For anyone in ecom or performance marketing, this podcast is a must listen. Forget ROI and ROAS, think unit economics, says former investment banker (her last big deal was the Myer float) turned entrepreneur Carla Penn-Kahn. She was early into ecom and left Credit Suisse to launch four of her own – Kitchenware Australia, A Gift Worth Giving, Everten and Buy My Thing. But she sold her last venture last year when she realised it had hit peak profitability. With performance ad prices doubling in four years, and Amazon reaching full speed, the unit economics weren’t going to get any better. Penn-Kahn thinks direct-to-consumer trailblazers have likewise lost their mojo – and their moats – and face the same dilemma, because they can no longer sustainably scale through advertising and VCs are sharpening their bottom line focus as much as the top.

Meanwhile, Amazon has just signed an exclusive deal with Australia Post to deliver on weekends. “I can’t see other brands like Myer and DJs getting Aus Post to do the same for them … which 100 per cent gives Amazon an edge in this market over Australian businesses.” Hence she’s cool on the outlook for many, but particularly the likes of The Iconic, Temple and Webster, Adore Beauty and Australian marketplaces like Woolworths-owned Catch, which last week put a $96m dent in Wesfarmers’ balance sheet. Loyalty programs and retail media offers a lifeline for some, per Penn-Kahn, but most DTC brands don’t have the latter option.

But Amazon might not have it all it’s own way. She suggests Microsoft might be gearing up to buy Shopify (which in Australia lays claim to controlling 25 per cent of all ecom transactions). If it happens “they will own the space”, suggests Penn-Kahn. “You will be advertising on Bing through the Shopify network as an ecom brand and leveraging Microsoft's AI to build your website, build the content. It could be a full ecosystem roll up if it happens. It's very possible.”