When you think of trying on clothes with augmented reality, what pops into your head? How about the idea of “connected” grocery stores? As far as most people's imaginations go, some of those things are becoming a reality.
In this week's 87th edition of the Shopifreaks E-commerce Newsletter, I've got stories for you about Amazon launching free shipping software, Shopify integrating more features that were previously only offered by 3rd party apps, and grocery store product labels that light up as you walk by based on your shopping list.
I also share news about upgraded Google e-commerce features, Walmart AR, and curbside delivery upsells.
All this and more in this week's edition. Thanks for reading and sharing!
Stat of the Week
The average conversion rate across the web is 2.35%. Products with high star ratings, sales volume, and recent reviews can be as much as 8%. – According to Wordstream
1. Shopify launches Markets Pro and Translate & Adapt
Shopify Markets Pro – One year ago I reported that Shopify launched Shopify Markets, which offers tools for merchants to identify, set-up, launch, and optimize international markets from a single Shopify store — an effort that historically has taken a combination of multiple storefronts, third party apps, and patient developers to make happen.
Now Shopify is doubling down on those efforts with the launch of a new premium paid feature called Shopify Markets Pro. Built within the Shopify Admin, the new feature is an expanded integration with Global E-Online (GLBE), of which Shopify took a $193M pre-IPO stake in the company in May 2021.
Differences between Markets and Markets Pro include features such as extended currencies, guaranteed duties, express duties prepaid shipping with negotiated rates, international tax & duty compliance, restrictions management, fraud protection, guaranteed foreign exchange, and more.
Markets Pro will work in more than 165 countries, but to start, will only be available to Shopify merchants in the US this year, and Canada, U.K. and parts of Europe next year.
For merchants who use the service, components like buyer's fee, tax and duty will be pre-calculated and checkout. Shopify has also negotiated express international shipping rates for merchants with DHL and other partners.
In exchange for the service, merchants will pay a 6.5% transaction fee.
Shopify Translate & Adapt – Shopify also introduced a free app for its merchants called Shopify Translate & Adapt, which works with Shopify Markets and Markets Pro to help merchants localize the customer journey by offering them the ability to manually or automatically translate their online stores into various languages.
Historically, translation services for Shopify stores have been provided by 3rd party apps like Weglot, Langify, Smartling, and Polyglot. Earlier this year in March I reported that Weglot raised $50M in a Series A round, and in December last year, I reported that that Smartling raised $160M from Battery Ventures — so translation services are a big business.
I don't imagine that this new free translation app from Shopify comes as welcome news to those translation providers, especially the ones with predominantly Shopify merchants as clientele.
2. Walmart unveils new augmented reality try-ons
Walmart unveiled a virtual try-on option called “Be Your Own Model” that uses AR and AI to give customers a realistic simulation of what clothing will look like on them based on a photo of themselves.
In May 2021, Walmart bought the virtual clothing try-on startup, Zeekit, which shows shoppers how they would look in an item by simulating their body dimensions, fit, size, and even the fabric of the garment itself. And in March 2022, I reported that Walmart started bringing that tech to Walmart.com and its mobile app, beginning with their “Choose My Model” feature that allowed customers to select a model that best matches their own appearance and body type.
At the time I had rated that feature as — just okay. My expectation was that they'd offer more of an avatar experience (like creating a player on PGA Tour 2k21 and then dressing it), but in actuality, Walmart was simply taking pictures of clothes on a variety of models of different sizes and dynamically displaying those images on the product listings. It was cool, but not the high tech or sophisticated “virtual try-on” that most people would imagine when AR enters the chat.
However with this new “Be Your Own Model” feature, we're getting much closer to that reality. Starting this week, customers are able to test out what a shirt, dress, pants, or blouse looks like on their own bodies by taking a picture of themselves and telling the app how tall they are. From there the app uses AI to form a topographical map of their bodies, which it then uses to create realistic images of how the fabric would follow their particular curves.
The feature will be available on over 270k items, beginning with brands like Free Assembly, Scoop, Sophia Jeans, Love & Sports, ELOQUII Elements, Time & Tru, Athletic Works, Terra & Sky, No Boundaries, Avia and The Pioneer Woman.
I think it works pretty well! I tested it out on a pair of pants. Check out what I look like wearing a pair of slacks from Walmart. Pretty true to form, Walmart.
I'd imagine that the next generation of this tech will offer live video try-ons or 360-views of the product, but as a starting point, photo representations are a great feature to have available while shopping online.
3. BigCommerce News (Sponsored)
- BigCommerce announced a strategic partnership with cryptocurrency leaders BitPay and CoinPayments to easily and securely deliver crypto payment solutions to BigCommerce merchants in select countries. By expanding its crypto ecosystem, BigCommerce opens up opportunities for its merchants to offer more payment options, broaden market share, tap into a new customer base and accelerate international growth through innovation. BigCommerce's open, flexible approach to e-commerce allows merchants to choose which cryptocurrencies work best with their store and integrate with a single-click.
- BigCommerce announced the winners of the 2022 Make it Big Awards, which spotlight and celebrate online retailers' achievements on the BigCommerce platform across design, innovating, emerging brand, and global strategy. Click here to view this year's winners.
4. Instacart launches Connected Stores
Instacart announced that it's launching Connected Stores, a suite of technologies that helps retailers create a personalized experience both online and in-store. I'm first to admit that some of these features sound pretty cool — like the Carrot Tags in particular!
New tools include:
- New version of their AI-powered Caper Carts – equipped with scales, sensors, touchscreens, and computer vision tech. Shoppers can uses new “Lists” to sync their shopping list directly to a Caper Cart by scanning a QR code, and then the items are automatically checked off their list as they shop.
- Scan & Pay – new feature that lets customers scan items as they shop and pay for them using a mobile phone.
- Carrot Tags – help shoppers find what they're looking for in a store by lighting up electronic shelf labels to help them find specific items. The tags can also display nutrition and product info.
- Department Orders – lets shoppers order from multiple departments, such as deli and bakery, and have them ready at the same time
- Out of Stock Insights – should be fairly self explanatory.
The first Connected Store will be with Good Food Holdings' Bristol Farms store in Irvine, CA. When will Connected Stores arrive in Tena, Ecuador? LOL. I might be waiting a while…
Instacart's been on fire this year launching new features:
- March 2022 – I reported on the launch of Instacart Platform, an Amazon-style e-commerce platform that offers a range of technologies that retailers can use a la carte or as a suite, and then later that month, on their new in-app navigation, which gave shoppers an interactive map of the grocery store in which they’re shopping with precise item locations.
- Aug 2022 – I reported that Instacart launched an OrderUp feature that lets user order from two retailers with one delivery fee.
- Sep 2022 – Two weeks ago I reported that Instacart acquired Eversight, an AI company that helps consumer packaged goods brands and retailers determine pricing and promotions by continuously testing at scale. And last week I reported that they acquired Rosie, an online grocery app that allows customers to shop online from local grocery stores in 40 states with same-day delivery and in-store pickup.
Any readers in the Irvine area? If so, go check out the new Connected Store and let us know what you think!
5. BigCommerce releases Global Consumer Report: Current and Future Shopping Trends
Today BigCommerce released its Global Consumer Report: Current and Future Shopping Trends, a consumer survey designed to give retailers insight into current and emerging trends shaping the way consumers buy from brands.
The survey included 4,224 participants total across the United States (1,698), United Kingdom (685), Italy (687), France (627) and Australia (527).
Here are some key insights from the report which you can download in full here:
- 55% of consumers shop online at least once a week
- They prefer free shipping over other discounts
- Consumers use BNPL because they say it helps fit purchases into their budget
- 34% were more likely to complete a purchase if BNPL was an option, while 49% would find it easier to complete a purchase if BNPL was an option.
- Consumers are willing to share their e-mail, gender, and name with brands in exchange for a personalized shopping experience
- Most important brand values are honesty and transparency, with paying fair wages and benefits to employees a close second.
- 84% of consumers rated sustainability as important when making purchase decisions
- 46% are willing to shop on the Metaverse, and of those, 51% are interested in buying both virtual and physical goods
- 5% said they have used cryptocurrency with the majority being in the US and Italy
- 95% said they love reading the Shopifreaks E-commerce Newsletter each week to keep up with important happenings in the industry and that they recommend you share it with your colleagues, while 5% mistakenly heard “Spotifreaks” and thought it was a newsletter about streaming music.
Okay, I made up the last one, but I do hope that you share this newsletter with your friends and colleagues so that they too can keep up with the latest happenings in e-commerce!
6. Bold Commerce launches Curb Up
Bold Commerce announced its newest curbside checkout feature for brick-and-mortar and omnichannel retailers called Curb Up. The feature enables retailers to capture high-margin impulse purchases that are currently lost with traditional curbside checkout by introducing upsell and cross-sell opportunities after an order has been placed and during pickup.
So in other words, the guy that delivers your groceries to your car is going to ask, “Do you want a Snickers bar?”
In 2021 alone, shoppers spent $6B on items they discovered in the checkout lane. However with the rise in popularity of Buy Online Pickup In Store (BOPIS), fewer shoppers are going through the checkout lanes, which is cutting into their bottom line.
Bold Commerce's new Curb Up functionality attempts to bring back these impulse buys by allowing retailers to make recommendations for add-on items before, during, and after checkout online. Here's how it works:
- Customer arrives at the store for order pick-up and are presented with an impulse buy pop-up within the app.
- The pop-up offers them the opportunity add one or more last-minute items, which were curated by the retailer, to their existing order.
- Store staff are notified about the new items and add them into the order. I'd imagine that stores are going to keep those items handy, right next to the previously bagged items, so that adding them to the order doesn't slow down the delivery.
I'll admit, that's cool, and smart for retailers. However I like my idea better of the delivery person arriving at your car holding a Snickers bar for sale. It's less digital, but I'd imagine, highly effective!
This whole thing makes me think about how ahead of the curve Dunder Mifflin was in some ways, despite their terrible website. Remember when Darryl Philbin had the idea for drivers to upsell paper on their delivery routes?
Jokes aside though, I think that it's a cool feature, but at launch is exclusively focused on the wrong thing. While last minute upselling checkout lane items adds to the retailer's bottom line by selling highly marked up / high margin items, ideally the feature could help consumers add-on items that they forgot — either based on popular selling items or personalized recommendations.
For example, “Paul, you haven't ordered milk since Sep 12, 2022. Would you like to add a gallon of whole milk to your order?” I'd find that a lot more valuable than being offered overpriced checkout lane items that I've traditionally ignored. (Every frugal shoppers knows to avoid the checkout items, right?)
But maybe as a price conscious shopper, I'm not the right target for BOPIS anyway, as it's been proven that shopping online is more expensive (even for curbside pickup) than shopping within the store — not only in regards to the service fees, but the actual prices of the items are higher too! So if people are aware of that and still shopping BOPIS out of convenience, then upselling last minute impulse items could be a perfect fit for that demographic.
7. Google expands enhanced products experiences to more sites
Google is expanding the eligibility for enhanced product experiences in Google Search to more e-commerce websites using Product structured data. The enhanced product experiences were previously only open to Merchant Center users.
Previously product snippets were primarily powered by schema.org product structured data, and merchant listing experiences were powered by details provided supplied via Google Merchant Center feeds, but now merchants can supply this same product data on their web pages without a Google Merchant Center account.
Google also added two new Search Console reports:
- Merchant Listing report – identifies structured data issues for free listings, and covers the wider range of schema.org structured product data including apparel sizing and energy efficiency ratings.
- Product Snippets report – identifies structured data issues for product snippets in search results, and replaces the previous Product structured data report with adjustments related to the separation of merchant listing validations into a dedicated report.
The result of these changes is that merchants who do not use Google Merchant Center may find that their products show up in more places than before, or display more data within search results, as long as they are using structured data properly.
If you're a store owner and you're not currently leveraging structured product data to boost your product ranking on Google, you're definitely missing out. Talk to your developer about how to best communicate your product structured data with Google. This is a service I offer (or I should say “require”) for my e-commerce clients.
8. Amazon's free shipping software
Amazon announced that it will now be giving merchants in the U.S. and U.K. free software for managing orders both on and off its platform.
The company is ending monthly fees of Veeqo, a shipping software firm it acquired in March. Veeqo integrates with various sales channels including Amazon, eBay, Etsy, and Shopify, and provides access to discounted rates on shipping services like UPS, USPS, DHL, and FedEx. The software also offers a rate-shopping feature that automatically finds the lowest shipping rate available for sellers' orders based on size and weight.
Veeqo's founder, Matt Warren, said that this was not a move against Shopify or others, but rather that, “Amazon takes a very long-term view that anything that helps sellers eventually will be good for Amazon.”
Veeqo previously cost $450/month before being acquired by Amazon. Since taking over the business, Amazon added new features like an inventory management solution and new inventory reporting and forecasting.
At its annual Amazon Accelerate seller conference, the company also announced new features:
- Manage Your Experiments – a tool that helps sellers optimize product content and drive higher sales
- Product Opportunity Explorer and Search Analytics Dashboard – adds new capabilities helping brands analyze marketing campaigns and identify ways to add new customers.
- Express Payouts – will move money from Amazon to sellers’ bank accounts in 24 hours, rather than the previous three to five days it took to move money through ACH networks.
Benjamin Hartman, vice president of Amazon North America Selling Partner Services, said, “We’re focused on supporting sellers as they work to build and grow their business. The tools we’re announcing today are a direct result of seller feedback and target every step of their Amazon sales funnel, from new customer acquisition to increased lifetime value. We’re committed to continuing to develop tools and features that deliver actionable insights for sellers.”
In April, I reported that Amazon launched Buy With Prime, a feature that allows select Amazon merchants to sell their products directly from their own websites, while still offering Prime shopping benefits like fast, free shipping, quick checkout with Amazon Pay, and free returns.
In August, I reported that Amazon was partnering with select stores including PacSun, GNC, Superdry, and Diesel to offer same-day Prime deliveries in certain cities.
And in September, I reported on Amazon's POS system, which can handle both online and offline transactions and link to other Amazon services including Prime membership, Amazon One hand-scanning biometric payment solutions, and Flex delivery, according to an internal document.
These moves, along with acquiring Veeqo and offering it free to merchants, is part of Amazon's long term plan of becoming indispensable to retailers' operations — both on and off their marketplaces.
Amazon is essentially evolving into a retail operating system that will be able to power a retail business’s point-of-sale, payments, website (via hosting on AWS and commerce capabilities through Buy with Prime), as well as handle their fulfillment and last-mile delivery. I even consider their Amazon Style store to be a prototype of a shopping experience that they will later license to other retailers.
9. Other e-commerce news of interest this week
- S&P DJI recently launched the S&P Global E-Commerce Ecosystem Index, which is designed to measure the performance of 50 companies in e-commerce-related businesses from global markets. The index identifies four business areas relevant to the ecosystem: online retail, social media, electronic payment and direct e-commerce support and solutions
- Patagonia founder, Yvon Chouinard, his wife and two children have transferred their ownership of Patagonia, valued at about $3B, to a nonprofit created to combat climate change and protect undeveloped land around the globe. Patagonia will continue to operate as a private, for-profit corporation, selling more than $1B worth of jackets, hats and ski pants each year, but the Chouinards, who controlled Patagonia until last month, no longer own the company.
- With energy prices rising across Europe, the Dutch National Hotline for Internet Scams is warning consumers about new fake online stores that claim to sell firewood and wood burning stoves. The fake stores never deliver ordered products, and instead just keep the customer's money. Hopefully the customers used BNPL!
- Salesforce previewed new automation features and data integrations planned for its Customer 360 platform, which tie together CDP data for sales, marketing, service, and e-commerce. New bots will simplify data intake, recommend content to answer prospective customers' questions, route conversations to the right sales reps, set up meetings with hooks into the CRM, and elevate conversions to live agents.
- Shopify is changing its compensation practices to now let staff decide how much of their pay will be cash versus equity. The change comes after SHOP saw its share price fall 75% this year and let go more than 10% of its workforce.
- Automattic released WooCommerce 6.9 last week, which was quickly followed up with WooCommerce 6.9.1 after a bug caused stores to produce a warning or a fatal error depending on the site's PHP version. This release brings the new Cart and Checkout blocks into core as beta features.
- Data from GoKwik showed that 64% of all orders placed on its network used cash on delivery in Q2 2022, proving that it's still the most preferred payment option among e-commerce users in India, despite the Unified payment Interface providing more digital options. Although the preference for UPI increased by nearly 20% in the last year alone, so digital payments are undeniably growing.
- California is suing Amazon, accusing it of coercing third-party sellers into agreeing not to sell their products cheaper anywhere else. Attorney General Rob Bonta argues that Amazon's market dominance meant sellers had no realistic alternative option but to comply.
- Amazon Prime Video pulled off its first Thursday Night Football game between the Kansas City Chiefs and Los Angeles Chargers. For the most part, it was football as usual for the first game. The most surprising part that viewers noticed was the high percentage of the ads that aired during the game for Amazon’s own products and content — including regular reminders to watch Lord of The Rings: The Rings of Power.
- PPRO, a UK-based digital payments provider, is integrating ZIP, a BNPL provider, into its platform. The partnership allows PPRO to expand its Australian payments offering, with ZIP being the first Australian BNPL method to be added to its infrastructure.
- Amadeus, a travel technology company that helps airlines, airports, hotels, railways, and other companies in the travel space connect to the digital travel ecosystem, is partnering with Uplift and Fly Now Pay Later to bring BNPL services to its Amadeus Xchange Payment Platform. Travelers will be able to choose to pay for travel in a series of installments over six, nine or twelve months.
- Walmart+ is now offering the streaming subscription service Paramount+ at no extra cost to their membership program. Last month I reported that they were in talks to do so, but now it's official. Walmart+ will remain $98/year and include the Paramount+ Essential Plan, which is $59 on its own.
- The Consumer Financial Protection Bureau (CFPB) has issued a report suggesting that BNPL companies must be subjected to stricter oversight. The bureau plans to issue guidance to oversee BNPL vendors and have them complete supervisory exams in line with credit card company reporting requirements.
- Amazon has closed or cancelled 44 warehouses and delayed opening of 25 sites so far this year. This map by MWPVL International shows where. The closures are slated to begin Oct. 25, and it’s currently unclear how many employees will be laid off as a result.
- Shopee, the Singapore-based e-commerce platform that was supposed to be Southeast Asia's answer to Amazon, is laying off staff and closing operations in Latin America amid widening losses. The company reported a loss of $931.2M in Q2 2022, widening significantly from a net loss of $433.7M in Q2 2021.
- The Monetary Authority of Singapore (MAS) and the International Financial Services Centres Authority (IFSCA) have signed an agreement for fintech cooperation, where both countries will operate a regulatory sandbox, which aims to ensure better cooperation between Indian and Singaporean fintech companies. 20% of Singapore's fintech landscape is focused on blockchain and cryptocurrency and 17% operate in payments. Digital wallets are set to overtake credit cards during the next four years. India is home to more than 20 fintech unicorns already with expectation to reach $1T in throughput by 2030.
- Adyen, a payment processor and acquirer, will start letting its US merchants accept online payments via Cash App Pay, starting next year, becoming the first merchant services provider to offer Cash App Pay since Block made it available to merchants that don't use Square. Block is trying to build out the Cash App ecosystem beyond peer-to-peer payments, and Cash App Pay can help Block monetize the app.
- Starbucks and DoorDash, who are currently testing delivery in Atlanta, will begin testing the offering in stores in Sacramento and Houston. Customers who live within the delivery radius of participating stores will be able to order Starbucks items through the DoorDash app. The two companies plan on scaling the partnership nationally in 2023.
- Amazon will be boosting pay and adding benefits for some delivery drivers after workers protested earlier this year amid rising gas prices. The company will invest $450M into rate increases, an education program, and a 401(k) program for US delivery partners. The wage increase only affects Amazon's Delivery Service Partner program, a network of independent businesses that hire and manage drivers, which is separate from Amazon's Flex program, which are independent contractors who work directly under Amazon.
- An Indian court has directed Amazon to delist the Pakistani versions of Rooh Afza, a popular Indian summer drink concentrate that has been consumed in the country for more than a century. Some of the products listed as Rooh Afza on Amazon India were not manufactured by it, but instead were made by Pakistani firms, which was not revealed on the packaging..
10. This week in seed rounds, IPOs, & acquisitions….
- Adobe has struck a $20B acquisition deal with Figma, a competing design platform. The company plans to continue operating the two services autonomously, with no plans to bring Figma inside of Creative Cloud and no changes to Figma's pricing. The acquisition is expected to close in 2023, but it will need to pass regulatory scrutiny before it does. Many creatives are audibly upset over the deal, as they intentionally used Figma to avoid Adobe's ecosystem.
- Prediko, a London-based platform that helps merchants forecast inventory needs and generate different growth scenarios, raised $5M in a seed round led by Felix Capital with participation from other investors including Klarna co-founder Victor Jacobsson. The company will use the funds to hire engineers and other talent, while expanding its footprint across Europe.
- ECC, a beauty and personal care manufacturer in Egypt, acquired a majority stake in Source Beauty, a women-led beauty platform with over 85 local and international beauty brands and 60k users. The new funds will be used to accelerate digital and physical marketing strategy to reach a broader customer base, as well as expand their team.
- 1MRobotics, a startup that takes an automation-first approach to deploying dark stores for rapid delivery, raised $16.5M in a Series A round led by Ibex Investors, bringing their total amount raised to $25M. The company's co-founder, Eyal Yair, claims that their platform consisting of a small warehouse of robots that pack orders, can be installed nearly anywhere and doesn't need require regular maintenance.
- Power, a US-based fintech that offers embeddable fintech for companies like personalized rewards, targeted promotions, and customized credit card programs, raised $16.1M in seed funding and $300M in credit facility in a round led by Anthemis and Fin Capital. The company plans to issue thousands of cards this year and tens of thousands of cards next year, so they are using the funds to build their team, while the credit will go towards funding the receivables of credit card programs.
- Raisin Bank, a Germany-based BaaS provider, acquired the payments division of Bankhaus August Lenz, a private bank based in Germany. The acquisition will allow Raisin Bank to support electronic payment transactions and cash solutions for its partners and customers.
- Xeneta, an Oslo-based startup that applies innovations in crowdsourcing to the world of shipping to build transparent data and analytics for the industry, raised $80M in a round led by Apax Digital, valuing the company at $265M. The company will use the funds to build out its datasets and customers across more global routes.
- BillEase, a Philippines-based BNPL platform, raised $20M from Helicap Securities, a Singapore-based fintech that offers private debt investment opportunities to accredited and institutional investors, bringing their total amount raised to $55M in debt and equity. The company will use the funds to further expand its loan portfolio and accelerate their growth.
- Kafene, a fintech platform that provides lease-to-own payment solutions to merchants, raised $18M in a Series B round led by Third Prime and existing investors.. The company will use the funds to increase its headcount to meet merchant and consumer demand for their product.
What'd I miss?
Shopifreaks is a community effort and I appreciate your contributions to help keep the rest of our readers in the know with the latest happenings in e-commerce. Whenever you have news to share, you can e-mail [email protected] or hit reply to any of my newsletters.
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See you next Monday!
Paul E. Drecksler
PS: What do you call a sick Instagrammer? … An influenza!