droesch (25:27):

Thanks for having us.

Sky Canaves (25:30):

Thanks. I really enjoyed it.

Arielle Feger (25:31):

Yeah, me too. Thank you to our listeners, our studio team, and our podcast editors who are always making it count. Please leave a comment or review and remember to subscribe to Behind the Numbers podcast. We'll be back next Wednesday with another episode of Reimagining Retail, and on Friday, join Marcus for another episode of Behind the Numbers, an eMarketer podcast made possible by Awin.