#11 Friday Business Nuggets 1 (11/30)
Friday Business Nuggets: 3 tactics, news, businesses, or ideas. Curated by yours truly.
1. Italic: Prada, beware.
I consider myself a consumer in search for quality, not status. The brand tag does very little to my purchase decision. But, that’s not the case for consumers in the high fashion industry. Brand is everything. They are willing to pay exorbitant prices for the latest season releases. For instance, this Hermès bag is $12,700. Of course, I’m not a bag or fashion connoisseur, so my opinion on this product or its price may be irrelevant… But $12,700 for a bag, what is it made of, alien unicorn leather!? Nope. Again, as much high quality as the bag is, the price is driven by other factors. High end fashion consumers are also purchasing status. These price tags keep mainstream consumers away, making the products very exclusive. The biggest chunk of markup goes to the very brand tag.
So if most of high fashion items’ perceived value is in the brand, what would the prices for these items be, if you were to remove the branding?
Cue Italic. Italic is an ecommerce business that’s revolutionizing retail. No middlemen. No branding. On Italic, you can find 1000s of products sourced from the same manufacturers as the likes of Miu Miu and Prada. The markup on the items they sell is low, they offer the best possible prices. To purchase items, you need to buy an annual membership that will set you back $120.
Check out this zip card case. It’s $30 on Italic and a similar one from the same manufacturer, but Saint Laurent brand, would cost you $295. Whoa.
Their product range includes apparel & accessories, home essentials, kitchenware, active wear, among others… So, if you’re ready to ditch the logo, save money, and buy quality products go cop yourself an Italic membership.
2. Live streaming a literal dump fire
This next nugget is a very spot-on drop from Hey. Hey is a new email provider that re-designed how e-mail works, from scratch. It launched summer of 2020 and you may recall their marketing tweets and their debacle with Apple (Apple sure picked up some fights last year, huh?). For $99/year, you get a re-designed e-mailing experience without all the things you hate about it.
Spoiler alert: 2020 sucked. For many reasons. It was a dumpster fire. And Hey cooked up the perfect end-of-year marketing drop.
- Send an e-mail to dumspterfire@hey.com
- Watch your e-mail burn, live on Twitch
Oh, and most importantly “experience catharsis”. I can imagine how fun this brainstorming session was: “…so people will send an email, it’ll be printed and conveyed into a literal dumpster fire, and we’ll stream it on Twitch”.
It got people sharing the site (myself included) and spreading the word about Hey. I mean, who didn’t want to send a message to see it burn? By the way, Hey also offset 3x the amount of CO2 emitted. Neat.
3. Amazon’s “other” business unit (hint: not AWS)
Another one? Yes. This one is growing faster than its retail, streaming and cloud units. It’s their Ad business. It’s growing so fast, they will change their name to Admazon. Just kidding. www.admazon.com does redirect to their site though 😏. And it makes lots of sense. Let’s break it down:
- Facebook and Google are both advertising businesses. They collect and mine your data across their products (and the web), to zero in on your consumer preferences and get insights of what you want to buy next. Amazon already has 20 years of your purchasing preferences (much more valuable), it’s where you buy everything. Also, Alexa.
- When the pandemic hit and all shopping was done online, brick and mortar stores (as well as online shops that wanted more sales) flocked to Amazon. The amount of new products for every single search catalyzed the demand for sponsored results. Pretty quickly being listed on Amazon was just half the trick.
- Sponsored results are just the beginning. Amazon will double down on display ads across the web. Here are some of the destinations: Twitch (acquired 2014), IMDb (acquired 1998), Goodreads (acquired 2013), Kindles, and Fire tablets. They also roll targeted ads on partnered websites.
Fun fact: Amazon’s Ad business 2020 revenue is greater than Twitter’s 2011–2020 revenue.
More business nuggets next Friday!
