WHERE PEOPLE ARE SHOPPING
Shopify’s first-quarter sales results will be a strong indication of whether and where a post-pandemic shopping boom is taking shape
Retail sales have soared in the US and UK as pandemic concerns and lockdown restrictions have eased
Several senior Shopify executives recently left the company
It’s safe to say at this point that last year’s asceticism is on its way out. Whether it’s camp jewellery or handbags, consumers are making up for lost time as they build their post-pandemic wardrobes. Surging US retail sales in March, and record sales from Primark and other newly reopened UK retailers are evidence enough for that. Upcoming corporate earnings releases should provide some additional colour.
Shopify was one of the pandemic’s biggest beneficiaries, as scores of its online retailer clients saw sales spike. The question is whether that boom will continue now that vaccination rates are topping 50 percent of eligible adults in some countries. The platform is built around small businesses, including scores founded during the pandemic lockdowns. The failure rate for new businesses is high, of course, and it’s uncertain whether the pandemic’s entrepreneurship boom will continue.
The Bottom Line: Shopify was on the upswing before the pandemic and is likely to continue that trajectory regardless of how post-Covid shopping patterns play out.
RETURN OF THE RED CARPET
On April 25, the Oscars will mark the first primarily live awards show, complete with a red carpet, since the pandemic
Viewership, already falling pre-Covid, is expected to be low
The red carpet remains a prime marketing tool even as brands turn to social media to promote their best looks
The Oscars on Sunday mark a triumphant return to the red carpet for luxury brands — and perhaps a last hurrah. The fashion industry is desperate for the return of live events, and there are few bigger opportunities than the Academy Awards.
Legions of stylists, hair and makeup artists and consultants are certainly relieved to have one of their biggest gigs back, but they may be in for a wicked hangover when the ratings for Sunday’s telecast come in this week. The Oscars has seen a steady decline in viewership, with ratings hitting a record low in 2020. Weak ratings for live sports and other events don’t bode well for this year’s audience tally.
Certainly, luxury brands care more about impressions on social media and press mentions when their stars strut the red carpet than how many people tune in once those A-listers are seated at Union Station. But falling viewership poses a long-term threat: the reason those red carpet looks gain traction in the first place is because of the Oscars’ position as the most important entertainment event of the year, and one of the few remaining must-watch cultural events. That status is looking shakier each year.
The Bottom Line: This year at least, the red carpet is likely to produce plenty of big moments for brands. Designers and stylists are promising some exuberant looks to match the hopeful tone of the event.
ANOTHER BITE AT THE APPLE
Hermès designed leather straps for Apple’s new AirTags, which go on sale on April 30
Hermès has created a series of high-profile, entry-level products in recent years, including straps for Apple Watches and lipstick
Luxury brands rely on entry-level goods to acquire new customers and broaden their reach
Hermès makes leather handbags that sold briskly even during the nadir of the pandemic. So why bother with casings for high-tech luggage tags? Those tiny bits of leather are an important part of the French luxury brand’s business model, just like the Birkin. Luxury brands can only sell so many bags at four and five figures a pop; to broaden their reach and hook new customers, they peddle entry-level goods. The Apple tags, along with last year’s watch straps, will no doubt catch the attention of plenty of people who aren’t in the market for a new silk scarf. Apple, which knows a thing or two about selling premium branding to the masses, is a safe partner as well.
Hermès executives like to brag that the brand, which last week reported $2.5 billion in first-quarter sales, a 44 percent year-on-year jump, doesn’t “do marketing.” But what else to call teaming up with Apple to create accessories for their latest must-have product, or launching a line of lipsticks where the appeal is as much in their packaging as their range of colours?
The Bottom Line: So long as customers feel they are buying into a brand’s story, it almost doesn’t matter whether they’re purchasing a $67 lipstick or a $4,000 handbag.
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