A Magic Trick

The Blaine-ification of brute-force delivery and running out of pennies.
November 6, 2020

This week’s podcast was all about a Black Friday #shipageddon and the opportunity for logistics to rise to meet the digital demand. This, the same week as American elections which has felt like a different-kind of ‘geddon, nawmean? Let’s talk 

The Pledge

“Logistics” is a bit of a magic trick. Amazon is David Blaine, the customer is the ‘mark’. We think we know how the trick works, but, much like Blaine’s most popular tricks, logistics are not as much of an illusion as it is brute force of sheer will (David Blaine really did put a needle through his frickin arm, building up scar tissue over time.)

Amazon’s build-up? A 20-year head start in logistics, real estate, and tech investment. But not even Amazon can service every man, woman, and child in the United States. So, the opportunity is for technology and third party fulfillment to enable any brand to offer the promise that Prime offers.

The Turn

Blackstone’s $18.7B investment in eCommerce logistics in 2019 seemed visionary at the time, but in the post-pandemic ‘20s, it seems it didn’t come soon enough. As Instacart pivots to last-mile-for-everything, and every restaurant relies on myriad delivery apps, it’s starting to look like we’ll need nearly 3 times that investment to meet the shifting demand.

The Prestige

The road to Prime-for-all is paved with a basement full of dead Hugh Jackman clones. This isn’t going to be easy. Some companies, like Shipium, are trying to make it easier. But technology only allows your brand to fulfill its promise at scale. There’s a real-world challenge that requires infrastructure capabilities that no one brand has yet. The big reveal? Ecommerce is nothing without operations, and they have to work together.

Are you lost? Watch Ricky Gervais flip out, or stream The Prestige on Netflix.

As mentioned in this week’s pod, Silicon Graphics Int’l had to create the hardware and software that built a whole generation of visual effects with famed VFX house, Industrial Light and Magic. Building systems to build systems? That’s logistics, baby.

The Queen's Gambit - A gorgeous period mini-series drama centered on Beth, a child chess prodigy with a substance abuse problem. Interesting retail-centric scenes include the interior of a 1960’s-era independent Kentucky department store chain and a corner drug store.

Given the ongoing national coin shortage, you’re likely not touching a lot of change in your pocket these days. This is causing major issues with coin laundry and other cash-centric businesses.

Price-sensitivity was core to Amazon’s dominance in the 2008 U.S. economic recession. This week’s guest, Jason Murray, recounts his time there and how the strategy helped them sell Prime into households (timecode: 29:20)

Phillip: I recently bought some bougie hand sanitizer from P. F. Candle for a whopping $25. It smells amazing - but maybe not $25 amazing. The hook: they bundled it with incense and a car air freshener. We’ll see more vertical product differentiation in this category the longer that the COVID Era wears on. Bundling is a strategy many premium brands are using to avoid discounting strategies. We’ll see more of this during Black Friday/Cyber Monday. More strategies can be found in this Privy post featuring Nik Sharma.

Why buy finished goods when you can make almost-finished goods? “DIY” doesn’t have to mean creating things from scratch - for these brands it means tactile connection with the final product, giving you entertainment in addition to the product itself. This is something we’ve covered extensively, and especially in our newest report, The New DIY: Retail Opportunity in the Passion Economy. 

Sibling Candles - siblings.co “candle in a bag”. Why buy a candle when you can MAKE a candle? Smell what I’m stepping in? Everything you need to make a candle, except for the vessel. Hits on upcycle culture, it’s instagrammable. It’s everything you didn’t know you needed from a candle. 

Dough Dealer - doughdealer.com “just add water”. Bread only has four ingredients, but it’s still too hard. Just add water, get your fingers a little sticky. Never wonder what a “scant” cup is again. Marie, baguettes. Hurry up.

Popin Cookin - japancandystore.com “2 kawaii 4 u”. TikTok trend. Adorable DIY candy for aspiring harajuku girls. Kits are affordably priced, available on Amazon or online specialty retailers. Fun to make, even more fun to post on TikTok. 

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