Months after stepping back from plans to open a US factory, Peloton announced earlier this week it will start outsourcing the manufacturing of its bikes and tread machines to Rexon Industrial, its Taiwan-based manufacturer, to recover financial losses.

• Peloton also hopes to streamline its supply chain. “We believe that this, along with other initiatives, will enable us to continue reducing the cash burden on the business and increase our flexibility,” CEO and president Barry McCarthy said in a statement.

Don’t sweat it: Mike Simoncic, managing director at Alvarez & Marsal Consumer Retail Group, agreed that the move might actually help Peloton navigate a challenging supply-chain environment. “Turning over…the actual manufacturing of the equipment makes a lot of sense, because you’re going to lean on a third-party partner, who actually has more scale,” he told Retail Brew.

Zoom out: The timing also makes sense, Simoncic noted, as Peloton shifts its attention from manufacturing to enhancing its membership service—something CNBC also noted has appeared to be McCarthy’s focus to get the company back on track.

• Peloton hiked the price of subscription to $44—up from $39—earlier in June.
• The company is also trying a model that lets consumers rent its machines for a flat rate to boost demand.

“Peloton’s competitive advantage is more in the user experience,” Simoncic said. “The focus needs to be more on the user-experience content generation and retention and growth [of] subscribers. I don’t think the in-house manufacturing is where they need to differentiate.”—JS

While most cultivated-meat companies are betting on reproducing the most popular proteins in the world, one Australia-based startup has a different idea. Vow Food wants to bioengineer entirely new, better forms of meat. Emerging Tech Brew’s Dan McCarthy has more deets:

“We can just invent entirely new types of meat that are going to become as abundant, well-recognized, and well-understood as a Cheerio is, 80 years in the future,” Vow founder and CEO George Peppou said in June during a talk at New Harvest, an annual cellular-agriculture conference.

Vow announced its first brand—a cultivated-quail product dubbed Morsel—in May, and pending regulatory review, it will be available at one high-end restaurant in Singapore later this year, Peppou told us. It also just finished building its first factory in its hometown of Sydney, which will produce Morsel. Peppou declined to share exactly what Morsel’s made of, but told us that up front you get some “umami, roasted chicken” flavors before it melts in your mouth “like a beef brisket” and concludes with some “seafood notes.”

Cultivated meat is still unproven at scale, and right now, it’s only legal to sell in Singapore. But the space is drawing more and more investment as the industry pushes for regulatory approval in the US and elsewhere: Since 2020, investors have poured at least $2.4 billion into cultivated-meat startups. McKinsey predicts cultivated meat could be a $25 billion industry by 2030, accounting for as much as 0.5% of the world’s meat supply. Even so, some experts are skeptical that the industry will ever be able to scale and compete with traditional meat producers.

Click here to read the full story on Emerging Tech Brew.—GT

Today’s top retail reads.

Unsnapping the Gap: How the Gap lost its groove. “The Gap’s failure is all about its lack of leadership," said Mark Cohen, director of retail studies at Columbia University’s business school. “They had a brilliant period of growth and popularity, which they frittered away.” (CNN)

Adapt and conquer: The founder of the new adaptive-fashion marketplace, Adaptista, sees huge potential in the space. (Vogue Business)

The ties that bind: Here’s why there’s “unprecedented” growth in the menswear market. (Business of Fashion)

to brand loyalty: Building trust with consumers during Black Friday, Cyber Monday, and beyond starts with honesty and authenticity. Wunderkind’s Market Outlook Report breaks down ways to drive customer loyalty and increase revenue. Get the insights here.*

^{*This is sponsored advertising content.}

Is your brand ready for the metaverse? We discuss why you should be thinking about this virtual space now—before your competitors do!

The big numbers you need to know.

There are few things that unite consumers as much as a good sale, and that seems to ring true for Prime Day this year. The two-day event pulled in a whopping $6 billion on Tuesday alone, according to Adobe’s Digital Economy—making it the biggest online spending day of 2022 so far.

• In all, Amazon said it sold 300+ million items during the event and called it the biggest Prime Day ever.
• Total online sales for Prime Day were just shy of $12 billion this year, per Adobe Analytics, up 8.5% from 2021. 

Up, up, and away: The average order value on day one increased 13.1% this year, compared to 2021. Meanwhile, retailers that offered curbside pickup saw their conversion rates up by 11.8% YoY, which also boosted the likelihood of a purchase in comparison to an average day in June.

And while many categories offered good deals, there were a few that had better discounts than others. 

• Toys topped the list, with discounts of 15.4%, followed by apparel at 11% and electronics at 6%.

Catch up on the Retail Brew stories you may have missed.

• The state of American manufacturing jobs, in three charts
• How a former P&G exec is helping take the risks out of CPG launches
• A look back at the Great Recession and how it changed the retail landscape