CLEAR DIGITAL

  • Home
  • Jim Clear
  • Blog
  • Contact
  • Home
  • Jim Clear
  • Blog
  • Contact

CLEAR DIGITAL BLOG:
Ecommerce, marketing, media

Clear Digital Digest: subscription coffee, Amazon ads, retail sales update and cricket data

18/9/2020

0 Comments

 
Picture
Today’s Clear Digital Digest looks at some recent stories regarding Pret A Manger and Amazon, reviews today’s new ONS retail data and learns how the data revolution is transforming the world of cricket.
  • Pret A Manger’s new subscription service
  • How Amazon’s ads service is driving its profits
  • Hot off the press: today’s ONS retail sales update for August
  • And finally…the cricket data revolution
PRET A MANGER: ALL YOU CAN DRINK

  • There’s been quite a bit of noise surrounding the recent launch of Pret A Manger’s new subscription service offering unlimited hot drinks for £20 a month, something I was actually first alerted to via a Gmail ad (see below) last week…
Picture
  • With its ever increasing profile – and high density of London outlets – Pret is increasingly viewed as an emblematic example of the issues facing coffee/sandwich shops who continue to struggle with the unforeseen ongoing trend to work from home.
  • Within this context, this new subscription service makes sense as Pret urgently needs to try new revenue streams.  Wired had a typically insightful take on this story with their article “The rise and fall of Pret A Manger”.
AMAZON’S PROFITABILITY: INCREASINGLY DRIVEN BY ITS ADVERTISING

​Well worth a read is this fascinating article about Amazon and its profitability, courtesy of Ben Evans.
  • The article firstly challenges the initially previously received wisdom that “Amazon doesn’t make a profit”, perhaps true in years gone by, but profits jumped especially in 2018 and 2019, reaching $22bn last year.
  • More recently, the conversation has shifted a little to state “ah but all the profits come from AWS” – ie Amazon Web Services, Amazon’s highly successful cloud computing service.  Again, while this may historically have been true, the case is made that it’s now Amazon’s ad services that are really gaining in profitability, having grown hugely in revenue over the last 5 years as the graph below shows…
Picture
  • Although these figures relate just to ad revenue (not profits), Ben Evans posits that “we can make some informed (wild) guesses. So: it mostly leverages existing technical infrastructure and engineering resource. It must have meaningful numbers of sales and operations people, but the system itself is mostly automated. It will have knock-on consequences to other parts of the business - for example, it may steer sales to product with higher or lower profitability. And it seems reasonable to assume that it has pretty high margins…it’s reasonable to suggest that the ad business is contributing as much operating income as everything else apart from AWS, and it’s not absurd to suggest it might be close to matching AWS”.
Picture
  • Finally, the article also highlights how an ever growing amount of Amazon ecommerce sales take place through its third party marketplace, a trend that I’ve also recently explored in my “The UK marketplace sector – and the role of community” deep dive.  The graph below shows how this has evolved over the last 6 years…
Picture
RELEASED TODAY: ONS RETAIL SALES UPDATE FOR AUGUST

The Office for National Statistics (ONS) have today released their latest retail sales figures for August.  We reviewed July’s data in a Digital Digest last month, so here’s a quick update, one month on…
  • Overall retail sales increased slightly in August, up 0.7% against the previous month, but more pertinently, up 1.7% on the previous year (August 2019).
  • Internet sales accounted for 26.6% of all retail sales in August, the second full month since all physical stores were able to trade.  This share fell back slightly from the 28% recorded in July, but is still significantly higher than the 18.1% recorded in August 2019.  
  • With the current volatility surrounding Covid, it is difficult to make any predictions about how much of this shift to online shopping will remain in the medium/long term, but it is certainly interesting to continue tracking this share.
Picture
AND FINALLY...

When my subscription copy dropped through my letterbox this week, I was surprised to see The Cricketer magazine (now in its centenary year) highlighting “The Data Decade” on its front page. 
Picture
​With the relevant articles exploring how increasing use of digitised data has fundamentally changed recent cricket coverage and some future predictions on how this may evolve, it’s a timely reminder than even such a traditional pastime as cricket is experiencing unprecedented change with its own digital/data revolution. 
But this also demonstrates that there is still a place for more traditional media…yes I do still read some print magazines as well…
0 Comments

Clear Digital Digest: Ocado, eBay, Discogs, Netflix and authorised handball

4/9/2020

0 Comments

 
Picture
Today’s Clear Digital Digest round-up looks at:
  • This week’s big ecommerce story: the new Ocado/M&S partnership that launched this Tuesday.
  • Some updates from the marketplace sector, with a growth in sales of vintage products from both eBay and music specialist Discogs.
  • Netflix’s trial move into the freemium sector.
  • Memories of another Argentinian football genius.
OCADO LAUNCHES WITH MARKS & SPENCER: PERCY PIGS FOR ALL (WELL, SOME…)
Picture
Ocado launched their much publicised partnership with Marks & Spencer on Tuesday (Percy Pig branded vans et al) and with such a highly anticipated launch, perhaps unsurprisingly there were teething troubles as some disgruntled customers were not happy that their day one orders were cancelled.  Those of us who have been around the block won’t be surprised that there were one or two problems with a new service launch, and time will tell how short-term or significant these issues were.

However, Ocado chief executive Tim Steiner was perhaps bullishly tempting fate the weekend before when he told the Sunday Times: “They [Waitrose] have done an advert saying ‘we’ll take it from here’ or something.  Well, they can’t take it from here because they don’t have the technology, the infrastructure or the systems.”

“Taking it from here” referred to the fact that previous Ocado partners Waitrose were already running their own parallel Waitrose.com delivery service, generally despatched from local Waitrose stores rather than Ocado’s regional distribution hubs.  Waitrose also recently announced plans for a 12 week trial with Deliveroo, joining brands such as Morrisons and the Co-Op already on the platform in selected locations.  
Sainsburys also continue to expand and promote their similar new ChopChop service, as the choice and variety of grocery home delivery options expands to keep up with this year’s step change in customer demand. 
​VINTAGE/USED ITEMS CONTINUE TO DRIVE SALES ON EBAY AND DISCOGS

There were two updates from key marketplaces this week, both showing the increasing appetite for vintage/second hand items, a trend we explored in much more depth in our recent deep dive on “The UK Marketplace Sector – And The Role Of Community”.

eBay UK have stated that sales of used goods jumped 30% between March and June this year leading to an overall 10% rise in the first half of 2020 compared with last year.  Secondhand and vintage fashion is by far their biggest category, but sales of secondhand chairs, sofas and TVs also shot up by 41%, 30% and 17% respectively during June and July compared with February and March.

Music community Discogs (the 10th most visited marketplace in the UK) have also released their mid-year report this week.  In the first six months of 2020, 4.3m orders were placed globally through the Discogs marketplace (+30% year on year) for a total of 7.7m items (+34% YOY).  Vinyl records remain by far the largest sellers for Discogs, with 5.8m sold (+34% YOY) although CD sales also grew by a similar amount, with 31% YOY growth for the 1.7m sold.
Picture
Total items sold by month on Discogs H1 2020 v 2019 (Source: Discogs)
As the chart above shows, Discogs sales growth really accelerated as lockdown fully kicked in around the world, although January and February were already showing healthy sales growth.  This is in line with more recent trends for Discogs, who sold a total of 14.6m records in 2019, growing by 34% on 2018.  We explored the Discogs marketplace – and the community that underpins it – in more detail in our recent deep dive “Discogs: The Digital Success Story Of The Vinyl Revival”.  
NETFLIX TRIALS FREEMIUM
Picture
Netflix this week revealed plans to offer some of its original movies and shows to non-subscribers.  Free films available include Bird Box and The Two Popes, while original series include Stranger Things and Our Planet.  The real hook to this new initiative is the fact that it’s only the first episode of each show that is available, although Netflix newbies can still get a month’s free trial to then continue watching. 

This type of freemium model seems to make perfect sense for a lower risk trial for anyone that hasn’t yet succumbed to Netflix’s charms; as we reported last month, 43% of UK households currently subscribe to Netflix, ahead of Amazon Prime Video’s 35%.  A full list of “free” Netflix shows and movies is available here.
AND FINALLY...

In a week when the future of another certain Argentinian footballing genius remains up in the air, this tweet raised a chuckle (and makes perfect sense with the final touch)…
Picture
0 Comments

    Jim Clear

    Lead blogger and founder of Clear Digital: talking about ecommerce, digital, marketing and media.   

    View my profile on LinkedIn

    Categories

    All
    Advertising
    Analytics/Data
    Clear Digital
    Content
    Digests
    Ecommerce
    Film/TV
    Lists
    Media
    Mobile
    Music
    PDF Downloads
    Search
    Social
    Sport
    Strategy
    Technology

    Archives

    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2016
    April 2016
    March 2016
    February 2016
    January 2016
    December 2015

Clear Digital Blog

jim@cleardigitaluk.com

Copyright © 2021