Ecommerce

One of my interests in research concerns business history, especially how company strategies evolve. In that regard, I've always found Alfred Chandler's writings fascinating (I'll put a link to an open access article in the comments). As such, when I read of companies undertaking strategy changes, I tend to frame those decisions within the framework(s) that Chandler developed. I mention this because I believe Chandler would be scratching his head (as I am) about the recent story that Amazon plans on competing with Temu and Shein by effectively cloning their strategy (see the WSJ article below). Some concerns I have with this strategy: •Shein and Temu are far down the learning curve in the direct China -> USA model (as opposed to sourcing from Chinese suppliers and then feeding those goods into a domestic US distribution network). As such, Amazon will be competing at a disadvantage (both in terms of cost and service) for an extended period before it can move down this learning curve. Shein and Temu clearly have first-mover advantages in this regard. •The proposed lead time for direct China -> USA shipments to consumers are 9-11 days. These lead times risk alienating Amazon's customers, who have come to expect lead times of 2 days or less. The general public doesn't understand they can't order cheap products directly from China and get a product at low cost in 2 days because the air freight cost would be prohibitive. This has the potential to create confusion within the customer base. Implication: if I was Amazon, I would continue with my strategy of providing an assortment of quality products with very short lead times (and make investments accordingly), and compete along these dimensions, as opposed to trying to take on low-cost firms at their own game. #supplychain #supplychainmanagement #ecommerce #shipsandshipping #freight https://lnkd.in/gxeNs3w2

Brands that previously criticized Amazon are now increasingly utilizing the platform, indicating a notable trend for 2024. Here are some other developments I anticipate: When Allbirds' CEO published an article on Medium criticizing Amazon for imitating its product at a lower price, it was unexpected that Allbirds would later join Amazon as a seller. Yet, that's precisely what happened. Allbirds products are now available not only on Amazon but also at REI and Nordstrom. This move is part of a broader trend where DTC-first brands are diversifying their distribution channels, encompassing marketplaces, traditional brick-and-mortar retail, wholesale, and their own stores. A notable benefit of this expansion, as per Shopify's data, is the 'halo effect' on eCommerce: brands entering physical retail see, on average, a 37% increase in website traffic. As we transition away from cookies, brands are expected to increasingly focus on owned channels. Amazon has been a pioneer in this area with the introduction of its marketing cloud, which enhances brands' abilities to understand customer journeys and target specific audiences. Utilizing first-party data allows brands to maximize ROI on marketing expenditures and provide more personalized shopping experiences. This trend likely influenced Amazon's launch of Buy with Prime, enabling brands to combine fast delivery with ownership of customer data. Sustainability will remain a crucial factor in brand visibility and loyalty. I anticipate Amazon and other retailers will give more prominence to brands committed to sustainability. Those with climate pledge certification or using the Ships in Own Product Packaging program will likely see benefits (aside from savings on fulfillment costs). Consumers are also expected to demand greater transparency in supply chains, including sustainable last-mile delivery methods like electric vehicles. AI's impact on customer search and discovery is a major focus for Amazon. We may see conversational search alter how we find products (e.g., "show me gift ideas for boys age 4-6 with over 1000 4.5 stars between $25-35"). AI will bring more personalized recommendations, optimize pricing, enhance customer service, and improve customer segmentation. Social commerce is also expanding. With the launch of TikTok shops and the ability to buy Amazon products on Meta platforms, this trend is set to grow. I predict that brands will soon use Amazon data to target shoppers on Meta for purchases either through Amazon.com or Buy with Prime. Finally, Livestream shopping, AR, and VR – key questions for 2024 include: Will Livestream shopping gain as much traction in the US as it has in China? Will augmented and virtual reality shopping experiences become more mainstream? I’d love to hear your thoughts and predictions for the future of commerce in the comments.

Thank you very much to the 8,200+ readers of the #ecommert newsletter and industry professionals. First-party data emerges as a vital asset for retailers, especially with the decline of third-party cookies. Most retailers, however, are not fully harnessing the potential of this data. In our conversations with our CPG clients and based on the research by leading institutions. I observe that there are four levers to improve the structured collection and utilization of first-party data: 📍Advanced loyalty programs  📍Personalized content and offers  📍Retail media solutions  📍Data monetization ++ My Observations ++ 📍Many #retailers have yet to structure and fully utilize first-party customer #data. But the race is heating up; there are so many investments in this field, I know for a fact from our ongoing projects. 📍Yes, innovative #loyalty programs and personalized content can drive significant engagement and revenue. Most CPGs are trying to cut the middlemen and build robust in-house platforms to capitalize on this trend fully rather than paying for the intermediaries and service providers. 📍This approach opens new profit opportunities with suppliers through retail media solutions and data monetization. I am working in this field personally. 📍The synergistic effect of these strategies creates a powerful financial impact. The measurement of this impact is another hot topic trending right now. ++ Where the Opportunity Lies for Retail & CPG ++ The Transformative Power of First-Party Data: In the face of the "cookie apocalypse" and the end of third-party cookies, first-party data emerges as a critical asset. Individually, each lever can drive revenue and profit, but collectively, they create a robust flywheel effect that significantly enhances financial performance. ++ Industry Examples from the US and Europe ++ (...) In summary, in the USA, retailers like Amazon, Costco, Target, and Walmart are leveraging first-party data to enhance their retail media strategies. In Europe, the UK and Germany stand out for their growth in RMNs, driven by high eCommerce penetration and advanced digital capabilities. Across the EMEA region, the focus is on leveraging first-party data through loyalty programs in response to strict data privacy laws and the decreasing availability of third-party data. ++ Addressing Shortcomings: Buy, Build or Collaborate ++ (...) When a retailer identifies areas of deficiency, they must choose the optimal approach to remedy these gaps: developing the required capabilities internally, acquiring an external entity possessing these capabilities, or engaging in a collaborative effort. Collaborations could be joint ventures, minority investments, or strategic alliances. Click the image below to read the full article. 👇 #ecommert for #ecommert #strategy, #digitalshelf and #retailmedia

10 Ways Small Businesses Can Use AI to Level Up Their Marketing 🎯 Think AI is only for big brands with deep pockets? Think again. AI is changing the game for small businesses—making it easier (and faster) to create standout marketing that actually drives results. Here are 10 ways you can start using AI to market smarter—not harder: Content Creation: Generate blog posts, product descriptions, and social media captions in minutes—not hours. Ad Copy Optimization: Use AI tools to write and test dozens of ad variations to see what actually converts. Customer Segmentation: Automatically group your audience by behavior, interests, or purchase history—and market to each group differently. Social Media Scheduling & Ideas: Let AI tools suggest trending topics, write your posts, and even schedule them at the best times. Email Campaign Personalization: Tailor every email to feel 1:1—even when you’re sending to thousands. Chatbots for Engagement: Turn site visitors into customers by answering their questions and collecting emails in real time. Predictive Analytics: Know which products will sell and what kind of messaging your customers want—before they do. AI Video Tools: Create engaging marketing videos with voiceovers and captions—no studio or crew needed. SEO Optimization: Automatically improve your website content for search rankings with the help of AI-powered keyword tools. Brand Monitoring: Use AI to track mentions of your brand online and quickly spot trends, shoutouts, or even complaints. AI isn’t about replacing people—it’s about giving you leverage. For small businesses, that kind of edge can make all the difference. If you’re already using AI in your marketing, what’s working best for you? #SmallBusinessMarketing #AIforMarketing #MarketingTips #GrowthHacking #AItools #ContentCreation #DigitalMarketing #AIforSmallBusiness

One of the biggest trends I'm watching in e-commerce right now is the scale and velocity of the mega-retailers, both online and offline, like Amazon, Target, Walmart, and Costco Wholesale. Well, according to Digital Commerce 360, those 4 names now represent 49% of all US e-commerce sales. Zooming in on Costco who reported earnings last week, e-commerce was at the forefront of the conversation and was the bright spot in an otherwise meh growth story. Online is growing 18% YoY which is 3x the growth rate of the overall business. Interestingly, they mentioned mobile app orders represent over 60% of visitors and orders (CC Tapcart) Additionally, they touted the conversion increase associated with a site redesign that increased load time from 8 seconds to 2 seconds, showing the importance of speed in e-commerce (CC Platter Nostra) Costo also launched a cool online segment called Costco Next that curates a selected group of trusted partners and sends the traffic to the brands' site with specific benefits for the Costco Member. I'm surprised they're willing to send that traffic away, but cool to see some familiar brands there like TravelPro and IQBAR. They expressed intentions to continue to expand this part of the business and reach 90 brand partners by EoY. It'll be interesting to see if next year is the year those 4 majors make up over half US online sales. Time will tell!

I talked with Scott Luton from Supply Chain Now about how teams can focus AI investment on value vs. hype. Most use cases don’t need advanced AI, and that’s why most AI investments have negative ROI. Data, analytics, and machine learning should be leveraged to support use cases that other technologies can’t. Incremental improvements can be made, but why not go after higher-value use cases first? That’s the approach I use with clients to deliver 8 and 9-figure initiatives. The playbook for monetizing AI in the enterprise is: ✔ A Phased Maturity Improvement Model ✔ Opportunity Discovery, Estimation, And Selection Aligned With AI's New Monetization Paradigm ✔ Incremental Initiatives That Align With A Long-Term Vision And Roadmap ✔ Establishing A Quarterly Delivery Cadence For Faster Value Creation And Returns For The Business Listen to the full episode here: https://bit.ly/3sGNT2q Huge thanks to Scott and his team for having me and supporting this conversation. #AIStrategy #DataStrategy #GenerativeAI

If you're embarking on the e-commerce journey, here's the #1 action you need to take on your first day: Initiate an honest dialogue about the e-commerce realities with your team… Let me break down why this is essential and what it should cover: In my countless interactions with e-commerce entrepreneurs, a common narrative emerges. Many enter the arena lured by the appeal of setting up a shop once and watching the passive income roll in. However, the reality of e-commerce is often starkly different, marked by intense competition and numerous operational challenges. Here's what I've frequently encountered: - Entrepreneurs dazzled by the dream, yet unprepared for the grit required. - A rush to market without a solid strategy, leading to costly pivots. - The struggle for resources and support to scale effectively. - The misconception that e-commerce is an easy, set-and-forget business model. - Difficulty in aligning cross-functional teams towards a unified e-commerce goal. Given these challenges, here's what you need to do: Dedicate time to have a thorough discussion with your core team, and perhaps even mentors or advisors, by asking these pivotal questions: 1. What's our core motivation for entering e-commerce? Understanding the why behind your venture can clarify many strategic decisions. 2. How do we perceive e-commerce, and what myths need debunking? This helps set realistic expectations and prepare for the hard work ahead. 3. What unique value proposition are we bringing to the table? In a crowded market, differentiation is key. 4. What level of support and resources can we realistically dedicate to this venture? This includes budget, manpower, and technological tools. 5. What are our success metrics in this venture? Clear goals and KPIs are crucial for measuring progress and pivoting when necessary. 6. How will we keep the pulse on customer needs and feedback? Direct customer insights are invaluable for e-commerce success. 7. Are we prepared to commit fully to this venture? Half-hearted attempts are seldom successful in the competitive e-commerce landscape. This conversation might lead to some uncomfortable realizations or even inspire a strategic pivot. That's okay. The key is to initiate this dialogue early. It sets a foundation of honesty, realism, and strategic clarity. Without this foundational understanding, navigating the e-commerce waters can be perilously difficult. Success in e-commerce is possible, but it begins with a clear-eyed understanding of the journey ahead. So, take the time to have these conversations. You may not love all the answers, but they're crucial in shaping a resilient, adaptable e-commerce strategy.

Amazon, the #ecommerce giant, weighs how to respond as online shopping sites SHEIN and Temu notch rapid growth by stressing low prices, not fast shipping. While Amazon has for years contended with challenges from rivals such as  Walmart and Target, Temu and Shein, both of which have Chinese roots, are tapping into demand for low-price items that aren’t delivered quickly. Amazon hasn’t taken steps to match the prices of items on Temu, a rare strategy for a company that typically scours the internet with various price-matching tools to ensure its site has some of the lowest prices online. Shein and Temu “aren’t going after two-day delivery or better customer service,” said Steve Tadelis, a former Amazon executive and economics professor at the University of California, Berkeley. “They seem to be hitting the lower end—cheap stuff that people are willing to wait for.” Inflation-wary American customers have increasingly been willing to try out Temu and Shein. Since launching its U.S. services in September 2022, monthly unique visits from U.S. customers on Temu’s website and app, a measure for how often shoppers are visiting the service, grew by more than 10 times to about 70.5 million by March. Since August 2021, Shein’s U.S. monthly unique visitors nearly doubled to roughly 41 million in March. Amazon’s monthly unique visitors decreased to about 211 million in March from about 217.5 million in September 2022. An Amazon spokeswoman said the number of customers across its website and apps has grown year-over-year. The company said independent studies have found its prices are frequently the lowest online among major U.S. #retailers and that it works to ensure the prices in its #online #store are as good or better than at competing retailers. Amazon must balance its brand as a reliable retailer versus potentially cheapening its image by mirroring Temu and Shein with lower-priced products. Customers may be sacrificing the quality of products by shopping on Temu and Shein because products are priced so low. In online reviews and forums, some Shein and Temu customers have expressed concerns after not receiving quality products and said they restrict their purchases to items that are less likely to break in shipping, such as hair clips or laundry bags. https://lnkd.in/eupY7TWz

The AI Commerce Plot Thickens: Who's Really Leading This Race? My recent post about OpenAI and Shopify sparked some fascinating insights from this community. Ryan Levander reminded us that Perplexity actually launched shopping features months ago, while Stan Sidorenko highlighted Google's impressive "Shop with AI mode" that's been quietly building momentum. The Current Players: • Perplexity: Visual product cards, photo-based "Snap to Shop," and PayPal checkout (live now, Pro users only) • OpenAI: Native ChatGPT checkout with Shopify backend (coming soon, massive scale potential) • Google: Leveraging the world's largest e-commerce product database plus Google Pay integration (Stan's right - they're positioned perfectly) The Real Question: Kevin Taylor captured it perfectly - "feels like we're watching the e-com playbook get rewritten in real time." But who's actually winning? Perplexity moved first with solid features. Google has the infrastructure advantage. OpenAI has the marketing machine and user base scale. This isn't about who launched first - it's about who can execute at scale. Just like the early search engine wars, being first doesn't guarantee victory. HELLO? Remember AltaVista? The winners will be determined by: ✅ User adoption rates (not just feature launches) ✅ Merchant satisfaction and economics ✅ Integration depth with existing commerce infrastructure ✅ Trust and transaction security As Steven Scheuer pointed out, this could truly "redefine the role of marketplaces." The question is: which AI platform will become the new Amazon? What signals are you watching to determine the winner in this AI commerce race?