FEBRUARY 13, 2025
Are your research dollars allocated to detecting real inflections or have your overspent on predicting the present?
> Explosion in alternative data has led increased precision in predicting KPIs such as current quarter revenues and same store sales.
> Sudden share revaluations in brands such as DASH, MTCH, BROS, SIG, MODG and PLAY indicate significant opportunities remain in detecting organic inflections.
Missing the Forest
The above advertisement from 1996 was prescient, but our promotional ensemble data can help investors better understand the tidal wave of changes that are occurring in real-time.
Institutional investors’ thirst for edge has led to overconsumption of complex ‘information’ that often misses the bigger shifts in preferences. Random Walk focuses on uncovering more actionable inflections based on changes in core demand for products and services through our Promotional Ensemble.
Stay Home and Swipe.
Perhaps mostly driven by 5G and engineered addiction of smart phones consumers are moving away from activities popular in the past. Dating, courtship, buying engagement rings and the products of Signet and marriage appear to be substituted by ordering Wingstop delivery on DoorDash and betting on sports with Draftkings.
Getting together and going out for in person entertainment at Topgolf or Dave & Busters is being replaced by swiping through Insta.
Random Walk Promotional Ensemble
When brands are struggling to generate demand the easiest and most cost effective band-aid is to blast out email discounts. This is where the Random Walk process provides unique edge. We have been capturing, categorizing and classifying millions of email promotions from leading brands for more than 7 years. If decaying inventory isn’t moving quick enough, without spending much on advertising, brands just push out escalating discounts to leads. Conversely, when organic demand is growing brands slow email campaigns.
Random Walk has been serving investors for 14 years. After years of focusing on clicksteam, foot traffic data and other online measurement, in 2017 we shifted to focusing on creating the most quantitatively accurate promotional ensemble in the industry. As others used tractional data to incorrectly assess demand in department stores such as JC Penny, our process alerted investors that these sales were just a result of liquidation coupons.
Listen to learn more about our methodology is different than other big data providers below:
Greg’s chat with Mark Fleming-Williams on Apple Podcasts
Below: skyrocketing steep discounts and a rise in the effective discount uncover the inflection.
Promotional Ensemble for JC Penny: 2017 Liquidation coupon explosion inconsistent with a rebound in organic demand.
Uncover gross proift and gross margin inflections
Our promotional ensemble indices are now available through Maiden Century. For many brands spikes in email promotional activity have meaningful relationships with gross profit and gross margin.
We’re capturing increased promotions from Crocs and Crocs wholesalers.
Promotions from Shoe Carnival containing “Crocs” were up 600% Y/Y in September. We also captured a new “Up to 40% off” Crocs promotion from Walmart last week.
We continue to capture significant email volume from Crocs.com containing “price drop” and prices have dropped,” language we didn’t capture at all last year.
| Random Walk New Keyword Tracker Launched. Our new technology helps investors instantly detect changes in the promotional intensity brands are using to communicate with leads. Detect inflections in core demand through tracking of desperation keywords in emails such as “extra”, “extended”, and “one more day”. Keyword tracker uncovered the largest ever spike in “Nike” related keywords from key wholesale partner email correspondance over the past two weeks. |
| PREVIEW: Promotional Outlier Focus: Nike Partners Sending Record Volume of Discount Campaigns ASO, DKS, FL, M, NKE, SCVL Last quarter, Nike reported slowing revenue growth as consolidated revenue increased year-over-year by 5%, down from 14% year-over-year growth in the prior quarter. While total promotional activity direct from Nike is stable, we are capturing record breaking volumes of Nike coupons from wholesale partners implying lagging organic demand. We also anticipate a weak quarter for Foot Locker, which purchased 65% of its athletic merchandise from Nike during the most recent fiscal year. NIKE PARTNER PROMOTIONAL HIGHLIGHTS Foot Locker (FL) sent record volumes of “Nike” focused promotions in July. We have tracked a 67% year-over-year increase in email volumes containing “Nike” for the May-July period .Academy Sports & Outdoors (ASO) sent greater volumes of “Nike” focused promotions this Summer. We tracked a 49% year-over-year increase in email volumes containing “Nike” for the May-July period. Shoe Carnival (SCVL) Shoe Carnival “Nike” focused promotion volume increased by 2,783% on a year-over-year basis for the May-July period. Macy’s (M) We captured a rare “Special 20-25% off from Nike”. |
June 28
We recently launched a new product that examines trends of promotional activity within subsectors.
Highlights:
Our promotional email ensemble helped investors better understand and quantify the magnitude of changes in the intensity and aggressiveness that apparel brands such as Abercrombie & Fitch (ANF), American Eagle (AE) and Guess (GES) are sending. As weather has warmed, our promotional ensemble reveals robust demand growth as consumers previously stuck at home load up on “going out” summer apparel.
Our promotional ensemble quantifies the changes such as key declines in the volume of email campaigns, the distribution discounts offered.
Successfully channelling rebounding demand for swimwear, AEO’s Aerie has further throttled back its promotions.
Our tracking on an sector basis reveals AEO has become one of the least aggressive promotors compared with its peers compared with just a year ago.
For Guess, our email intelligence allows investors to quantify the exact campaign frequency and intensity. As can be seen below, Guess is pushing out significant promotions and discount coupons much less frequently than a year ago as organic demand has rebounded.
Tracking New Customer Acquisition: 2020 was our most successful year in uncovering demand changes undetected by ‘big data’ credit card and transactional sellers. As COVID forced Americans inside, consumers discovered existing virtual solutions were superior to legacy in person dependent platforms.
For Docusign (DOCU), Fiverr (FVRR), Upwork (UPWK), Wix (WIX) our email intelligence captured exponential explosive growth in new customer acquisitions a full quarter ahead of pricy ‘big data’ transactional providers. By focusing on unique leading indicators such as “Welcome to Docusign” and “Your Wix site is published” instead of chasing coincident revenue proxies such as receipts we provided our investor subscriber parters a big jump on their competition. Docusign (DOCU) shares have appreciated more than 150% since growth in consumers receiving these confirmations triggered our identification in MARCH. Similarly, our methodology identified Upwork(UPWK) to start May with shares quadrupling.
If consumer preferences changes again as Americans leave their homes our investor partners will be the first to know.
We recently made substantial upgrades to our email categorization system. As as result of this, we can now better understand which brands and businesses are changing how they communicate with consumers and leads.
Our weekly ‘Promotional Spotlight’ report highlights the brands whose discounting and promotional activity have diverged the most since the prior year. We can provide custom analysis for investors in brands of interest. Which brands increased their steep discounts? Which brands are sending their seasonal sale related email offers more frequently? Are brands slowing their sending pace based on strong demand.
