Data Dive

YouTube Soothes, Dunkin’ Runs On Bitcoin, Aéropostale Pulls Off A Miracle

It was a big week for payments and commerce last week. The rapid proliferation of headlines indicated that everyone came back from summer vacation tanned, rested and committed to finishing off 2016 with a sprint.

Some of the big news was expected — the iPhone launched to a collective yawn and probably decent sales in its first weekend. Nothing like having the competition’s phone blow up, literally, to drive sales of your own product.

Some of it was unexpected — like Wells Fargo’s nine-figure CFPB fine for a truly shocking collection of violations. While it’s not hard to foresee the CFPB fining a bank in any given week, the fact that one of the biggest banks in the country had employees creating scores of fake credit card and bank accounts was something that was hard for anyone to truly predict was in the offing.

Well, no one but maybe Amazon. The reasons why it said “goodbye and don’t let the door hit you on the way out” to Wells seem to get clearer by the minute. Who needs that reputational drag.

And the hits, as they say, just kept on coming. YouTube tried to fend off a wave of internet discontent over its monetization policy — with mixed results. Mastercard got pulled into its latest round of interchange fee lawyers looking for a quick buck, and contributing to the miracles-are-real file, Aéropostale managed to avoid liquidation and will live to sell another day.

Need to know more? Read on…


YouTube And Its Discontents

Though the team at YouTube would dearly love to monetize every moment of video content up for grabs on the world’s largest video-sharing platform, not every act of content creation has value that can be measured in money — because no advertiser wants to appear anywhere near it.

Videos that do not fall within YouTube advertiser friendliness guidelines fall into the “demonetized” category, which means ads don’t appear on them and thus content creators don’t make any money.

The issue seems to have arisen when YouTube announced some changes to its monetization policies last week — mostly in response to complaints that had been circulating among content creators that YouTube has suddenly ramped up its demonetization of videos.

According to YouTube, the company started rolling out improved notifications in Video Manager in an effort to make it fairer and clarify confusion in the creator community around its longstanding advertiser-friendly guidelines. Those guidelines have reportedly not changed.

The improved notifications are aimed at making it clearer to creators when a video is demonetized due to advertiser-friendly content concerns and making it easy for them to appeal.

“Today, it’s become clear to us that there is some confusion in the creator community, so we wanted to take a moment to clarify things: We did not change our policy of demonetizing videos that may not be appropriate for Google’s brand advertisers. Nor have we changed how these policies are enforced,” it said.

The notification changes to be rolled out over the coming few weeks include changing the $ icon in Video Manager to yellow with the hover message “Not advertiser-friendly. Request manual review” to make it more clear when a video is demonetized. YouTube will also send an email notifying a creator if a video is newly demonetized due to advertiser-friendly content concerns.

“Note that demonetization decisions may not happen immediately, so a video may be monetized for a period of time after it is uploaded and then become demonetized,” YouTube said.

YouTube said the content creator will be able to appeal to a human judge on their content if they think the decision is in error and that they will be notified once a decision is made on the appeal. If the content creator is successful, the video will immediately be monetized again and have a green $ icon in Video Manager.


Dunkin’ Donuts Now Buyable With Bitcoin

Bitcoin’s days as being sort of a fringe financial product may be coming to a close, since so much of 2016 has been dedicated to pushing toward a more mainstream future.

And it looks like the world’s favorite digital currency has just made a big step forward, as the coffee that America runs on can now be bought with bitcoin.

The ability is unlocked care of eGifter, the online gift card platform, which is supporting Dunkin’ Donuts cards. EGifter notably takes bitcoin, which means distributed ledger has made another step forward into becoming a regularly occurring part of consumer commerce life. Once purchased with bitcoin, customers can then load the card into the Dunkin’ Donuts mobile app and buy all the coffee and egg sandwiches their heart desires.

Bitcoins payments will deprive Dunkin’s drinkers of automatic reload capability; every time a bitcoin shopper needs a new card, they have to buy again from eGifter.

The bitcoin payments option is offered across the spectrum of eGifter’s prepaid card pantheon, encompassing more than 200 brands. Dunkin’ Donuts operates more than 8,000 locations across the United States.

The outlet quoted eGifter CEO Tyler Roye as stating: “The [Dunkin’] card was on our wish list since our first day in business. Many of the eGifter team members start every day with Dunkin’ coffee, also referred to around here as ‘startup fuel.’ Those cups in our hands were a constant reminder that we wanted this card, so we are quite excited to finally be able to offer it to our members.”


Aéropostale And The Retail Miracle

In one of the more dramatic retail stories of the first half of 2016, it looks like, somehow, Aéropostale will emerge from its recent bankruptcy a smaller chain — but one that still exists. And while, under normal circumstances, closing more than half of a store’s retail locations would be difficult to report as a win, Aéropostale has been far from a normal story from the word go.

As August was passing into September, Aéropostale’s liquidation seemed certain. Then, a bankruptcy judge ruled that private equity firm Sycamore Partners — the retail chain’s largest stakeholder — could use the $150 million it is owed by the bankrupt teen retailer as a bid at its bankruptcy auction. This ended Versa Capital Management’s interest in the deal, and by all accounts, it looked like Sycamore Partners was going to use its leverage to liquidate the chain.

And that itself came at the end of a long, acrimonious dispute between Sycamore and Aéropostale’s executive team, which accused the private equity firm of colluding with Aéropostale’s main supplier (and other Sycamore-backed firm), MGF. Aéropostale has long contended that Sycamore and MGF conspired to essentially gaslight the company into bankruptcy.

Sycamore has long since maintained that mismanagement and falling fundamentally out of step with the times were Aéropostale’s problems.

And just when it all seemed over, mall landlords Simon Property Group and General Growth Properties, liquidators Gordon Brothers Retail Partners LLC and Hilco Merchant Resources LLC and licensing firm Authentic Brands Group won ownership of the struggling retail chain with a joint offer of $243.3 million.

The drama is not quite over yet — a bankruptcy court must sign off on the agreement, with a hearing scheduled for Sept. 12.

If that hearing goes the way it is widely expected to, the teen retailer will continue to operate a much smaller footprint of stores — 229 — while the remaining inventory from hundreds of stores to be shut down will be sold off.

Will Aéropostale be able to capitalize on this reprieve? The experts have their doubts.

“Today, Aéro is all about price. They have this kind of junior customer who’s not quite a fast-fashion customer, where Mom’s the real shopper, taking the 11-year-old into the store. So, if that trend is off or too sexy for this kid, Mom’s not going to be buying that,” Shelley E. Kohan, VP of retail consulting at store analytics firm RetailNext. “I think they’re missing the trend for that market.”



The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.

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