Aggregators Pivoting into Agency and Incubation Not Enough to Save Them

Modern Retail has an article today about Heyday partnering with Eva Longoria on a new line of cookware -- a new celebrity brand.

Heyday CMO (just there for a year and a half): "We've always been about pioneering a new digital-first approach to brand-building."

Bollocks.

Look, you don't need to raise $800M dollars to build a new digital incubator. You need to acquire brands and operate them.

This is a classic misdirection and just about PR.

If you just want to own IP, start a new IP licensing firm and acquire the brand assets, and have someone else operate it. It's quite a profitable and proven enterprise with few headaches.

Celebrity brands have been created since there were celebrities.

Aggregators were built on the promise of acquisition and economics of scale through operation. That premise was always incredibly more difficult than advertised.

Of course Heyday has incubated (a few) brands, but there is a reason Heyday exists and it's not to "create digital-first brands" from whole cloth. How are you going to return 10x on that $800M?

The Heyday founders were financiers, not operators. Of course, operators were hired, but that's not the point.

Look, there are fewer profitable Amazon brands to acquire.

It was never easy to run an Amazon business.

It's far more difficult to integrate Amazon brands post-acquisition.

Warmed over aggregators are still aggregators at the core, and in the end what we have is VC firms trying to invest in and predict retail outcomes. What's the secret sauce?

Not buying it.