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Kelly Cook on David’s Bridal’s Aisle to Algorithm to Amazon Strategy | PYMNTS.com

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Turns out Kelly Cook wasn’t kidding around. When David’s (formerly David’s Bridal) CEO last spoke to Karen Webster in mid-June she promised a big upcoming announcement that would support her vision of rebranding the dominant bridal retailer as a special occasion apparel and media company. But in order to take that next step she needed a big win. A big retail partner to amplify her “aisle to algorithm” vision.

How’s Amazon for a big win? On July 9, David’s opened a new Amazon storefront featuring a new brand that offers gowns and dresses for both special and everyday occasions. By opening The Edit by DB Studio, Cook aims to continue expanding its offerings and ways to shop, positioning it to compete outside of bridal fashion and introduce its fashion to new shoppers through the biggest retailer on the planet. And in fitting with Cook’s expansive vision, The Edit by DB Studio offers styles that span bridal, bridesmaid, wedding guest, junior and occasion wear.

Cook understands that as far as her ambitions for David’s go, it still begins and ends with the bride.

“We needed to serve the brides that wanted a dress that was under $500, but she did not want to sacrifice the quality of a $5,000 dress,” Cook told Webster. “That is the key. She did not want a cheap dress. That is not what she wanted. She wanted a highly constructed, beautiful branded gown of high quality that was under $500. So that’s when we launched, discovered and defined the Edit by DB Studio brand. And we wanted to serve it to as many customers as possible, which is why we partnered with Amazon.”

Aisle to Algorithm

The partnership creates huge opportunities for David’s revenue and Cook’s vision of a special occasion apparel and media company. Nothing says “aisle to algorithm” like buying formal occasion attire on Amazon. But the partnership raises new issues for David’s, which Webster pressed Cook on during their conversation. How could a bride and her guests say yes to the dress without trying it on? How would the mass market Amazon experience play in the specialized, upscale world of David’s? And how would formal apparel play on Amazon?

All those questions define Cook’s next challenge, which is convincing brides that a dress ordered with one click can still make them feel flawless on the big day. “Most women, most brides want to come in for an appointment. They want to fit the dress because fit is everything,” Cook acknowledged. Yet pandemic‑era virtual consultations proved the fitting room can be digitized. “Our virtual stylists are incredible. I mean, they sell millions and millions and millions of dollarsof gowns online without ever seeing a bride in person.”

For Amazon shoppers, the safety net is logistics, not tailoring. “Amazon has such an incredible model, meaning you can buy multiples and return. That process is extremely convenient for brides,” she said, noting Happy Returns counters at Kohl’s and UPS that remove friction from the try‑buy‑return loop. And David’s is hardly ceding speed to its new partner. The chain already has an inventory of about 400,000 dresses locally across the country, with each of its retail locations serving as a distribution center. The difference, she said, is that Prime now meets a cohort of “last‑minute brides” who shop “a month away”— or even a weekend before — without compromising fit or style.

Cook insists the partnership will enhance rather than dilute the 75‑year‑old brand. “We think we’re fulfilling a need on Amazon to offer trustworthy, high-quality, really sophisticated craftsmanship gowns,” she said, recalling that reporters at New York Bridal Fashion Week could not single out the Amazon‑bound styles from the couture rack.

Asked whether the anything‑goes Amazon cart — where a $199 wedding dress might sit alongside paper towels — could cheapen the experience, Cook was blunt: “If our bride chooses a David’s dress but she wants to buy it on Amazon, we’re serving her … we’re just so privileged to serve her.” The storefront, she noted, flows directly from management’s first pillar under its “Aisle to Algorithm” roadmap: “to own all bridal across all price points and channels.”

Data to Aisle to Algorithm

What David’s hopes to gain from the experiment is data and speed. “We want to know what sells the quickest … Amazon could just get us data faster,” Cook said. Occasion‑wear prices on the marketplace have already climbed from $49 four years ago to $199 today, and David’s “is forecasting that the Amazon price point will continue to grow as they lean more heavily into fashion. She also wants a close look at Prime‑style fulfillment: “They are the best at distribution … is there something we can learn from them there as partners?”

Traditional seasonality is shifting, too. “About three years ago, we were seeing this massive spike come up in May, Cook said, eventually realizing, “guess what else requires a white dress? Graduation. Meanwhile, many ceremonies now require wardrobes, not just one gown. “Some of our data say their second dresses, some of our data say their third dresses … we even have brides buy an exit dress, she said, adding that Amazon’s two‑day promise “allows them to sort of level up those second and third and tertiary dresses without sacrificing look or fashion.”

Wholesale rollout is next. The vertically integrated chain “is going to be partnering with boutiques to supply gowns at a fraction of current wholesale prices. And Cook double-clicked on her last interview with Webster, which dealt mostly with the role AI will play in the aisle-to-algorithm journey. “Our vision is to be the largest AI retail and media marketplace for all special occasions.”

Cook closed with the metric she guards most closely. “The number one word customers use when they describe us is trust, and we will never do anything to break that trust, she said.

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US Proposes to Expand Delivery Drone Flights  | PYMNTS.com

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The Trump administration has proposed a rule to significantly expand drone operations, which could alter America’s shopping habits, boosting retailers like Walmart and Amazon as they expand into delivering consumer packages by autonomous aircraft.

The proposal, unveiled on Tuesday (Aug. 5), aims to safely integrate drones — technically called unmanned aircraft systems — into the national airspace. Under current rules, operators must seek individual waivers for flights beyond the drone operator’s direct line of visual sight.

The Federal Aviation Administration’s (FAA) Bryan Bedford said comments accompanying the rule announcement that the “Beyond Visual Line of Sight” proposal is key to realizing drones’ societal and economic benefits.” He cited package delivery first, followed by agriculture, aerial surveying, public safety, recreation and flight testing.

An FAA fact sheet said that under the proposal, drone operations would occur at or below 400 feet above ground level, from pre-designated and access-controlled locations. Operators would need FAA approval for the areas where they intend to fly, and proposals for a single operator to fly multiple drones would be evaluated on a case-by-case basis.

Late last year, Amazon’s Prime Air drone delivery service got a boost with new drones that have double the range and half the noise of previous models.

Approved by the FAA the month before, the drones began operations in select areas of Arizona and Texas, delivering small packages weighing up to five pounds. The retail behemoth paused the aircraft for two months for a software upgrade but resumed flights in April. Amazon aims to deliver 500 million packages by drones by the end of the decade, with groceries and other retail goods on a customer’s doorstep within an hour of ordering.

In June, Walmart expanded its ultra-fast drone delivery across five states to Arkansas, Florida, Georgia, North Carolina and Texas.

Accounting firm PWC sees drones making 808 million deliveries to global consumers by 2034, at an average cost of around $2 per package. 

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Household Debt Rises to $18.39 Trillion as Auto, Mortgage Originations Tick Up | PYMNTS.com

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Mortgage balances led the rise, growing by $131 billion to $12.94 trillion as housing activity remained stable despite affordability concerns. Auto loan originations also climbed, totaling $188 billion — up from $166 billion in Q1. Credit card balances rose by $27 billion, while lenders expanded aggregate credit limits by $78 billion, pointing to continued lender optimism in extending consumer credit. 

But that expansion came alongside rising signs of financial pressure. Student loan delinquencies surged as paused missed payments resumed reporting. The share of seriously delinquent student debt jumped to 12.9% — up from just 0.8% a year ago. More than 2.2 million borrowers saw their credit scores fall by over 100 points, and 1 million lost at least 150. Bloomberg Economics estimates these credit shocks could pull $63 billion in consumer spending out of the economy on an annualized basis.

Delinquency rates for mortgages and home equity lines of credit also ticked up, though performance remains strong relative to historical benchmarks. Still, rising mortgage costs have pushed 70% of households earning more than $100,000 into living paycheck to paycheck — a sharp shift in financial stability among higher-income consumers. 

As traditional credit becomes harder to manage, younger consumers are turning to alternatives. Buy now, pay later (BNPL) usage continues to rise, especially among Generation Z and younger millennials — 58% of whom now prefer BNPL over credit cards. That shift is also shaping commerce habits: 43% of shoppers now choose merchants based on whether installment plans are available.

At the same time, 69% of Gen Z consumers report living paycheck to paycheck. One in three U.S. adults also said they experience surprise expenses of several hundred dollars each year — making short-term financing tools more of a necessity than a convenience. 

Together, these trends reveal a consumer credit landscape in flux. Borrowing continues to rise, but so do the risks tied to repayment, especially for younger and mid-income households navigating higher costs and shrinking buffers.

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Upstart Sees Surge in Demand for Auto and Small Dollar Loans | PYMNTS.com

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Triple-digit gains across key business segments — as measured in loan originations and revenues — were not enough to stave off a 7% drop in Upstart Holding’s shares in after-market trading on Tuesday (Aug. 5).

Company materials revealed that revenues surged 102% year on year in the second quarter, while the platform’s loan originations topped more than 372,590 in the period, up 159%. 

The data showed that as loans topped $2.6 billion, personal loan originations were up 143%. The company also noted that borrowers with super-prime FICO scores represented 26% of originations.

Upstart’s management noted on the call that other business lines such as auto-related loans also saw growth. The platform originated more than 4,600 auto loans in the second quarter, up more than 6x from a year ago and up 87% sequentially, equating to $114 million in volume. Home loans were up by 9x year on year to $68 million in originations, jumping 67% sequentially.

Management has guided to $1 billion in revenues for the current quarter, which is in line with Wall Street consensus.

Growth in Newer Business Lines

During a conference call with analysts, CEO Dave Girouard said that with respect to the auto business, “the dealership adoption right now is like nothing we’ve seen in the past, and the volume of loan requests and closed agreements from our dealer partners is on a steep climb. This is a recent phenomenon.”

Girouard said that the newer businesses in home and auto attracted almost 20% of new borrowers to the platform, including the small dollar loan product, which grew 40% sequentially, crossing more than $100 million in originations in the latest period. 

“Our growth last quarter was not a result of dramatic macro improvements or Fed rate decreases,” he said. “Our growth was primarily on the back of model improvements.”

Upstart’s models, he added, powered by AI, helped drive conversion rates from 19% in Q1 to 24% in Q2. The improvements were tied to Model 22, which the company launched in early May.

Funding Pipeline Outlook

“Our funding partnerships have been both durable and scalable, allowing us to grow rapidly while delivering the target returns our partners expect,” Girouard said. “With respect to banks and credit unions, we expect to reach a new all time high for monthly available funding in Q3, surpassing our prior peak from early 2022. The funding markets continue to improve as the year progresses, particularly since the Liberation Day fears in early April subsided.”

Added Girouard: “We’re building the ‘always on everything store’ for credit, aiming to persistently underwrite 100% of Americans.”

Upstart Co-founder and CTO Paul Gu said on the call that the model upgrades had translated into “numerous improvements and optimizations to how customers can pay, how much they pay, and when they pay. As a result, year-over-year population adjusted delinquency rates are down 20%, and raw delinquency rates are down 32%.”

CFO Sanjay Datta said in remarks on the call that “the broader macro has been idling in regards to its impact on credit trends, registering as neither a significant headwind nor tailwind over the past months.” Fee-based revenues were up 84%, he said, and was 15% better than guidance.

“Average loan size of approximately $7,570 was 15% lower than the prior quarter as model advancements drove higher approval rates in smaller loan amounts,” Datta said. Management also noted on the call that the shift to small dollar loan products also has moved to drive average loan sizes down.

Asked on the call about the competitive nature of the markets, Girouard said that the improved funding environment “does tend to bring more competitors into the space. So unsurprisingly, it’s a fairly competitive game these days … We’re very focused on having best offers both at super prime level and at our core business as well. We’re confident in our ability to grow our market share and keep our strength in those markets.”

As for the state of the consumer, Datta said: “We’ve been consistent in saying that the American consumer in aggregate is probably overspending relative to the income levels that we’re earning and that’s been true for a while now. If that balance improves, we would expect that credit trends would improve as well.”

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