Today in retail, Instagram’s algorithm change triggers a social commerce drop for food companies, while inflation could come to the rescue for secondhand apparel retailer Poshmark. Plus, Petco focuses on its long-term plans for its health and wellness growth.
Food Companies See Social Commerce Drop off After Instagram Algorithm Change
Food businesses that have relied on Instagram to build, maintain and grow their followings have been hit hard by recent changes in the social media app’s algorithm.
Businesses that had seen high engagement with a social strategy centered on photography and captions have been left by the wayside as the platform has begun to surface videos and deprioritize still images, The New York Times reported Tuesday (March 22).
In late December, Head of Instagram Adam Mosseri announced the shift in focus to video. Given the higher barrier of entry required to create successful video content — taking photographs of an item does not require the resources needed to produce a high-quality video — the change has made it harder for small businesses to stand out on the platform.
Macy’s Adds More Backstage Stores as Bargain Hunting Business Booms
Macy’s fast-moving plan to open 37 new off-price store-in-store Backstage locations over the next three months to go with the 300 existing Backstage outposts is not only a reflection of the times but a statement on a changing industry.
The department store said the rapid rollout will get underway next month and be completed by the end of June — including in its New York and Chicago flagship stores.
The strategic shift reflects current consumer trends and will not only serve growing customer demand for “quality merchandise and brands at great prices,” according to a company announcement, but will also meet the needs of shoppers who enjoy a “thrill of the hunt” type experience when they shop.
Petco Unveils Long-Term Health and Wellness Strategy
Petco Health and Wellness Company, Inc. on Wednesday (March 23) announced its long-term strategic plan to catch Chewy in the increasingly competitive pet health and wellness sector as part of its 2022 Investor Day.
Petco’s Investor Day agenda included outlining a future loyalty program under Vital Care that will migrate customers to subscription, save money for customers and expand Petco’s position as the premiere destination for pet parents; testing Small Town Rural concepts in key locations; increasing brand awareness in low-share markets; and building a differentiated merchandise offering through its vendor relationships.
Petco’s strategic plan also includes scaling personalization capabilities by adding more data on pets and their so-called pet parents to deepen engagement and loyalty; building a customer-centric fulfillment network through a more robust physical footprint and additional digital capabilities; and driving access to new customers through partnerships with Lowe’s and other brands.
GameStop Chairman Ryan Cohen’s Tweet Sends Stock Surging
Video game retailer GameStop Corp.’s shares were up early Wednesday (March 23) after surging more than 30% Tuesday, in part because Chairman Ryan Cohen said he had purchased 100,000 shares of the company’s stock Tuesday (March 22).
RC Ventures LLC paid between $96.81 and $108.82 for the shares it purchased. Cohen now owns 9.1 million GameStop shares, or 11.9% of the company, according to a Tuesday (March 22) report in The Wall Street Journal.
GameStop’s stock has been on a roller-coaster ride since early last year, when it was part of a social-media-fueled trading frenzy. Shares peaked at $350 last year before steadily dipping to as low as $78.11 when investors were concerned about the company’s performance in the last three months of 2021.
Inflation Might Fix Poshmark’s Growing Business, Falling Stock Problem
After secondhand apparel retailer Poshmark’s IPO debut 15 months ago, when its stock briefly raced above $100 per share, it has literally been all downhill for the reCommerce platform ever since.
Today, with its stock down 90% from the peak and its market value slipping below $1 billion, Poshmark is struggling to convince investors — who not long ago loved it — that its story is still intact.
But where the reseller from Redwood, California has failed to change the Wall Street narrative in its first year as a public company, a brand-new incidental condition may have better luck: inflation.