Future of commerce 🔮
Snacks winning, NFLX disaster, and more edtech.
Hi 👋, Tanvi here.
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Let’s go ahead and get started:
Stock market summary:
US - S&P 500 up 0.28%
India - Sensex up 1.50%
Google takes another shot at commerce 🎯
Google is looking to merge short form videos and ecommerce to create a new platform called Shoploop where users can watch 90 second videos of products and then buy them in-app with 1-click.
Developed by Google’s internal research and development department Area 120, the product is currently undergoing public tests. Video commerce is picking up rapid steam globally Google is already well versed in both aspects of the equation - video experience with YouTube and some ecommerce experience with Google Shopping.
Video based ecommerce is actually already quite popular in China and other southeast Asian countries. Hosts conduct live selling sessions and end up with millions in orders in no time. Some of the sellers in fact have become celebrities, raking in million dollar contracts like sports personalities.
Western tech companies are now taking notice. However, Google is notorious for launching a bunch of products and then quickly killing them so I guess we will wait to see how this pans out.
Key takeway: Video commerce has existed on TV for ages. Startups like Meesho, BulBul, SimSim are pioneering a digital version of this in India. Western world hadn’t seen much in this space but Google’s entry underscores renewed interest. This space will be hotly contested.
Snacking is through the roof 🤯
Biscuits and bakery product maker Britannia, posted a blowout quarter boosting profits by 117% YoY on the back of 26%YoY growth in revenue. Total revenue for the quarter was Rs. 3,384 Crore.
Panic struck consumers stocking up on snacks early on to deal with the pandemic lockdowns clearly helped the company. The price of raw material went up moderately which ate into some profits, however these trends are expected to stabilize. Investors were already hoping for a breakout quarter and stock had gained 42% since March.
The company employed localised strategies to meet the surge in demand and compete against other players. When the lockdown was eased Britannia focused on getting distribution levels up and reaching stores in rural areas as well says management. Read more.
Investors won’t chill 📉
Netflix reported quarterly earnings yesterday and the markets went nuts. The company grew revenue 25%, added nearly 10 Million new subscribers in the last three months, and announced a new co-CEO as a possible successor to legendary Reed Hastings.
But the stock was down 10% as investors did not like the projections for new subscribers next quarter. Netflix expects to add 2.5 Million new subscribers next quarter while investors were expecting something like 5 Million. Ouch.
Netflix stock had been the pandemic poster child so far as locked down consumers turned to streaming to pass time, accelerating sales growth for the company. Also, it helped that most movie theaters were closed. But it appears that with time the demand has evaporated.
Summary: the FAANG stocks (Facebook, Apple, Amazon, Netflix and Google) hold the key to US tech markets. So far they’ve had an excellent run on the back of the pandemic. Anything short of imperfection could crater the run, and with that bring the broad market down. Investors closely watch the rest of that group that report in the coming weeks. Read more.
Edtech is on fire 🖥️
Vedantu has now raised a $100 million Series D in a round led by Coatue Management along with some of its existing investors, valuing the startup at $600 Million, reportedly in the No.2 position behind Byju’s. Just a few days ago legendary tech investor Mary Meeker’s Bond Capital invested in Byjus.
The edtech market is heating up as many schools and colleges are shut and shifting online because of the pandemic. Vendatu registered a 220% growth in users in the last 3 months with over 2 million students joining its live classes since the pandemic began.
Strong growth and great execution in managing the live classes has apparently been key in attracting investors. The capital raised will go towards ramping up its grade 1-5 education. This is Vedantu’s third investment in the last 12 months alone.
Bottomline: ed-tech platforms have at best penetrated 75 Million students, while there are almost 600 Million Indians below the age of 25. This is a massive massive market and the next 5 years will see countless billion dollar ventures pop up. Brace yourselves. Read more.
What else are we snackin’🍿
🍿 Zydus receives nod to test drug in Mexico - Zydus Cadila has received approval from the Mexican Regulatory authority to conduct clinical trials for its COVID-19 drug. The study will be a comparative one aimed at evaluating safety, efficacy and tolerance in COVID-19 patients.
🏛️ Instacart is suing Cornershop - Instacart has filed a lawsuit against Uber’s grocery delivery service Cornershop, over stealing its copyrighted images, product descriptions and pricing data. Grocery delivery business is heating up and both companies are eager to lock horns.
🚙 Nissan launches its first electric SUV - Taking on Tesla and a range of other young startups, Nissan unveiled its first ever electric SUV Ariya offering a drive range of 300 miles on a single charge.
🙁 Layoffs despite booms in certain categories - Curefit has undertaken a second round of layoffs and furloughs, impacting hundreds more just two months after it laid off 700 workers. The downsizing comes after business is hurt due to prolonged closure of fitness centres.
🤚 Hiring is on the pause - The number of jobs openings fell 6.73% YoY in the first quarter of the ongoing fiscal. Certain roles including IT designers, engineers, sales, operations and management professionals, HR and admin staff saw higher demand during the period. No surprise here.
😷 India's coronavirus count hits million - total infections crossed 10 Lakh while death toll crossed 25,000. India is the third country to report over 1 million cases after the US and Brazil.
Hope you took a thing or two away from today’s edition. 😀
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