The Brand Move Roundup – September 16, 2020
We’re tracking the notable brand moves & highlighting the companies who are tackling this challenge successfully.
In early March we began reporting daily on how brands were dealing with Covid-19. But it’s become clear that the current climate is one of near-perpetual disruption, so we decided to keep on telling the stories of inspiring brand leadership and strategy amid the latest crises in an anxious world. Our goal is to provide an up-to-the-minute source of information, inspiration and insight on brand moves as they happen.
Apple has expanded its services to include a fitness subscription, Fitness+, to rival Peloton and Fitbit, saying that its Workout app is one of its most popular offerings. Fitness was a major focus of the recent Apple launch event – the Apple Watch 6 was also announced, with a new health sensor in the watch that allows you to monitor your blood oxygen levels and an ECG (electrocardiogram) that keeps an eye on your heart rhythm. The new WatchOS 7, Apple Watch 6, and Apple Watch SE all come with new health-tracking features. Fitness+ will also be bundled in with the new Apple One subscription bundles, alongside Apple Music, Apple TV Plus, Apple News Plus, and Apple Arcade. All will be part of a range of different bundles, making it cheaper to subscribe to multiple Apple services at once. Rivals in the booming online fitness space so far appear relatively untroubled, however; Peloton’s share price took a brief hit during Apple’s Fitness+ presentation before rebounding, up more than 5%. Its stock is currently up a staggering 191% in 2020. Fitbit’s share price was relatively unchanged in intra-day trading. The company launched a Fitbit Premium service last month, but its stock is flat from the beginning of the year. Things didn’t look much different for the more entrenched fitness companies. Weight Watchers International, which has seen its share price nearly halved since the beginning of the year, was down less than 1% by time of publication, and Planet Fitness, which has had a rough year but is showing signs of recovery, was up nearly 5%.
Amazon, which has made its name providing easy access to a huge array of goods at hard-to-beat prices, has launched an in-app storefront with luxury brand Oscar de la Renta offering more or less the exact opposite – and promises more to come from other luxury fashion and beauty brands. Inventory and pricing will be at the brands’ discretion, while Amazon will provide merchandising tools so brands can personalize content, according to a company statement. Access is granted to U.S. Prime members by invitation, giving the program an air of exclusivity for shoppers. The ecommerce platform is also attempting to translate the typically high-touch experience of luxury retail to digital with features like 360-degree product view. Christine Beauchamp, president of Amazon Fashion, said in a statement that the platform was “inspired by feedback from Prime members who want the ability to shop their favorite luxury brands in Amazon’s store.”
Scientific American, the oldest continuously published magazine in the US, is backing Joe Biden in its first ever presidential endorsement, sharply critiquing the record of president Donald Trump. A letter from the editors in its October edition reads: “Scientific American has never endorsed a presidential candidate in its 175-year history. This year we are compelled to do so. We do not do this lightly. The evidence and the science show that Donald Trump has badly damaged the US and its people — because he rejects evidence and science.” Citing the coronavirus pandemic as the most devastating example, the editors call his response “dishonest” and “inept” leading to the deaths of more than 190,000 Americans. The editors reference the promises and lack of delivery on testing and tracing; the impact on vulnerable communities, including people of colour; and the lack of national mask mandate, with the president making a point not to wear one himself. Lauding the Democrat nominee’s plans for tackling Covid-19, while putting the country back on the path to economic recovery, they note that he is being advised by epidemiologists, immunologists, and bioethicists, not “physicians who believe in aliens and debunked virus therapies”. The editors sign off by acknowledging the obstacles that Trump and his allies have created to prevent people from casting ballots safely in November, saying that “it is crucial that we surmount them and vote.” They conclude: “It’s time to move Trump out and elect Biden, who has a record of following the data and being guided by science.”
Long-established UK travel firm Thomas Cook is being resurrected as an online-only travel business, exactly a year after the 178-year-old company ceased trading, stranding 150,000 holidaymakers abroad. The relaunch comes as the travel industry faces the worst tourism crisis since records began. World Tourism Organisation figures show that international tourist trips dropped by 65% during the first half of the year, an unprecedented drop. But Thomas Cook’s UK chief executive, Alan French, said the company was taking the “long view”. The new “Covid-ready” website will initially sell holidays to beach resorts and cities in countries on the UK government’s travel corridor list, including Turkey, Italy and some parts of Greece. Further destinations will be added when government restrictions are lifted, alongside more hotels and other types of accommodation. The website features tens of thousands of hotels, as well as flights, transfers, and other add-ons, for customers to tailor trips, which will be protected by Atol, the government-run financial protection scheme operated by the Civil Aviation Authority (CAA). The relaunch is backed by Fosun Tourism Group, the Chinese conglomerate that bought the Thomas Cook brand and online assets for £11m in November. Fosun also owns Club Med. The Thomas Cook Group, which operated 560 high streets branches in the UK and a fleet of aircraft as well as its tour operation business, employed 9,000 people in the UK. The new company employs 50 people, who will work remotely.
Swiss Federal Railways (SBB) and Austrian Federal Railways (ÖBB) have announced a joint strategy to expand the number of Nightjet international overnight services operated through their partnership from six to 10. New services planned include a new Zürich – Basle – Frankfurt – Cologne – Amsterdam daily overnight service from the end of 2021, splitting the existing service from Zürich to Berlin and Hamburg into two separate services to increase capacity from the 2023 timetable change, as well as introducing a new Zürich – Leipzig – Dresden Prague service, and new planned connections from Zürich – Rome and Zürich- Barcelona. “We have no doubts about the Nightjet’s continued success,” says Mr Andreas Matthä, CEO of ÖBB. “We are also investing in 13 latest generation Nightjet trains which will be in operation from the end of 2022.” Demand for international overnight services rose significantly in 2019 and early 2020 until the outbreak of the Covid-19 pandemic, with passenger numbers from Switzerland growing by more than 25% year-on-year. Despite the disruption caused by the crisis, the two operators expect the trend for increasing night train demand to continue as customers seek more environmentally-friendly and resource-efficient means of travel.
UK supermarket Waitrose is following rival Tesco by stocking plasters in a variety of skin tones to better cater for black, Asian and mixed-race customers. Until recently, virtually all widely-available plasters designed to blend in with people’s skin tone came only in shades of beige. As with many other products commonly advertised as “nude” or “flesh-toned”, while they came fairly close to matching Caucasian complexions, they often bore no resemblance to black and Asian skin tones. But from the end of this month, Waitrose shoppers will be able to choose from three shades – light, medium and dark – when the grocer becomes the first UK retailer to stock a new brand of multi-tone plaster. Boxes of 40 Skin Deep plasters will be sold at Waitrose shops and online. In February, the nation’s biggest retailer, Tesco, became the first UK supermarket to bring out plasters in a range of shades. The supermarket chain was praised for the move though some remarked it should not have taken so long to introduce these products.
The pandemic disrupted the bicycle industry’s supply chains, but at the same time pushed demand to never-before-seen heights, as people seek alternatives to public transportation. New bikes have been in extremely short supply – but the used-bike market is on fire. One big player in the used market is The Pro’s Closet, located in Boulder, Colo. It has a slightly different tactic common in the car industry, but rare in the bike world: certified pre-owned bicycles. The company does do local business, but its main presence is online, selling enthusiast (generally $1,000+) bikes nationally via eBay. Unlike bike shops that mostly sell new stock, The Pro’s Closet’s business model is tailor-made for the current coronavirus moment, able to take advantage of the demand thanks to its unique and relatively untapped supply chain of garages around the country. “We’re tapping into every garage to buy bikes from people that have a bike in their garage or a bicycle they’re not using,” Nick Martin, the company’s founder and CEO said. “We’re in a unique position to own our own supply chain and provide bikes to meet demand.” The demand, even at the end of the summer, is still high. In April, U.S. sales grew 75% compared to last year, to $1 billion. At the same time, imports fell dramatically and are up just 3% through June, according to trade publication Bicycle Retailer, and bike shops have consistently struggled to maintain inventory given supply chain difficulties. This year, The Pro’s Closet’s revenue is up 130%, and the company says it sells through its inventory every 13 days. “We believe if we could process twice as many bikes, we could sell twice as many, too,” said Martin.
Shares in UK DTC specialists the Hut Group have jumped in value by a quarter at the start of trading on their first day on the stock market in a signal of strong investor demand for the British e-commerce company. The valuation propelled Hut Group into the ranks of Britain’s most valuable public companies. The biggest London stock market debut since 2013 has netted the company £920m while shareholders led by the group’s founder, Matthew Moulding, and a group of retail veterans, will share gross proceeds of £961m. Former Tesco boss Terry Leahy is cashing in £17m of shares, the former Matalan and Asda boss Angus Monro £4.6m and the former Debenhams boss Terry Green £6.2m, with all three retaining multimillion-pound stakes. Scottish retail entrepreneur Tom Hunter, a former House of Fraser investor who made millions from selling the Sports Division chain to rival JJB Sports in the 1990s, is the biggest beneficiary among the Hut Group’s retail veteran backers, selling £52.5m of shares and retaining a stake worth more than £95m. Moulding founded Hut Group in 2004, gradually moving the business from selling CDs tax free online to running websites for other retailers such as Asda, Tesco and WH Smith. The Hut Group provides technology for brands such as Nestlé, Unilever and Danone to sell direct to consumers. However, the majority of its £1.1bn revenues in 2019 still came from its own direct-to-consumer sales, through websites including Lookfantastic, Glossybox and Zavvi as well as beauty brands such as Espa and Illamasqua and the sports nutrition company Myprotein. It employs about 7,000 people around the world and has just built a new $1bn campus near Manchester airport, which it says has room for 10,000.