?? Consumers Shift to Store Brands to Cut Costs?? Plus: BNPL impact in Fashion, Cart Abandonment rates

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??This week maze:

1. The Big Story ???

Consumers Shift to Store Brands to Cut Costs??

2. Data ???

BNPL impact in Fashion Cart Abandonment rates

3. News ??

?? Amazon, TikTok, eBay, Walmart

?? Shein, Zara, Douglas, VestiaireCollective, JD.com

?? Getir, Tesco, Amazon, Grubhub, Swiggy, Uber Eats

??Decathlon, YouTube, Meta, Alibaba, Google

4. Deals ???

ByteDance, Shopify, Swappie, Qeen, OneRail, Semexe

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1. The Big Story ??

WSJ recently published a great article analyzing store brands’ performance vs national brands (like Store coke vs Coke) predominantly based on NielsenIQ data. Let’s dive into the main messages.

?? Store Brands on the Rise

• Store-brand goods now account for 22% of grocery spending, a record high.
• Walmart's Great Value, Kroger's Private Selection, and Aldi brands are leading.
• Prices for groceries rose 26% since 2019, making store brands more appealing.

?? Why Consumers Choose Store Brands

• 65% of shoppers prefer store brands for lower prices, according to a Food Industry Association survey.
• Consumers cut costs on other expenses like streaming services to afford groceries.

?? Retailers Invest in Store Brands

• Walmart plans to launch a premium food line, Bettergoods, with items under $5.
• Aldi to add 800 stores by 2028, with 90% of products as store brands.
• Retailers like Trader Joe's and Lidl are attracting more foot traffic with private labels.

?? National Brands Under Pressure

• National brands like McCormick and Campbell Soup are feeling the heat.
• Food manufacturers are offering more deals and smaller packages to compete.

2. Data ???

Foxintelligence reported last week on BNPL impact on average order amount in

??? Fashion AOV Data

• Fashion average order value (AOV) amounted to €76 in 2023 vs €110 with BNPL
• Largest AOV in Germany at €121, Lowest AOV in Spain at €37

?? BNPL Boost

• BNPL purchases show an AOV 45% higher than traditional purchases for fashion retailers in EU5
• Largest BNPL impact in Spain and Italy, with 135% and 87% higher AOV respectively
• Lowest BNPL impact in Germany and UK, with 11% and 26% higher AOV respectively

2. Data ???

Last week, ECDB revealed the critical data on rising cart abandonment rates in

?? Cart Abandonment Rates on the Rise

• In 2023, the average cart abandonment rate hit 80%, up from 75% in 2020.
• Bulgaria leads with the highest rate at nearly 85%.
• Romania, Croatia, Greece, Portugal, Serbia, and Italy follow at around 83%.

?? Impact of Shipping Costs

• 50% of European shoppers cite high delivery costs as the main reason for abandoning carts.
• Transparency in shipping fees is crucial for retaining customers.
• In Spain, 72% of shoppers prefer delivery costs included in the item price.
• Conversely, 64% of Polish shoppers prefer to see delivery options at checkout.

?? Importance of Checkout Process

• Simplified checkout processes are key to reducing cart abandonment.
• 67% of Austrians abandon carts due to a lack of preferred delivery options.
• Flexible delivery and payment options can significantly lower abandonment rates.

4. News ??

?? Mass merchant

?? ???? Amazon faces $1.3B lawsuit from UK retailers. BIRA is suing Amazon for $1.3B, claiming misuse of data and unfair Buy Box manipulation. The case, filed on June 6, 2024, involves thousands of retailers and spans from 2015 to present. Amazon denies wrongdoing.

????? TikTok shifts focus to US, pauses EU ecommerce. TikTok stops ecommerce in Europe to focus on the US, aiming for $17.5B in sales by end of 2024. The company faces a potential ban in the US and legal challenges to divestment demands. Investigations in Europe also continue.

????? eBay drops Amex due to high fees. eBay will no longer accept American Express cards starting August 17th. The company cites "unacceptably high fees" as the reason. Amex disagrees, noting its fees are comparable to other cards.

????? eBay launches AI tool for image backgrounds. eBay launched an AI tool for background enhancement on June 5, 2024. The tool, available for iOS users in the U.S., U.K., and Germany, lets sellers replace image backgrounds with AI-generated ones. This feature helps improve photo quality and follows similar moves by Amazon and Google. Android rollout is planned soon.

????? Amazon's AI Spots Product Defects Before Shipping. Amazon's Project PI combines AI and computer vision to detect damaged items before shipping. This new tech operates in several North American warehouses and aims to expand. Human reviewers decide if flagged items are resold or donated.

????? Amazon struggles to compete in South Africa. Amazon's South African launch saw initial hype but quickly declined. Competing with local giant Takealot, Amazon struggled with product selection and pricing. Experts doubt Amazon can easily outperform established local players.

????? Walmart expands InHome delivery service. Walmart’s InHome delivery is expanding to 45M U.S. homes, adding 10M potential customers. Since its 2019 launch, the service has grown steadily, now covering Southern California, Boston, Detroit, Minneapolis, and Philadelphia.

?? Fashion & Beauty

????? Shein expands resale platform to Europe. Shein's resale platform is now in Europe. Starting in France, it will expand to the UK and Germany. This follows its successful US launch in 2022, with 4.2M users joining in 2023. Shein aims to boost circular fashion with this expansion.

????? Zara expands live shopping to US, UK, Europe. Zara, owned by Inditex, is expanding its live shopping broadcasts to the US, UK, and Europe between August and October. This follows successful trials in China on Douyin, boosting sales through weekly shows since last November.

????? Douglas tests new AI Beauty Advisor. Douglas partners with Google Cloud to test a new AI Beauty Advisor chatbot. This chatbot provides personalized product recommendations and beauty tips. The current test phase is internal and focuses on improving customer experience.

????? Vestiaire Collective partners with Sojo for tailoring. Vestiaire Collective partners with Sojo to offer tailoring and repair services. This addresses the issue of 65% of returns due to incorrect fit. Sojo provides zero-emission pick-up and delivery, enhancing the resale value of items.

????? True Fit's New AI Tool Reduces Clothing Returns. True Fit's new tool, Fit Hub, uses generative AI to help online shoppers find clothes that fit their body type. By analyzing size charts, descriptions, and reviews, it reduces return rates. Fit Hub is in beta and launches next month.

????? JD.com launches Massimo Dutti store. JD.com partners with Inditex to launch Massimo Dutti’s flagship store on June 3rd. The store will feature nearly 1,000 exclusive items, just in time for JD’s 618 Grand Promotion. China’s vast digital consumer base can now access premium fashion.

?? Food & Grocery

????? Getir faces cash crunch, needs new funding soon. Getir is running out of cash and needs new funding within weeks. The company, exiting the UK market, must implement leadership changes to secure tens of millions from investors. Founder Nazim Salur faces pressure to step back, while the company risks losing 1,500 jobs.

????? Tesco launches online marketplace with 9K items. Tesco's new marketplace includes 9,000 products from 17 sellers. Shoppers can buy DIY, homeware, and more, collecting Clubcard points with every purchase. This makes Tesco a one-stop shop for groceries and more.

????? Amazon Adds Grubhub to U.S. App. Amazon partners with Grubhub, offering food delivery to US customers via its app. Prime members receive free Grubhub Plus, a $120 annual value. This expands Grubhub's reach, boosting sales and earnings for delivery partners.

????? Grubhub now delivers Starbucks nationwide. Starbucks partners with Grubhub for nationwide delivery starting in Pennsylvania, Colorado, and Illinois this June, expanding to more locations by August. This move follows Starbucks' reported decline in same-store sales but growth in delivery.

????? Swiggy Instamart Launches Mango-Scented Ad. Swiggy Instamart launched a mango-scented ad in ‘Times of India’ newspaper to enhance customer engagement. The campaign combines scent and visuals to make ordering mangoes irresistible. 800K copies circulated in Mumbai, drawing widespread acclaim.

????? Uber UK introduces 'Sponsored Items'. Uber UK's advertising launches 'Sponsored Items' on Uber Eats. PepsiCo is among the first brands to use this feature, aiming to boost sales and gain consumer insights. Powered by Criteo, the feature is now in 12 markets, enhancing product visibility.

??General

????? Decathlon launches resale platform in Belgium. Decathlon's new resale platform allows Belgians to sell sports gear directly to each other. The service is aimed at reducing waste and promoting sustainable practices. Initially available only in Belgium, it might expand to Europe if successful.

????? YouTube partners with Coupang for shopping. YouTube partners with Coupang to launch an affiliate shopping program in Korea, allowing creators to tag products and earn commissions. This is YouTube’s second rollout of the program after the US.

????? Meta Verified launches WhatsApp Business. Meta introduces Meta Verified for WhatsApp Business in Brazil, India, Indonesia, and Colombia at $14/month. New features include multi-device support, custom web pages, and verified channels. Businesses can now call customers via the app.

????? Alibaba launches fixed-price delivery service. Alibaba.com has launched Alibaba Guaranteed, a service ensuring fixed prices, included shipping fees, and guaranteed delivery dates for cross-border trade. This aims to simplify the global sourcing process for SMBs, offering faster dispatch and robust after-sales services.

????? Austrian Post Launches New Address Service. Austrian Post introduces AllesPost Deutschland, a service allowing Austrian customers to use a German address for international shopping. Almost 90% of Austrian online shoppers have faced issues with deliveries. This service aims to solve that.

????? Google’s AI disrupts ecommerce search visibility. Google’s AI overviews are disrupting ecommerce search visibility. Most overviews pull product data from non-ranking sources, creating new opportunities to optimize product pages for better visibility.

5. Deals??

????? ByteDance seeks $800M for Dongchedi IPO (car marketplace). ByteDance is in talks to raise up to $800M for Dongchedi from HongShan, KKR, and General Atlantic. HongShan will likely contribute up to $500M. Dongchedi saw 33.6M visits in April, surpassing AutoHome.com.cn's 30M.

????? Shopify buys Checkout Blocks for no-code checkout. Shopify has acquired Checkout Blocks, allowing no-code checkout customizations for Shopify Plus merchants. This acquisition aims to improve customer experiences and boost sales. Checkout Blocks, used by over 850 merchants, now offers a free Starter plan for Shopify Plus users.

????? Swappie Secures €17M Loan for Green Tech. Swappie has secured €17M ($18.5M) from the European Investment Bank to enhance its refurbishment processes, reduce carbon footprints, and expand R&D in robotics. This funding, backed by the InvestEU guarantee, aims to make refurbished smartphones more accessible and sustainable.

????? Qeen.ai raises USD 2.2 mn pre-seed funds. Qeen.ai, an AI startup, raised USD 2.2 mn in pre-seed funding led by Wamda Capital. The funds will enhance its platform for better e-commerce vendor support. Founded by ex-Google employees, Qeen.ai aims to simplify AI solutions.

????? OneRail acquires Orderbot for omnichannel boost. OneRail's purchase of Orderbot on June 5, 2024, adds advanced inventory and order management to its system. This integration aims to improve order accuracy, cost savings, and customer experience, with a network of 12M drivers.

????? Semexe secures $0.8M for Loopify expansion. Hiker Ventures invests $0.8M in Semexe, aiming to expand the Loopify re-commerce platform. Loopify helps brands implement trade-in and used goods programs. This marks Hiker's third 2024 investment, emphasizing circular economy.