1) Mira debuted its eponymous beauty search engine, merging community with AI to bypass fake reviews.

WHAT HAPPENED: Available as a website and a mobile app, Mira bundles comparative pricing for beauty products and user reviews into digestible synopses. Users can search for beauty products, message with community members, and use facial recognition to find the right products. The company raised $4.5 million from a group of investors including Unilever Ventures and 14W.

WHY IT MATTERS

  • The need for authentic reviews is increasingly important as new beauty brands and products continue to emerge. This week the FTC reached a settlement with the cosmetics brand Sunday Riley after it published fake reviews on Sephora.com for close to two years to increase its sales. Thingtesting, a platform promoting unbiased consumer reviews for direct-to-consumer brands, with recent funding from Silicon Valley investors, proves that there is a growing interest in impartial reviews across the consumer economy. Mira’s ability to use algorithms to promote authenticity and transparency within the beauty space is hard to replicate but could make a difference.
  • Service and experience are essential, but Mira’s accessible community and AI-driven product recommendations challenge retailers like Sephora and Ulta. Sephora’s physical footprint and its knowledgeable staff are helpful, but Mira’s algorithms enable consumers to get better results faster. Sephora launched its Insider Community in 2017, which allows users to review products and participate in conversational forums, but only around products stocked at Sephora. Mira’s focus on what’s best for the user, regardless of where the product is sold, makes the beauty-search engine especially valuable.

2) Nordstrom will open its first flagship store in New York City, but the emphasis on hospitality doesn’t guarantee staying power.

WHAT HAPPENED: Nordstrom will open its first New York City flagship store in Midtown Manhattan on October 24th. The department store will feature a range of direct-to-consumer and luxury brands as well as a food and beverage service available for shoppers almost anywhere in the 320,000 square foot store.

WHY IT MATTERS

  • Nordstrom’s wide-ranging product offering and its central location will attract many shoppers, which will make it challenging to maintain a superior level of service. Offering food and drink service across the entire store will create logistical challenges that could backfire. Long wait times and food-related messes—guacamole on your Givenchy blouse —could make the Nordstrom shopping experience more chaotic than relaxing, ultimately deterring shoppers from visiting again.
  • The retailer’s eclectic brand offering might be more impactful than its emphasis on beauty and hospitality services. Nordstrom’s new/old/high/low assortment will help it attract a diverse audience. Hudson Yards, which opened in March, has already reported early success with a similar juxtaposition of brands, which could be a good sign for Nordstrom. While its diverse product assortment is positive, having so much space to fill forces the retailer to buy more things, resulting in an over-inventoried store—a main ingredient in the demise of American department stores.

3) Affirm launched a new mobile app that connects consumers directly with brands while allowing them to bypass brands at the same time.

WHAT HAPPENED: Affirm’s newly designed app allows customers to quickly find the participating 3,000 companies that use the platform as a financing option. It also allows customers to use Affirm on purchases from companies who have not yet integrated the service into their checkout by generating a one-time credit card number.

WHY IT MATTERS

  • Affirm’s new technology enables it to better influence customer purchasing behavior. Until now, Affirm has been a boon for consumers without a credit card. Paying with Affirm usually comes up during the shopping or checkout process, rather than as a planned payment method at the start of a purchase. Though the platform doesn’t yet have the rewards system of retailer-branded credit cards, Affirm’s mobile application creates a new sense of loyalty between the payment platform and the consumer.
  • The one-time credit card number allows Affirm to reach a broader audience. Instead of relying on the company’s sales team to strike all of its brand partnerships, the one-time credit card number allows customer to use Affirm across the internet instantly. This is beneficial for customers without a credit history and turbo-charges Affirm’s sales team, who can now see where demand is and use the data to better sell into specific accounts. This data-driven approach will allow Affirm to better focus its sales resources and should exponentially increase the use of its product along with its revenue.

4) Lego might create a rental service, signaling the evolution of the traditional toy model.

WHAT HAPPENED: Tim Brooks, the vice-president for sustainability at Lego, said that the company is “totally open” to the idea of a product rental scheme. “But it has to come down to the value proposition.”

WHY IT MATTERS

  • If Lego could introduce a plausible rental scheme, other toymakers might follow suit. Much like children’s clothing, a rental model is ideal for the toy industry. Kids apparel and toys are often passed down through families or neighborhood networks, but a well-priced service, spearheaded by an iconic toymaker like Lego, could change the industry as a whole. If Lego could incorporate recycled plastics alongside a rental program, the kids’ category could transform into a more affordable and sustainable enterprise.
  • Lego’s stance indicates that the company is open to change and is listening to consumer demand. The sheer number of pieces that make up a modern lego set and a child’s tendency to lose parts could, however, make a rental model difficult for Lego. But the move is likely to attract sustainability-focused parents who are working to phase out single-use plastics from their households. With significant competition in the toy space, and it becoming harder to maintain a brand over time, positioning itself at the forefront of the modern parenting mentality will help Lego continue to stand apart.