COMMERCE BRIEF FOCUS

If you have not yet done it, read Vincent's article on post-crisis commerce.

"In just a few weeks we observed a complete transformation of the commerce operating system that was not expected for years. Fully powered by technology."

With this perspective, we share below a few trends in last mile delivery that we've seen over the last 6 months. 

Delivery by Drones or Autonomous Robots

COVID19 seems to be accelerating many commerce trends; the recent announcement of the expansion of the Drone delivery program by UPS is bringing a whole new drone dynamic. Flight Forward, a UPS subsidiary, in collaboration with Matternet and CVS, is planning to "deliver prescription medicines from a CVS pharmacy to more than 135,000 residents in Florida’s retirement community"! Starting beginning of May. 

Starship initially launched their robots food delivery on university campuses. 30 cities across the USA and UK are now deploying them to provide more delivery options to local restaurants and other food businesses.

Contactless for sure. But are these actually scalable? What about their actual visual, social and environmental impact? A recent study outlined that energy consumption of flying drones may be 10 times higher that conventional vans. 

Local Runners and Nano Fulfillment Centers.

Maybe less innovative but highly ingenious, apps promoting social delivery to help neighbors and seniors can finally expand out of university campuses. 
Cheap and environmental friendly, there is a non negligible positive side-effect: it boosts social and local interconnection cross-generations. Now Pikup and the likes have a new serious awaited competitor with Walmart and Nextdoor just announcing their partnership.

As the crisis showed, logistics / delivery are not ready for the shopping journey to go on such a massive digital switch. Now since new routines are expected to stick, some stores will not close but turn into micro fulfillment centers. It sounds especially true for D2C apparel brands. Solutions such as Bond or Fabric could surf that wave.

We also see CargoAI, powering deliveries and returns directly into car trunks, joining the effort to bring efficient contactless last-mile solutions.

What are your thoughts?

COMMERCE NEWS BRIEF

Retailers in the West begin cautious reopening

(Post)COVID / Vogue - "Fashion retailers are reopening through the month of May as lockdowns ease in Europe and North America, but they anticipate a cautious response from consumers. E-commerce, particularly in the beauty sector, has proven more resilient during the pandemic, with companies accelerating their online strategies."

Why it matters - Well, we just want to start smiling againg :).

The current crisis has big CPGs rethinking their DTC strategies

D2C / Modern Retail - "The coronavirus pandemic has brought about a lot of issues for CPG brands — especially those that have relied heavily on their wholesale business."

Why it matters - The shift may mean doubling down on digital channels. Retailers with strong online presences are partnering with brands to better facilitate basket add-ons.

Anna Wintour Made Condé Nast the Embodiment of Boomer Excess. Can It Change to Meet This Crisis?

Fashion Sustainability / NY Times - "The coronavirus chased the fashion industry across Europe in February, from fashion week in Milan to fashion week in Paris, where designers handed out masks and some nervous fashion editors left early."

Why it matters - We are excited to see how this crisis will accelerate how fashion brands 1/ innovate how they bring products to market and 2/ rebalance the focus to sustainability.

Ecommerce shipments increase 47%

Ecommerce / Digital Commerce 360 - "Online order shipments in March and April continue to outpace 2019 levels, logistics vendors report. Consumers are more likely to see order delays because of the coronavirus, especially for larger shipments."

Why it matters - As Eric Gervet says, we've done 5 years in just 5 weeks and delivery actors were / are not ready to handle the load at this scale.

Retailers face another challenge during coronavirus: Handling returns

Retail / CNBC - "Many retailers are adjusting return windows to ease customers’ worries about getting their money back, if they shop online for clothing and other items. Longer return windows add another level of complexity to how companies are managing their businesses during the coronavirus pandemic."

Why it matters - Consequence of no store experience, new strategies are in development to do virtual fittings / demonstrations. Nevertheless, we still believe the store will come back but more experiential driven.
 

Amazon was already powerful. The coronavirus pandemic cleared the way to dominance

Amazon / Recode - "Before the pandemic, the US e-commerce industry only represented between 10 percent and 15 percent of overall retail. Now, that percentage seems likely to grow, setting up Amazon to have a bigger advantage over most other retailers, including Walmart."

Why it matters - We believe this is still up for debate.  The crisis has converted many shoppers to online and today, thanks to its infrastructure and depth of assortment, Amazon seems to be in a good position - though maybe not in all countries :).
 

The Pandemic Will Change American Retail Forever

COVID19 / The Atlantic - "The big will get bigger as mom-and-pops perish and shopping goes virtual. In the short term, our cities will become more boring. In the long term, they might just become interesting again."

Why it matters - This trend has a large impact on how the investors look at the typology of software they back. We can already see it, a flight towards enterprise grade software at early stage.

PORTFOLIO BRIEF