Published on: November 12, 2019
• UK retailer Tesco is primed to get into the subscription business.Pymnts
reports that as part of its Clubcard loyalty program, "for £7.99 a month, customers will have access to 10 percent off two big shops up to £200 each; 10 percent off customers’ favorite Tesco brands at all times; double data on a monthly contract for new and existing Tesco Mobile customers; and exclusive access to apply for a Tesco Bank credit card with no foreign exchange fees. The company says a customer’s potential savings add up to more than £400 a year."
The story notes that "the move is a page out of the Amazon playbook, as the eCommerce giant has seen great success with its own subscription service, Amazon Prime. Earlier this year, a study revealed that more than half (51.3 percent) of U.S. households will have Amazon Prime memberships this year, which would equal 63.9 million households in total."
• Vogue Business
has a story about what "fashion rental startup" LeTote plans to do with Lord & Taylor, now that it has acquired the 38-store retailer for $100 million.
The story says: "That the US’s oldest department store could be scooped up by a seven-year-old e-commerce startup captured the current volatile state of the retail industry.
The companies are not an obvious match. Le Tote’s online-only subscription model lets customers rent clothing and accessories from roughly 180 mid- to high-end and private-label brands up to twice a month, starting at $79, with new merchandise added on a monthly cadence. Lord & Taylor’s traditional merchandising model operates on seasonal buys; at the time of the acquisition, the retailer stocked between 400 and 500 brands, including more than 100 proprietary labels."
The goal is to reach profitability in the next 12 months, but the story says that this "will be a considerable challenge. Lord & Taylor did $1.4 billion in sales last year, but lost $114 million. Le Tote is not yet profitable, and would not disclose how much debt it was taking on as a result of the acquisition."
Here's step one: "Le Tote will reformat Lord & Taylor’s 38 bricks-and-mortar stores and migrate its systems onto a unified technology platform … Over the next nine months, both companies’ inventories will be unified under a single backend system, which will allow customers to rent or purchase all merchandise. All 38 Lord & Taylor stores will remain open, but their format will change over time to emphasise rent and subscribe options, including drop-off and pick-up points for rentals."
• The Wall Street Journal
this morning reports that Anheuser-Busch InBev "has agreed to buy out the remaining shares of Craft Brew Alliance Inc. that it doesn’t own, placing the value of the Portland, Ore.-based company at roughly $321 million." The move gives A-B beer brands that include Kona Brewing Co., Omission Brewing Co., Redhook Brewery and Cisco Brewers.
• Business Insider
reports that Burger King is happy enough with the performance of its plant-based Impossible Whopper that it will introduce three more Impossible burgers to its menu - the Impossible Whopper Jr., the Impossible Burger, and the Impossible Cheeseburger.
The new burgers will be tested at some 180 locations around the country.