To Survive the Retail-pocalypse, Lean Into the Experience Economy
The Signal: As lockdown orders in many states have eased, brick-and-mortar retailers are hopeful that business will begin to recover. But the numbers tell a different story: An estimated 100k retail stores are expected to close over the next 5 years. That’s triple the number of stores that closed during the last recession.
In dollar terms, brick-and-mortar retail sales are on course to fall ~14% from 2019 to 2020, to $4.2T. This is compared to an 18% increase in ecommerce sales over the same period.
Historically, 3 roadblocks have prevented ecommerce from eclipsing brick-and-mortar shopping: tradition, pricing, and the in-store experience. The recent pandemic, coupled with innovations on ecommerce platforms such as Coupang’s “dawn delivery” (order by midnight, and it’ll be on your doorstep by 7am the next day) and Amazon Prime’s seamless same-day delivery, beg the question: Why would anyone want to go to a physical retail store again?
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The alternative milk market is getting frothy
The signal: As more people wave goodbye to dairy, alternative milk is slowly taking over; it has already cornered 13% of the market. With the exception of soy milk, all of the alt-milks have been on the up, with some of the newer entrants including hemp milk and pea milk. Other alt-products are getting attention, including cashew cheese, with 18100 searches per month.
Capitalizing on the Airpods market, making more money than Shopify
The signal: Since killing the headphone jack, Apple has graced the world with AirPods, which did an estimated 60m units in 2019. That means AirPods alone are bringing in approx ~$10b in revenue, more than Twitter, Shopify, or Spotify, to name a few popular tech giants. Opportunity lies in Apple opening up SiriOS or the wave of iPhone accessories (including cases, cleaning kits, hooks, and keychains) which have shown “hockey stick” growth alongside their hardware predecessor.
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