Hey Snackers,
Good day to be Justin Bieber's natural deodorant.
Bad one to be a department store.
A pile of earnings reports from suburban shopping destinations weighed on markets Tuesday before stocks got a chance to rebound.
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General Motors shrinks its "Maven" car-sharing
That buddy who needs to borrow your car... for "just a little bit." She's mourning General Motors' decision to cut Maven's footprint from 24 cities to 16. Maven is GM's version of Zipcar, expanding for three years since it launched in Ann Arbor, MI. GM's blaming this rollback on a lack of demand (but says it could still expand elsewhere).
The future = fewer cars... So GM's thinking about how it can still make money from people who don't buy pickup trucks. The solution is a whole flock of Maven car options:
- Maven Share: GM's car-share to get around. Your app unlocks the doors thanks to Bluetooth. Then for $9/hour you get a GM car + insurance + gas.
- Maven Gig: Use your car to make money driving Uber/Lyft but don't actually have a car? Gig with Maven.
- Maven Home: A shared car or two for big apartment buildings. Reserve your Trader Joe's self-delivery on Tuesday mornings, when the car's probably available.
- The competition: In 2016, Ford acquired Chariot, a van that fills in gaps from buses and subways. But it shut down in January.
This is GM's training wheels... Once its cars are fully self-driving (thanks to Cruise Automation, the startup it bought), GM will launch a fleet of self-driving robo-cabs that could compete with Uber. In the meantime, GM's letting non-car-owning Millennials guinea pig the whole thing while it collects ride data through the Maven app. It's a good deal.
Urban Outfitters launches a clothing rental biz
Commitment issues over v-neck tees?... Perfect. Urban Outfitters is launching a clothing rental business: Nuuly. For $88, you get 6 pieces ($14.67 per item) + reusable bag + prepaid return envelope so you can send it all back in a month (or decide you love one/all of them and pay full price). The founder's son is running Nuuly, and he expects to hit 50K subscribers and $50M in revenues by this time next year.
Rent The Runway without the fancy... Urban's copying the model of clothing rental pioneer RTR, whose core biz is making glam gowns you can't afford (nice $650 Solani) yours for the weekend. Urban's focused on the un-ironed options stuffed in your drawer, starting this summer.
- Anthropologie & Free People: Urban owns both boho-chic brands, so they're included in the rental wardrobe.
- Random new partners: Reebok, Gal Meets Glam, and Levi's are also involved.
- Flea markets: Yep. The Urban team is hitting stands to curate pre-worn classics. Which you can rent. And then Urban dry-cleans and re-rents.
But will it cannibilize sales?... Unlike Rent The Runway, which only rents, Urban has to sell you clothing too... hopefully after you've rented. And the CEO thinks renting is just "trying before you're buying." With Urban stock down 19% this year, it's trying the clothing-sharing/closet-renting industry that's growing 20% annually.
PS: Urban also announced quarterly earnings after markets closed yesterday, and the results sent shares down 6%.
Almost every department store just had a horrible day
The mall is closed... Your go-to childhood "run errands with mom" shopping options all released earnings Tuesday. And the combo of JCPenney and Kohl's dragged down the rest of their department store siblings:
- JCPenney (-7%): The stock dropped to $1 as sales fell 5.5% and its quarterly loss doubled. Plus, it's got a problem with "shrinkage" (aka shoplifting).
- Kohl's (-12%): Sales dropped 3.4%.
- Nordstrom (-9%): Bad timing. It reports earnings later this week, so it fell along with the rest of the crew because investors are dreading it.
Which aisle for "turnaround plans?"... None. JCPenney doesn't have one. And it says its turnaround strategy will arrive "in the coming months." Meanwhile, Kohl's is making creative moves:
- Embrace the space: It's subleasing its unused space for gyms and grocery stores.
- Embrace the Amazon: It's becoming Amazon's doormat partner, taking Amazon return items and installing Amazon lockers in 200 stores.
One OG retailer got the retail-pocalypse right... Walmart. Earth's biggest retail chain invested big in ecommerce, acquiring Amazon competitor Jet.com and online-savvy Bonobos. Then it kicked things up last week with Prime-killing 1-day delivery just before we learned sales rose 3.4% last quarter. JCPenney simply never made those investments.
What else we’re Snackin’
- New: Procter & Gamble's Tampax releases its first ever organic tampon
- Whachamacallit: Comcast employees leak that they're working on an Alexa virtual assistant competitor — But to (creepily) track your health
- Arriving: The US Postal Service is testing out self-driving trucks this month
- Teamwork: Nike and Adidas warn how much tariffs would mess with your shoes
- Enthused: Amazon's CEO Jeff Bezos tells employees at an all-hands meeting that he's 'very excited' about the auto industry. Very excited.