November Monthly News Roundup

We are pleased to share with you our roundup from November 2019. There continued to be high activity in the private markets from seed investments to major buyouts such as LVMH's $16.2B acquisition of Tiffany -   the largest deal in the luxury sector to date. We also continued to see convergence between retail and technology, innovative distribution channels and new product offerings.

In November we saw limited activity in the public markets, but the private markets remained active as ever. By far the largest to note was LVMH’s $16.2 billion acquisition of Tiffany. This is the largest deal to be completed in the luxury sector and adds a prominent American name to the LVMH portfolio. Other notable acquisitions this month included: Vince’s acquisition of Rebecca Taylor and Parker, Vision Investment’s acquisition of Roberto Cavalli, Karen Murray’s acquisition of the luxury women’s store Fivestory, Beauty brand Il Makiage’s acquisition of data science startup NeoWize, Care/of’s acquisition of wellness-tracking app LabLyfe, Yellow Wood Partners’ acquisition of foot-care brand Dr. Scholl’s and Advent International’s acquisition of haircare brand Olaplex. 

Notable raises this month included: Faire, a wholesale market place ($150M), Whoop, a sports tech and analytics company that creates discrete wearables ($55M), Eight Sleep, a high-tech mattress ($40M), Mirror, an interactive home gym equipment ($34M), Banza, a chickpea pasta startup ($20M), 11 Honoré, a size-inclusive womenswear site ($10M), Loop Returns, a company that processes customer returns through Shopify ($10M) and Ash & Erie, the “short guy” clothing retailer ($1.2M). Undisclosed investment amounts included: L’Oréal’s investment in Canadian professional skin care group Functionalab and Roger Federer’s investment and involvement with Swiss sneaker brand On. 

In beauty specifically we saw activity from two major players. Kylie Jenner sold a majority stake in her beauty brand to Coty, which values Kylie Cosmetics at approximately $1.2 billion. This strategic partnership grants Coty access to Gen Z through Kylie Jenner’s powerful social media presence and brings global potential to the brand. Estée Lauder announced its plans to expand in Asia with a deal to buy Seoul-based beauty brand Have&Be. This will bring popular Korean beauty brands Dr. Jart+ and Do The Right Thing into Estée Lauder’s portfolio. The deal is expected to close this December and would be Estée Lauder's first acquisition of an Asia-based beauty brand.

The Increased Convergence of Retail and Technology

Retailers continue to focus on technology to optimize and maintain more control over their operations. Ralph Lauren announced it will implement digital product identities on all its SKUs. This will allow consumers to scan any item on their smartphone and verify authenticity, view additional product information and receive styling advice. UK-based soaps company, Lush, developed its own POS software to control more of its business. It also debuted its own POS hardware that is currently being tested in two stores. Lush has made its POS software open-source meaning any company can utilize it and also help to improve it.  With such initiatives there have also been setbacks. For example, Richemont has been struggling with Yoox Net-a-Porter’s new technology update. Although the intention behind the update was to create a single technology platform that Yoox, Net-a-Porter, Mr Porter, and The Outnet could utilize, the initiative has instead created operational delays. 

In hopes to rival Amazon, Google has ramped up its retail efforts via Google Shopping, a new e-commerce platform. The Google Shopping experience acts like any other e-commerce site but focuses heavily on providing a highly personalized experience through features such as product recommendations, price change tracking and local product searches.   

Meeting Consumers Where They Are  

Taking an omnichannel approach one step further, retailers and brands are meeting consumers in new and unexpected places. This holiday season major retailers will sell merchandise in hotel lobbies and have even collaborated on themed rooms with merchandise that guests can purchase at the end of their stay. For example, F.A.O. Schwarz partnered with the Conrad to create a high-end suite filled with toys starting at $3,000 per night. Bloomingdale’s will be selling select items at the Loews Regency and Nordstrom will have a pop-up at the JW Marriott Essex House by Central Park. Beauty subscription box brand, Birchbox will continue to expand its partnership with Walgreens this holiday season from 11 permanent locations to 500 pop-ups. The pop-ups will run through the end of December and include “grab-and-go” gifts for the holiday season. In addition, Netflix screened its original movie “Marriage Story” at the famed Paris Theater in New York City this month. It subsequently announced it has taken over the lease of the theater where it will host special events, screenings and releases of new films. 

New Product Offerings 

This month we saw some interesting new products and initiatives launched. Perhaps most expected is Warby Parker’s launch of Scout, a line of daily contact lenses which perfectly complement its line of prescription glasses. The Skimm, a favorite daily news source among millennial women has expanded from content to commerce. It launched an e-commerce site and holiday pop-up boutique called the "celebrate smarter shop”, which sells fashion, fitness, and home décor items inspired by The Skimms’ shopping and trend guides from their daily newsletter. Social media video app, Tik Tok, is also testing out a new feature in the U.S that could provide an entry into e-commerce. Tik Tok is currently conducting a test which allows a dozen of its top creators the ability to add retail links to their videos. 

Targeting the eSports and gaming industry specifically, Herman Miller has partnered with Complexity Gaming to create high quality ergonomic gaming equipment. The famed furniture brand will now be Complexity’s official seating partner and is in the process of setting up an esports focused lab in Texas.  As it relates to gaming footwear, former Beats CEO Susan Paley may have the answer with her newest venture DropLabs. DropLabs is a new technology that enhances music listening through footwear. The company’s first iteration is the EP 01 sneakers. While they have not been created only for gamers, these sneakers can work as a two-way communication device between the game and gamer. 

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