Amazon has agreed to shut down its “Sold by Amazon” program, and pay $2.25 million, in an agreement with the Washington Attorney General.
Washington AG Bob Ferguson launched an investigation into Amazon’s “Sold by Amazon” program. The program effectively amounted to price-fixing, as Amazon and third-party sellers agreed to a specific price, rather than compete with each other.
Amazon has agreed to shut the program down, and pay $2.25 million to the Attorney General’s office.
“Consumers lose when corporate giants like Amazon fix prices to increase their profits,” Ferguson said. “Today’s action promotes product innovation and consumer choice, and makes the market more competitive for sellers in Washington state and across the country.”
The investigation is not the only such legal challenge the company is facing. Washington DC AG Karl A. Racine filed a similar lawsuit against the company, accusing it of using its “most favored nation” (MFN) agreements to price-fix.
If you avoid these seven online marketing mistakes and you follow these tips you’re going to generate more sales, says popular digital marketing expert Neil Patel. A common theme of Neil’s tips is creating a brand. “Google doesn’t want to rank sites that aren’t brands,” he says. “There’s an issue out there called fake news and that’s why they’re pushing brands over anything else.” Patel says that if you follow these tips you’re going to crush it!”
Neil Patel, digital marketing expert and founder of Neil Patel Digital, discusses the seven online marketing mistakes in his latest video release:
Stop Making These 7 Online Marketing Mistakes
I’m going to break down seven online marketing mistakes that you need to stop. You’re probably wondering you’re doing all these things but why aren’t you seeing results? Even if you’re doing the right things, if you’re also doing the wrong things at the same time it’s going to hurt you and it’s going avoid you from getting the results that you deserve.
Mistake 1: Not Collecting Emails
The first mistake you are making is not collecting emails. It doesn’t matter how good you are with SEO or marketing only a very small percentage of your visitors are ever going to convert into customers. By collecting emails not only can you get people to come back to your site but you can convince them to convert over emails.
The moment someone gives you their email address think of that as a micro-commitment. They’re much more likely to convert into a customer because they committed, they already gave you something. That’s why you want to collect emails. You can do this through sliders or exit pop-ups. You can do this for free using tools like Hello Bar.
Mistake 2: Not Collecting Subscribers Through Push Notifications
The second mistake you’re making is you’re not collecting subscribers through push notifications. There are free tools like Subscribers.com that’ll make it easy. Just add in a JavaScript or a WordPress plug-in and then when people come to your website they will automatically subscribe through the browser. Then anytime you have new content or products or services that you want to sell then you can notify them through Subscribers.
Mistake 3: Not Building a Brand
The reason tip number one on collecting emails and tip number two on getting more push notifications subscribers are really important is because you need to build a brand. This gets you into the third mistake. Google doesn’t want to rank sites that aren’t brands. Why is this? There’s an issue out there called fake news and that’s why they’re pushing brands over anything else. It’s not just going to be Facebook and in Google. Eventually, it’s going to be Twitter and LinkedIn and all the sites out there.
When you get people back to your site seven times you’re much more likely to build a brand. It’s called the Rule of Seven in marketing. So with your site, you want to provide an amazing user experience. When you provide an amazing user experience, create a great product, create a great service, it’ll help you build a great brand over time.
Mistake 4: Not Interlinking
The fourth mistake you’re making is not interlinking. You may notice on Google I’m ranking for terms like online marketing on page one. You’re probably wondering how do I do this? A lot of it comes out to interlinking. In my sidebar, I link to my most popular pages of content. When I write blog posts related to online marketing I link back to the online marketing guide that talks about what online marketing is. By having all these links it helps me rank higher.
Mistake 5: Just Focusing On Text-Based Content
The fifth mistake I have for you is just focusing on text-based content. The future of digital marketing is moving to video. It doesn’t mean you should stop doing text but it means you should also be doing video. When you do video you’re going to get more traffic because everyone’s lacking it. LinkedIn wants it right now. YouTube wants more of it. Facebook wants it. Instagram even wants it.
Why is this? They want to crush the television networks. You look at things like the Oscars or traditional movie theaters and they’re not doing as well. You look at traditional TV and they’re going to get crushed. Why? It’s because of Facebook. It’s because of Google. It’s because of Netflix. If you’re there creating that video content you can be part of it and you’re going to get extra traffic. They want as much help as possible to crush these big old-school companies.
Mistake 6: Sticking To Just a Few Marketing Channels
The sixth mistake that you’re making is you’re really sticking to just a few marketing channels. Marketing is competitive. People raise venture capital hundreds of millions of dollars just so they can compete in marketing and sales. You need to do more than one or two or three marketing channels. The more you do the better off you’re going to be.
Mistake 7: Not Asking For the Sale
The seventh mistake I have for you is not asking for the sale. Whether it’s a lead or whether it’s getting people to buy your product, there’s nothing wrong with asking people to buy from you. If you don’t you’re not going to generate any sales. Everyone’s like I get all this traffic through my online marketing but no one’s converting. Why? Because you’re not asking for a sale.
Stop Making These 7 Online Marketing Mistakes and You Will Crush It, Says Neil Patel
“Our ads on Reddit have gotten a lot of traction and puts a big smile on people’s faces,” says 1-800 Flowers CEO Chris McCann. “That’s what we’re trying to do is just make sure we’re relevant and create that cognitive speed bump when people think about our company. They see something different and I’m thrilled with the creative team for coming up with something like that.”
Reddit Ad That Went Viral for 1-800-Flowers.com
As usual, some opinionated Redditers expressed their thoughts on the ads:
1-800 Flowers CEO discusses the company’s growth that was accelerated by the pandemic:
Ecommerce Growth Accelerated During Pandemic
What we’ve seen is an acceleration of growth in our company that began back in 2018 and really then accelerated even further in 2020 with the pandemic. It’s driven by the need for us as people to connect and express ourselves. As a company whose vision is to inspire more human expression, connection, and celebration, and as an ecommerce leader, we’re well-positioned in the trends that we see coming out of this pandemic. We think these trends are sustainable going forward.
We started out as one flower shop many years ago. What we’ve done is created this e-commerce platform for growth, a platform for expression, connection, and celebration. It starts with this all-star family of brands that we have led by Harry & David, 1-800-Flowers, Cheryl’s Cookies, Shari’s Berries, and our recent acquisition just this past August of Personalization Mall. You see us now as a company in the expression and connection business with a leadership position in floral, a leadership position in gourmet food gifting, and certainly now leadership and position in expressions and personalized items which is a fast-growing market.
You’ll continue to continue to see us grow by organic product development of products that help customers express and connect. And as we’ve done through acquisition, adding to that platform and leveraging that platform that we’ve built.
Need To Express and Connect Is a Lasting Trend
Hopefully, the vaccines accelerate and we turn to some sense of normalcy sooner rather than later. As we look at our business, the momentum we saw began in 2018 and 2019 and then accelerated with the pandemic. We’ve been on a good momentum growth even before the pandemic and we really see ourselves now as a bigger stronger company than we were prior to it. We’ve acquired Personalization Mall just this past August and by putting it on our platform and leveraging our digital marketing expertise we accelerated the growth of that company. It grew by 50 percent this last quarter.
A year ago August we acquired Shari’s Berries and took a business that was stagnant and losing money to now one that’s got a nice growth rate and is generating a nice contribution margin as well. If we just keep our focus on what the consumer is looking for to help express and connect then we’ll be continuing to see double-digit growth for some time to come. That trend that we’ve all learned from being isolated, our need to express and connect is a lasting trend coming out of this pandemic along with the shift from offline to online.
1-800 Flowers Ecommerce Growth Accelerated During Pandemic
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.
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.
“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.
Washington, D.C. Attorney General Karl A. Racine has filed an antitrust lawsuit against Amazon for anticompetitive practices and price-fixing.
Amazon has increasingly been under fire on all fronts. The company has repeatedly been criticized for how it treats employees, as well as its attempts to combat unionization efforts.
Now the company is under fire for alleged anticompetitive behavior, including wide-scale price-fixing. At the heart of the case is the company’s “most favored nation” (MFN) agreements, which prohibit retailers from offering their products elsewhere at cheaper prices, or with better terms, than they do on Amazon. The MFN agreements even prohibit retailers from offering their products cheaper on their own websites.
“Amazon has used its dominant position in the online retail market to win at all costs. It maximizes its profits at the expense of third-party sellers and consumers while harming competition, stifling innovation, and illegally tilting the playing field in its favor,” said AG Racine. “We filed this antitrust lawsuit to put an end to Amazon’s illegal control of prices across the online retail market. We need a fair online marketplace that expands options available to District residents and promotes competition, innovation, and choice.”
According to the AG, Amazon claimed to have removed its price parity policy in 2019. In actuality, the company is accused of quickly and quietly replacing it with a replacement policy that accomplished the same thing. Under the new policy, the Fair Pricing Policy, “third-party sellers can be sanctioned or removed from Amazon altogether if they offer their products for lower prices or under better terms on a competing online platform.”
“Our digital performance was up 50 percent,” says Target CEO Brian Cornell. “As we gain greater clarity around the consumer, the economy, the state of the vaccine, we feel that the consumer continues to respond to our in-store experience and the ease and convenience of shopping with some of our same-day services like pickup, drive-up, and ship. Same-day fulfillment services now represent over half of our digital channel.”
Brian Cornell, CEO of Target, discusses their massive Q1 results in an interview on CNBC:
Digital Performance Up 50 Percent
We’ve had a string of really solid results going back to 2017 but this quarter may be one of the highlights. Our team executed throughout the quarter. We had a great performance from our store teams with a store comp of 18%. Our digital performance was up 50%. It was really a team effort. We had great supply chain support with our merchants and marketers all coming together to support the results which speak for themselves.
We are benefitting from investments we’ve been making for years now. Our investment in our store experience, our curated Home Brand and national brand mix, and then the fulfillment services that we offer. That combined with the investment in our team, I think we are seeing continued strength. We feel really good sitting here right now about our outlook, not just for the second quarter but for the full year.
We’ve Connected With The Consumer
As we gain greater clarity around the consumer, the economy, the state of the vaccine, we feel that the consumer continues to respond to our in-store experience and the ease and convenience of shopping with some of our same-day services like pickup, drive-up, and ship. They really connect with our curation of Great Home Brand, national brands, and the service our team provides each and every day.
We are feeling very confident about our position today. I look at the proof point from Q1, we picked up another billion dollars in market share on top of the $9 billion of share last year. That’s just a sign that we’ve connected with the consumer, we’re building relevance, and we’re providing what they need and what they want throughout the year.
Newness Is A Huge Trend In Our Business
When you see the combination of stores comping up at 18%, which to me is just a highlight number, and categories like apparel growing again by over 60%, that combination of store traffic and category mix really benefited us throughout the quarter. We are seeing a resilient consumer. They’re clearly shopping our stores and when they’re there they are attracted to anything that’s new.
Newness has certainly been a trend throughout our business in the first quarter and I think that’s going to continue. That great combination of store traffic and store comps and the continued movement of same-day fulfillment services which now represent over half of our digital channel. We really like that transaction. It looks and feels more like a store transaction which from a profitability standpoint certainly is beneficial for us.
Target CEO Brian Cornell Says Digital Performance Up 50%
“We are arming the rebels… the entrepreneurs, the small business owners, the independent brands, and the rebels are winning,” says Shopify President Harley Finkelstein. “It feels like the retail world that would have existed in 2030 was pulled back to 2020. We have seen this massive catalyst to an acceleration in digitalization in commerce and retail. We are writing the future of commerce and entrepreneurs are really the heroes of the Shopify story.”
Shopify President Harley Finkelstein says the rebels―the entrepreneurs and the small business owners―are the heroes of the Shopify story… and the rebels are winning:
We Are Arming The Rebels
There’s a lot to be optimistic about even in the second half of 2021. It feels like the retail world that would have existed in 2030 was pulled back to 2020. We certainly have seen this massive catalyst to an acceleration in digitalization in commerce and retail. But actually, we are writing the future of commerce and entrepreneurs are really the heroes of the Shopify story. We are arming the rebels… the entrepreneurs, the small business owners, the independent brands, and the rebels are winning.
Consumers have been voting with their wallets for the last ten months or so to buy from independent brands wherever possible. In 2020, 47 million consumers purchased from a Shopify merchant. That’s up 52 from 2019. Our merchant’s performance helped expand Shopify’s lead on an aggregated basis to be the second-largest e-commerce retailer in the U.S. Shopify is now about nine percent of all US ecom. If you think about it, Shopify is a proxy for independent retail and for direct-to-consumer retail.
Shop Pay Launches Accelerated Checkout
We only succeed when our merchants do. This has led to us having more than 1.7 million merchants on Shopify. This includes people from first-time entrepreneurs making their first sale every 28 seconds to the likes of O’Neill and Hallmark and Herman Miller and Purina. Diageo, who also just launched in Shopify and in Q4 alone revenue nearly doubled year over year to $978 million. There’s a lot to be optimistic about. Actually, the future of retail and commerce we think is going to look a lot more like these independent brands than these sort of department stores that existed in the past.
Shop Pay is our accelerated checkout. We just announced it last week. We know that it not only helps merchants get more sales, it helps buyers convert better and much faster. Now we think that providing it to the Instagram and Facebook platforms means that our merchants can not only access new customers on those platforms, and frankly anywhere where customers are, but now can transact in a more efficient way. Shopify is becoming far more than an e-commerce provider.
Future of Retail Is Wherever Consumers Are
We are trying to build the world’s first retail operating system, which makes it as easy as possible and where the cost of failure is as low as possible, so more people can participate in entrepreneurship. We think the future retail is not online or offline or anywhere, in particular, it’s wherever consumers are. That’s what we’re trying to build. Seeing Shop Pay move into Facebook and Instagram is a really great way to demonstrate where the future of retail is happening.
We are trying to get to a point where we completely democratize entrepreneurship. We use a 100-year perspective and we want to build a 100-year company. We’re about 15 years into our journey right now and we have 85 years left to go. In the long run, we’re happy where Shopify is but frankly, on the topic of more participation in the equity markets, we think that is also entrepreneurial and we think that’s also democratizing.
Amazon is grappling with an entire industry aimed at providing fake reviews and gaming the system, according to new research.
Which? is a UK-based company that reviews products and services and helps consumers make educated choices. The company has investigated the state of Amazon reviews and found that fake reviews are being sold in bulk.
Customers rely on Amazon reviews to make decisions about their purchases. Even when customers ultimately end up purchasing elsewhere, Amazon product reviews often still impact customers’ decisions. Unfortunately, many of those reviews may be fake, according to Which?.
“More people are shopping online than ever before due to the coronavirus crisis – yet our latest research shows that Amazon is facing an uphill struggle against a relentless and widespread fake reviews industry geared towards misleading consumers,” Natalie Hitchins, Head of Home Products and Services at Which?, said.
Some companies charge as little as £5 per review, while others charge more, up to £8,000 for 1,000 reviews. Many of the companies provided incentives and rewards programs, along with guidelines to help their armies of reviews avoid detection by Amazon.
All the sites Which? signed up to gave advice for how to write reviews so as not to arouse Amazon’s suspicion, and in many cases had criteria for reviewers to meet to qualify for rewards. These included leaving reviews that were at least two sentences long, posting an accompanying image or video and not posting reviews until at least four days after receiving a product. Some sites also had no return policies – as returned products are monitored by Amazon and high return rates can affect the chance of an Amazon’s Choice endorsement.
Which? is calling on regulators to take action against these kind of schemes, in the interest of protecting customers that rely on such reviews to make informed decisions. The company is also calling on tech firms, such as Google and Facebook, to crack down on these companies, as many of them use search and social media platforms to gain reviewers.
“The regulator must crack down on bad actors and hold sites to account if they fail to keep their users safe. If it is unable to do so, the government must urgently strengthen online consumer protections,” Hitchins added.
“Amazon, and other online platforms, must do more to proactively prevent fake reviews infiltrating their sites so that consumers can trust the integrity of their reviews.”
It remains to be seen what, if any, action will be taken. in the meantime, savvy purchasers would do well to take Amazon’s reviews with a grain of salt.
“Customers that engage with us from a digital standpoint also continue to enjoy coming into the store,” says Kroger CEO Rodney McMullen. “They also spend about twice as much with us. When you look at those things together I really feel optimistic about the future. We’re continuing to make progress on the things that matter on a seamless experience… digital, fresh, and friendly.”
Rodney McMullen, CEO of Kroger, says that customers who engage digitally come in more often and spend twice as much on average as non-digital customers:
Seamless Experience of Digital, Fresh, and Friendly
Every day our associates are taking care of our customers. We’re continuing to make progress on the things that matter on a seamless experience… digital, fresh, and friendly. When you look at the things behind the numbers continuing strong trends. If you look at the things that we’re doing it sets us up well for the fourth quarter and sets us to continue to gain share in 2021 as well.
One of the things that our customers are telling us is they’ve learned how to cook, they enjoy cooking, and they enjoy the time together as a family. Also, I think the economy continually will continue to be a little bit soft which will cause people to eat at home more as well. Both of those things will continue to provide support (for increased sales).
Customers That Engage Digitally Spend Twice As Much
Obviously, we’re anxious for the vaccine to get here and to get widespread use of it just like everyone else is. We were making great progress in gaining share even before COVID 19 started and we expect once things get back to normal we’ll be able to continue to gain share as well. We can’t wait until a vaccine gets out there and it gets widespread usage.
I really believe our teams will continue to take care of our customers and the seamless experience will tie it all together. What we find are customers that engage with us from a digital standpoint also continue to enjoy coming into the store. They also spend about twice as much with us. When you look at those things together I really feel optimistic about the future.
Kroger CEO Rodney McMullen: Customers That Engage Digitally Spend Twice As Much
McDonald’s is the latest fast-food company to offer plant-based meat alternatives with its McPlant lineup.
Plant-based meat alternatives have been growing in popularity as a healthy alternative to traditional meat. Burger King, Dunkin’, Carl’s Jr., Qdoba, Subway and White Castle are just a few of the chains offering plant-based alternatives.
McDonald’s is now joining that growing list of restaurants with its McPlant, based on Beyond Meat.
“Beyond Meat and McDonalds co-created the plant-based patty which will be available as part of their McPlant platform,” a Beyond Meat spokesperson said, according to CNN Business.
Initially, McPlant will be used for a burger, but the company may eventually expand to include plant-based breakfast and chicken alternatives. The company will be testing the burger in select markets beginning next year.
Chipotle has announced its first digital-only restaurant, potentially disrupting the restaurant industry during one of its most challenging periods.
One of the more controversial COVID mitigation measures has been curtailing restaurants and bars. Around the world, customers and establishments have protested, and in some cases defied, closure orders. In spite of the unpopularity of such moves, however, experts have continued to warn of the dangers of dining in. In fact, a new study by MIT Technology Review has labeled restaurants “covid hot spots.”
Although not necessarily the focus, Chipotle seems to have the answer to COVID challenges as it prepares to debut Digital Kitchen, its first digital-only restaurant. The new concept will not have a dining room, or a front service line. Instead, guests will place their order in advance using the Chipotle app, Chipotle.com or third-party delivery options. Orders can be picked up via the restaurant lobby.
“The Digital Kitchen incorporates innovative features that will complement our rapidly growing digital business, while delivering a convenient and frictionless experience for our guests,” said Curt Garner, Chief Technology Officer of Chipotle. “With digital sales tripling year over year last quarter, consumers are demanding more digital access than ever before so we’re constantly exploring new ways to enhance the experience for our guests.”
Chipotle’s new restaurants will likely be a big hit and help the company expand in locations where full-sized restaurants are not feasible. In addition, it should help the company weather any future COVID crackdowns.
Google has announced that it is bringing free retail listings to the main Google Search results page.
The move follows Google’s decision to primarily include free listings on the Google Shopping tab. According to Bill Ready President of Commerce, that move resulted in a significant uptick in engagement between customers and merchants. This would seem to indicate that people are having better success finding what they’re looking for.
“Sellers of all sizes are benefitting from this incremental traffic, particularly small and medium-sized businesses,” writes Ready. “And we already see that these changes will help generate billions of dollars in sales for retailers and brands in the U.S., on an annual basis.
“Now, we’re bringing free listings to the main Google Search results page in the U.S., helping shoppers choose the products and sellers that will serve them best, from the widest variety of options.”
Given the impact the pandemic has had on the retail industry, this move will certainly help small and medium-sized businesses connect with more customers online.
Luxury online retailer Farfetch, where product prices start at around a thousand dollars, had a breakout IPO on Thursday, raising $885 million while setting a valuation of $6.2 billion for the company. Then on Friday the stock surged 53 percent above their initial offering price and it’s up again this morning valuing the enterprise at $7.4 billion.
Farfetch plans to use their IPO windfall to dramatically improve their technology which they see as the best way to improve the consumer experience.
Farfetch Founder and CEO José Manuel Ferreira Neves recently discussed Farfetch and the online luxury brand industry on Bloomberg:
Online Luxury is Growing 25 Percent a Year
It’s a very unique opportunity. You have this amazing global industry. It’s $300 billion, the personal luxury goods industry and only 9 percent is online. There are two opportunities here really. One is the growth of online luxury which is going to grow to 25 percent a year for the next seven years. This is a $100 billion opportunity shift in online luxury.
The big question is how is technology going to help brands and retailers really improve the consumer experience in the physical store. This is something at Farfetch that we are very passionate about.
China is an Incredible Opportunity for Online Luxury
China is a very exciting opportunity. Chinese citizens are at the onset of the luxury industry, whether they shop at home or when they’re shopping abroad. Online penetration is very low in China so this means that there is an incredible growth runway for Farfetch in the territory.
That led to our partnership with JD.com where we have our own team. We have the Farfetch China app and website, we have local customer service, local payment systems, and local marketing. It’s a truly localized service. That is what’s driving incredible growth to the Farfetch brand in that region.
José Neves, founder and CEO of @farfetch, told us about the company’s grand ambitions for China at the WWD’s Men’s Wear Summit this week. https://t.co/MrMj7y5VCG
WeChat is an amazing app with over 900 million users. It is the Instagram, plus WeChat, plus PayPal, etc. of China in one app. That is very powerful and very interesting. Now with our acquisition CuriosityChina we are powering the retail presence of 80 luxury brands. We think that is very interesting for the industry and we think that is probably something that we will see for the western world.
Brands Now Using Social and Digital Marketing Extensively
I think brands move cautiously and they choose their marketing channels very carefully. As these newer channels have developed the brands have adapted to them and their now using social media and digital media extensively to create desire, to drive discovery of new products obviously transactions as well.
It’s a gradual pace but it’s really exciting that were at that inflection point where the brands see this as a tremendous opportunity.
“I know everyone wants to focus on the Travis Scott Meal and Spicy Chicken McNuggets which definitely contributed to the fantastic September that we had,” says McDonald’s USA President Joe Erlinger. “But the setup for this great quarter actually started much earlier in the year. Our drive-throughs have been getting faster at McDonald’s. We’ve made a lot of investments in digital and drive-through and delivery as well.”
Digital, Drive-Through and Delivery Powering McDonald’s
I know everyone wants to focus on the Travis Scott Meal and Spicy Chicken McNuggets which definitely contributed to the fantastic September that we had. But the setup for this great quarter actually started much earlier in the year. Our drive-throughs have been getting faster at McDonald’s. We’ve made a lot of investments in digital and drive-through and delivery as well.
Then really we made a lot of changes to our business model as the pandemic set upon us including over 50 changes in operations. We limited our menu and we’ve made our restaurants easier to run. At the same time, we conserved some of our marketing funds. We began to unleash those marketing funds in the third quarter. That’s what set up this great result of 4.6% double-digit comps in September.
Breakfast Is BACK At McDonalds
When we entered the pandemic we had reversed what was a long-term trend of negative guest counts. It’s been lost in the results of what happened in the epidemic. But in January and February, we actually had positive comps at breakfast and positive guest counts. It goes without saying that we don’t sell the Spicy McNuggets or the Travis Scott orders at breakfast and we’ve obviously seen positive comps across all dayparts.
So we are actually very optimistic about the daypart. We’re excited about the bakery launch that’ll take place later this month. We’ve got a real built-in advantage on this because of our drive-throughs and just because of our overall convenience factor. I like the characterization that yes, breakfast is back at McDonald’s.
Mood Amongst Franchisees Is Strong
Franchisees did come into this in a position of absolute strength. In fact, 2019 was the highest cash flow year ever for our franchisees. Some of the steps that we took through the pandemic both to support them in terms of their liquidity but also to make the operations of the restaurant easier (helped significantly). We actually improved margins at the restaurant level as well.
They’re actually coming out of the worst of the pandemic in a very good position and in a very strong financial position. The mood amongst our franchisees is strong. I was in restaurants uh in Washington state a few weeks ago. Last week I was actually in Washington DC. There’s a lot of optimism confidence as we enter the fourth quarter.
Gary Vaynerchuk, CEO of Vayner Media, social media star and entrepreneurial guru followed by millions, says you can’t even find a 24-year-old on Facebook today:
I Don’t Believe TikTok Is A National Security Threat
Adobe has released its predictions for the 2020 holiday season, between November 1 thru December 31, and online retailers are set to score big.
Adobe is predicting record-breaking online sales, totaling some $189 billion. This represents a 33% year-over-year increase. According to the company, this is the equivalent of two years’ worth of growth packed into those two months.
Should the government approve another round of stimulus, spending would be driven up further, likely passing the $200 billion mark. If this happens, it would be a 47% increase.
“As retailers adapt to consumers’ new behaviors in this pandemic, we expect earlier discounts, more shipping and pick-up options and uncertainty around in-store purchases to drive this year’s online holiday sales to record highs,” said John Copeland, head of Marketing and Customer Insights at Adobe. “This year is unlike any in the past, and for the first time we are no longer referring to peak holiday sales as Cyber Week – it’s now Cyber Month.”
While large e-commerce entities may seem to be the biggest beneficiaries at first glance, in reality it is small retailers that will benefit most. Accord to the report, small retailers will see their revenue increase 107%, vs 84% for their bigger rivals.
Curbside pickup will also grow in popularity, with BOPIS (buy online, pick up in store) expected to account for more than 50% of orders at retailers offering the service.
Although the pandemic may be forcing holiday shoppers online in record numbers, shoppers may develop a taste for the low-hassle benefits of online shopping and BOPIS. If so, it’s a safe bet that many shoppers’ behavior may be permanently altered over the next two months.
Amazon wants to emulate the success of Prime Day every day with ‘Holiday Dash,’ a new section on Amazon with daily deals that “equal Black Friday.”
Amazon says that “with new deals dropping every day starting October 16, customers can shop early and with confidence that they are getting Black Friday-worthy deals and incredible savings on a huge selection of products.”
Here are the announced details on Amazon’s Holiday Dash deals:
Amazon Brands
Save up to 30% on select kid’s clothing and more from our brands including Amazon Essentials, Spotted Zebra, and Simple Joys by Carter’s
Save up to 30% on select men’s and women’s clothing and more from our brands including Amazon Essentials, Daily Ritual and Goodthreads
Save up to 20% on AmazonBasics
Save 40% on Wag dog food, and treats
Save 20% on household and personal care products from Solimo
Save 20% on Presto! Refillable Cleaners
Save 20% on baby care products from Mama Bear and Solimo
Save 20% on Belei skincare
Save 20% on nutrition and wellness products from Amazon Elements and Revly
Save 20% on coffee, snacks, and other grocery essentials from Solimo, Happy Belly, and Amazon Fresh
Toys & Games
Save up to 40% on Star Wars toys
Save up to 40% on Collectible toys from L.O.L. Surprise!, Calico Critters, Fingerlings, and more
Save up to 30% on Hot Wheels toys
Save up to 30% on Building Sets from LEGO, Magna-Tiles, and PlayMonster
Save up to 30% on Marvel toys
Save up to 30% on Fortnite, Pokemon, Roblox and more
Save up to 40% on Tegu Building Blocks
Save up to 30% on Funko POPs!
Save up to 30% on Arts & Crafts sets
Save 30% on Evenflo Pivot Explore Wagon
Save up to 30% on preschool toys from Jazwares, Spin Master, Hape, and more
Save on AmScope 52-piece kids beginner microscope STEM kit
Fashion
Save up to 40% on select apparel from Calvin Klein
Save up to 40% on select Levi’s apparel for the whole family
Save up to 40% on Star Wars apparel
Save up to 30% on select New Balance footwear and apparel
Save up to 40% on select Tommy Hilfiger apparel
Save up to 40% on select kids’ clothing from Gerber, Hudson Baby, and more
Save up to 50% on select watches from Citizen, Bulova, Anne Klein, and more
Save up to 30% on select Lacoste apparel, shoes, and accessories
Save up to 30% on Marvel apparel
Save up to 30% on select seasonal fashion trends
Save up to 25% on select Nautica men’s and women’s apparel
Save up to 48% on select Hanna Anderson pajama sets and underwear styles
Save up to 30% on select styles from The Drop
Save up to 40% on select women’s shoes from Shopbop
Save up to 15% on select women’s accessories from Shopbop
Household, Kitchen, Home Improvement & Smart Home
Save on Le Creuset Cast Iron and Stoneware, including up to 48% on select Le Creuset 3.5Qt Oval Dutch Ovens
Save up to 50% on select Bissell Vacuums
Save up to 40% on SharkNinja Shark Navigator Lift-Away
Save up to 35% on Eufy by Anker RoboVac
Save up to 30% on Eureka Stick Vacuum
Save on iRobot Robotic vacuums and mops
Save up to 30% on iLife Robotic vacuum cleaner
Save up to 25% or more on Samsung vacuums
Save up to 36% on select Blueair air purifiers
Save up to 20% on select Molekule air purifiers
Save up to 40% on KitchenAid tools
Save up to 20% on the Instant Pot Duo Mini Plus
Save up to 30% on Hallmark gift wrap, ornaments, and cards
Save up to 20% on select Breville Smart Ovens
Save up to 20% on OXO BREW coffee makers
Save up to 30% on Tineco floorcare products
Save on Ninja AF161 Air Fryer and Ninja FG551 Foodi Indoor Smart Grill
Save on select SodaStream Fizzi Sparkling Water Maker Bundles
Save on the Keurig K-Mini Coffee Maker
Save up to 20% on OXO Good Grips Smart Seal and bakeware
Save up to 35% on Ayesha Curry Cookware
Save 30% on Linenspa 10″ hybrid mattresses
Save up to 30% on Zinus furniture and mattresses
Save 30% on Sweetnight mattresses
Save up to 30% on Moen bathroom fixtures and up to 20% off on Moen kitchen products
Save up to 25% on select Hansgrohe products
Save 15% on GE Profile Ice Maker
Save 20% on select Broan appliances
Save up to 15% on select Delta Faucet products
Save up to 15% on Whirlpool softeners
Save 15% or more on gaming, home education and home office furniture
Save on select August Smart Locks
Save on select Kwikset Smart and Mechanical Locks
Save on Smart Home products from Emerson, Kasa TP-Link, and more
Beauty, Health & Personal Care
Save up to 50% on your favorite Premium Beauty brands from Elemis, Mario Badescu, Redken, and more
Save up to 40% on Premium Beauty appliances from T3, Foreo and more
Save up to 40% on Waterpik and Colgate oral care appliances
Save up to 45% on skin care from NIVEA, Aquaphor, and Eucerin
Save up to 30% on hair dryers and products from Revlon, Bed Head, and more
Save up to 35% on razors from Braun, Gillette, and more
Save 33% on Panasonic and Norelco shavers
Save up to 20% on Fitbit Activity and Fitness Trackers
Electronics
Save up to 33% on select Nintendo Switch games
Save up to 35% on Nixplay Digital Frames
Save up to 30% on Kodak Instant Cameras and Printers
Save 25% on Adobe Creative Cloud Entire Collection
Save up to 20% on Samsung TVs
Save up to 20% on Sony TVs
Save up to 50% on JBL Speakers
Save up to 33% on Sony Headphones
Save up to 33% on Bose Headphones
Save up to 40% on select Mynt 3D printing pens and accessories
Save 30% on Mynt 3D PRO Pen with OLED Display
Save up to 30% on VAVA 4K Projectors
Save up to 30% on TaoTronics Headphones
Small Businesses on Amazon Launchpad
Save up to 50% on Kids Against Maturity: Card Game for Kids and Families
Save up to 30% on the SOLIOM S600 Outdoor Security Camera
Save up to 25% on the Zen Laboratory DIY Jumbo Slime Kit for Kids
From October 26 to November 19, Prime members can save 10% or more on select unique products from small brands on Amazon Launchpad like: Mobile Pixels Duex Portable Monitor for Laptops and Scentered Travel Essentials Aromatherapy Balm gift set
Entertainment: Amazon Music, Audible, Books & Prime Video
Amazon Music: Beginning October 23, new Amazon Music Unlimited customers can get three months of the premium streaming tier free, to enjoy unlimited access to more than 60 million songs, ad-free and a wide selection of popular podcasts.
Amazon Music: Beginning October 29, current Amazon Music Unlimited subscribers can upgrade to the Family Plan free for three months, with access for up to six accounts.
Audible: Between November 1 and December 31, new members save nearly 40% on the first six months of an Audible Plus membership at just $4.95 per month. Membership includes unlimited access to more than 10 thousand Audible Originals, audiobooks and podcasts.
Books: Deals on select multi-genre books and ebooks throughout the season
Prime Video: This holiday season, Prime Video will offer up to 50% off select popular Halloween, family and holiday movies to rent or buy. Deals will roll out over the next few months, so be sure to check www.amazon.com/pmd for updates.
Amazon Gift Cards
Starting today, customers using Amazon Reload to replenish their Amazon Gift Card balance for the first time will receive a $10 bonus with their reload of $100 or more. Offer available through December 31.
Starting October 26, first-time Amazon Gift Card shoppers will receive a $15 promotional credit with the purchase of $50 or more in Amazon Gift Cards. Offer available through December 20. The promotional credit expires on February 6, 2021. Other restrictions apply.
Amazon Credit Cards:
Now through December 22, with an eligible Prime membership, customers who apply and are approved for the Amazon Prime Rewards Visa Card will instantly receive a $100 Gift Card. Prime Cardmembers earn 5% back at Whole Foods Market and Amazon.com. Additionally, starting November 1 through December 22, customers without a Prime membership can apply for the Amazon Rewards Visa Card and receive a $60 Gift Card upon approval, in addition to earning 3% back at Whole Foods Market and Amazon.com as a cardmember. Restrictions apply. Visit amazon.com/visa for details.
Automotive, Tools and Lawn & Garden
Save 50% on tire installation
Save up to 25% on Miracle-Gro Expand ‘n Gro concentrated planting mix
Save 25% on Castrol GTX Conventional motor oil
Save 20% on Select Tonno Pro Tonneau covers
Save up to 20% on select Streamlight flashlights
Save on select DEWALT cordless drills and tools
Save up to 30% on select SKIL tools
Save up to 15% off on select ZGrills Pellet Grills & Smokers
Save up to 15% on Shintenchi 4 piece wicker rattan outdoor patio furniture set
Save on select Renogy monocrystalline solar panels
Sports & Outdoors
Save up to 20% on Select Coleman Tents & Gear
Save up to 20% on select CamelBak kids water bottles
Save up to 25% on select Sawyer Products water filters
Save up to 30% on select Stanley drinkware
Save up to 28% on select Segway scooters and kids bikes
Save up to 30% on select Stiga table tennis rackets and Zume badminton set
Save up to 30% on select Legendary Whitetails apparel
Save up to 30% on select Osprey Outdoor Packs
Pets
Save 20% on Catit Creamy cat treats
Save on Petsafe electronic dog toys
Save on The Honest Kitchen human grade pet treats
Save on Friends Forever donut pet beds
Whole Foods Market:
Both in-store and online, Prime members can receive discounts on customer favorites including 35% off Bare Bones broths and 35% off all packaged teas, available now through October 27.
Available now through October 20, customers can get 20% off pumpkins and gourds – excluding squash.
“When are the rest of the countries in the world going to catch up to China?” asks IMAX CEO Richard Gelfond. “When is Hollywood going to feel comfortable releasing their blockbuster movies globally where the rest of the world is like China. In China, people feel safe and in fact, they are safe. They really want to resume their lives. They want to go back to the movies. They want to go back to restaurants. They want to do a lot of things. China in particular, but Asia in general, is ahead of the western world.”
Richard Gelfond, CEO of IMAX, says that China and Asia, in general, are ahead of the rest of the world in feeling safe and resuming their lives including going to the movies:
When Is The Rest Of The World Going To Catch Up To China?
It’s remarkable that cinema capacity is constrained to 75% yet we did 25% better than our best year which was last year. That’s clearly an indication that people feel safe and in fact, they are safe. They really want to resume their lives. They want to go back to the movies. They want to go back to restaurants. They want to do a lot of things. China in particular, but Asia in general, is ahead of the western world. It hasn’t gone as smoothly in a lot of businesses as it’s gone in China but the indications are quite good that they want to get back to normal.
I don’t think that the message in the rest of the world is survival. From the China experience, we know that there’s a pent-up demand for going to the cinema. We know that when people feel safe and healthy they’re going to go. In the United States, on the other hand, that’s the other end of the spectrum, where people just don’t feel comfortable at this point in time. I don’t believe it’s an existential issue.
The lessons of China, not just from the National Day this weekend, you go back a few weeks ago to when the ‘The Eight Hundred’ came out and that did $115 million dollars in its opening weekend. That is in the top 10 Chinese local language movies of all time. The proof points are there. The question is when are the rest of the countries in the world going to catch up to China? When is Hollywood going to feel comfortable releasing their blockbuster movies globally where the rest of the world is like China.
China Is Largest IMAX Market In The World
We’ve done very well in China. We have about 700 plus screens open. We have another 300-ish in backlog. We’ve also signed a few deals this year in China, one with Wanda Cinemas and another one with a number of other operators. There’s great demand in China and as we speak we’re opening new screens there. There’s also a lot of dialogue going on. China is our largest market in the world for IMAX. It’s about 40% of our screens globally even though we’re in 82 countries. As a reference point, in North America, we have 400 screens.
In China, we have 700 screens with several hundred still to go. So the demand is growing there. The Chinese consumer really wants to go to the movies. The Chinese consumer is also brand conscious. They also want something innovative, the next forward-looking thing. It’s a terrifically promising market for us.
Saudi Arabia Is A Rapidly Growing Market
Japan is another market that has gone very well for us in recent years. We have about 30 to 35 theaters open with a backlog opening. In Korea, we just signed a large deal with CGV, the largest cinema operator there. We have 16 open now and we’re opening another eight or ten in Korea. Saudi Arabia is also a rapidly growing market. There was no cinema in Saudi Arabia until about a year ago.
Since it’s opened it’s been very successful. We have 25 theaters slated to open in Saudi Arabia. In Saudi Arabia, we can’t build them fast enough. Western Europe, also once it starts to feel safe again and cinema gets back to normal, that’s a very good market as well.
Non-IMAX Cinemas Have Short-Term Cash Issues
What happens between now and the vaccine? For IMAX, we have a very strong balance sheet. We have over $315 million in cash and our cash burn is less than $9 million a month. But now that China’s open it’ll be significantly less than that. So for us, we have a long runway and a lot of staying power. For cinemas, in general, they tend to be much more levered than we are so there will be some short-term cash issues.
What they’re going to have to do is just manage their spend rates until there’s a vaccine and Hollywood releases more films so they can come back in a direct way. Most of the major ones have raised capital during the last several months with the financial markets being very amenable. So I suspect a lot of them will make it through it but it’s a matter of cost control and how soon they reopens.
America Didn’t Open Theaters Up As Quickly As China
In China, there is a lot of local content as well as in Japan. IMAX has been in China since around the year 2000. We have lots of relationships with filmmakers and studios in China. We have 10 local language films available between now and the rest of the year. So there’s a lot of content going on there. I think movies got pushed because, in North America, it didn’t open up as quickly as China opened up.
There are a few reasons for that. One is people just don’t feel as good about the virus and they’re leerier about going to out-of-home experiences. It didn’t happen the same way it happened in China. Also in China, they were very intelligent about the way they reopened. They opened about a month before some of the blockbuster movies came out so people got comfortable going to theaters. Then when the movies opened it was just a natural progression.
In the US, because of local regulation, it happened very suddenly and then the movies came out right away. People really weren’t conditioned to go. A lot of people, if you read the polling data, didn’t even know the cinemas were open. In terms of Disney’s Mulan, the results were not as good in China as was expected but I think that probably had more to do with how the movie played rather than any safety concerns.
IMAX CEO: When Is The Rest Of The World Going To Catch Up To China?
“We really doubled down on digital,” says Bed Bath & Beyond CEO Mark Tritton. “We weren’t easy and we weren’t convenient. Life’s tough at the moment and you really want to make it simple, easy, and frictionless for customers. The introduction of BOPIS (buy online, pick up in-store), curbside, and now same-day to really facilitate ease and frictionless shopping starting with digital or in-store, wherever the customer wants to go.”
Mark Tritton, CEO of Bed Bath & Beyond, after releasing their earnings report discusses how the company is driving success by leveraging digital with frictionless brick and mortar stores:
Doubling Down On Digital
Our (6 million) new customers coming on board are about six years younger which is great news for us as we expand our customer profile. The key to that is our omni-always strategy. We talk about understanding our customer, how they shop today, and this was pre-COVID. Even more important, we know that 80% of our customers pre-shop online and either purchase there or go to store.
We had a really broken paradigm. We had a fantastic digital business that was very large. We did about $1.8 billion last year. We already beat that by this time this year. We’re large, but we are growing. We really doubled down on that digital aspect. But we weren’t easy and we weren’t convenient. Life’s tough at the moment and you really want to make it simple, easy, and frictionless for our customers.
Stores Are Key To Profitability
So we looked at our website and our integration with our stores which is an ability to leverage our store asset and connect those strongly to an omni environment. It’s really worked out. The introduction of BOPIS (buy online, pick up in-store), curbside, and now same-day to really facilitate ease and frictionless shopping starting with digital or in-store, wherever the customer wants to go.
We know that if we have a digital side that is BOPIS, curbside, or same-day, our margin is actually equivalent to a store. We are driving behaviour, driving engagement, and driving those three assets. That’s helping to leverage out our gross margin. As we rapidly expand our digital business the stores are a key to this profitability.
