Hey Snackers,
Kirkland peanut butter and 36-packs of toilet paper aren't the only hot commodities at Costco: one value-savvy shopper just dropped over $600K on a diamond engagement ring.
The Dow rebounded up 1.1K points Tuesday after Monday's dramatic drop — hints of possible economic stimulus sent tech, travel, and financial stocks higher.
Strut
Stitch Fix falls 25% because we may have hit peak Fix
In need of financial stitching... Stitch Fix, the online personal styling service, just unveiled its earnings for the last quarter — far from glamorous. It's a fashion company trying to look like a tech company. You fill out a style quiz (modern or boho? Slim fit or athletic?) and Stitch Fix sends you monthly subscription boxes of ambitious clothes to push your looks envelope.
- The population of Fixers jumped 17% over the year to reach 3.5M.
- And it's a scaling up tech company that's actually profitable ($11M last quarter).
But its latest service reveals a problem... "Direct Buy." Instead of using Stitch Fix's proprietary, algorithm-enabled, human-curated style decision tool to hook you on a monthly subscription, Stitch Fix offers the option to just buy clothes from its online store instead. Direct. Just like other ecommerce sites. That undermines Stitch Fix's core service and could be a sign of an underlying demand problem.
It's struggling to move past early adopters... And that's why the stock is down 67% from its peak. Early adopters drive initial sales and growth for innovative new companies — then it's time to go mainstream. The true test of success is expanding beyond its early demographic. But 2 stats show that's not exactly happening for Stitch Fix:
- To find new customers, Stitch Fix had to up its spending on ads — by 49% last quarter.
- But customers spent less per "Fix" on average.
Sustain
Grove Collaborative is going plastic-free by 2025 — it's a "tree-positive" story
I want to break tree... The commercial use of tree, that is. Grove Collaborative is a consumer packaged goods unicorn offering sustainable products and a Millennially-pleasing website font. Grove elevates un-sexy basics — like toilet paper, trash bags, and fabric softener — by positioning itself as a positive force for the environment:
- 'Tree-Free': How Grove describes its Seedling paper products (like tree-free TP) — they're made of just one ingredient: 100% Sustainable Bamboo
- 'Tree-Positive': Grove offers the "first 'tree-positive' paper in the World" (don't bother Googling the term — we tried). A portion of every Seedling purchase goes toward tree-planting.
Grove just announced it's going Plastic Free by 2025... It's already plastic-neutral, which is the same idea as carbon-neutral — it pays to intercept plastic before it reaches oceans/landfills. It also offsets carbon emissions from its free shipping. To get plastic-free, Grove will gradually use more glass and aluminum. But here's what really fascinated us:
- Bamboo: Grove is obsessed with it — bamboo paper, straws, cutting boards — even the $25 paper-towel holder has a bamboo handle (to hold your bamboo paper towels).
- Bamboo is the fastest growing plant in the world (note: not a tree). While trees take around 20 years to grow back after harvesting, bamboo takes only 3 months – Grove also assures us) that no baby panda will be left hungry in the making of its paper.
Being "sustainable" is no longer enough for a brand... Supermarkets and drugstores already boast eco-friendly options like Seventh Generation or Method. Grove's brand stands for approachable sustainability — but its new aggressive commitment to tree-free-ness is what sets it apart. We're in an era of sustainable products right now (think plant-based meat) — Grove's focused on the next era: sustainable packaging. They're even working on shampoo concentrate to reduce plastic bottles.
What else we’re Snackin’
- Inmate: The state of New York engages prisoners to produce hand sanitizer as the shortage continues — Governor Cuomo thinks it smells like a "floral bouquet"
- Zero: Trump pitches a 0% payroll tax rate for the rest of 2020 on coronavirus worries (less taxes paid usually means more spending)
- Descend: United Airlines' US bookings plunge 70% as travelers avoid traveling
- Sugar: Hostess launches Twinkie and Ding Dong-flavored iced lattes — TBD on when it'll launch ice-latte flavored Twinkies
- Stay: Zumper raises $60M to double down on its apartment rentals platform
- Ghosted: Some European airlines are flying near-empty 'ghost flights' — an EU law requires them to fly 80% of slotted trips to remain at major hubs
Wednesday
- Earnings expected from LG
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