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The weekly dispatch: The delivery market heats up, NFTs go offline

illustration of a person standing next to a large monitor with a line process graph pointing to a fire graphic

The delivery market is heating up – both on the doorstep and at the storefront. Retailers continue to bet on the power of the in-store experience, but with an eye on wholesale as a source of stability. NFTs are finding a new market not as digital assets, but physical one-of-a-kind collectibles. Find out about these developments and more in this week’s round-up:

Glossier takes flight with its fifth retail location

Glossier has officially opened its fifth brick and mortar store in Washington D.C.1; Continuing with Glossier’s iconic, locally inspired store designs, their ‘Terminal G’ location embraces the golden age of air travel – complete with an old-school departure flipboard. 

This latest expansion of their store network comes fast on the heels of Glossier announcing its wholesale partnership with Sephora – a first for the D2C icon.2

a glossier instagram post announcing their new DC store

Glossier’s recent path to sustainable growth has been a rocky one with hiring starting later in 2022 that will focus on supply chain and wholesale.3

This two-pronged strategy marks an interesting development for the cult beauty favorite. Glossier is still putting considerable money behind its immersive retail experiences, while also admitting to the limitations of its single-channel approach. 

A recent analysis by BMO Capital Markets found that wholesale profit margins are roughly 1,000 basis points higher on average than direct to consumer channels.4 As Glossier comes under pressure from investors to grow profits, wholesale’s allure will only grow.

Amazon takes same-day delivery to brick and mortar

the side of an amazon prime box with the words ‘no patience required. free same-day delivery’

Amazon is no stranger to rapid delivery, but the e-commerce giant is kicking this up a notch with a new batch of same-day delivery partnerships for Prime members.5 Currently facing an excess in fulfillment capacity, Amazon is putting its capabilities to good use by offering faster delivery on a broader range of products outside of its own label.6

Prime shoppers who are fans of Pacsun, GNC, SuperDry, and Diesel will now be able to shop these brands via the Amazon app and have their orders delivered or ready to pick up in-store the same day. This service is available to customers in key metro areas including Atlanta, Chicago, Dallas, Las Vegas, Miami, and Phoenix.

The announcement comes after Amazon pivoted away from offline store formats with the closure of Amazon 4-star and Books due to lagging sales.7 With the growth of e-commerce slowing as consumers return to physical stores following the end of pandemic restrictions, this initiative can be read as an effort to capitalize on the industry-wide need for seamless hybrid fulfillment services. 

Tiffany & Co. goes crypto with NFT jewelry

a blue tiffany and co box with a chain punk pendant and chain inside

Tiffany’s might be the byword for tradition, but the iconic jeweler certainly isn’t phobic about the possibilities of new technology. In their recently announced project with Chain, holders of the CryptoPunk token collection have the opportunity to buy one of just 250 digital passes to have their Punk made into a bespoke, one-of-a-kind pendant by Tiffany & Co. jewelers.8 Each digital pass costs just over $50,000 in U.S. currency – and has the potential to net the brand over $12.5 million in total.

These ‘NFTiffs’ mark a shift by Tiffany & Co. towards an even more personalized and exclusive level of service beyond their regular retail offerings. The power of blockchain technology and its unique writs of ownership offer a powerful value proposition that’s attracting luxury retailers at large, with brands including Gucci, Prada, and Nike investing heavily in their own NFT initiatives.9

Given the relative youth of cryptocurrency investors, NFTs offer luxury brands like Tiffany & Co. a way to make inroads with Millennial and Gen Z audiences, who are fast becoming the biggest source of spending power in the economy. According to Statista, only 12% of U.S. consumers are currently investing in NFTs, 44% of whom are aged 18-44.10

For more about NFTs, check out our full guide about this growing tech trend.

LaserShip and OnTrac offer coast to coast delivery just in time for peak season

a map of the united states showing routes for lasership and ontrac’s transcontinental parcel delivery service

The holiday season is rapidly approaching, and LaserShip and OnTrac’s new transcontinental delivery service is ready to assist brands in meeting customer expectations for faster urban delivery.11

Following their merger at the end of last year, the combined capabilities of LaserShip and OnTrac can now reach 74% of U.S. consumers across 30 states and Washington, D.C, achieving transit times of 3- 5 days.12 This massive boost in coverage is enabling the once-regional carriers to present a credible challenge to the parcel duopoly.

FedEx (38%) and UPS (26%) have traditionally dominated the nationwide delivery market, leaving merchants with limited carrier choice when shipping parcels across a large number of zones.13 In recent years, regional parcel carriers have seen a big upswing in popularity, thanks to the pandemic causing a huge squeeze in capacity and forcing retailers to look elsewhere for space. With peak season rapidly approaching, this initiative opens the door to more cost-effective shipping options. 

However, questions remain over whether these carriers will have the capacity to cope with a steep rise in parcel volumes at the end of the year. It’s reliability, just as much as price, that will be critical if these new players expect to compete effectively with the likes of FedEx and UPS this peak season.

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