Retail Brew // Morning Brew // Update

December 19, 2024

Hey there, it’s Thursday, and likely not a great one for Starbucks in China, which according to a New York Times report, is losing money left, right, and center. It turns out the coveted Pumpkin Spice Latte has lost its charm among consumers who instead prefer a variety of inventive flavors offered by local coffee chains at a much lower price. Nothing wrong with a little healthy competition, right?

In today’s edition:

—Vidhi Choudhary, Alex Vuocolo, Jennimai Nguyen

E-COMMERCE

China, china, china

Jakub Porzycki/Getty Images

E-commerce in 2024 had one underlying theme: China.

This year highlighted that the best known Chinese way of doing e-commerce, aka selling cheap and inexpensive items online, is here to stay.

The rise of Chinese-linked marketplaces like Temu and Shein showed up in the volume of delivery packages received from these platforms, so much so that there is no room for other industries on international cargo flights. Shein and Temu together shipped roughly 600,000 packages to the US every day, Reuters reported at the beginning of 2024.

As the year progressed, the US escalated its crackdown on the trade rule (de minimus) that helps Shein and Temu easily import goods to the US. In September, the White House used its executive authority to tighten regulations against “increased abuse” of the de minimis exemption, and proposed stringent rules on the entry of low-value shipments into the US.

Another China marker dropped when Amazon opened its own discounted store, Haul, in November, in a likely bid to compete more aggressively with these Chinese rivals. In a brutal take on Haul, The Atlantic wrote that, “Amazon’s entry into the market officially makes it mainstream..”

The way Juozas Kaziukėnas, founder and CEO of Marketplace Pulse, sees it, “You’re either competing with China [or] you’re sourcing from China [or] you’re dealing with upcoming tariffs on Chinese goods, or you’re competing with Chinese platforms.”

Keep reading here.—VC

Presented By PayPal

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It’s the PayPal checkout stack.

STORES

Holiday check-in

Ftiare/Getty Images

Bad weather and election fears didn’t put a damper on retail spending in November. The latest federal data showed a 0.7% increase from the month before and 3.8% from the year before.

J.P. Morgan analyst Christopher Horvers wrote in a research note that the return of cold weather and strong Black Friday spending offset “post-election uncertainty and unfavorable weather” earlier in the month.

Six categories out of 10 tracked by the bank accelerated year over year, he explained, including non-store, sporting goods, home improvement, general merchandise, and auto parts.

Keep reading here.—AV

MARKETING

Doll’s well

Illustration: Anna Kim, Photos: @Americangirl/TikTok

The American Girl brand is, well, all-American. The dolls all come with their own stories, some tied to pivotal moments in American history, and the brand aims to instill “confidence, character, and courage” in young girls, according to Jamie Cygielman, president of American Girl. Inspiring its target audience to learn and be the best version of themselves? Very wholesome!

But if its TikTok account is any indication, the beloved doll and book brand isn’t afraid to embrace some slightly less squeaky-clean internet humor—and its audience isn’t just young girls.

Keep reading here on Marketing Brew.—JN

Together With Walmart Connect

The holiday forecast is in. It looks like retail spending is projected to reach $1.37t this year. If you want to capture a slice of that seasonal market, Walmart Connect can help. Their robust targeting capabilities and comprehensive customer insights will integrate your brand across Walmart’s digital and store footprint. Learn more.

SWAPPING SKUS

Today’s top retail reads.

To the top: Inside Vuori’s rapid rise to becoming a $5.5 billion athleisure company. (CNBC)

Return to form: After closing 85 stores in February, iconic beauty brand the Body Shop is reportedly back in business. (The Guardian)

Side effects: As luxury retailers take a hit this year after a drop in consumer spending, resale site The RealReal sees grow. (the Wall Street Journal)

Supercharge conversion: Crush your holiday sales goals with the ultimate checkout stack. PayPal drives growth and boosts conversion rates with payment options that connect you to 430m+ active consumers.*

^{*A message from our sponsor.}

JOBS

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Analyst, Category Management - Jewelry at Harry Winston (in person)
Poultry Category Manager at an undisclosed organization (in person)
Total Rewards/Benefits Manager at Boot Barn (in person)

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✢ A Note From PayPal

¹ PayPal internal data, 2023. Venmo is only available in the US

² PayPal internal data from August 2 to September 30, 2024. Comparing Fastlane accelerated shoppers vs. non accelerated shoppers for merchants that have integrated Fastlane.

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