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EcommerceTrends

  • Google Cloud Retail Search to Address $300 Billion E-Commerce Search Abandonment

    Google Cloud Retail Search to Address $300 Billion E-Commerce Search Abandonment

    Google is trying to help the e-commerce industry address a $300 billion abandonment issue with Google Cloud Retail Search.

    According to Inc. search abandonment — where a user searches for a product but doesn’t click through to the results — costs the e-commerce industry a whopping $300 billion a year. Google is working to address that with its new tool, which has been in private preview, but is now available to all.

    “Search abandonment is a costly industry-wide issue, but for startup founders and small business owners, it can be devastating,” Carrie Tharp, Google Cloud’s vice president of retail and consumer, told Inc. “With Retail Search, we’re able to help convert site traffic to sales and keep startups and small businesses from leaving money on the table.”

    The tool brings the power of Google Search to a company’s own sites.

    Retailers now have the ability to provide Google-quality search and recommendations on their own digital properties, helping to increase conversions and reduce search abandonment. 

    Cloud Retail Search should help Google as it continues to fight for cloud market share against its larger rivals, AWS and Microsoft Azure.

  • Recommerce: the Secondhand eCommerce Market

    Recommerce: the Secondhand eCommerce Market

    Since eBay began as a company in 1995, transactions between consumers (known as C2C transactions) have been a vital part of eBay’s business model.  In particular, the sale of secondhand goods between parties is something eBay has grown famous for during the internet age.   When someone sells a pre-owned good to another person, they engage in a process known as recommerce.  To celebrate the impact recommerce has had on eBay, its users, and the planet as a whole, eBay launched its new Recommerce Report.  The report’s highlights have been outlined below.

    The first main point to come out of the report is the rise in recommerce’s popularity.  More than 7 in 10 of the US eBay sellers surveyed say buying pre-owned products has grown more common in recent years.  The numbers are even higher among Generation Z, of which 81% report that buying second hand has become more common in 2020.  This may be due in part to the recession caused by the COVID-19 pandemic.  When people face financial woes, they are less likely to buy items new.  Furthermore, the strains coronavirus placed on traditional stores did not affect eBay’s online platform, allowing business on eBay to continue as normal while yard sales and thrift stores may have suffered.  Though possible the trend towards recommerce may reverse as the economy heals, there is also the chance that the current trend reduces the long term stigma of buying and using secondhand items.  If that is the case, the power of recommerce is here to stay.

    The Benefits of Recommerce

    For sellers, the recommerce market boasts extremely low barriers to entry.  The average American owns 36 household items that are worthy of sale on eBay.  If the individual agrees to part with said items, they can earn over $3600 in supplemental income.  While most sellers are likely to only engage in recommerce as a side hustle, more dedicated sellers can also search yard and estate sales for hidden treasures.  On the side of the buyers, secondhand finds usually cost less than their new counterparts.  Thanks to eBay’s auction style format, buyers and sellers can negotiate a mutually beneficial price on each transaction that takes place.

    So far, recommerce has been shown to greatly benefit eBay, buyers, and sellers.  There is still one more beneficiary worth discussing: planet Earth.  As green living enthusiast Hannah Stringer put it, “recommerce is the most effective strategy as a consumer taking on a climate crisis.”  In addition to being accessible to consumers with a wide variety of incomes, buying second hand preserves the environment in two important ways.  Every item sold second hand is spared from a landfill and every consumer who demands a pre-owned good saves the water, energy, and resources that would have made a new good from being used.  In the electronics and apparel markets alone, recommerce on eBay kept 720,000 metric tons of carbon emissions out of the air.

    eBay Recommerce Report
  • Uber Built A Very Anti-Fragile Business, Says Jason Calacanis

    Uber Built A Very Anti-Fragile Business, Says Jason Calacanis

    “Uber built a very anti-fragile business in regards to having the Eats business and having the Rides business,” says early Uber investor Jason Calacanis. “When the Ride’s business went down that kind of indicates people are staying home. When they stay home they use Uber Eats and increasingly Drizly, Cornershop, and Postmates. Watching the Uber team take on this challenge of the pandemic year has been really impressive.”

    Early Uber investor Jason Calacanis says that unlike Lyft, Uber built a very anti-fragile business with the combination of Eats and Rides and has become relentlessly focused:

    Uber Built A Very Anti-Fragile Business

    What we’re really going to see here is that Uber built a very anti-fragile business in regards to having the Eats business and having the Rides business. When the Ride’s business went down that kind of indicates people are staying home. When they stay home they use Uber Eats and increasingly Drizly, Cornershop, and Postmates. People are ordering groceries. Watching the Uber team take on this challenge of the pandemic year has been really impressive.

    It reminds me a lot of Disney and how they got focused around Disney+ as the center of the organization. They looked at what was happening in the pandemic and said parks are great, merch is great, movies are great, let’s just put everything into Disney+ and accelerate that. Look what happened to that company. I’ve got to give Dara Khosrowshahi a lot of credit. He got rid of a lot of the noise like self-driving cars which are a multi-decade kind of vision. He sold off the places where they weren’t going to be in first, second, or even third place. He did JVs and sold off those businesses like Russia and China, etc. That’s well documented.

    The Space Can’t Have 50 Players Losing Money

    They found a new really inspiring footing which is if Amazon is two-day delivery going to one-day, Uber’s is one-hour delivery going to 10-minute delivery. That is Travis Kalanick’s original vision for Uber. When I met with him when he was building the company and I was the third or fourth investor his vision was this is a logistic company. We took atoms in the world made them bits on the internet. Now we’re going to take bits on your phone, an app, and we’re going to move atoms in the real world. That was his original pitch. Here we are in decade two where I’m still own the same shares I’ve had since I bought them for a penny or whatever back in 2008 or 2009. I remain super bullish. I have a huge position in Uber and I’m going to hold it for the next decade.

    It’s fairly obvious that there are acquisitions and consolidation that need to happen in the space in order for it to be profitable. The space can’t have 50 players losing money. We’ve watched Lyft, Postmates, Doordash, and everybody, say that we’re going to have to charge what this product is worth. We’re going to have to stop burning money. There’s no free VC money. The public markets are not down with lose money forever and grow. I think we found a happy medium here between what public market investors want, profits, and what private market investors want, growth.

    Uber Has Become Relentlessly Focused

    I think Dara has done an exceptional job. Some things will come from acquisitions but most of it has to be just relentless execution and focus. That is the inspiring part of what happened here. Uber has become relentlessly focused. Things that were coming in 10 or 20 years like self-driving in all likelihood will be a commodity business. In 10 or 20 years there’ll be five companies who have that technology. VTOLs are very fascinating and very interesting, but again that’s probably seven, eight, nine, or ten years off as a very niche product.

    Uber Built A Very Anti-Fragile Business, Says Jason Calacanis
  • Salesforce and FedEx Partner to Deliver End-to-End E-Commerce Solution

    Salesforce and FedEx Partner to Deliver End-to-End E-Commerce Solution

    Salesforce and FedEx are partnering to deliver an end-to-end e-commerce and shipping solution.

    The partnership between the two companies will see the integration of Salesforce Commerce Cloud and Salesforce Order Management with features from FedEx and its e-commerce subsidiary, ShopRunner. The combination of platforms and services should help e-commerce shops manage the entire process, from promotion to purchase to shipping.

    “Brands and merchants have to move quicker than ever to meet their customers’ expectations,” said Claude Russ, COO of FedEx Dataworks and CEO of ShopRunner. “With the combined power of Salesforce and FedEx, we will provide them the speed, control and economics they need to help them exceed those expectations. From optimizing their inventory management and fulfillment operations, to faster delivery and attracting new buyers, together we’re helping change the game so brands and merchants can have greater control over the links of their supply chain and increase their competitiveness.”

    “We are in a world of commerce anytime and anywhere,” said Lidiane Jones, EVP & GM, Salesforce Commerce Cloud. “Commerce Cloud and Order Management let companies sell wherever their customers shop and fulfill on any channel. Pairing that with FedEx’s logistics capabilities lets us deliver an even faster, easier, and cost-efficient experience for our customers. Now, retailers can better meet shoppers’ two-day shipping expectations without accumulating extensive costs, or sacrificing their time or brand.”

    The partnership is a multi-year agreement, with US customers set to see the first results of the partnership in Spring 2022.

  • Amazon Will Hire More Than 40,000 Corporate and Tech Roles

    Amazon Will Hire More Than 40,000 Corporate and Tech Roles

    During Amazon’s Career Day 2021, to be held on September 15, the company plans to hire more than 40,000 corporate and tech roles.

    Amazon has experienced significant growth as a result of the pandemic. During lockdowns and quarantines, the company’s e-commerce platform was the lifeline for many consumers. The company has already went through multiple hiring sprees.

    Amazon has now announced it will hire more than 40,000 tech and corporate roles during Career Day 2021, along with tens of thousands of hourly positions in its Operations network.

    “We’re working hard every day to be the best place for people to have satisfying and fulfilling long-term careers,” said Amazon CEO Andy Jassy. “Amazon continues to grow quickly and relentlessly invent across many areas, and we’re hoping that Career Day gives both job seekers and current Amazon employees the support they need to learn new skills or reimagine their careers at Amazon or elsewhere.”

    Amazon says it is the biggest job creator in the US right now, and has hired a whopping 450,000 individuals since the pandemic started. It appears the company isn’t slowing down yet.

  • Amazon Partners With Affirm to Offer Buy Now, Pay Later

    Amazon Partners With Affirm to Offer Buy Now, Pay Later

    Amazon is partnering with Affirm to offer its customers the option to buy now, pay later.

    Buy now, pay later is becoming an increasingly popular option, even in e-commerce. Square recently inked a deal to purchase Afterpay Limited in an effort to offer buy now, pay later.

    Amazon is now getting in on the action, partnering with Affirm to offers its customers the convenience.

    As a result of Amazon and Affirm’s partnership, select Amazon customers now have the option to split the total cost of purchases of $50 or more into simple monthly payments by using Affirm. Approved customers are shown the total cost of their purchase upfront and will never pay more than what they agree to at checkout. As always, when choosing Affirm, consumers will not be charged any late or hidden fees. 

    The two companies are testing the service with select customers, but intend on bringing it to Amazon’s wider customer base as soon as possible.

    “By partnering with Amazon we’re bringing the transparency, predictability and affordability that Affirm provides today to the millions of people who shop on Amazon.com in the U.S.,” said Eric Morse, Senior Vice President of Sales at Affirm. “Offering Affirm’s alternative to credit cards also delivers more of the payment choice and flexibility consumers on Amazon want.”

  • Amazon Expands A-to-z Guarantee to Cover Personal/Property Damage

    Amazon Expands A-to-z Guarantee to Cover Personal/Property Damage

    Amazon has unveiled a major upgrade to its A-to-z Guarantee, vowing to cover personal or property damage caused by defective products.

    A-to-z Guarantee was initially rolled out 20 years ago and provided no-hassle returns for products sold by third-party sellers on Amazon’s store. The company is now expanding that to cover damage caused by defective products sold via Amazon, including products that are sold by third-parties.

    The program will automatically cover up to $1,000, at no cost to the seller, although Amazon reserves the right to cover more expensive claims if it feels the seller is not properly addressing the issue.

    Amazon announced the program in a blog post:

    Now, in the unlikely event a defective product sold through Amazon.com causes property damage or personal injury, Amazon will directly pay customers for claims under $1,000—which account for more than 80% of cases—at no cost to sellers, and may step in to pay claims for higher amounts if the seller is unresponsive or rejects a claim we believe to be valid. We are also launching Amazon Insurance Accelerator to help sellers buy insurance at competitive rates from trusted providers. We’re excited that these innovations create a more trustworthy shopping and selling experience for customers and sellers in our store.

    The new policy is good news for customers and sellers alike.

  • Amazon Poised to Open Department Stores

    Amazon Poised to Open Department Stores

    Amazon may dominate e-commerce, but reports show it now plans to take on traditional retail with its own debarment-style stores.

    Department stores were once a staple of American life and the go-to place to shop for everything from clothes to household items. In recent years, however, e-commerce has taken a toll on the industry, with many going into bankruptcy or making major changes to how they do business.

    Now Amazon, arguably one of the biggest factors in the demise of the industry, is now preparing to open its own department-style retail stores in California and Ohio, according to The Wall Street Journal.Amazon already has some retail locations, such as bookstores and the Whole Foods chain it purchased 2017. The company also has its 4-star stores, although those primarily sell gadgets.

    According to WSJ, Amazon’s new retail stores will be roughly 30,000 square feet, quite a bit smaller than a traditional department store, which usually comes in around 100,000. Even so, the new stores will be much larger than the company’s other retail efforts and will offer the full range of products from top brands, much like a traditional department store.

    While nothing is a sure bet, Amazon’s chances of success are pretty good. Having its own stores would give users the ability to try on clothes before buying them, eliminating one of the more frustrating aspects of online shopping.

  • Amazon Warning Sellers About Congress’ Antitrust Efforts

    Amazon Warning Sellers About Congress’ Antitrust Efforts

    Amazon is contacting third-party sellers to warn them of how impending action by Congress could impact them.

    Congress seems determined to tackle issues with Big Tech, including what it perceives as antitrust violations and monopolistic behavior. Amazon is one of the companies Congress has its sights set on, and this is already a concern for the e-commerce giant.

    According to CNBC, the company has begun contacting some of its third-party sellers, one of its biggest growth markets, to inform them of how they may be impacted.

    “We’re reaching out to a small group of our sellers to make them aware of a package of legislative proposals, currently in Congress, that is aimed at regulating Amazon and other large technology companies,” states the email, send by CNBC. “It is early in the process and the bills are subject to change, but we are concerned that they could potentially have significant negative effects on small and medium-sized businesses like yours that sell in our store.”

    As Amazon points out, there is much that could change before the antitrust bills make it into law. Nonetheless, the threat of the bills is already causing major concern.

  • Amazon Sellers Trade Positive Reviews for Massive Refunds

    Amazon Sellers Trade Positive Reviews for Massive Refunds

    Amazon sellers are encouraging users to delete negative reviews, even offering refunds above and beyond the sale price in exchange.

    Amazon has long-struggled with fake reviews, with an entire industrysprouting up to game the system. The problem has even received the attention of regulators, with Britain’s Competition and Market Authority investigating whether the company is doing enough to combat the issue.

    According to The Wall Street Journal, via Business Insider, some resellers on the platform are contacting individuals who have left negative reviews to offer refunds, in some cases more than double the initial price, in exchange for removing the negative reviews. In some cases, resellers have repeatedly contacted individuals until they get a response.

    Amazon’s policy prohibits sellers from contacting buyers outside of the company’s own platform, but that hasn’t stopped sellers from doing just that. The company has reiterated these types of interactions shouldn’t occur, and that it takes action against those responsible.

    “Amazon provides a great deal of help content, proactive coaching, warnings and other assistance to sellers to ensure they remain compliant with our clearly stated policies,” an Amazon spokesperson told The Journal. “We have clear policies for both reviewers and selling partners that prohibit abuse of our community features, and we suspend, ban and take legal action against those who violate these policies.” 

    In the meantime, as The Journal points out, customers leaving a review should be careful not to leave personal details in their reviews, thereby making it more difficult for sellers to contact them outside of Amazon’s system.

  • Panera CEO: Ecommerce Pivot Sparks Dramatic Growth

    Panera CEO: Ecommerce Pivot Sparks Dramatic Growth

    “Close to 60 percent of our sales are coming from e-commerce,” says Panera CEO Niren Chaudhary. “By focusing on servicing customers through our off-premise channels, leveraging e-commerce, and then rapidly innovating we’ve seen a very smart recovery on our brand and also a stronger business model emerging from the pandemic. What’s clearly playing out is the off-premise channel is seeing dramatic growth.”

    Niren Chaudhary, CEO of Panera, discusses how the company has focused on ecommerce and the “off-premise channel” to drive dramatic growth:

    Panera’s Ecommerce Pivot Sparks Dramatic Growth

    Panera is actually emerging quite strongly through the pandemic because we’ve been completely focused on what we have control over. By focusing on servicing customers through our off-premise channels, leveraging e-commerce, and then rapidly innovating we’ve seen a very smart recovery on our brand and also a stronger business model emerging from the pandemic. What’s clearly playing out is the off-premise channel is seeing dramatic growth.

    To give you a sense, our delivery is growing by over 100 percent, drive-throughs are growing by over 60-70 percent, and rapid pickup is seeing strong growth. The off-premise channels are growing very strongly and in some ways compensating for the decline in business on-premise. Pre-pandemic we were probably about 60-40 in terms of off-premise versus on-premise. Now it is predominantly off-premise convenience for our customers as we’re moving in that direction.

    Close to 60 percent of our sales are coming from e-commerce. Brands that are able to leverage their e-commerce strength and pivot very sharply on providing convenience and off-premise are beginning to see a smart recovery.

    It’s All About Convenience, Ecommerce, and Innovation

    There are three levers that we’re working on to get our business back on track: convenience, e-commerce, and then meaningful innovation. Included in that are cool foods, a coffee subscription program, and most recently the flatbread pizza launch. We’re very excited about this because it’s the launch of a new food category at Panera, one that we haven’t had before. It’s a bullseye innovation in terms of what the customer is looking for at this time. Customers are looking for a warm shareable at-home meal solution for their families. The flatbread pizza fits perfectly for that.

    We’re doing it in a uniquely Panera way as you would expect. We’re leveraging the credibility of our breads. We have unique ingredients that are all clean, they’re fresh, we have double blend cheese, bold flavors of our sauces, and it’s stone-baked. Think of this as a pizza that customers love but done in a very unique Panera way. That’s why we’re so excited.

    Panera CEO Niren Chaudhary: Ecommerce Pivot Sparks Dramatic Growth
  • Inflation Only Expected to Last Six Months

    Inflation Only Expected to Last Six Months

    Consumers and businesses struggling with inflation received some positive news, with one expert saying it will only last six months.

    Recent months have seen the fastest-growing inflation rates in a decade, with prices soaring for common items and goods. Many families and businesses have been struggling to keep up with rising prices, with many wondering if/when prices will level out.

    Former Federal Reserve Governor Randall Kroszner has weighed in, saying he believes the current inflation is largely the result of a perfect storm of circumstances, including pent-up demand, large savings people had built up, stimulus-fueled spending and supply bottlenecks, such as the semiconductor shortage.

    Kroszner does not, however, believe the increased prices will be a sustained trend.

    “We’re going to see a lot of price increases in the short-run,” Kroszner said in an interview with Bloomberg. ”The key question is: Are those transitory or are those sustained? I think we’re going to see them transitory for a while. I don’t think they’re necessarily going to be sustained over the year-to-two-year horizon. But over a six-month horizon? I think certainly.”

  • Ready to Drink Cocktails: the Latest eCommerce Trend

    Ready to Drink Cocktails: the Latest eCommerce Trend

    Graduations, weddings, becoming a parent, becoming a grandparent, promotions, anniversaries, vacations, birthdays, a night on the town, and a quiet dinner date at home. What do all of these things have in common?  They all involve the consumption of alcohol.  No matter the occasion, there’s always a reason to have a drink, and since the COVID pandemic, we’re consuming even more alcohol than before.  Even though we could no longer meet for drinks at a bar, overall alcohol consumption actually grew by 14% during quarantine, with the top growth demographics being among women (17%) and millennials & Gen X’ers (19%).  Forty-four percent of Americans began buying their alcohol online which caused a 243% spike in online alcohol sales.  Instacart alcohol orders also grew by 75%. And the emergence of ready-to-drink cocktails are here to serve.

    The pandemic also naturally caused a spike in home bartending, and now we have new Quarantinis to add to our mixed drink repertoire.  Some of these drinks include the Kumquarantini; a mix of rye whiskey, kumquat syrup, lemon juice, saffron liquor, and egg whites.  Or if you want to embrace your inner health nut while consuming your alcoholic beverage, you might enjoy the Kombucha Quarantini, which includes a blend of gin, kombucha, and blackberries.  We also can’t forget this throwback to the great toilet paper shortage of 2020; the Charmin Quarantini, with vodka, cointreau, lime juice, simple syrup, cranberry liqueur, and toilet water (just kidding.) 

    No matter what’s going on in the world, alcohol has been there to help us cope and help us celebrate.  Cocktails have played a big role in human history.  Gin & Tonic (gin, tonic, and lemon or lime) was popularized by the Brits in the 19th century as a health tonic many traveled to India and warmer climates.   Maraschino Cherries became popular in the early 1900’s after a New York Times post in 1910 reported on a young woman who had ordered dozens of Manhattans at a fashionable hotel.  Upon investigation it was discovered that the drinks were still untouched, but all the cherries were gone.  By 1915, the cherries were popping up in drinks and ice creams all over the country.  

    Another interesting bit of cocktail history is that the Spanish flu of 1918, much like the COVID pandemic, also produced it’s handful of cocktails including the Corpse Reviver (gin, cointreau, Lillet Blonde, lemon juice, and Absinthe); the Penicillin Cocktail (Scotch whisky, lemon juice, honey syrup, ginger, and Islay single malt Scotch); and the Medicina Latina (Mezcal, honey ginger syrup, and lime juice.) 

    The Mai Tai was created by Victor J. Bergeron, or “Trader Vic”, in 1944.  It included rum with lime, orgeat, orange curacao, and simple syrup.  However, in 1954, the Royal Hawaiian Hotel began adding pineapple and orange juice to sweeten the cocktail and this new recipe quickly became the standard.  

    And who could forget the Pina Colada?  Created by Ramon “Monchito” Marrero in 1954, this fruity drink includes rum, coconut cream, and pineapple juice.  In 1978 the Pina Colada was named the official drink of Puerto Rico.  

    Although classic drink mixing still reigns supreme, the 2020 pandemic brought a huge boost in the sale of ready-to-drink cocktails.  In fact, sales of these quick drinks rose by 43%.  By 2024, ready-to-drink cocktails are expected to make up 20% of alcohol e-commerce.  

    Someday soon, we may all be headed back to bars and restaurants, but with everyone becoming a bartender at home since COVID, the invention of ready-to-drink cocktails might just be something to celebrate.  We’ll drink to that! 

    Ready To Drink Cocktails
    Via     Cooloo.com
  • Amazon Tackling Waste After Reports It Destroys Millions of Items

    Amazon Tackling Waste After Reports It Destroys Millions of Items

    Amazon is looking to reinvent how it handles unsold or returned inventory, following negative reports about it destroying millions of items.

    An investigation by Britain’s ITV News reported on Amazon’s practice of destroying millions of items a year that go unsold or are returned. The revelation prompted quick and severe backlash, with many using it as the poster child for greed and waste. As ITV News reported, many of the items are perfectly fine and could have been donated instead of ending up in a landfill.

    Amazon appears to be trying to address the problem, with two new “Fulfilment by Amazon” (FBA) programs.

    “Customer returns are a fact of life for all retailers, and what to do with those products is an industry-wide challenge,” said Libby Johnson McKee, director, Amazon WW Returns, ReCommerce and Sustainability. “These new programmes are examples of the steps we’re taking to ensure that products sold on Amazon—whether by us or our small business partners—go to good use and don’t become waste. Along with existing programmes like FBA Donations, we hope these help build a circular economy and reduce our impact on the planet. And we’re excited that these programmes will also help the businesses selling on Amazon reduce costs and grow their businesses—it’s a win for our partners, customers, and communities.”

    “FBA Grade and Resell” gives sellers the option to resell returned items as “used,” while the “FBA Liquidations” program helps sellers recoup some of their loss via Amazon’s wholesale resale channel.

    The company also touted its “FBA Donations” program, which has donated some 67 million goods since its launch in 2019. The company did not, however, touch on why millions of products per year were being destroyed, instead of making their way into FBA Donations.

  • Former Walmart U.S. CEO Sees Virtual Reality As Future Of Retail

    Former Walmart U.S. CEO Sees Virtual Reality As Future Of Retail

    Former Walmart U.S. President and CEO Bill Simon sees technology, such as virtual reality, having a big impact on traditional brick-and-mortar retail, according to CNBC.

    Simon served as President and CEO of Walmart U.S. from 2010 to 2014, giving him a unique perspective on the retail industry. Rather than predicting doom-and-gloom for traditional retail, Simon believe technology has the ability to transform the industry and open all new possibilities.

    Even something as simple as trying on clothes may be revolutionized by technology, such as virtual reality.

    “Could we have virtual changing rooms so that you can just scan an item in a store with your phone and try it on yourself without actually having to go try it on?” Simon said on CNBC’s “Squawk on the Street.”

    Simon believes successful retailers will combine online sales with a brick-and-mortar presence, and cites Target and Amazon as two examples of companies that are making it work.

  • Is Amazon Destroying Retail?

    Is Amazon Destroying Retail?

    “A set of facts could be put forward that would support that (they are destroying the retail landscape),” says former Walmart CEO Bill Simon. “They’re going through another cycle of it where their CFO in the (earnings) call said we’re reinvesting to drive one-day Prime shipping. That’s going to put more pressure on retailers and give them this Sophie’s Choice. Do I want to go out of business because I’ve lost my sales by not matching them on price? Or, do I want to go out of business because I’ve matched them on price?”

    Bill Simon, former CEO of Walmart, discusses how Amazon uses profits from AWS to prop up operating losses in online retail while in the process, destroying competing retail businesses, in an interview on CNBC: 

    Is Amazon Destroying the Retail Landscape?

    They’re running their business model and they’re just doing a fantastic job of it. Who doesn’t like stuff shipped to their house for free? It’s an awesome business model. It’s going to be increasingly challenging for them though because nearly 70 percent of their operating income came from Web Services. If you filter out the operating income from web services and if you take out the operating income for advertising, then there’s a chunk of it that is made in brick and mortar through Whole Foods, or at least there was because they don’t report that anymore, their worldwide retail business is operating break-even or at a loss. 

    Their international business loses money on $16 billion this quarter in sales. It’s really no wonder that regulators internationally are starting to look at them. A set of facts could be put forward that would support that (they are destroying the retail landscape). Think about it, in North America, they priced at or below cost for many years and didn’t make money. It’s arguable today whether their online business makes money in North America. 

    This Quarter Is the Poster child For Anti-Competitive Behavior

    All the while, Circuit City went out of business, Linens N Things went out of business, Toys R Us went out of business, and then Prime is the driver of it. It went from $79 to $99 to $119. That’s sort of the definition of anti-competitive behavior and anti-competitive pricing. Price below the market and when your competitors start to go out of business you ratchet up your price. This quarter is really a poster child for that. Their North American business grew $6 billion and lost money. Their operating income went down in North America. 

    They’re going through another cycle of it where their CFO in the (earnings) call said we’re reinvesting to drive one-day Prime shipping. That’s going to put more pressure on retailers and give them this Sophie’s Choice. Do I want to go out of business because I’ve lost my sales by not matching them on price? Or, do I want to go out of business because I’ve matched them on price? I’ve not been able to make any profit because they support their retail business with web services. It’s tough to compete with them when they’re not making money and pricing below cost with online retail.

    It’s Not Possible To Do One-Hour Shipping and Make Money

    Who doesn’t love stuff free shipping to your house in two days or one day or in an hour? That’s awesome. I use it all the time. Everybody does. But there are consequences to it. As the expenses go up and the price goes up, eventually, Prime has been going up in price sequentially and has to continue to go up. It’s not possible to ship things to your house in one hour and do it at the same price or cost that can make money in retail. It’s just not possible. The packaging alone, the delivery person walking from the street to your front door, start adding up the cost of all that and you can’t make money on a $3 box of breakfast cereal. 

    So it’s going to be tough. I don’t know that regulators will take that on given the consumers love for it. But if the retail landscape keeps getting impacted and the weaker keep dropping out and it gets down to this battle between the behemoth on the online side and Walmart on the physical side, it gets to be a complicating factor. I think then regulators have to look at it. When that happens it’s hard to tell but this quarter has really kind of the poster child for that.

    Is Amazon Destroying Retail? – Bill Simon
  • Twitter Announces Shop Module, Its Foray Into E-Commerce

    Twitter Announces Shop Module, Its Foray Into E-Commerce

    Twitter is looking to help businesses bring e-commerce to their Twitter profiles with a new feature called Shop Module.

    Shop Module is designed to let businesses showcase their products at the top of their profile page. Businesses will be able to use the feature to create a carousel of their products for people to browse.

    Bruce Falk, Product Lead, Goldbird, described the feature in a blog post:

    The Shop Module is a dedicated space at the top of a profile where businesses can showcase their products. When people visit a profile with the Shop Module enabled, they can scroll through the carousel of products and tap through on a single product to learn more and purchase — seamlessly in an in-app browser, without having to leave Twitter.

    We’re starting small with a handful of brands in the United States. People in the U.S. who use Twitter in English on iOS devices will be able to see the Shop Module.

    Some see Twitter’s announcement as part of the larger evolution of the e-commerce industry.

    “Social commerce solves the agility challenges brands have experienced within other e-commerce platforms,” Eric Dahan, Open Influence CEO/Co-Founder, told WebProNews. “Moving forward, we don’t expect this evolution of e-commerce to slow down. 64 percent of small businesses plan to continue their new e-commerce strategies in 2021.”

    Twitter plans on rolling the feature out to a handful of US-based brands. English Twitter users in the US on iOS should soon start seeing Shop Module.

  • Uber Now Offers Grocery Delivery in Over 400 Cities and Towns

    Uber Now Offers Grocery Delivery in Over 400 Cities and Towns

    Uber has announced a major acceleration of its grocery delivery service, now available in more than 400 cities and towns in the US to Uber and Uber Eats customers.

    The global pandemic saw a dramatically increased demand for grocery delivery services, demand Uber and Uber Eats has benefited from. The company’s recent expansion is its first major one in the US, and more than doubles its footprint. Part of the expansion is a 1,200-store partnership with the Albertsons grocery chain. Albertsons also includes, Safeway, ACME, Jewel-Osco, Randalls and Tom Thumb.

    “This past year has been one of incredible growth for grocery delivery,” Raj Beri, Uber’s Global Head of Grocery and New Verticals “Today nearly 3 million consumers order groceries and other essentials each month through Uber and we’re just getting started. By adding thousands of beloved grocers to our selection this year, we are fast-tracking our efforts to help Americans get everything they need from their favorite supermarket, delivered to their doorsteps.”

  • GoDaddy Online Shops Now Integrate Across Google

    GoDaddy Online Shops Now Integrate Across Google

    GoDaddy online shops will now be able to integrate their products and inventory across Google.

    GoDaddy is a popular web hosting option used by many small and medium-sized businesses. Google has been teaming up with e-commerce platforms in an effort to better integrate their inventory and products across the search giant’s properties.

    “Starting today, we welcome GoDaddy online store customers to more easily integrate their product inventory across Google at no additional cost,” writes Matt Madrigal, VP/GM of Merchant Shopping. “This means that GoDaddy merchants can now get discovered across Search, Shopping, Image Search and YouTube in just a few clicks. With this integration, GoDaddy merchants can upload their products to Google, create free listings and ad campaigns and review performance metrics — all without leaving GoDaddy’s Online Store.”

    The move is good news for small shops, and should help them gain even more visibility. Especially as small companies have increasingly turned to e-commerce to survive the pandemic, the arrangement should help them make the transition even more successful.

  • COVID Has Had Lasting Impacts on the Consumer World

    COVID Has Had Lasting Impacts on the Consumer World

    A new report shows just how widespread the impacts from COVID have been as consumers look toward a post-COVID world.

    Brooks Bell conducted a survey of 700 consumers on a variety of topics, and the results show just how much the pandemic has altered consumer views and habits. The “New Normals in Retail, Travel and Financial Services: Consumer Sentiment Beyond 2020” report offers a number of insights businesses should pay attention to.

    • The report is good news for brick and mortar stores, with 76% of respondents planning to buy in-store post-COVID restrictions. At the same time, curbside pickup is here to stay, with 34% planning to continue using the service.
    • Travel is also looking to rebound, with 70% of Americans eager to travel. Millennials, in particular, are the most eager to do so. Interesting, 20% said safety will be a travel consideration indefinitely, while the single biggest consideration remains price.
    • Banking is another industry set to experience a revival, with in-person banking set to almost double from pre-pandemic levels. In-person banking doesn’t equate to face-to-face banking, however, as a preference for interacting with a human teller dropped 8 points to 38%. Even more telling, online communication in banking was the top choice among 56-74 and the over-74 age groups, dispelling the myth that older consumers are opposed to online banking.

    The full report is well-worth a read and can be found here.

  • Shopify Announces 0% Revenue Sharing on First $1 Million in Sales

    Shopify Announces 0% Revenue Sharing on First $1 Million in Sales

    Shopify is dropping its revenue cut for developers that earn less than $1 million annually, in a move that rivals other tech platforms.

    Shopify is one of the most popular e-commerce platforms, powering some $120 billion in Gross Merchandise Volume (GMV) in 2020. Until now, the company took a 20% revenue commission, but the company is waiving that for smaller developers.

    Developers who build for the Shopify App Store will now pay 0% revenue share for the first $1M they earn annually on the platform starting on August 1. That’s down from 20%. The $1M benchmark resets annually.

    The same 0% revenue share model will also be available to Theme Store developers. 

    The announcement follows similar moves by Google, Apple and Amazon as app ecosystems are increasingly under scrutiny by regulators. Whatever the motivation, the move will certainly help small developers.