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Hey Snackers,
Job posting for the extreme introvert (in case regular social distancing isn't enough): NASA is seeking "social isolation experts" to spend 8 months alone in a Russian lab. Since Russian labs are ideal getaway destinations, the applications are probably flooding in quick. Nyet.
Markets ticked up Wednesday — the S&P 500 snagged its highest close in over two months as all 50 states have now eased stay-at-home orders.
Shop
Facebook expands social media dominance with ecommerce: meet "Shops"
Hold the (i)Phone... This could be "Bezos is worried"-worthy. Facebook unveiled a new product letting businesses set up full-on digital storefronts across FB/Instagram. It's called Facebook "Shops" — unexciting name, but spicier than Shopify's newly launched "Shop" app (the "s" is key). Shopify isn't (openly) mad though — it's actually partnering with FB, providing its ecommerce tech/platform to help get Shops up and running:
- In 2016, FB had 60M business pages and 4M businesses actively advertising — just imagine how many it has today (because we don't know). Take all those FB business pages racking up likes, and add all the Instagram brand pages dropping pastels in your feed.
- Shops turns these business pages into digital storefronts — FB has already dabbled in ecommerce (with Marketplace and Checkout), but Shops is the whole shebang.
Let's see the receipts... Facebook couldn't have launched this at a better time. With businesses suffering from shutdowns (especially small ones), many who shrugged off the ecommerce life are now moving online out of necessity.
- Businesses get: A free and easy way to turn their social media pages into storefronts.
- Facebook gets: A "small fee" per purchase — a key revenue differentiator as its profit puppy ads sales decline during this recession.
- It's very much in Facebook's interest to make sure businesses don't go under, so that these businesses have the money/reason to keep advertising on Facebook/Instagram.
Social media + ecommerce is a powerful duo... And Facebook is already a Master of One. Many of our purchasing decisions are influenced by the things we see on social, partly because it's where we spend so much of our time. And while Amazon is the master of ecommerce, it doesn't have 3B users scrolling through its feeds for #inspo.
Fix
Lowe's rides on "House Hype" to soaring quarterly sales: the DIY renaissance
The "House Hype" is real... Not to be confused with Tik Tok-famous Hype House, where teens with millions of followers dance in bathrooms. The "House Hype" refers to the period of time during which we realized we'd be spending all our waking and non-waking hours in one place: the house. One beneficiary of that period was Lowe's — the big home improvement retailer is doing the Renegade dance to some hype-y numbers:
- Sales surged 11+% for the quarter as locked down people finally got around to fixing that door handle that's been loose for 12 years. "BRB honey, emergency Lowe's run for more decorative pillows" — the consequences of boredom (see: frog bread).
- Online sales jumped 80%, as Lowe's pivoted to ecommerce — it rolled out curbside pickup to accommodate online demand, and its website saw triple-digit traffic growth in April.
- Profit popped 28% compared to last year, as people realized the best time to DIY-home improve is when you're home 24/7.
But... Lowe's earnings probably would have looked very different (read: bad) if it wasn't blessed with an "Essentials Club" membership. Some retailers got it (cough, Walmart), some didn't (cough, Kohl's).
The House Hype might be over... Lowe's CEO warned that such high sales growth likely isn't sustainable, and that sales could be moderate going forward (Lowe's stock dropped 4% — there's only so many times you can repaint a kitchen). That's the challenging part of success: it makes it harder to impress investors in the next quarter. Plus, if the housing market suffers on the currently staggering unemployment rate, Lowe's may too.
Chat
Clubhouse hits a $100M valuation — and it only has 1,500 users
Ain't no crying in the club(house)... There's definitely no crying over at Clubhouse app, the buzzy new social media company that just hit a $100M valuation after raising $12M in funding. The audio app — which is still in beta — is currently only available to a select group of just 1.5K users (#exclusive). It's so stealthy that it doesn't even have a website yet.
- It seems kind of like Houseparty, in the sense that you can spontaneously join a "room" of people for a live chat — but Clubhouse is all about that audio life.
- As an audio-only social network, Clubhouse lets you tune into live conversations going on in "rooms" — for example, a discussion on how the pandemic is affecting prison inmates (led by rapper MC Hammer and venture capitalist Marc Andreesen).
The first rule of Clubhouse... Tell every reporter and celebrity about Clubhouse. The exclusivity, "novelty," and celebrity buzz behind Clubhouse likely helped it snag its latest funding round. TBD whether the app will survive past the hype.
- While "audio social network" sounds like a fancy name for a phone call, Clubhouse has the potential to be a place where people tune into live conferences about topics that interest them (minus the hassle of a Zoom setup). But...
- There's no lack of fad social apps that raised a ton of money on early hype, only to later drift into nothingness (even now-shutdown YikYak managed to raise $70M).
Exclusivity as a product... If Clubhouse isn't able to scale beyond its "exclusive" user base, maybe it can charge member fees. This membership-based model that leverages exclusivity worked on some "selective" social/dating apps (like Raya). It's the opposite of the free, "as many users as possible" ad-reliant strategy of social giants like Facebook and Twitter. But if there's no demand for the product, neither strategy will work.
What else we’re Snackin’
- Stream: Apple pays Sony $70M for streaming rights to a new Tom Hanks movie — it was scheduled to go to theaters in June, but will now go straight to Apple TV+.
- Stars: Celebrity-taught classes startup Masterclass raises $100M to hit an $800M+ valuation.
- Twitchy: Amazon releases its first original video game, "Amazon Crucible" — the 'Zon hopes the free big budget game will level up its play status (it has Fortnite-envy).
- Chipper: The US gov moves to cut off chip supplies from Chinese tech giant Huawei, imposing restrictions on who can sell it chips made with American tech.
- Track: Alabama, North Dakota and South Carolina will use Apple and Google’s COVID-19 tracking tech in statewide apps.
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