When consumers look around online, e-commerce is everywhere. Unfortunately, for the businesses, startups and investors, profits are hard to find. We take a look at e-commerce news to try and identify the e-commerce businesses that have found the secret sauce for success.
We start with Wayfair whose 2015 online sales grew 85.5% to $2.04 billion, up from $1.10 billion in 2014. Amazon is quickly building its list of IoT products. Imagine having your products order for you via the Internet when you need new supplies? Internet Retailer’s new Digital Marketing Report Series ranks the top e-commerce businesses and retailers, providing lots of lessons and inspiration. With a low Canadian dollar, business from US consumers at Canuck e-commerce sites was up 20% in 2015.
Personals care subscription service Birchbox cuts 15% of staff and closes its Canadian operations. “Reverse retail” using pop-up stores and temporary outlets with later fulfillment online, is proving profitable for Bonobos and other retailers. E-commerce startups in India may soon hit the wall in finding new venture capital for growth unless they get profitable. Could a”try before you buy” e-commerce business be viable? Znatta hopes so.
Wayfairs direct-to-consumer sales nearly double in Q4
Direct-to-consumer sales, which are orders placed on Wayfair.com, Joss & Main, AllModern, Birch Lane and Dwell Studio, increased 97.8% in the fourth quarter to $685.6 million from $346.7 million in the same period a year earlier. For 2015, sales on Wayfair’s websites increased 85.5% to $2.04 billion, up from $1.10 billion in 2014.
Web sales accounted for 92.7% of total revenue in Q4 and 91.1% for the full year. Wayfair also earns revenue from selling ad space on Wayfair-owned sites and via sales through other retail sites that sell Wayfair products. Via internetretailer.com
Amazon’s IoT approach is a shopping list killer
Who needs a shopping list—pen-and-ink or mobile or otherwise—when you could hit a button or—in the case of the Brita pitcher and other items—let the pet food bin or water pitcher do the ordering for you? That’s, of course, just another way of saying, “Why go to the store?,” which could have been an Amazon tag-line from the beginning. Via retaildive.com
The 5 best digital marketing success stories of 2015
The retailers holding the five top spots, according to Internet Retailer’s just-released Digital Marketing Report Series, range in size from the very large to the very small.
Digital ad spending among online retailers reached $12.91 billion last year—far outpacing the spend from any other industry, according to research firm eMarketer. Paid search spending among retailers ranked in the Internet Retailer Top 1000 alone reached $278.9 million per month in 2015—up 21.2% from 2014….
The time and money online retailers are spending on digital marketing are benefiting some more than others, according to the recently released 2016 Digital Marketing Report Series. The report, available as a four-part downloadable PDF, scores retailers on effectiveness in the main channels of online marketing—social media, email, and paid and natural search. Via internetretailer.com
US shoppers, lured by the loonie, flock to Canadian e-commerce sites
It’s long been common practice for Americans to head north for bargains whenever the Canadian dollar falls meaningfully below the greenback. During the current slump, they’re doing so from the comfort of their homes by shopping online from small-time Canadian merchants.
The Canadian dollar—the loonie—has fallen about 18% against its U.S. counterpart over the past two years after flirting with parity several times in the last decade. At the same time, spending by U.S. shoppers using PayPal on Canadian websites jumped 20% in 2015 from the year before.
“The recent drop in the Canadian dollar presents an exciting export opportunity for Canadian businesses selling to American buyers,” Cameron Schmidt, PayPal Inc.’s Canadian general manager, said in an e-mail. Via internetretailer.com
Birchbox trims 15% of staff, halts Canadian operations
Birchbox Inc., a startup that sells subscriptions for personalized beauty samples, said it’s cutting 15 percent of staff and suspending operations in Canada. The cutbacks, which affect 45 people out of a staff of 300, are the latest sign that technology startups are struggling to create sustainable businesses as venture funding begins to cool.
“The cuts made today will allow us to reinvest in our biggest opportunities and grow even more quickly in the future,” Birchbox co-founder and Chief Executive Officer Katia Beauchamp said in a statement. “Our vision for Birchbox has always been to build a standalone company, and today’s market demands that we reach profitability this year.”
A slew of venture-backed tech companies have reduced staff in the past few months, including Evernote, Hootsuite, Jawbone and Snapchat. VarageSale, an online marketplace styled as a garage sale for hyper-local communities, said Thursday it cut 26 employees. Via retaildive.com
How Reverse Retail Is Changing The Way We Buy
When popular ecommerce fashion brand Bonobos founder Andy Dunn decided to sell shirts from his website, he also built several fitting rooms in the lobby of the brand’s headquarters to allow customers to try them on. Within months they were on track to do $1 million in sales directly from the lobby and he realized the potential of having a physical presence to augment their online sales.
By the end of 2014, the brand had opened ten shops across the United States with plans to add 30 more in the next three years. The vast majority of orders still come through the online system. Dunn’s major insight from that lobby experience was that most of their customers (almost entirely male) usually didn’t mind leaving a store without a purchase in hand.
It is the perfect example of a Reverse Retail experience: one that was designed by a brand to create affinity and inspire a purchase that could be completed online directly from the brand and fulfilled later. Via rohitbhargava.com
As tech startups run into rough weather, they cast a shadow on the entire risk capital-funded ecosystem
Despite Flipkart’s bombast, there’s plenty to ponder for the company and the industry it claims to lead. While Flipkart may itself raise a down round of investment (a financing round at a valuation lower than at which the previous investment was made; the spokesperson offered no comment on this), lesser ventures may be in more trouble and the investors pouring billions of dollars to back their ambitions may be left reeling.
For a sector fed on a rich diet of risk capital funding and that was set for rocketing growth, these were rude shocks. Vishal Gupta, a managing director with storied investor Bessemer Ventures (which has backed the likes of Ola, Snapdeal and BigBasket), believes this correction was looming. “Many businesses had run ahead of time,” he says. “The question you have to ask today is: Are you building a viable business?”
Vijay Shekhar Sharma, founder of Paytm, reckons his mobile wallet and mobile commerce business has enough in the tank for the next 31 quarters (in 2015, an Alibaba company made an investment of $500 million in Paytm’s parent firm, One97 Communication)…. Via economictimes.indiatimes.com
Smartwatches, drones, VR headsets and more: Try before you buy, says e-commerce startup Znatta
E-commerce in India is already getting crowded and a recent Assocham report stated that e-commerce in India is likely to be worth $38 billion translating to roughly Rs 2,51,720 crores by this year. With biggies like Amazon, Flipkart and Snapdeal, there sure needs to an alluring factor to attract customers. Znatta, a Bangalore-based startup managed by an IITian trio are trying to add value proposition with ‘Try before you buy’ feature with its e-commerce platform, similar to the Y Combinator-backed Lumoid. This three-week old startup has already completed over 70 trials, with 6 converting into sales.
“We’ve had 70+ orders since our launch, and we just expanded our Portfolio to Virtual Reality, Drones and Life Loggers and we expect to see a spike in our Trials model,” said Surenedranth Adireddi, B Tech from IIT Madras and an ex-eBay Analytic Manager.
The product listings include smartwatches, GoPro and other cameras, fitness trackers, VR headsets, drones and other cool robotic stuff. The site also lets you add product reviews. Znatta has teamed up with over 35 OEMs, resellers, and is working at increasing the number. Currently, only active in Bangalore, it plans to add Pune to the list soon. Via tech.firstpost.com
We live in interesting e-commerce times
To say e-commerce is interesting is a vast understatement. But we enjoy bringing you global e-commerce news for exactly that reason. Stay tuned for much more as always and sign up to get news you can use, conveniently in your inbox, Monday through Friday mornings.