Thursday, June 29, 2017

Flowers in the crevasses

On the front page of the Journal today there is a story about Nike and Amazon. Basically, Nike hadn't let Amazon sell its branded products directly because it didn't want to give up control of its branding and also wanted to maintain higher margins, but lots of 3rd party resellers had been selling Nike on the Amazon platform anyway. What is interesting is where they got their products. Many of them apparently scour discounters like TJ Maxx, Walmart, even Nike's own website, hoover up stuff, and then sell it on Amazon.  Really small players, like one person with two or three helpers.

It is truly astounding how markets work, how people can be disciplined about pricing, see opportunities, and dive in their and make things work. In aggregate, the third-party resellers were in effect eroding Nike's power over the presentation of its own brand, which in turn pressured, if you will, Phil Knight to toodle up from Beaverton, Oregon and do a deal with Mr. Bezos up in Seattle.

The economy will continue to change. As AirBnb, Uber, and Lyft change lodging and transportation, new niches will appear. Already the question of little amenities in AirBnbs arises. If shared soap and shampoo is not attractive, who will scale up the delivery of miniatures to AirBnb owners? (thinking for just a second: Amazon) What about new kinds of hostels for Uber and Lyft drivers who spend 4 days a week in higher rent locations like the Bay area then retreat to where they live? (Probably someone on AirBnb) I'm pretty sure this is happening. Uber and Lyft should be gathering data (or someone should) to help drivers shift between metro areas in response to shifts in volume, perhaps for events, or for seasons. If, for example, there are parking constraints around beaches in summer, and a lack of public transportation, we should see Uber/Lyft van services arise that can provide fluid, variable capacity between places on, say, Long Island, and Jones Beach, for example. I just read that institutional buyers have been buying houses and apartments in choice neighborhoods and turning them into AirBnbs, which has in turn impacted the availability of housing in some markets. And has riled neighbors.

On the other hand, friends in Princeton just built a spare room on the back of their house and are clearing $3k a month from it. I stayed there in March (for free, thank you). It was nice.

1 comment:

Anonymous said...

You could drone drop your enhancement cream anywhere in the world!!