Overstock.com relaunch shows a significant shift

Signaling a strategic pivot

March 29, 2024

Greetings from the Retailist crew! With the weekend on the horizon, the realms of e-commerce, retail, and Direct-to-Consumer (DTC) markets are evolving swiftly. Over the last week, there have been a plethora of updates, budding trends, and fresh advancements in the retail sector. Let's explore the top stories together.


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In the news: Top headlines this week

Beyond Inc. names new chief customer officer, relaunches Overstock.com. Beyond Inc. has appointed Carlisha Robinson as its new chief customer officer and relaunched Overstock.com, signaling a strategic pivot in its online retail offerings. Robinson, who joined the company in 2002, takes on her new role with immediate effect, as announced by Marcus Lemonis, executive chairman of Beyond’s board. The relaunch of Overstock.com, previously deemed "a fatal mistake" to shut down by Lemonis, represents a significant shift in the company's direction and was highlighted during the company's latest earnings call. [Retail Dive]

Fast-food companies seeing low-income diners pare orders. Fast-food companies, including industry giants like McDonald's and Wendy’s, are witnessing a decline in business from low-income consumers due to rising prices, with a significant portion of these consumers reducing their fast food consumption and visits to fast-casual and full-service restaurants. This trend is attributed to a staggering 20% increase in food prices from January 2021 to January 2024, exacerbating financial stress and difficulty in managing everyday expenses among those earning less than $35,000 annually. [Reuters]

Target's collection with Diane von Furstenberg is another step in the right direction for the brand as it leans into luxury for less. Target's collaboration with renowned designer Diane von Furstenberg, alongside her granddaughter Talita, marks a strategic move towards offering luxury for less, featuring a limited-edition collection that includes von Furstenberg's iconic wrap dresses among other apparel, accessories, and home decor items. With prices starting at $4 and clothing items capped at $50, the collection makes the designer's famed fashion accessible to a wider audience, contrasting with the higher price points of her DVF line, despite von Furstenberg's standing in the luxury fashion sector and her considerable wealth and high-profile connections. [Business Insider]

Costco and Sam’s Club’s smaller rival BJ’s Wholesale will open more clubs in Southeast. BJ's Wholesale Club, aiming to grow its presence in a competitive membership warehouse market, announced plans to open four clubs in the Southeast and one in the Midwest within the current fiscal year. This expansion includes new locations in Tennessee, South Carolina, Florida, and Indiana, contributing to a total of a dozen new clubs slated for opening this fiscal year. This move positions BJ's as an active competitor to larger players like Costco and Sam’s Club, both of which have also detailed significant expansion plans, with Costco aiming to open 30 new clubs globally, including 22 in the U.S., and Sam's Club planning to open more than 30 stores across the U.S. over a five-year period. [CNBC]

How to overcome 5 retail industry challenges. The retail industry faces significant hurdles such as high turnover rates, low-profit margins, and intense competition, which make managing a retail business challenging. Employers must balance administrative duties, compete for workers against an expanding market and the gig economy, and handle the complexities of seasonality, all while trying to foster a collaborative culture and develop employees on limited budgets. Additionally, navigating compliance and labor laws adds another layer of difficulty to the operational challenges in retail.  [Retail Dive]

Krispy Kreme shares jump as US partnership with McDonald's goes national. Krispy Kreme announced a nationwide expansion of its partnership with McDonald's in the U.S., planning to make its donuts available across McDonald's restaurants by the end of 2026 after a successful pilot in Kentucky, leading to a 23% surge in its shares. The rollout will start in the second half of 2024, with Krispy Kreme committing to exclusively supply McDonald's and not any other quick service restaurants in the U.S. until the end of 2026. This strategy is part of Krispy Kreme's broader aim to increase its presence globally through at least 75,000 points of access, including quick-service restaurants and grocery stores. [Reuters]

Why we don't actually know whether retail theft is a big problem. Retailers attribute enhanced security measures and store closures, like those implemented by Target, to rising theft rates, particularly organized retail crime, which the National Retail Federation claims results in billions of dollars in lost merchandise annually. However, quantifying the actual extent of retail theft poses a significant challenge, as highlighted by a report from the Brookings Institution. The difficulty in accurately assessing the scale of the problem stems from various factors, making it hard to determine the true impact of theft on the retail industry. [Business Insider]

Home Depot is acquiring specialty distributor SRS for $18.25 billion in huge bet on growing pro sales. Home Depot is set to acquire SRS Distribution for $18.25 billion, marking its largest acquisition to date and underscoring its strategy to enhance sales among professional contractors and home service providers. This move aims to bolster Home Depot's existing business with professionals, which already accounts for half of its revenue, by expanding its capacity to supply and deliver large quantities of construction materials directly to job sites. The acquisition, which Home Depot plans to finance through cash and debt, is expected to close by late January of the next fiscal year, reflecting the company's commitment to grow its professional customer segment as DIY demand softens. [CNBC]

Amazon’s New Leased Retail Space in Washington Is Complete. Amazon has completed leasing Vulcan Real Estate's West Main project in downtown Bellevue, Washington, a significant development that features three towers with over one million square feet of office and retail space. This modern complex, which includes two 17-story towers and a central 16-story tower, integrates approximately 34,000 square feet of retail space into Bellevue’s retail landscape, enhancing the connection between the city's commercial core and its old town area. The project is further beautified with landscape design and local art installations, enriching the street-level experience. [Retail Wire]

Dr. Martens launches recycled leather collection and resale platform. Dr. Martens is advancing its sustainability efforts with the launch of a recycled leather collection and a resale platform, following its participation in Gen Phoenix's $18 million funding round alongside other notable investors. The collection, named Genix Nappa, will include eco-friendly versions of iconic styles such as the 1460 Lace-Up Boot, the 1461 3-Eye Shoe, and the 2976 Chelsea Boot, with prices ranging from approximately $177 to $215. Gen Phoenix's innovative technology enables this by breaking down waste leather to the fiber level and reconstructing it with recycled water into a new, sustainable material. [Retail Dive]

Fast-fashion retailer H&M surprises with spring recovery. H&M reported a stronger-than-expected first-quarter operating profit, leading to a 13% rise in its shares, buoyed by positive customer reception to its spring collections under new CEO Daniel Erver. Amid challenges from major competitors like Zara and the rapidly growing online retailer Shein, Erver, who took over after Helena Helmersson's unexpected departure, emphasized the need to focus on H&M's core young female demographic to reclaim its position in the fast-fashion industry. [Reuters]

Job Board: This week’s Top Openings in DTC, RetailTech, and more

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