Shopifreaks E-commerce Industry News Recap ?? Week of Jan 20th, 2025

Hi LinkedIn - I'm Paul Drecksler and I follow the e-commerce industry closely for my Shopifreaks E-Commerce Newsletter.

This is a summary recap of the 209th Edition published Jan 20th, 2024. Check out the full edition for links and sources and subscribe here.

STAT OF THE WEEK:?The average return to office worker spends an additional $561 per month on transportation, child care, pet care, and domestic assistance. That is comparable to the average two-person household's grocery bill in the US for the entire month. Workers who have been forced to return to office are also found to have higher burnout, stress, and turnover intentions, as well as lower trust in their organization, engagement, and productivity levels.

TikTok is officially?banned?back in action!?On Saturday night, the US TikTok users (along with US citizens living outside the country like myself) woke up to a message from TikTok informing them that the app was no longer available. Other Bytedance apps including CapCut, Lemon8, Gauth, and Marvel Snap displayed similar messages and also became unavailable to many US users Saturday evening. By Sunday, TikTok began restoring its services after Trump said he would revive the app's access in the US when he returns to power on Monday. Trump said he would “extend the period of time before the law's prohibitions take effect, so that we can make a deal to protect our national security.” The President-elect also said that his executive order would protect from liability any companies that helped keep TikTok accessible before the order is issued. However there's apparently a catch: Trump wants TikTok to operate under 50% US ownership in a joint venture.

Ahead of today's presidential inauguration, incoming first couple?Donald and Melania Trump?launched a pair of meme coins that are already worth billions of dollars in market cap. Both coins are trading on the Solana blockchain. On Friday, Donald Trump launched?$TRUMP?coin, which skyrocketed over the weekend and was trading at more than $75 by Sunday afternoon. The coin now trades around $48 at the time of writing this, representing a market cap of over $10B. Two days later, Melania Trump launched her coin?$MELANIA, which spiked to around $12 a day later, and currently trades for around $7.50 each, representing a market cap of $7.6B. Melania's coin launch announcement initially sent $TRUMP coin nosediving to $40, but it has since slightly recovered.

Walmart?launched?Zepeto's?first-ever e-commerce experience for physical goods. Zepeto, if you're unfamiliar, is a digital avatar creation platform that allows users to create and share virtual experiences using digital representations of themselves. Now Zepeto's 20M monthly active users can view virtual Walmart clothing items and use the app to log into their Walmart accounts and order physical versions of the same items. The two companies will share revenue from the product sales, but the actual distribution is unknown. Conversely, purchases of select physical garments in brick-and-mortar Walmart stores will also come with free downloads of their virtual equivalents on Zepeto.

Elon Musk?confirmed that his team is looking into bringing back?Vine, the six-second video app that Twitter acquired in 2012 before it officially launched, and then subsequently shutdown in 2017 because Twitter historically has quit everything too early. Musk originally floated the idea of bringing back Vine last April in an X poll that received over 2M votes, with almost 70% of users saying “YES” to the idea, but not much has been said about it since.

In the meantime,?X?shared yesterday that “an immersive new home for videos is rolling out to users in the US” with the launch of a dedicated video tab in the mobile app. The company shared a screen capture video of what that will look like. Previously, X users had to click on a video and then scroll up or down to see more content. The new video tab exists in the app's bottom bar represented by a play button icon, which cuts out having to choose a starting video.

Guess who also launched a dedicated video tab??Bluesky! The company said on Sunday that it is launching a custom feed for vertical videos in its app alongside a trending videos section in the Explore tab. Bluesky also acknowledged developers building TikTok alternatives on AT Protocol, the decentralized protocol that powers Bluesky, such as Tik.Blue, Skylight.Social, and Bluescreen.Blue, which are in early stages of development.

Walmart?revealed its plans for an updated look to its brand that will roll out on its website and mobile app later this month. It's 4,600 US stores will get refreshed over time. Walmart says that the wordmark is "inspired by Sam Walton's classic trucker hat and brough tto life with a modern, custom font that differentiates Walmart from the crowd." Danny Baker commented on the update saying, "As the former head of visual design at wm dotcom, this is a great refresh. This definitely feels more contemporary and approachable, not trying too hard, either. The font is so much better than Bogle/Brandon Grotesque for this brand. The blue is a happier color, too. Overall, this should go at least another 20 years."

commercetools?announced?Instore, a new application that brings its composable commerce capabilities into physical stores. With the addition, the platform now lets enterprise retailers power their online and offline shopping experiences with a single platform. Kelly Goetsch, COO of Pipe17, explained what's special about Instore on LinkedIn, "It’s fundamentally different from all the other POS offerings, in that it allows retailers to use existing legacy POS (think NCR, Toshiba, etc.) and have those systems call back to commercetools APIs from the store. One channel, no re-training cashiers, no finicky iPads. Nobody has done this yet! Now commercetools truly has the only real omnichannel commerce product on the market."

From Feb 18th,?Klaviyo?announced that it will be enforcing “profile compliance” on legacy accounts — which means it will be billing customers based on total active profiles in their Klaviyo account, not just contacts they e-mail. Klaviyo will also be automatically bumping customers to a higher plan if they have more active profiles than the plan allows. They put a 25% cap on the price hike for now to give merchants time to clean their lists, but there's anticipation that they'll remove the cap at some point in the future. Previously, there was a loophole merchants could use to pay only for emailed contacts, but now Klaviyo is enforcing billing based on ALL active profiles in the account.

Amazon?suspended drone deliveries in Texas and Arizona following a crash of two of its models in rainy weather at a testing facility in Pendleton, Oregon. In a previously unreported December incident, two MK30 drones crashed during flights at an airport Amazon uses for testing, with one catching fire on the ground. Amazon later discovered that a software issue was to blame, related to the light rain happening during testing. The MK30 drones were cleared to make deliveries by the FAA last October and have since been delivering packages to customers’ homes in College Station, Texas, and Tolleson, Arizona.

In other Amazon Prime Air news…?right before the new year, the division filed an application with the FCC to gain two-year access to a radar frequency band not currently used by drone operators. The frequency is currently used by the US Coast Guard, NASA, and other federal agencies for use cases like identifying distressed vessels, weather-tracking radar systems, and avian detection. Amazon says its use of the frequency pertains to its R&D efforts in building drone air-traffic control systems controlled from the ground.

Amazon CEO Andy Jassy?has a?new shadow advisor, Alex Dunlap, who will join him on every call and meeting for the next 18-24 months. Shadow advisors are a position at the company that allow a person to learn the ins and outs of the company by providing support to someone in an executive role. Former shadows include Jeffer Helbling (current VP of Amazon Shipping Business), Amit Agarwal (SVP of emerging markets), Eric Rimling (held the position before Dunlap, and previous VP for Global Specialty Fulfillment). Jassy himself was once a shadow advisor to Jeff Bezos.

Brands are seeing an?influx in traffic?from?ChatGPT?and?Google Gemini, according to Spins' 2025 Industry Trends and Predictions Report. The period care brand Viv saw its monthly traffic spike by 400%, driven primarily by AI chatbots' search recommendations for non-toxic period care, following a study that went viral which found that popular tampon brands contain heavy metals like lead and arsenic. Stories like this are becoming more common for retail brands as AI tools change the way people search for products and solutions.

Google?has been accused?of sending data on American citizens to China, in a new complaint by privacy groups to the FTC. The complaint is the first to be brought under new US data-security laws and takes aim at Google's real-time bidding system for ads, which the group claims is where Google is sending large quantities of sensitive data about Americans to China and other foreign adversaries, and has known it's been doing so for over a decade. Google said the claim was “wrong” and based on “a flawed understanding” of how its digital advertising technology works. The company says it has the strictest restrictions in the industry on the types of data it shares in real-time bidding.

Apple's incoming CFO, Kevan Parekh,?claimed that the company?has no clue about its App Store profit margin, while in court last week defending the company against a class action lawsuit that alleges it abuses its monopolistic control over the sale of iPhone apps to charge excessive commissions. A billion dollar lawsuit was filed on behalf of developers in 2023, while a second lawsuit on behalf of consumers is being heard in a UK court. It's been independently estimated that Apple's profit margin on the App Store is around 75%, but Apple has always claimed it simply doesn't know the number because it doesn't break down its Service revenue into different categories.

Walmart?added tens of thousands?of pre-owned luxury handbags, jewelry, and watches to its marketplace, thanks to a new partnership with resale platform?Rebag, which boasts a catalog of more than 27,000 luxury items including products from Louis Vuitton, Hermès, Chanel, and Gucci. The partnership coincided with the launch of Luxe Resold, Walmart's new dedicated destination for reselling luxury brands.?

Klarna?is?exploring the sale?of its US pay-in-four loan portfolio to raise capital for future growth, in preparation for its anticipated IPO, expected in the first half of the year. The company is floating the sale to multiple banks including Citigroup, RBC, Nordea, and Société Générale. Klarna recently executed a similar strategy in the UK, where it sold its BNPL portfolio to Elliot Management in order to free up capital for ￡30B in new loans.

In other Klarna news…?the company?expanded its partnership?with?Stripe?to make its BNPL service available as a payment option for merchants in 26 countries. The two companies' initial collaboration began in 2021, opening the door for US merchants to offer Klarna's BNPL services through Stripe's platform. The expanded partnership also introduces the ability for Stripe's merchants to perform A/B tests on Klarna products in real-time.

BigCommerce?intends to sublease?around 65,000 square feet of office space from Expedia at The Domain building in Austin, TX. Both Expedia and BigCommerce are among the largest tech employers in Austin, though both companies had multiple rounds of layoffs during the past couple years. The sublease would begin on Oct 1st this year and terminate on Jan 31, 2031. BigCommerce's current headquarters is located northwest of the city, so the new sublease would provide it with a more central office.?

Over 85% of products from Chinese platforms?fail to meet EU product regulations?and are often ineffective, risky for consumers, or do not work properly. These include toys with loose parts, which are choking hazards for young children, electronics that catch fire due to overheating or malfunctions, or products that contain banned substances such as lead. Dutch market surveillance authorities and customs are calling for a joint approach in checking packages coming from Chinese platforms.

Two-thirds of BNPL users?said they?use the payment option?as a way to manage cash flow, and more consumers use it strategically than out of necessity, according to PYMNTS Intelligence data. Around the same time that PYMNTS released its report, the CFPB released data which showed that 20% of consumers used BNPL loans, and 20% of those borrowers took on more than one BNPL loan per month. Young borrowers aged 18-24 are the most prolific users of BNPL, with installment loans comprising 28% of their unsecured debt, compared to an average of 17% across all age groups.?

Meanwhile in the UK…?BNPL use among British consumers?climbed 20%?to around $27B in 2024, driven by PayPal, Klarna, and Affirm, which is new to the UK market, according to a report by GlobalData. The BNPL market in the UK has increased tenfold since 2019, driven by a cost-of-living crisis, higher interest rates from other forms of credit, and the disappearance of alternative payday loans.

Two co-founders of Ritual Technologies, a food takeout app that was once one of Canada's fast-growing tech companies, along with several members of the company's R&D team, are?joining Shopify. Sources described the move as an “acqui-hire” by Shopify, which describes a scenario when a company's talent is acquired while the underlying business is closed down or sold off. The same sources said that a separate process is under way to sell Ritual, with at least two buyers undertaking due diligence, but no deal has concluded yet.

Amazon?still has to sort out “several technical hurdles”?before rolling out?its long-awaited AI-powered Alexa, including solving the issue of hallucinations, which refer to non-factual information that many LLMs often produce. Amazon AI team lead Rohit Prasad told the?FT?that “Hallucinations have to be close to zero” — which is easier said than done. Some experts argue that the issue of hallucinations might be intrinsic to the tech itself and will always be part of the equation, a reality that tech companies are unlikely to admit.?

Speaking of AI…?OpenAI?removed language?from its policy doc that endorsed “politically unbiased” AI. In the original draft of its “economic blueprint” for the AI industry in the US, the company said that AI models “should aim to be politically unbiased by default,” but its newest draft deletes that phrasing. An OpenAI spokesperson said that the edit was part of an effort to “streamline” the document.?

Meta?is?planning to layoff?thousands of “low-performers” next month in its first massive job cut of 2025. The company plans to fire and replace roughly 5% of employees who have gone through its performance review process. Mark Zuckerberg said in a memo to employees, “This is going to be an intense year, and I want to make sure we have the best people on our teams.”

Microsoft?also announced?in a company memo that it plans to pause hiring and make layoffs in part of its consulting business in the US, as part of its broader effort to reduce costs. The cuts will affect less than 1% of the company’s workforce, according to one person familiar with Microsoft’s plans. The memo also instructed employees to not expense travel for any internal meetings and encouraged them to use remote sessions instead.

Last but not least…?Amazon?is?eliminating 200 roles?across its retail team in North America from both physical store and e-commerce operations. The cuts are being made as part of the company's regular evaluation of its team structure “to ensure we're best set up to move fast as we innovate for customers.” Last year Amazon also started the year with several hundred layoffs.

Telegram's CEO Pavel Durov?pledged to crackdown?on illegal activity and provide better content moderation on the platform during an initial court hearing in December, the details which were revealed on Friday. Durov told the courts that Telegram deletes between 15M and 20M accounts each month that it suspects of involvement in criminal activity and that Telegram has actively cooperated with law enforcement and handed over the data of more than 10,000 of its users to the authorities in a number of countries over the past six months. Durov stressed that “Telegram was not created to be a platform for criminals.”

The Australian Securities & Investments Commission?mandated?that BNPL platforms must obtain credit licenses to engage in credit activities as credit providers. All BNPL platforms operating in the country must apply for a credit license before the deadline of June 10, 2025 and become members of the Australian Financial Complaints Authority or potentially face consequences for operating as unlicensed lenders.?

Amazon?made the UK's biggest order?of electric trucks, including more than 140 electric Mercedes-Benz heavy goods vehicles and eight Volvo lorries, which are set to hit the road over the next 18 months. The company's switch to electric logistics is partly funded by the UK government's zero emission HGV and infrastructure demonstrator program. Amazon plans to install fast-charging points across its UK network to keep the trucks in action.

Canon?is?facing heat?from photographers for introducing a $5/month or $50/year subscription to unlock the company's EOS Webcam Utility Pro software, which provides full 60 fps video and other features that you'd typically expect from camera software. Photographer Roman Zipp?outlined his frustration?with purchasing a high-end Canon camera only to discover that “Canon will not allow you to use your own camera on your own computer with your own cables the way you intent to without paying for another subscription.”

The European Commission?requested information?from?X?relating to the algorithms that determine the content it recommends to users and how those algorithms may or may not be compliant with the Digital Services Act. The EC has requested X to provide “internal documentation” on its recommendation systems, along with any recent changes the company has made to them. It also issued a “retention order” that requires X to keep a record of any future changes through the end of 2025.

Workers at Teleperformance, a customer support company in Greece that serves Apple, Google, and Netflix are?accusing the company?of union busting, constant surveillance, and even refusing bathroom breaks in retaliation for workers pushing for a collective labor agreement. Workers say that wages have remain unchanged since 2010, despite high inflation in recent years and increases to the cost of living. Around half of the call center workers are from outside of Greece and are provided housing as part of their pay structure, but many say the company particularly exploits these workers who fear homelessness if they were to be let go.?

The?FTC?is?suing?John Deere?over anti-consumer repair practices that have driven up prices for farmers and have made it difficult for them to get repairs during critical planting and harvesting seasons. The lawsuit alleges that John Deere has monopoly power over the repair market and that it has illegally restricted the ability of farmers and independent technicians to repair their equipment. The company is also facing a class-action lawsuit related to its repair practices from consumers in Illinois.

Pixelfed, an opensource photo and video sharing alternative to Instagram that has no ads or tracking,?officially launched?mobile apps for Android and iPhone, allowing users to upload media directly from their phones. Pixelfed is part of the Fediverse, which means people on Mastodon and other Fediverse networks can follow accounts on Pixelfed and vice-versa. Meta has been?taking heat?from users for labeling links to Pixelfed.social as “spam” and deleting them immediately.?

In the world of corporate turnover…?Bumble's CEO?Lidiane Jones is?leaving the company?for “personal reasons” only a year after taking the role. Jones is infamous for killing the app's signature feature of only allowing women to message first during her tenure, a change which subsequently caused the company's stock to fall by 54%. Founder and executive chair Whitney Wolfe Herd will return to the role, starting in mid-March.

OpenAI?appointed?Adebayo Ogunlesi, a senior managing director at BlackRock and CEO of Global Infrastructure Partners, to its board of directors. OpenAI’s board today includes chairman Bret Taylor, Sam Altman, Quora CEO Adam D’Angelo, Bill & Melinda Gates Foundation CEO Sue Desmond-Hellmann, former NSA director Paul M. Nakasone, former Sony Corporation of America President Nicole Seligman, Instacart CEO Fidji Simo, economist Larry Summers, and Carnegie Mellon computer scientist Zico Kolter. D’Angelo is the sole holdover from the previous board.

Walmart?named?Dave Guggina, its current executive VP of Supply Chain, as its new US chief e-commerce officer, replacing Tom Ward, who will take on the role of COO of Sam's Club. The move comes as Walmart is investing billions to expand its e-commerce business by providing more product choices online and automating its supply chain to improve delivery times.

Spotify?elevated?Simran Singh, who's served as Director of Sales since September 2023, to the role of Director of Sales for E-commerce & Retail. Before joining the music streaming platform, Singh was with Sony Pictures Networks India as their regional head of ad sales, and before that she worked with ByteDance, Times Internet, and Viacom18.

Teikametrics, an AI-powered marketplace optimization platform,?appointed?Sandie Hawkins?as the company's president. Hawkins previously served as the Head of E-commerce at TikTok and brings over 20 years of experience in multi-channel marketing and e-commerce growth to the business.

Apple?finally introduced?its Apple Store app in India, which alongside buying products, handles product customizations, such as allowing customers to change the configuration of Macs, or add engravings to their AirPods and AirTags. The app also provides Indian consumers ways to learn about Apple products and services, retail programs, and financing options.

Meanwhile in China…?Apple?was?dethroned?as China's biggest smartphone seller in 2025 after experiencing its worst decline of iPhone sales in the country since 2016. Local rivals Vivo and Huawei overtook the iPhone maker after its annual shipments in the country declined 17%. Vivo captured a 17% market share in China, followed by Huawei with 16% and Apple with 15%.

Cash App?agreed to pay $255M?in multiple settlements around its consumer protections. Block, its parent company, agreed to pay $80M to 48 states that fined the app for violating laws intended to keep illicit activity off the platform. Separately, the federal Consumer Financial Protection Bureau reached a settlement with Block in which the company agreed to pay up to $120M to Cash App customers and another $55M to the CFPB over its weak security measures, which put consumers at risk and made it difficult to get help after experiencing fraud on the platform.

In other Block news…?the company is?now offering employees?the option to choose rewards in the form of cash or stock. Block's Q1 performance rewards have historically been offered as four-year equity grants, but now employees can choose a mix of cash or equity. Block's CFO Amrita Ahuja said, “The comp program is about attracting and retaining great talent who are interested in making their own choices on how they're compensated.”

Amazon?will stop offering prep services?for sharp products through its FBA fulfillment service in April to help ensure the safety of its associates. Sellers will be required to handle the end-to-end packaging of all sharp products before sending them to Amazons fulfillment centers, starting in April, as well as package all sharp products in secure, cut- and puncture-resistant packaging such as hardened plastic or blister packs.

Squarespace?unveiled?its return to Super Bowl advertising with a tease of a?30-second ad?that is expected to run between the first and second quarters of Super Bowl LIX on Fox. In the teaser video, a man on a donkey moves forward on a path, tossing laptops out of a satchel as he travels to the sounds of uilleann pipes. The spot will mark Squarespace's 11th time advertising during a Super Bowl. David Lee, the company’s chief creative officer, said, “Obviously it's a huge expense, and it's a costly thing to do every year, but, you know, some would argue it actually might be one of the cheaper things to do. You kind of put out one silver bullet and reach a massive audience in one shot.”

Plus 18 seed rounds, IPOs, and acquisitions of interest including?eBay?signing a definitive agreement to acquire?Caramel, an online platform that simplifies private car sales by handling pricing, paperwork, financing, and title transfers for buyers and sellers, for an undisclosed amount. Caramel's platform supports transactions in all 50 US states either through an independent dealer or via its marketplace and auction partners. Last month I reported that Amazon launched Amazon Autos, a platform that will initially offer Hyundai vehicles to US customers, marking its entry into the automotive market. Everyone wants a piece of the automobile market apparently.

I hope you found this recap helpful.

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See you next week!

Paul Drecksler