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#113 – Shopify + Buy with Prime, BNPL Demographics & Apple Specialists

by | Mar 20, 2023 | Recent Newsletters

Would you change web browsers so that your favorite e-commerce marketplace can keep tabs on you for advertising purposes?

Who's actually using BNPL as a payment method?

Are customers ready to live video chat with Apple specialists when buying their next iPhone?

Can Amazon and Shopify come to terms over Buy with Prime?

I've got answers to all those questions and more in this week's 113th Edition of Shopifreaks. Thanks for subscribing and sharing!

PS: On Tuesday I'm participating in a live panel webinar about mastering omnichannel retail alongside Ron Wastal of Jitterbit, Paul do Forno of Deloitte, and Sean Buckley of Shopify. We did a test run the other day to prep speaking points, and those guys above have a ton of insight to share. It should be a great webinar, and it's free if you'd like to register and participate.

Poll of the Week 🗳️

💻Would you use an Amazon Web Browser over Chrome, Firefox, Safari, or others on the market?

🗳️ Take the Twitter poll.

Last Weeks Poll Results: Last week I asked you to predict whether or not we'd see more bank runs / closures in the coming week. 75.7% voted “Yes, more to come” and 24.3% voted “No, it'll slow down / stop.” So far, no more bank closings.  [View Poll]

Stat of the Week 📈

92% of Zillennials prefer to shop in-store despite being digital natives. They are also leading the charge in consumer demand for cross-channel experiences. – According to PYMNTS

Share this week's stat on Twitter & LinkedIn.

1. Shopify + Buy with Prime

Shopify is in talks with Amazon about adding its Buy with Prime service as a payment / fulfillment partner. 

In April 2022 I reported that Amazon launched its Buy with Prime service on an invitation only basis. By September, Shopify was warning merchants that Buy with Prime was an unsupported external checkout and enabling it was against their TOS. In January, Amazon began expanding the service nationwide to US sellers.

Since last year there's been debate about if / when / how Shopify would allow the service, as it competes with their native checkout and payment process — which is how Shopify generates a bulk of its revenue. 

In a conference call to discuss financial results for Q4 2022, Shopify president Harley Finkelstein said, “When it comes to Buy with Prime, we think any company that's going to make their infrastructure available to merchants to sell more [is] a great thing.”

And later when speaking at the Morgan Stanley Technology Media and Telecom Conference earlier this month, Finkelstein said, “I'm optimistic we'll get there with Amazon. We have a good history and a good relationship with them.”

However Finkelstein later added that if a deal were to get done with Amazon, it would be on Shopify's terms — leaving merchants in control of their customer and order data. 

Keep in mind one thing about Shopify and Amazon — which is that they already partner together in various ways including allowing merchants to connect to FBA as a fulfillment channel and accept Amazon Pay as a payment method.

The two companies are already more than halfway there to being able to offer a Buy with Prime badge on products by simply enabling the badge for products fulfilled by FBA and continuing the checkout through Shopify. Most of this whole will they won't they in regards to Buy with Prime just comes down to where those checkout transaction fees are going.

It would behoove Amazon to make a deal on Shopify's terms just to get that sweet branded Buy with Prime badge all over their merchant network.

Rick Watson of RMW Commerce Consulting made a great post on LinkedIn the other day entitled “5 Scary Things I Learned While Shopping Amazon Buy With Prime”.

He wrote, “I've been surprised so many people talking about Buy With Prime, but few of them actually have even ever looked at it, much less purchased from a seller with it.”

Rick decided to remedy that by purchasing a product from one of Amazon's case study merchants. Here's a summary of what he learned, which you can read in detail about in his full report:

  1. All sellers are using FBA vs their white-label MCF shipping, which means the packaging is undifferentiated and worse than most typical premium D2C experiences.
  2. All sellers are using Shopify, which is why it's so important that Amazon ink a deal with them.
  3. Buyers need to agree to Amazon's privacy policy, which has more to do with data-sharing than fast delivery.
  4. Rick never got a branded e-mail from a Shopify store after his purchase, and only received notifications from Amazon itself.
  5. Returns were “super hard” — neither Amazon customer service nor the brand itself could find the orders in their database or tell him how to return the items successfully.

So maybe making the infrastructure available to Shopify merchants is not such a “great thing” after all. I guess customers will be the judge.

2. Who's actually using BNPL?

The Consumer Financial Protection Bureau (CFPB) published a report analyzing the financial profiles of consumers who use BNPL.

I'm fairly vocal about how much I hate BNPL for the simple fact that it's an unregulated lending channel that preys on lower-income consumers who shouldn't be presented with more easy ways to put themselves in debt — especially not for buying consumer goods.

Plus many BNPL firms don't even seem to have a basic understanding of the business of lending, as exemplified by Affirm, who last month had to go around to all their clients and ask their permission to raise their interest rates because their initial agreements did not include an automatic mechanism for dealing with Fed rate increases. There isn't a regulated lender on the planet who would've made that oversight when drafting their agreements because they actually understand how lending works!

Well, back to the CFPB report… Are myself and others who've criticized BNPL companies for preying on the financially challenged correct with our criticisms? Why yes, yes we are… 

Here's what the report found: 

  • BNPL borrowers on average are more likely to be active users of credit cards and payday loans.
  • BNPL borrowers are more likely to exhibit signs of financial distress including high levels of indebtedness, revolving balances, or delinquencies on their credit cards.
  • BNPL borrowers had higher usage of loan products compared to non-borrowers including retail accounts (62% vs 44%), personal loans (32% vs 13%), and student loans (33% vs 17%).
  • 18% of BNPL borrowers had at least one reported delinquency in another account, compared to 7% of non-borrowers.
  • BNPL borrowers had average credit scores in the sub-prime range  of 580–669, while non-borrowers had average credit scores in the near-prime range 670–739.

In a statement released with the report, CFPB Director Rohit Chopra noted that there is a common misconception that BNPL borrowers lack access to other forms of credit and that the survey data instead indicates that BNPL borrowers are more likely to use a wider variety of credit products than non-borrowers.

In conclusion… regulate these BNPL companies or shut them down. Enough is enough already. 

3. BigCommerce powers WineDirect (Sponsored)

WineDirect, the largest D2C e-commerce platform for wineries that serves over 1,800 of the 11,000 wineries in the US, chose BigCommerce because their enterprise wineries were looking to build on a platform “that's open, with limitless integrations that they can plug into”, said Jim Secord, VP of Product.

WineDirect also built a wine-based CRM platform that allows them to have a 360-degree view of customers, capture repeat purchases, and retain them, as well as a customized reporting and dashboard system exclusive to the winery, that helps them determine which varietals are popular and the inventory available for processing the wine club.

CEO of BigCommerce Brent Bellm said, “By partnering with BigCommerce, WineDirect is bringing the most sophisticated and advanced capabilities in ecommerce, and then tailoring them for ease of use so that all wineries, from small mom-and-pops to large enterprises, can use them. Wineries who log into WineDirect are accessing 100% of BigCommerce functionality through APIs, but they're doing so via a WineDirect custom interface.”

Brent also highlighted that BigCommerce platform is relevant to both B2C and B2B sales and it serves around 60k merchants worldwide, including brands like Procter & Gamble, Ted Baker, and 1800 wineries soon to be added via a partnership with WineDirect.

Learn more about WineDirect's partnership with BigCommerce enables them to provide better e-commerce experiences via this 30 minute video recorded at NRF2023.

Apple introduced a new way to shop for iPhones called “Shop with a Specialist” which allows US customers to interact with an in-store Apple expert via a live video chat without ever leaving the website.

The specialist will be on camera throughout the live video session and share their screen, but they will not be able to see the customer.

For now the service is limited to shopping for iPhones, but Apple says that it'll eventually be made available to all of its products. 

The service is offered at no cost to customers, allowing them to look at the newest iPhone models, compare features, ask questions, and get advice from an Apple professional.

The launch of Shop with a Specialist service coincided with the release of Apple's new yellow iPhone 14 / 14+ phones.

The new live shopping experience can be accessed here, available daily from 7am – 7pm PT in the US.

5. Washington vs Big Tech

The Biden administration is planning to take action on at least three of its half-dozen investigations of Amazon.

The FTC has been investigating Amazon on multiple fronts since 2019, looking into its abuse of power within its online marketplace, as well as consumer -privacy violations connected to its Ring cameras and Alexa assistant. The agency is also reviewing Amazon’s purchase of robot vacuum maker iRobot.

POLITICO spoke to more than 10 people with direct knowledge of the investigations by the FTC to learn how the agency is now pursuing Amazon, why it didn't take action on the One Medical acquisition, and what's likely to happen in the coming months.

Here's a recap of POLITICO's findings: 

  1. The FTC is weighing whether to challenge Amazon's $1.7B acquisition of iRobot, with staff attorneys leaning toward suing to stop the deal.
  2. It has at least two open privacy investigations into Ring and Alexa over potential violations of the Children's Online Privacy Protection Act, with the result of at least one investigation coming in the next couple of months.
  3. A wide-ranging antitrust case targeting Amazon's retail operations may be coming in the next few months, which could include the bundling of services through its Prime subscription offering and using competitor data to out-muscle rival retailers on its platform.
  4. The FTC is pursuing a “dark pattern” probe into the difficulty customers have unsubscribing from Prime and other Amazon services.
  5. They are also conducting a deceptive advertising probe into the “Amazon Choice” label and how that label is used to promote products that appear in search results. 

Amazon closed its $8.5B purchase of MGM Studios in March 2022, with the agency’s hands tied as its four commissioners at the time deadlocked along partisan lines on whether to intervene. 

Now the FTC is looking into the $1.7B iRobot deal and the One Medical deal and is continuing to collect documents and testimony from third parties, five of the people with knowledge of the review said.

Buckle up for an exciting year at the FTC, who are also looking into Meta, Microsoft, Google, and Apple for various reasons.

6. eBay vs Meta vs FTC

eBay competes with Facebook Marketplace, but NOT with Facebook's social network — at least that's what it told a judge last Monday.

eBay filed a motion to quash Meta's deposition subpoenas, claiming that it had already worked with Meta for a year and already disclosed nearly 2,500 pages of internal records to the company.

eBay's lawyers said, “Meta's discovery gluttony confirms its request of eBay is not worthy of the burden Meta seeks to impose. The breadth of the subpoena is alarming.”

The subpoenas are in regards to an FTC lawsuit against Meta filed in D.C. federal court in 2020, accusing the company of abusing its power in the “personal social networking services” market. The lawsuit seeks to force the company to sell Instagram and WhatsApp.

Meta is now attempting to demand even more confidential business information about eBay's privacy policies, data retention, and other topics, which eBay says are not relevant to the FTC's monopoly claims.

(Not relevant, maybe. But shouldn't that information be relatively public anyway?)

However eBay feels that it's done enough already, and that its proprietary information as an auction site may be relevant to Facebook Marketplace, but it isn't relevant to the FTC's lawsuit.

eBay told the court, “eBay is an online platform that brings buyers and sellers together to buy and sell goods, either through auctions or traditional purchase and sale transactions. People and businesses do not use eBay's platform to ‘maintain personal relationships' or ‘share experiences with friends.'”

eBay pointed to restrictions it places on buyers and sellers communicating with one another, as a means to demonstrate how different it is from Meta's communication platforms.

eBay posed the question to the courts, “One could be excused from wondering whether Meta is more interested in the FTC matter or how eBay views Meta's Facebook Marketplace product.”

7. More layoffs to report

Klaviyo laid off 10% of its workforce, or approximately 140 staff members across all teams including engineering and design, in what they said is an effort to reduce redundancy and recalibrate their areas of investment for the future. 

Fetch Rewards, a shopper rewards startup, also laid off 10% of its workforce, comprising of around 100 employees. Fetch was impacted by the SVB situation, but a spokesperson for the company said that the decision to restructure was in the works prior.

Anchorage Digital, a fintech that offers prime brokerage services and custom API integrations for financial institutions, laid off 20% of its staff, or about 75 employees, citing regulatory uncertainty, crypto market volatility, and macroeconomic headwinds. In December 2021, the startup raised $350M in a Series D round, valuing the company at over $3B.

Twitch announced it would be laying off over 400 of its 13,600 employees, also pointing to the current macroeconomic and missed projections as the cause. The layoffs come a week after cofounder and CEO Emmett Shear stepped down from his role.

In addition to those lay offs at Twitch, its parent company Amazon also announced another 9,000 lay offs, bringing its total to around 27,00 since late last year. Most of the cuts will be from AWS, advertising, and human resources.

8. Is Amazon building a web browser?

Amazon sent a survey to users asking detailed questions about which features would convince them to download and try a new desktop browser from Amazon.

Users were asked to rate the important of features including text to speech, extensions, data syncing across desktop and mobile devices, and blocking third-party cookies.

The ad industry is bracing for change as Google moves to kill third-party cookies in Chrome, which is a primary way that businesses, including Amazon, track consumers for ads. Google has extended the deadline for the death of third-party cookies twice — first to 2023 and then again to 2024.

Regardless of how great an Amazon browser may or may not be — would consumers switch to a browser that clearly has an agenda to track their every move for the purpose of advertising? Well, I guess technically 65.74% of Internet users already do so when using Chrome browser, but at least Chrome offers a connection to the rest of the Google ecosystem like Search, Gmail, Calendar, Maps, and Google's other suite of tools. 

To get consumers to switch browsers, Amazon would have to provide a pretty compelling offer. Credits to use on the more I browse? Other browsers including Brave and Edge offer rewards for browsing, but they don't have direct access to the world's largest online store as an incentive. 

This would not be Amazon's first attempt at a browser. The company launched Silk browser in 2011, which is built on the Chromium Project and used for its own products including Fire Tablets, Fire TVs, and Echo Show devices. 

Right now Amazon is doing its homework to determine if there's a market outside of its own devices for an Amazon Browser.

Would you use it? Take our Twitter Poll and let me know. 

9. Other e-commerce news of interest

Amazon Go stores have no cashiers and instead use a system of cameras, sensors, and motion detection software to track customer shopping. New York City customers are now suing Amazon in a class action lawsuit which claims that Amazon collected data on the shape and size of customers' bodies, as well as scans of some customers' hands, without proper warning.

Meta rolled out blue ticks in the US, costing $11.99/mo via web or $14.99/mo via app store. Web sign ups only receive the blue checkmark on Facebook, while the mobile app sign ups includes the blue checkmark for both Facebook and Instagram.

Paramount Global is rolling out a mountain of merchandise from Paramount Pictures, CBS, MTV, BET and Comedy Central to Nickelodeon and Showtime. The site launched on Wednesday under the tagline “Where Products Are Paramount.”

Lands End reported that their e-commerce net revenue decreased 10.1% to $1.1B for the fiscal year, primarily driven by lower consumer demand caused by the global supply chain challenges in the first half of fiscal 2022. Gap also reported a 10% drop in online sales for Q4, however, the company's e-commerce revenue is still up 29% compared to pre-pandemic 2019.

Amazon will discontinue distributing Kindle Newsstand subscriptions in September and is no longer selling new Kindle Newsstand subscriptions for magazines and newspapers as of this month. Starting in June, Amazon will no longer alow users to manage print subscriptions either, and subscribers will have to deal with the publishers independently.

Ulta Beauty is transforming its e-commerce operation with Google Cloud, Google Kubernetes Engine, and Anthos cloud-based managed services solution, which will enable the company to save several hundred thousand dollars in additional licensing fees. The company is relaunching its e-commerce platform with multiple, distinct microservices to perform unique functions.

ALPHV, a ransomware group, claims to have breached Amazon Ring and is threatening to publish its data. Since Ring devices support E2EE in most countries, which means that neither Amazon, law enforcement, nor ransomware groups could access uploaded footage, it is possible that ALPHV exfiltrated corporate or customer data rather than video.

About You, a German fashion e-commerce platform, introduced a minimum order amount of €30 to obtain free shipping, while customers with smaller orders will have to pay €4.90. The new feeds are already in effect in Germany, and will eventually be rolled out to all markets. Last week I reported that their parent company, The German Otto Group, was disbanding its operations of by next year.

AliExpress launched its AliExpress Choice service in Spain, which will offer a curation of the best value products the platform has to offer and a new monthly shopping event “Choice Day”. The marketplace has been offering a nine-day delivery time for customers since the beginning of this month, and hopes to have 7,500 pick-up locations throughout Spain by the end of the month.

Wix partnered with Forter, a US-based trust platform for digital commerce, to increase approval frates for merchants while minimizing fraud. Forter will deliver its real-time decisions to Wix merchants in certain regions using an identity-based decision engine.

Searchspring, a specialist in site search and e-commerce personalization, appointed Alex Kombos as CEO to head up its next stage of growth. Kombos previously served as CEO at Pressable, which is part of Automattic.

Brightcove, a streaming technology platform, introduced new integrations with Shopify, Instagram, and Salesforce Sales Cloud to its video cloud platform. The integrations enable merchants and content creators to leverage live and on-demand video content.

WooCommerce 7.5.0 was released this week with three new blocks for the Product Archive templates including a new Store Breadcrumb block, Product Results Count block, and a Catalog Sorting block. The release includes two database updates, 278 commits to WooCommerce Core, and rolls in 170 commits from the WooCommerce Blocks plugin.

Some eBay affiliates were hit with hefty bank fees after Impact, the company that eBay uses to manage its affiliate program, used wire transfer instead of ACH transfer to distribute funds to affiliate's bank accounts. eBay was responsive to affiliates and said that it will reimburse those who were unexpectedly charged wire transfer fees by their banks. 

10. Seed rounds, IPOs, & acquisitions

Stripe raised $6.5B from Andreessen Horowitz, Founders Fund, Goldman Sachs, and Temasek at a $50B valuation, a steep discount from its record valuation of $95B in 2021. The company noted that it does not need the capital to run its business, but will put the funds towards providing liquidity to current and former employees and tax obligations associated with equity awards. Sounds like they just want to buy some time for the market to turnaround before going public.

Parker, a fintech startup that offers a corporate credit card for e-commerce businesses, announced $157M in equity and debt funding that was mostly raised in 2022 including a $31.1M Series A round led by Valar Ventures, $5.9M in seed funding, and $70M in debt from Triple Point Capital, plus an uncommitted option to upsize by $50M. The company offers raised limits that are on average 10-20x higher than traditional business credit cards.

Tamara, a Saudi-based fintech and BNPL provider, secured a $150M debt facility from Goldman Sachs to expand across its range of financial products in shopping, payments, and banking. The company has a customer base of 6M and competes with Dubai-based Tabby in the region.

BlackCurve, an e-commerce pricing platform that enables merchants to set rules that automatically change prices in reaction to competitor behavior, raised £750k in funding from Nauta Capital and ACF Investors, bringing its total amount raised to £3.7M since being founded in 2017. BlackCurve recently launched in the Shopify App Marketplace and will use the funds to expand in its core online markets and further drive down its cost of sale. 

T-Mobile is acquiring Ka’ena Corporation, the parent company to budget wireless providers Mint Mobile and Ultra Mobile, in a deal valued at $1.35B. Actor Ryan Reynolds, who owns about 25% of Mint Mobile and is the spokesperson for the brand, is rumored to be making $300M on the deal. His video announcement about the sale was pretty funny.

Verify AG, a Zurich-based startup using drones to make logistics warehouses more efficient, raised $32M in a Series B round led by A.P. Moller Holding, bringing its total amount raised to over $60M. Verity's drones automatically scan merchandise at warehouses and are capable of flying in low-light conditions without a human pilot, which means they can scan merchandise at night while a warehouse is not operating.

One Impression, an Indian influencer marketing platform with more than 7M content creators on the platform that helps brands find relevant influencers for their campaigns, raised $10M in a round led by Krafton. The platform is currently enabled on Instagram and YouTube with plans to unlock it for LinkedIn, Moj, and TikTok over time.

Sezzle, a US-based BNPL provider that operates in the US and Canada, announced plans to list publicly on the Nasdaq no later than Sep 2023, while continuing to sell common stock on the ASX. Last February, Zip was supposed to acquire Sezzle, but the deal was terminated in July due to market conditions.

DressX, a digital fashion store that carries 3D clothing that you can impose on top of your photos and videos, raised $15M in a Series A round led by Greenfield. The funds will be used to help scale the three-year-old business by adding more gamified experiences.

Bundle x Joy, a D2C pet care startup that provides premium superfood nutrition and curated product bundles of supplements and treats for dogs, raised $1M in a round led by Leap Venture Studio. The company will use the funds to expand into new stores, expand its team, increase its inventory, and product development. 

FairMoney, a Nigerian credit-led digital banking platform, acquired PayForce, a merchant payment service that serves small businesses, in a cash-and-stock deal in the range of $15-$20M. The acquisition will provide incentives for PayForce-acquired merchants who use FairMoney as their primary bank, such as an 18% annual return on deposits.

COFE App, a beverage collection and delivery platform that connects Middle Eastern consumers to coffee chains in the region, raised $15M in a Series B round led by Wa'ed Ventures. The company will use the funds to develop its e-commerce channel and prepare for further international expansion.

Nimble, a provider of fully autonomous 3PL warehouse and fulfillment services, raised $65M in a Series B round led by Cedar Pine, bringing its total amount raised to $110M. The company will use the funds to move away from its previous model of retrofitting existing warehouses into operating its own robotic warehouses. 

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.

You can also mention @shopifreaks on Twitter or submit posts to r/Shopifreaks on Reddit, and I'll curate the best submissions each week for inclusion in the newsletter. 

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See you next Monday,


Paul E. Drecksler
[email protected]

PS: The genie asked, “What’s your first wish?” Steve answered, “I wish I was rich!” The genie continued, “What’s your second wish?” “I want a nice long life!” responded Rich.