Cash for class: Not new, not disruptive

Welcome back to Notes From the Economy Class, the newsletter that does not charge you for selecting your seat ahead of time. Thank you all for such a lovely reception on launch, and thank you for your patience with bumps like "Who is this newsletter from?" and "Why did all the links italicize of their own volition?"

 Here's to clear skies and clear inboxes.

My group chats lit up Sunday with the news that Shein is buying Everlane for $100 million, a move that would appear to be the nail in the coffin of transparent and ethical retail, and has been framed as such in a few articles. Everlane, you may or may not recall, was part of the wave of Direct To Consumer (DTC) retail industry disrupters bursting out of San Francisco during the Obama administration. 

Aesthetically, companies like Everlane, Allbirds and Cuyana heralded the end of Aughties-era plastic bubble necklaces and sequined high-low exuberance (per the Jenna Lyons era of J. Crew) for a minimalism that owed as much to the frictionless promise of technology as it did the water-clear promise of knowing which factory in Vietnam made your fantastically unflattering sailor pants. Operationally, what DTC did was put regular retail on notice: retailers that wanted to compete with the clean, digital experience a DTC brand offered were going to have to learn how to lock down supply chain readiness, manage multichannel offerings, and use data to drive both customer engagement and demand forecasting.

A decade later, brick-and-mortar retailers had adapted, consumers were drowning in a sea of finally-shaky DTC brands, and the airy, transparent minimalism that had felt so fresh in the mid-2010s had been smothered under a pile of quiet luxury-coded cashmere and boring "ethical" fashion in colors ranging from barley to oatmeal. Suddenly, shopping offline got cool again. 

A lot of the knee-jerk opining centered around the notion that millennial idealistic retail is dead. (See also: Allbirds.) This isn't why Everlane got snapped up by Shein. 

The reason is actually much more quaint: It's a dollar princess marriage — cash for class. Everlane is carrying $90 million in debt and Shein is carrying reputational skepticism viz its practices (plus an EU investigation). By buying a company that used to offer radical transparency in the supply chain, it's Shein's chance to signal that they get it, they're not treating their workforce terribly, now please buy from their premium brand that doesn't exploit people (as much).

Gen X has been through this already. In the 1990s, a handful of brands were able to charge premiums for their products under the premise that they were doing capitalism in a socially and environmentally conscious way — Aveda and the Body Shop both promised a clean and global alternative to the (presumably) petroleum-soaked artifice of one's usual toilette, while Ben & Jerry's got away with charging a lot for a pint of ice cream because no sloths were harmed in the making of Rainforest Crunch. In 1997, cosmetics juggernaut Estee Lauder bought Aveda for $300 million in cash; in 2000, Unilever bought Ben & Jerry's for $326 million, and in 2006, L'Oreal bought The Body Shop for $1.15 billion.

Of the three samples I cited, only the Aveda acquisition was a success. L'Oreal sold off the Body Shop in 2017, the brand foundered before shuttering in the U.S. in 2024, and then coming back a year later as an e-commerce play by a private equity firm. Yet despite the vicissitudes of the modern market, all three still retain reputational patina as icons of values-reinforcing commerce.

The Everlane purchase is no different. If anything, its acquisition by Shein proves that shopping one's "values" is a premium differentiator. The challenge now will be seeing whether Shein gets its money's worth for the reputational brand equity they just bought.

An unpleasant byproduct of spending a lot of time staring at a screen is my reduced ability to really sink into a paper book. Because print literacy requires developing and flexing specific cognitive muscles, I figured I'd retrain for improved reading just like one trains for a marathon by mixing short and long runs, i.e., by mixing intensive reads with lighter ones.

At least, that's my justification for my ongoing celebrity autobiography habit.

For Mother's Day, I received a copy of Liza Minelli's Kids, Wait Till You Hear This!, a book that is the celebrity autobiography equivalent of a doormat-sized chocolate lasagna. I have to nibble away a section at a time, so overstuffed is the tome with name-dropping, minutia-stuffed monologues, and ceaseless exuberant emoting. It is decadent, and too much makes the head spin.

In a section on entertaining (!), Minelli revealed her secret to her fabulous parties: She gets out her collection of Elsa Peretti-designed Tiffany silver bowls and fills them all with KFC. Yes! The Colonel is invited to the same parties that Madonna, Whoopi Goldberg and Quentin Tarantino all go to!

I adore knowing this. I am now inspired by this. And I am reminded of another excellent light-workout book I crack frequently for its recipes, Julia Reed's South: Spirited Entertaining and High-Style Fun All Year Long. In the "Summer Celebration on the Lawn" chapter, which treated fried chicken as the rightful showpiece of an alfresco dinner, Reed defended the virtue of getting KFC and then serving it with champagne, for science. As she reported:

I don't know about you, but I'm all for channeling Liza and Julia, picking up the Tuesday night special at KFC and a bottle of sparkling white from my favorite local market, and serving it up on silver-plated platters. Kids, wait till you get a load of dinner!