Shopifreaks E-commerce Industry News Recap ?? Week of July 15th, 2024

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 182nd Edition published July 15th, 2024. Check out the full edition for links and sources and subscribe here .

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STAT OF THE WEEK: 40% of U.S. households are expected to shop on Amazon's Prime Day this week. More than half of Prime Day 2024 shoppers will likely be comparing prices on other retailers but still buying on Amazon. — According to a survey by Numerator

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Etsy is attempting to go back to its roots and reclaim its original mission to support artisans and crafters, while still providing a sales platform for non-handmade goods. The company posted a policy update on Tuesday, noting that in place of its “handmade” and “vintage” labels, it will instead be categorizing products as Made by a seller, Designed by a seller, Sourced by a seller, & Handpicked by a seller. In addition to the product category updates, Etsy launched a new marketing campaign that'll feature Etsy sellers and their products in TV commercials, billboards, and social-media content in the U.S. and U.K. I think this is a brilliant way to humanize the buying experience on the platform — shopping with a real artisan as opposed to shopping with a fictitious private label brand name on Amazon. It's also bringing back its Etsy up virtual seller conference and launching Etsy Design Awards to honor the work of sellers.

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Wix added the ability for merchants to customize their checkout forms, providing a more tailored experience for customers. Merchants can now add custom fields, customize the layout of checkout, adjust field settings, control the visibility of custom fields via conditional rules, and pass on custom field data to emails, thank you pages, and order pages.

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More than 200 cryptocurrency domains registered with Squarespace have been identified at risk after the company was found to be under a massive DNS hijacking attack. By hijacking DNS functionality, hackers can redirect users to malicious websites or gain unauthorized remote access to an organization’s servers and steal sensitive data. The attack began Thursday with two websites of blockchain projects — Compound and Celer Networks — and then later researchers found that it impacted around 220 others. The incident is being blamed on the recent migration of 10M domains from Google Domains to Squarespace after the acquisition deal last September.

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Meanwhile across the Canadian border, Shopify had nearly 174,000 customers' info leaked on a web hacking forum last week. Shopify denies that its servers were hacked and gave the following statement: “Shopify systems have not experienced a security incident. The data loss reported was caused by a third-party app. The app developer intends to notify affected customers.” Shopify declined to confirm the number of customers impacted or what the particular third-party app is that got hacked. That'd be a nice thing to know for the users of that app, don't you think?

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Certain Amazon sellers lost their Buy Box status ahead of Prime Day after the company's algorithms found their items being sold for less on Target's website during its Target Circle Week promo, which ended July 13th. The problem for sellers resulted from a change in how Target promoted deals for Circle Week. In the past, Target would show the percentage discount off the regular price, while leaving the listed price the same. However this year, Target showed the item's actual sale price after the discount, which meant it was re-indexed by Amazon's pricing algorithms. Sellers took their concerns to Target, which then adjusted the Circle Week discounts on some listings to say “See price in cart” in order to skirt Amazon's pricing algorithms.

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Indiegogo launched a new e-commerce offering called IndieShop, which allows users to purchase products developed via crowdfunding. The platform is now live on the Indiegogo site, after launching in Beta in May, and currently features 40+ products. Almost a decade ago, Indiegogo launched its InDemand offering, which allows creators to sell their products as pre-orders after crowdfunding is complete and manage customers using the site’s platform. This allows creators to continue driving revenue through the platform after they hit their goal and while the product is in production. The difference between InDemand and Indieshop is that with Indieshop, the products are in-stock and ready-to-ship. Now Indiegogo can take aspiring brands through the entire sales cycle from crowdfunding to pre-orders to selling live once the product is ready.

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Chinese e-commerce vendors are struggling for survival as sales growth slows and price pressure rises due to shopping platforms competing with aggressive policies to attract customers, as reported by Reuters. Lu Zhenwang, a Shanghai-based e-commerce operator who sells items for small vendors, said, “The good times for e-commerce are over. This year there is fierce competition and I don't think a lot of sellers will survive another three years.” Lu said the operating environment is poor because the rise in e-commerce sales has created what is known in Chinese as the “neijuan” effect — working harder for smaller returns. He told Reuters, “There is no growth in sales, because there are no new customers and the average income of people is not rising like 10 years ago. There is only competition, between platforms, between sellers. This is the new normal for the e-commerce industry in China.”

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The Reuters article focused on sellers getting squeezed, but it's not any better for Chinese manufacturers either right now in the country. Between Temu's aggressive price negotiations with manufacturers, and Shein's allegedly requiring factories to sign loyalty oaths promising they won't sell to competitors — the ones left in the wake of these pricing and exclusivity wars are the manufacturers. Giving the buying power and reach of China's major e-commerce players — like Alibaba, JD.com, Pinduoduo, ByteDance, and Shein — manufacturers are left with a choice: Do I want to make a little bit of money selling my products at rock bottom prices or not sell anything at all? The latter, which could mean shutting down their factories.

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This year at its upcoming Prime Day sales event, Amazon promotions will be pointing shoppers toward collecting packages from its network of lockers and other pick-up points like Whole Foods stores. A spokesperson told Business Insider, “Amazon wants customers to choose the delivery option that is most convenient for them,” and that the company offers “tens of thousands of package pick-up locations” in the U.S. For customers, pick-up points are convenient and oftentimes more secure, especially for those that have previously experienced porch theft. For Amazon, it's less expensive for the company to deliver multiple customer orders to one location, as opposed to making individual drops across the city at each customer's home. Plus, porch piracy costs the company money too.

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E-commerce executive shake ups this week....

commercetools?appointed?Andrew Burton as its new CEO, effective July 8th. Burton succeeds Dirk Hoerig, co-founder and CEO of commercetools, who will remain on the board and transition to the role of Chief Innovation Officer. Burton joins commercetools from Rapid7 where he served as President and COO, growing the company from $150M ARR to over $800M.?

Bold Commerce?named?Steven Guevarra as CFO, succeeding Stuart Henrickson, who left the company, and Brandon Briggs as head of sales and agency partnership, a new position. Bold said in a statement that Guevarra brings “more than two decades of financial experience and expertise scaling high-growth technology companies” and that Briggs, an e-commerce and technology veteran, will assist in the company's effort to build strategic partnerships.

Global-e Online?promoted?Tomer Gold as EVP, Head of the Channels and SMB Division, and Siddharth Jain as EVP, Technology. Gold formerly held the position of VP of Corporate Development at Global-e, while Jain is ascending from his role as Senior VP of Engineering within the company.?

Elk Home?appointed?Anna Lee Schlueter as its new Director of E-commerce, charged with driving advancements in the company's online presence. Schlueter has served as VP and Director of Operations for the past 15 years at Jaben Holdings.

Guitar Center?appointed?Adolfo Rodriguez as VP, Chief Technology & Information Officer, effective July 9th. Rodriguez is responsible for the end-to-end technology vision and execution of the company and will report directly to CEO Gabe Dalporto. He most recently served at Advance Auto Parts, where he spearheaded technological advancements across the company's e-commerce, brick-and-mortar stores, and supply chain.?

Hasbro?Inc?named?Dan Rawson as global play lead for Dungeons & Dragons and D&D Beyond, its fan platform, where he will be responsible for all D2C and e-commerce operations. Rawson previously led e-commerce and SaaS businesses at Amazon and Microsoft. Hasbro named Stephanie Beal as its new chief supply chain officer. Beal has been with the company since 2022 and recently led a systems transformation to digitize planning processes across the enterprise. Hasbro also appointed Dan Shull as chief digital information officer, a newly created IT strategy position. Shull comes from REI where hew as CTO and previously held executive positions at Signet, Nike, and Borders.

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Amazon's AI shopping assistant, Rufus, is?now available to all U.S. customers, just in time for the company's annual Prime Day event this week. Amazon first revealed Rufus in February, but until now, it has only been accessible to a limited number of users in the app. The assistant is trained on Amazon's product catalog, customer reviews, community Q&As, and information across the web. And this is just a rumor, but I heard that Rufus is secretly in love with Alexa.

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eBay?launched a new dashboard?for its eBay Advertising, which the company described as a “reimagined and redesigned advertising experience.” The new version has a revamped Seller Hub Marketing tab and a new Advertising tab that provides sellers with a holistic view of all campaigns so that they can make quick adjustments, as well as a section with recommendations of the day which leverage ebay.ai to uncover trends and automatically build campaigns for your listings.

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Carvana?introduced a new feature?that highlights electric vehicles that qualify for the Clean Vehicle Tax Credit within the search results and lets legible customers apply for up to $4,000 in savings from the credit at checkout. Instead of waiting for a lower tax bill next year, customers can now get up to $4,000 savings up front, which automatically flow through to eligible customers' financing terms.?

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Ikea U.S.?is?trying to better serve?the needs of its Spanish-speaking shoppers by launching a Spanish-language platform. In addition to the new online shopping experience, Spanish-speaking customers can also receive support before, during, and after their purchase with a Spanish-speaking associate when calling the support phone line. I'm kind of surprised a company that large didn't already have Spanish-language service for years now.?

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Costco?is?hiking its annual membership fees?in the U.S. and Canada by $5, and raising the cost of its higher-tier membership by $10, marking the first increase since 2017. That's an increase to $65 from $60 for regular annual memberships and from $120 to $130 for “Executive Membership.” Rest assured though, the hotdog + coke combo will still sell for $1.50.

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Shein logistics software?is in beta testing with select supply chain customers, and?cybersecurity firms are concerned?over the potential for a company with close ties to China to spy on the supply chain as it grows its global logistics footprint. Dewardric McNeal, senior policy analyst at Longview Global, said, “Given the intricate nature of the U.S. and global supply chains, the potential for espionage or data gathering is a significant risk. Shein’s software could provide unprecedented access to sensitive supply chain data, which the Chinese government could seize under its laws. This exposure poses a direct threat to U.S. supply chain integrity, making it vulnerable to exploitation and manipulation.” Meanwhile Shein's like, “We don't need your secrets. We're already better at this than you.”

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Walmart?is offering?half off Walmart+ memberships?until July 18th, which funny enough, overlaps with Amazon's Prime Day on July 16th and 17th. What are the odds? Walmart+ offers free shipping with no order minimum, free grocery delivery from your local store with a minimum order of $35, savings on fuel, video streaming with Paramount+, free tire repair and road hazard warranty, returns from home, and other perks. Not bad for $49! However note that unlike Amazon Prime memberships, you can't give access to your Walmart+ to other members of your household. They'd all have to login to the same account, which has your payment info tied to it. I learned that the hard way last night when I bought a year of Walmart+, thinking I could add my parents and have them share the membership perks via their own Walmart accounts.

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More than?3,000 Amazon associates?at Amazon's Coventry warehouse in England?voted in a historic trade union recognition ballot?that could allow U.K. employees to bargain collectively for rights and pay for the first time. If the collective vote supports recognition, the GMB would be given the right to represent them in negotiations over pay and conditions in what would be the first instance of Amazon recognizing a union in the U.K.

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A US judge?ruled against?the?FTC?in a challenge to its ruling banning noncompete agreements, citing the FTC's lack of “substantive” rulemaking authority. The preliminary ruling blocks enforcement of the noncompete ban against the plaintiff and other groups that were involved in the case, and signals that the FTC cannot enforce the rule.

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OpenAI?whistleblowers?filed a complaint?with the SEC, calling for an investigation into the company for allegedly requiring restrictive NDAs. The whistleblowers claim that OpenAI issued overly restrictive employment, severance, and non-disclosure agreements to its employees, which could lead to penalties against workers who raised concerns about OpenAI to federal authorities.

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Marc Andreessen?sent $50k in Bitcoin?to an AI bot on X called the Truth Terminal, which operates semi-autonomously, with its human handler only approving its Twitter posts and deciding who it gets to interact with. After a chat with Andreessen where the investor proposed a grant, the bot created a plan of upgrades which included a personal CPU, AI model tweaks, and even a billboard. Andreessen agreed to the plan and proceeded with a $50k one-time grant.

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Amazon?introduced App Studio?at its AWS Summit last week, a new gen AI-powered platform that allows professionals to build apps using natural language descriptions and prompts. Users can specify the app's function and the data sources it should pull from, and App Studio will produce an app that would have otherwise taken the developer days. In a demo, Amazon demonstrated how App Studio can take a request for an invoice tracking app and lay out suggestions for how it should work, which the developer can approve before creating the actual app.

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WhatsApp Business?is?reducing rates?for utility messages and raising rates for marketing messages, effective Aug 4th and Oct 4th respectively. Over the last year, users have complained about the number of WhatsApp messages increasing over the platform, resulting in spam, so the company started testing restrictions on marketing messages sent to users in India, which it now expanded globally, hoping that the restrictions and increased cost will help reduce the Spam.

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Mastercard?and?Nuvei?teamed up?to hep consumers in Europe convert digital assets into fiat currency via debit, credit, and prepaid cards. The off-ramping solutions lets consumers convert supported crypto currencies into fiat currency, which they can then transfer to Mastercards without the need to go through third-party exchanges.

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Amazon?says it?reached its goal?of matching all of the electricity consumed by its operations with 100% renewable energy in 2023 — seven years ahead of schedule — — making it the largest corporate purchaser of renewable energy in the world for four years running. The company is exploring new carbon-free energy sources in efforts to meet its Climate Pledge commitment of net-zero carbon by 2040.?

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The EU?declared that?X breached its guidelines?under the Digital Services Act, following an investigation into the company's advertising transparency, availability of data, and risk management. X was informed of these preliminary findings on Friday, which found three primary breaches of the DSA including its use of the Blue Check mark to receive verified status, its inability to search its advertising system, and for prohibiting researchers from independently accessing its public data.

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TikTok ad spend?is?tapering off?since March when the U.S. introduced the selloff bill that would require the company to divest the app to American ownership or be banned from the country next year. It's still growing, just slower. Ad spend was up 19% in March, 11% in April, but only 6% in May. Target reduced its spend by 30%, DoorDash by 25%, Bayer by 20%, and Procter & Gamble by 10%.

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Amazon Pay India?is?introducing new payment methods?this year including UPI, credit cards, and wallets, rather than just specializing in a single segment. The company says it sees opportunities in penetrating offline payments and smaller towns, where currently 65% of the transactions done by consumers in tier two and three cities were digital versus 75% in larger cities.

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Plus 5 seed rounds, IPOs, and acquisitions of interest including Flip's acquisition of Curated, a marketplace that connects consumers with verified experts for personalized shopping advice, for $330M in stock.

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I hope you found this recap helpful.

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See you next week!

Paul Drecksler