TRD Issue 11 - Briefing: Amazon & Staples team up for returns, Overstock becomes Bed Bath & Beyond, and Instagram launches Twitter rival

Hello Subscribers,

Welcome to Issue 11 of The Retail Direct.?

This week, We're covering Amazon's customer returns, competition for Prime Day, and Alwayz's $46 million investment in online shopping. Also, Overstock.com's rebrand to Bed Bath & Beyond, H&M and Shein's new retail approach, and Threads - Instagram's competition to Twitter.

Lastly, we cover Ant Group's Alipay+ expansion in Malaysia, foodpanda and Visa's collaboration on payment solutions, the rise in Hong Kong's retail sales, and Mitsui Fudosan's new retail development - LaLaport Kaohsiung in Taiwan.??

Happy reading!

About 91APP

Founded in 2013, 91APP is the premier OMO (online-merge-offline) SaaS company, providing one-stop omnichannel retail solutions in Taiwan, Hong Kong, and Malaysia. It offers advanced Commerce Solution and Marketing Solution that enable retail brands to penetrate the D2C (Direct-to-Consumer) eCommerce market and drive their operational benefits to their full potential. In 2021, 91APP became the first SaaS company to be listed in Taiwan and has been named one of Taiwan's "NEXT BIG" companies by Startup Island TAIWAN.

For more information about 91APP (TWO: 6741), visit www.91app.com .

e-Commerce

How Amazon Is Taming Its Customers’ Returns Addiction

Why it is important

• Amazon's partnership with Staples aims to reduce customer return costs, which surged during the pandemic.?
• This move could affect the retail industry's approach to returns and Amazon's competition with Walmart.

What happened

• Amazon partnered with Staples, allowing customers to drop off return items at nearly 1,000 Staples stores.
• This move is part of Amazon's strategy to reduce the cost of returns, which increased significantly during the pandemic.
• Amazon has also been experimenting with fees and labels to discourage customers from using UPS for returns, which is particularly costly for the company.

Background

• Amazon's logistics costs doubled between 2019 and 2022, reaching $84.3 billion.
• Amazon has been trying to manage the high cost of returns, which is often more expensive than delivering the items to customers in the first place.
• Amazon's return rates doubled to 18% in 2020 due to increased sales in return-heavy categories like clothing.

What did they say

• Melissa Nick, former North America fulfillment operations at Amazon, said that returns are now a core competency for Amazon, a change from the past.
• UPS may increase fees for Amazon's use of their UPS Store network as Amazon relies less on UPS for deliveries, per Dean Maciuba of Crossroads Parcel Consulting.

Now what

• Staples will accept returns for Amazon in all U.S. locations by the end of July.?
• Amazon will experiment with more return policies and partnerships to boost efficiency and lower costs, which could affect the retail industry and its competition.

Source: The Information

Big-box Retailers are Once Again Set to Host Weeklong Events Against Prime Day This Year

Why it is important

• Target, Walmart, and Nordstrom use Amazon's Prime Day to boost sales and loyalty program membership amid reduced consumer spending.?
• Their tactics during this time could shape future marketing strategies.

What happened

• Prime Day on July 11 and 12 has sparked other retailers like Target, Walmart, and Nordstrom to host their own sales events to boost sales and loyalty program memberships.?
• This differs from previous years when retailers offered summer promotions to clear excess inventory.

Background

• Retailers like Target and Best Buy have been hosting sales events to compete with Prime Day for several years as the event has grown in popularity.
• Last year, some retailers struggled with surplus inventory and opted to offer sales during the summer instead of competing with Prime Day.?
• This year, retailers like Target and Walmart use sales events similar to Prime Day to entice more customers to join their loyalty programs.

What did they say

• Walmart's move to shift their sale back to July is a response to the coordinated shopper activity generated by Amazon's Prime Day, according to Andrew Lipsman, a retail and e-Commerce analyst at Insider Intelligence.
• According to Gartner analyst Kassi Socha, retailers use sales and promotions to attract consumers in a competitive market for discretionary spending.

Now what

• Retailers use Amazon's Prime Day to boost sales and loyalty program memberships.
• This affects future sales and marketing strategies and influences the retail industry.

Source: Modern Retail

Korea’s Alwayz Aims to Make Online Shopping Fun Again with $46M in Funding

Why it is important

• Alwayz , a shopping app operated by Levit , is innovating e-Commerce by making online shopping more entertaining and affordable.
• The app's unique features, such as gamification and social elements, could influence the future of online shopping experiences.
• The success of Alwayz could encourage other e-Commerce platforms to adopt similar strategies to engage users and increase sales.

What happened

• Levit, the operator of the shopping app Alwayz, raised $46 million in a Series B funding round.
• The app offers a wide range of products and incorporates social features and gamification to make online shopping more engaging.
• Always gives discounts for group purchases, and most sellers are producers or manufacturers, leading to lower prices.

Background

• Alwayz has 7 million users, with 2.5 million using it monthly and 1.3 million using it daily.?
• The app's games and social elements keep users engaged, and recommendation algorithms help users discover new items.?
• The company aims to have 12 million registered users, with 5 million monthly and 3 million daily active users by 2023.

What did they say

• Levit's CEO, Jaeyun Kang, claims Alwayz has an average product selling price 20% lower than other e-Commerce platforms.
• Kang also described the user experience on Alwayz as a "discovery shopping experience" and said that the company ensures an item isn't widely exposed until it has proven its quality.
• Daegwon Chae, general partner of BOND, praised Alwayz for its focus on user experience, engagement, and value.

Now what

• Alwayz plans to expand its platform to the U.S. market early this year.
• The company will continue to leverage its unique features to engage users and increase sales.
• The impact of Alwayz's success on the broader e-Commerce industry will be closely watched.

Source: TechCrunch

Retail

Overstock.com Rebrand to Bed Bath & Beyond Completes Its Transformation to 100% Home

Why it is important

• Overstock.com's rebranding to Bed Bath & Beyond is a significant shift in strategy and identity.?
• It could help overcome past challenges and capitalize on the Bed Bath & Beyond brand. Other companies could learn from its success.

What happened

• Overstock.com acquired the intellectual property assets of Bed Bath & Beyond, including its customer list and website domain, for $21.5 million in cash.
• The company plans to rebrand as Bed Bath & Beyond, reflecting its focus on becoming an exclusive online home furnishings destination.
• The rebranding will create powerful synergy by combining Overstock's operational model with the Bed Bath & Beyond brand name.

Background

• Overstock.com has been working to become an exclusive home furnishings destination online, but its name has hindered this mission.
• The company has experienced some challenges, with revenues dropping in recent quarters, but the rebranding could help turn things around.
• Bed Bath & Beyond has powerful assets, including a large customer base and a loyalty program with millions of members.

What did they say

• Jonathan Johnson, CEO of Overstock.com, said that the name Overstock had been a headwind for the company and that the rebranding would turn these headwinds into tailwinds.
• Johnson also noted that mismanagement could kill companies, but it doesn't kill brands and that the company is not trying to reboot a bankrupt brand but to apply a strong brand to a business model that works.

Now what

• Overstock.com will rebrand as Bed Bath & Beyond, focusing on maximizing market share growth in home furnishings.?
• The company plans to expand into the registry business, trade and B2B sales, and private-label offerings.

Source: Forbes

H&M, Shein Explore New Retail Model With Third-Party Brands

Why it is important

• H&M and Shein partnering with third parties means significant changes in retail strategy.
• It could attract new customers, enhance their experience, and increase sales. Other retailers may follow suit if it's successful.

What happened

• H&M and Shein are partnering with third parties to diversify their offerings.?
• This move could attract more customers and boost sales, paving the way for other retailers to follow suit.

Background

• In recent years, brands and retailers have been diversifying their offerings by launching third-party marketplaces or incorporating third-party brands into their portfolios.
• H&M added 70 brands in 6 markets, while Shein is teaming up with US vendors and opening pop-up stores.
• These strategies are part of a broader trend in the retail industry to enhance offerings and attract and capture consumer spending.

What did they say

• According to H&M's CEO, Helena Helmersson, the company's marketplace strategy has been well-received by customers.?
• However, they must have the appropriate logistics to ensure profitable growth.

Now what

• H&M and Shein plan to partner with third parties to expand their offerings and improve the shopping experience.?
• The success of these strategies will be monitored for impact on customer acquisition, sales, and loyalty.?
• The industry will likely take note and consider similar approaches.

Source: Pymnts

Social

Threads, Instagram’s Twitter Competitor, is Expected July 6

Why it is important

• Instagram's launch of Threads , a potential competitor to Twitter, represents a significant development in the social media landscape.
• The success of Threads could influence the strategies of other social media platforms and reshape user behaviors and expectations.
• Integrating Threads with Instagram could provide a unique user base and community-building advantage.

What happened

• Instagram launched Threads, a new app expected to compete with Twitter, on the iOS App Store in the U.S.
• Threads allow users to bring over their Instagram followers and following lists, providing a ready-made community for new users.
• The app is set to launch on July 6 and is designed to be a space where communities can come together to discuss various topics.

Background

• Instagram's parent company, Meta, has launched a new app called Threads.?
• It aims to provide an alternative to Twitter amidst recent issues.

What did they say

• According to the App Store description, Threads is where communities can discuss everything from current topics to future trends.
• An Instagram spokesperson described Threads as "decentralized," leaked slides from a briefing with top creators indicated that Threads would be compatible with Mastodon, hosted on the decentralized network ActivityPub.

Now what

• Threads is set to launch on July 6 and will aim to attract users looking for a new social media experience.
• Threads' impact on social media and competition with Twitter will be closely monitored. User behavior and expectations will also be watched.

Source: TechCrunch

Payments

Ant Group Expands Alipay+ to All 7-Eleven Stores in Malaysia

Why it is important

• Alipay+ is now available at all 7-Eleven stores in Malaysia, which could impact the digital payment industry by improving the convenience and adoption of mobile wallets.?
• Other payment providers may follow suit and restructure the payment landscape.

What happened

• Ant Group expanded its coverage in Malaysia, enabling all 7-Eleven stores in the country to accept Alipay+ and other mobile wallets in its ecosystem.
• Razer Merchant Services enabled 7-Eleven stores in Malaysia to accept AlipayHK, GCash, Kakao Pay, and TrueMoney.
• This development brings the total number of merchant touchpoints accepting Alipay+ in Malaysia to over 80,000.

Background

• Ant Group launched Alipay+ in 2020 to expand payment options for businesses and reach more consumers.
• Alipay+ is accepted in China, Macao, Singapore, Thailand, Japan, and South Korea.
• Alipay+ expands in Malaysia to connect Asian travelers to local merchants and boost tourism.

What did they say

• Cherry Huang, GM of Alipay+ Offline Merchant Services at Ant Group, said that the growing coverage of Alipay+ in Malaysia is helping to connect more Asian travelers to local merchants and unlock new opportunities for local businesses.

Now what

• Ant Group plans to expand Alipay+ and other mobile wallets to make digital payments more convenient.
• The company will observe how this expansion affects digital wallets and payments. It will also monitor how it influences other providers' strategies.

Source: Tech in Asia

foodpanda and Visa Sign a Memorandum of Understanding to Collaborate on Seamless Payment Solutions and Benefits for Customers

Why it is important

• foodpanda and Visa's collaboration could improve online food and grocery delivery payments.?
• This could save costs and create a smoother experience for customers and merchants, potentially influencing other platforms to form similar partnerships.

What happened

• foodpanda and Visa have joined forces to improve payment options for customers and merchants throughout Asia.?
• The partnership includes streamlining payments, enhancing online-to-offline channels, and cross-marketing opportunities.?
• They also plan to use Visa's analytics to enhance the user experience on foodpanda.

Background

• foodpanda is a leading online food and grocery delivery platform operating in several countries across Asia.
• The company prioritizes customer value, striving for seamless and convenient food and grocery ordering.
• This partnership with Visa is part of foodpanda's ongoing efforts to evolve and expand its services regionally.

What did they say

• Luc Andreani, COO of foodpanda, said that the partnership with Visa is the start of an exciting collaboration that will continue to evolve and expand regionally soon.
• Visa and foodpanda are partnering to expand services using Visa's global network and range of products. Neil Mumm, Head of Merchant Sales and Acquiring, Asia Pacific, Visa, expressed excitement about the collaboration.

Now what

• foodpanda and Visa have partnered up to introduce new payment solutions and offer cost-saving advantages to both customers and merchants.?
• The collaboration will be closely monitored to assess its impact on customer satisfaction, operational efficiency, and sales.?

Source: foodpanda

Asia

Hong Kong Retail Sales Climb Further as Economy Bounces Back

Why it is important

• Hong Kong's retail sales continue to rise for the sixth consecutive month, signaling a strong post-pandemic economic recovery.?
• Sectors such as jewelry, watches, and motor vehicles are seeing increased sales value, indicating a resurgence in consumer spending.?
• Hong Kong’s Tourism is also rebounding and is expected to contribute further to economic growth.

What happened

• According to the Census and Statistics Department, Hong Kong's retail sales by value increased by 18.4% from a year ago.
• Jewelry, watches, clocks, and valuable gifts sales rose by 52% in May 2022, while motor vehicles and parts sales increased by 55%.
• The number of mainland visitors to Hong Kong rose to about 60% of pre-pandemic levels, contributing to the growth in retail sales.

Background

• Hong Kong's retail sector has been recovering from the impacts of the pandemic, with retail sales rising for six straight months.
• The reopening of borders has allowed tourists to return, boosting consumption in the city.
• The government expects retail sales to improve further in the coming months due to the rebound of tourism.

What did they say

• According to the government spokesman, incoming visitors are expected to increase as transportation capacity expands.
• Bloomberg Economics forecasts a 5.2% expansion in gross domestic product this year.

Now what

• Hong Kong will continue to monitor the recovery of its retail sector and the impact of increasing tourist numbers on retail sales.
• The government will work on expanding transportation and handling capacity to accommodate more incoming visitors.
• The broader implications of this economic recovery, including its potential influence on other sectors, will be closely watched.

Source: Bloomberg

Mitsui Fudosan to develop flagship retail property in Kaohsiung, Taiwan

Why it is important

• Mitsui Fudosan's development of a new regional shopping center in Kaohsiung, Taiwan, represents a significant investment in the country's retail sector.
• The new shopping center, LaLaport Kaohsiung, is expected to boost the local economy by attracting domestic and international brands.
• The success of this development could influence other real estate firms to invest in Taiwan's retail market.

What happened

• Mitsui Fudosan is building a new shopping center in Kaohsiung, Taiwan.
• It will open in 2026, have 280 stores, and be Mitsui Fudosan's flagship property in the southern region.

Background

• Mitsui Fudosan, a Tokyo-based real estate firm, has a strong presence in Taiwan's retail market.?
• They are developing a new shopping park in Taipei to open in 2024 and expanding their outlet mall business in Shanghai and Kuala Lumpur.

Now what

• Mitsui Fudosan will continue the construction of LaLaport Kaohsiung to open the shopping center in 2026.
• The company will monitor the impact of this development on the local economy and the retail market.

Source: Retail in Asia

We can hardly contain our excitement as we embark on an innovation journey in 2023! Our commitment to providing you with the most up-to-date retail news never wavers, and we can’t wait to share it with your like-minded peers and colleagues.