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This week I dive into Shopify's latest Summer '23 Editions, which monopolizes the first three stories so that I could go in-depth into its new Collective feature and merchant credit card.
I also share stories about the future of eBay, who's winning the short-form video battle, and Wayfair's new free virtual room styler. Plus some e-commerce updates to GA4.
All this and more in this week's 132nd Edition of Shopifreaks. Thanks for subscribing and sharing!
Stat of the Week đ
A study of 1,700 products over one year found that smaller online shops beat Amazon and eBay on price 78% of the time. — According to Idealo
Share this week's stat on X & LinkedIn.
1. Shopify Summer '23 Editions
Twice a year, Shopify releases a mega showcase of its latest features called Shopify Editions, a tradition that started one year ago.
In June 2022, I covered the first Edition where Shopify announced B2B, tokengated commerce, Apple tap to pay, local inventory on Google, and a new headless feature called functions, among other updates.
In February this year, I covered their Winter '23 Edition which announced logistics (which there have since been major changes to), shop minis for developers to extend their app functionality to Shop app, cash campaigns, a sign in with Shop feature, one page checkout, meta fields & objects, and an AI product description generator.
Click those links above for a full recap of previous Editions.
Well, it's that time of year again!
Last week, Shopify released its latest Summer '23 Edition, which included a handful of AI improvements, new collaborative selling features, improved checkout, and more. I'll recap some new features below, and I'll also dive into two in detail in Story #2 and #3.
The theme of this Edition is “Imagine” because as Harley Finkelstein said, “we all need to reimagine our businesses.”
- Sidekick – an AI commerce assistant that merchants can use within their dashboard to update their store design, streamline workflows, and generate reports. (I covered this in detail two weeks ago.)
- FAQ & Response Recos – automatic personalized replies for common questions, which merchants can review and edit via Shopify Inbox.
- AI Blog Posts – instantly generated for holidays, business milestones, or promotional campaigns, with the ability to customize the tone of voice and translate content into different languages.
- AI E-mails – automatic subjects, content, and recommended send times.
- Shopify Collective – a new way for brands on Shopify to collaborate and cross-promote each others products. More on that in Story #2.
- Shopify Credit – a business credit card designed for Shopify merchants. More on this one in Story #3.
- Shopify Marketplace Connect – a single app for merchants to sell on marketplaces like Amazon, Walmart, and eBay, while managing their inventory and fulfillment from Shopify. Previously this involved multiple apps (one per marketplace).
- 17 New Checkout APIs & Updates – allowing developers to create unique checkout experiences with apps and manage them from within the checkout editor.
As a reminder, not all of the new features mentioned in the Summer '23 Editions are brand new / announced for the first time. Editions are always a mix between a recap of features released during the previous six months (many which I've covered in previous Shopifreaks editions), and a few brand new releases (several of which I listed above).Â
2. Shopify's new merchant to merchant dropshipping
One of the standout announcements from Summer '23 Editions was the public launch of Shopify Collective, a new feature that lets brands on Shopify collaborate and sell products from each other's stores.
Here's how it works:
- Find products you'd like to sell from other Shopify brands.
- Import those products to your store and sync inventory.
- Customers buy those products on your store. There can be a mix of your products and imported products in the same cart.
- The other brands fulfill their part of the orders and ship the products to your customers.
- Vice-versa you can offer your products to be sold by other brands.
- Brands who participate in Collective set their own wholesale and retail prices, which Shopify recommends offering a margin of 20-40% to other stores.
- The cost of shipping is automatically passed from the supplier store to the retailer's checkout, and back again following a sale. Supplier brands can set different shipping zones / rates for Collective than they do in their own store where their margin is higher. This might get a little confusing to the customer if, for example, Store A advertises free shipping above $100, but Store B charges flat rate shipping, but brands are aware of the other's shipping policies before choosing to collaborate.
So basically it's an internal dropshipping marketplace exclusive to Shopify stores!
Stores are eligible to participate in Shopify Collective if they are based in the U.S., sell in USD, have Shopify Payments activated, and sold at least $50k in the previous 12 months.
Shopify is very proud of the fact that Drake is on Shopify Collective and recently partnered with Funboy, Krink, Elder Statesman, Defective Garments, and Hidden NY.
Shopify Collective is a brilliant idea and opens the door for brand to brand collaborations beyond affiliate relationships.
Don't get me wrong, I love affiliate relationships, but this is a step above.
It's one thing to recommend other brands and send your customers to their shops to purchase, but it's another thing to sell their products right through your own store alongside your own products.
The feature also opens the door for creators to build shops and exclusively sell their favorite products from partnering brands all under one roof. For example, instead of a creator promoting six different brands and sending you to six different shops to purchase products, they can send you to their own branded shop where you can add products from all the brands they rep to one cart.
Swing and a hit with Shopify Collective in my opinion. I'm going to try it out on some of my eligible client shops. I'll let you know how it goes. Please e-mail me and let me know your experience if you give it a shot.
3. Shopify Business Credit Card
The other standout announcement from Summer '23 Editions was the launch of Shopify Credit, a business credit card designed exclusively for its merchants.
The card is powered by Stripe (which also powers Shopify Payments and Shopify Balance), issued by Celtic Bank, and accepted everywhere Visa is.
As opposed to credit checks for approval and credit limits, merchants are evaluated on factors like their sales performance and whether or not they use Shopify Payments.
The card offers 3% cash back on a merchant's top spend category, and 1% on remaining categories such as wholesale, marketing, and shipping.
Shopify also emphasized that it won't charge setup fees, annual fees, late fees, foreign transaction fees, replacement card fees, or any other kinds of fees (other than interest).
In case it's not blatantly obvious by now — Shopify wants you to process money through it! Whether through their app, website checkout, B2B vendor payments, a loan, etc, they make money when you move money.
Through Shopify Payments, Shopify Balance, Shopify Capital, Shopify Bill Pay, and now Shopify Credit, the company is finding more and more ways to have their hand in every part of merchants' financial transactions.
4. eBay's secret master plan
Okay, well it's not actually that big of a secret! They've been telling everyone who will listen about it…
eBay's CEO, Jamie Iannone, recently shared insight about the next phase of the company's evolution.
Iannone told analysts on a recent earnings call to expect a “comprehensive overhaul” of eBay's user experience and design that would be rolled out in phases over the course of 2023 and beyond, mentioning upcoming updates to the View Item page, header, homepage, search results, and other landing pages.
He later told Insider that new technologies such as artificial intelligence would supercharge the company's growth.
New strategies include:
- Building relevant experiences for shoppers and sellers
- Scaling tech solutions to be usefrom across eBay
- Using new features like AI and live commerce
- Offering the ability for livestream viewers to directly buy products
eBay recently integrated OpenAI tech to power its “magical listings”, which creates product descriptions based on an item's title, category, and other info input by the seller. The next version of that software will use image recognition, allowing sellers to create a product listing based on a photo.
eBay's recent re-focus:
When Iannone rejoined eBay as CEO in April 2020, he committed to doubling down efforts on “focus categories” which include: sneakers, handbags, watches, trading cards, and motor parts and accessories.
The company is now planning to cater to “enthusiast” shoppers, or buyers who make at least six purchases and spend more than $3,000 per year on average — of which more than 90% of eBay's roughly 16M enthusiast shoppers buy products in focus categories.
The hope is that the new focus will also continue to bring in new buyers, which the company desperately needs in order to compete moving forward against younger cooler platforms.
eBay's active-buyer base continued to fall in the most recent quarter, reaching 131M buyers, a 3% decrease YoY, but the number of new buyers grew for the second straight quarter. (Maybe all the old buyers suffocated beneath all the junk they bought on eBay over the years?)
5. An update on short form video
Short form video is taking over the Internet.
It all started with TikTok…
Well, no, technically it started with Vine. Remember Vine? The six-second looping video platform launched in 2013, bought by Twitter, and shut down in 2017?
Vine was ahead of its time. And just like the Twitter Buy Button, which the company sunset in 2017 because of lack of traction, Twitter should've kept going with the service.
After Vine shut down, TikTok quickly took its place as the world became ready for short-form content to go mainstream, rising to become the most downloaded app in the U.S. in Oct 2018 — just a year after Vine shut down.
Since then, every other social media and video platform has been attempting to capture a slice of the short-form video pie.
Digiday recently did a recap of how Google, Meta, and Snap's battle with TikTok in short-form video is playing out, which I'll highlight below:
- TikTok currently has at least one billion monthly active users
- YouTube Shorts are now watched by more than 2B logged-in users every month, having increased from 1.5B users the previous year
- Meta's Reels format exceeded 200B plays per day across Facebook and Instagram, but the company didn't note how many of its more than 3B users account for those views
- Snapchat's Spotlight feature is watched by more than 400M monthly active users, increasing 51% YoY
- TikTok garners the top daily watch time amount, recording 118 minutes compared to 75 minutes on YouTube, 52 minutes on Facebook, 31 minutes on Instagram, and 22 minutes on Snapchat
- TikTok also has the highest time spent per session at 9:08 minutes, compared to YouTube's 7:06 minutes, Facebook's 4:18 minutes, Instagram's 2:42 minutes, and Snapchat's 1:18 minutes.
- More than 75% of Meta's advertisers now use Reel ads
- TikTok hit $2.5B in revenue during Q1 2023
- TikTok's yearly ad revenue is forecast to be equal to just 16.3% of Facebookâs and 32.7% of Instagramâs
What's your favorite app to consume short-form videos? Hit reply and let me know.Â
6. Wayfair launches a virtual room styler
Have you ever wanted to reimagine how rooms in your home would look like if you actually took the time and energy to redecorate?
Now you can scratch that itch with Decorify, a new app by Wayfair that uses generative AI to create shoppable, photorealistic images of spaces in your home.
Customers upload an image of their space and prompt the app to reimagine it in a different style like bohemian, farmhouse, crack house, mid-century modern, or industrial. Decorify then presents redesigned images of the room that reflect the requested look and feel. From there, customers can browse various designs, which include products that can be purchased from Wayfair.
Alternatively, you can select single items in your room to have Wayfairâs model replace them with something in your desired style.
There are countless AI home design apps on the market, but most of them cost money to use. Decorify is free, with the hope that it helps customers discover new products to purchase from Wayfair.
It's free, but is it good?
The Verge says, “Wayfair uses an AI model to create new imagery, so itâs going to show you weird reflections on curtains, plants sitting on day beds, and furniture that doesnât quite make sense, and it might just decide your room is twice the size it actually is.”
One commenter described how if the software sees two chairs in the corner, it will simply exchange the chairs for different ones, as opposed to rethink how everything is positioned.
Shrenik Sadalgi, director of R&D at Wayfair told TechCrunch, “Our hypothesis is that the quality is good enough to drive value for a customer. Wayfair's customers are looking for, and love, visual inspiration — they get that from our rich lifestyle imagery that we custom produce and curate. Now they can blend that with their spaces.”
“Good enough” seems to be the consensus on Decority for the time being.
For now, Decorify only supports living rooms, but Wayfair says thatâll change in the future if the company can afford to stay in business until the end of this sentence.Â
7. TikTok's U.S. marketplace to launch in August
In June I reported on TikTok's new Trendy Beat offering in the U.K., where it offers products for sale that are shipped and sold by its parent company, ByteDance.
At the time I wrote that Trendy Beat would NOT be tested in the U.S., where TikTok says it's focused on adding new merchants to its TikTok Shop offering, but that it could be in the future.
Apparently the “future” is August, because according to the WSJ, the company is planning on launching its online marketplace in the U.S. in the coming month, where it will ship a variety of products from Chinese sellers including clothes, kitchen gadgets, and electronics.
I couldn't gather whether it would be called “Trendy Beat” in the U.S. or not, but the offering seems very similar.
According to the WSJ, TikTok will only pay Chinese suppliers once they find buyers in the U.S. and will return unpopular items âto avoid being stuck with inventory.â The company also said that it plans to open up its program to merchants outside of China as it works to create an âinternational settlement and logistics system.â
TikTok's e-commerce debut in the U.S. is beginning to feel a little botched already.
It's coming! It's not coming! It's coming later! It's coming now! I can barely keep up with what's actually happening with TikTok's e-commerce plans, and I go out of my way to keep up!
Snip, snap! Snip, snap! Snip, snap! You have no idea the physical toll that teasing an e-commerce marketplace can have on a person!
Here's a recap of TikTok e-commerce moves during the past two years:
- Last Week – TikTok offered WooCommerce merchants early access to its TikTok Shop platform, which allows them to sell their products directly on the app.
- Two Weeks Ago – TikTok began experimenting with a new way to integrate TikTok Shops into the app via a Shop tab adjacent to the Following and For You tabs.
- June 2023 -TikTok launched Trendy Beat in the U.K.
- Nov 2022 – TikTok announced that TikTok Shop was coming to the U.S. again.
- Oct 2022 – TikTok began building an international e-commerce fulfillment center.
- Oct 2022 – TikTok relaunched live shopping in the US.
- July 2022 – TikTok put its U.S. e-commerce plans on hold to focus on making the product a success in the U.K. first.
Aside from the bumpy launch road, The Atlantic questions if TikTok might be ill-suited for shopping? Caroline Mimbs Nyce wrote:
“At its roots, TikTok has more of an authenticity culture than Instagram does… In theory, that could lend them credibility as salespeople. But it could also work against the platform: Why is that random person on TikTok who seemed like a friend now trying to sell things?”
What are your thoughts? Is TikTok enshittifying itself or can it be a legit contender in the world of e-commerce? Hit reply and let me know.
8. Google expands GA4 e-commerce metrics
Google has announced an expansion of e-commerce measurement capabilities in Google Analytics 4, which include 30 new dimensions and metrics.
New dimensions — which include item affiliation, brand, category, ID, list name, list position, item name, variant, shipping tier, and more — will allow merchants to analyze metrics by product and by attributes like brand and promotions for a more granular analysis of what's driving revenue.
Google also added new e-commerce metrics in the custom report builder including gross item revenue, gross purchase revenue, item revenue, items added to cart, items viewed, shipping amount, tax amount, and more.
Previously merchants had to calculate gross purchase revenue using a formula combining other metrics, but now it'll be available directly in the custom report builder.
Lastly Google streamlined its e-commerce metrics in GA4 explorations including gross item revenue (total revenue from items only), gross purchase revenue (total revenue from purchases made on website or app), and refund amount (total amount from refunds).
To avoid duplicate revenue metrics, Google removed the e-commerce revenue and event revenue metrics.
With the new changes, merchants will have to build less custom reports to access key revenue metrics.
9. Other e-commerce news of interest
Microsoft is rolling out the PayPal Pay Later option in the U.S., U.K., Australia, Germany, France, Spain, and Italy, allowing customers to pay for their Microsoft Store purchases in installments. Customers in the U.S. will also have the option to pay with Venmo, which is currently available for Xbox purchases in the U.S.
Ad spend increased across Google, Meta, Amazon, and Walmart during the first two quarters of 2023. One standout ad buyer was Temu, who is now competing against 82% of U.S. advertisers, a higher share than Walmart.
Etsy began encouraging shoppers to think about their carbon footprint by buying items closer to where they live with a message that reads, “Shorter shipping distances are kinder to the planet.” Sellers are concerned that the new message could deter shoppers from completing a purchase in favor or a closer seller.
In other news of how Etsy is pissing of sellers, the company is putting more seller accounts under restrictive settings, which means they hold the bulk of their funds for two to six weeks in a payment reserve, with the entirety of Etsy's fees coming upfront from the remainder. Chirag Patel, head of payments at Etsy, said that less than 2% of shops currently have a payment reserve placed on their accounts, and for most of the shops, the amount being held is less than $50, although there are reports of sellers having thousands of dollars in the reserve.
After rebranding Twitter as “X” last week, the company stole the @X username from photographer Gene X Hwang who has used the handle since he registered it in March 2007. They offered him no compensation, basically saying it's their property anyway.
Bonanza will soon be unveiling a new homepage design that offers a better preview of what's available on the marketplace and a streamlined pathway to purchase. Existing sections like Hand-Picked Lists will continue to be offered.
After initially announcing that Llama 2 would be free, Meta changed course and decided to charge for the AI language model. The company recently partnered with Microsoft and Amazon, originally intending to offer the model for free, but now believes it should receive a portion of the revenue.
Fable Studios created a fake episode of South Park using its new generative AI product, Simulation, which it plans on releasing later this year. It definitely had that old school South Park animation and voices going on, but overall not bad for an AI generated episode!
Copia, a Kenyan e-commerce platform that serves low-income households, laid off 25% of its 1,800 workforce, blaming labor costs and a need to improve profitability for the layoffs. This marks its third round of layoffs this year.
Amazon also made a round of layoffs, this time cutting 44 jobs across Fresh stores in 8 states and Washington D.C., as part of a restructuring process.
Gap appointed former Mattel President & COO, Richard Dickson, as its next CEO, who takes the helm on Aug 22. Dickson helped revitalize Mattel's Barbie brand, including its box office movie, and is being brought on to help reinvigorate Gap's portfolio of brands which include Old Navy, Banana Republic, and Athleta, all which have struggled to maintain sales growth.
OnlyFans CEO, Ami Gan, is stepping down after two and a half years, to be succeeded by chief strategy and operations officer Keily Blair. Gan is moving on to focus on Hoxton Projects, a marketing company she founded.
Shopify's VP of corporate development and head of product acceleration is leaving the company after 10 years, with intentions to spend more time with his family and angel invest. Kanwar joined Shopify in August 2013 through its acquisition of design agency Jet Cooper, which he co-founded in 2009.
Block appointed Neha Narula to its board of directors, a former software engineer for Google who also serves on the Federal Reserve Bank of New York's Innovation Advisory Council and serves as director of MIT Media Lab's Digital Currency Initiative.
X is discounting ad prices on video ads by up to 50% in an attempt to lure back advertisers in the U.S. and U.K. The company also warned advertisers that they risk losing their verified status if they fail to hit minimum spending thresholds. That'll get them to come back! LOL.
Amazon India has launched a first-of-its-kind floating package delivery service in India that will serve customers on Dal Lake and Nigeen Lake. Previously residents had to paddle their way to the shores by boat to pick up their Amazon packages, which will now be delivered to their doorsteps.
Indonesia is planning to restrict the sale of imported goods priced below $100, in an attempt to tighten oversight on companies like TikTok and Temu. President Joko Widodo has repeatedly stated concerns about predatory pricing for cheap, Chinese-made goods and urged Indonesian consumers to shun them.
Libro.fm, a new audiobook retailer and listening app designed to give bookstores the ability to earn income via audiobook sales, launched internationally on Wednesday. The platform is now available worldwide in six currencies and currently partners with more than 2,200 independent bookstores.
Travelers in China can now add Visa and Mastercard to WeChat Pay and Alipay, which previously only allowed locally-issued cards. Transactions up to $800 will be supported, and both platforms will charge a 3% fee for most transactions.
Fanatics launched a livestream app called Fanatics Live, which allows fans to purchase sports collectibles and merchandise while also watching exclusive streaming content. The app, currently only available in the iOS App Store, will initially feature trading card “breaks” and limited-edition merchandise and collectible items.
Amazon has offered to limit its use of data on marketplace sellers so that its retail business cannot gain an unfair advantage over other sellers and guarantee equal treatment for all products displayed in its Buy Box, in an attempt to settle an open antitrust investigation in the U.K. Wait, I thought for years they said they didn't do that stuff?
In other troubles in the U.K., Amazon and Apple are facing a class-action lawsuit alleging they abused their market power by colluding to increase the price of Apple products by striking a secret deal in 2018 that unlawfully increased the price of Apple products sold on Amazon's marketplace. The suit claims that the deal led to Amazon restricting sales of popular Apple products by independent merchants on its marketplace in exchange for preferential wholesale prices on Apple and Beats products.
Louis Vuitton launched an e-commerce site in India, as the company looks to tap into the growing number of rich Indian consumers that shop online. The luxury brand is offering its bags, jewelry, watches, perfumes, accessories, shoes, and apparel with a personalization service, as part of its dedicated Indian platform.
Facebook's active monthly users topped 3.08B, a 3% increase from last year and a number which represents 38.4% of the global population. India has the most Facebook users at 314M, followed by the U.S., Brazil, and Indonesia at 100M each.
Grubhub is adding new rewards to its loyalty subscription program including a 5% credit back on pickup orders, lower service fees milestone rewards, and a new Shell offering for members participating in the Fuel Rewards program. The company found that 37% more consumers in the U.S. opted to pick up their orders in 2022 than the year prior, because it was a more affordable option.Â
10. Seed rounds, IPOs, & acquisitions
AppHub, an e-commerce aggregator and app builder, raised $95M from PSG, bringing its total amount raised to $155M. The company will use some of the funds to acquire Boost, an AI-powered search and discovery app, for an undisclosed sum.
Stay Ai, formerly called Retextion, an app that helps Shopify brands build up their subscription programs, reduce the number of cancellations, and increase customer LTV, raised $15.1M in a Series A round led by Telescope Partners and Watchfire Ventures. The company will use the funds to expand its team of 50 employees, accelerate its product roadmap, and make additional acquisitions.
DHL Group signed an agreement to acquire MNG Kargo, a Turkish parcel delivery company. The acquisition will enhance the company's logistics offerings in the country.
THG, a British e-commerce group best known for its protein and beauty brands, acquired City AM, a London-based newspaper and media outlet on the verge of bankruptcy. The deal will help THG reach a new audience to complement its e-commerce businesses and will save City AM from bankruptcy.
Upgrade, a San Francisco-based fintech company that offers credit, mobile banking, and payment products, acquired Uplift, a Menlo-Park-based BNPL and credit provider to travelers, for $100M. Uplift serves 3.3M customers and partners with over 300 airlines, cruise lines and hotel chains in the U.S. and Canada, and the deal will help Upgrade build on its existing BNPL products.
GlossGenius, a booking and payments platform for salons and spas, raised $28M in a Series C round led by L Catterton, bringing its total amount raised to $70M and valuing the company at $510M. The funds will be put toward developing additional products to support beauty and wellness business owners, as well as expand its team.
Sabre Corporation, a software provider that offers solutions for travel suppliers to plan airline crew schedules and manage day-to-day hotel operations, acquired Techsembly, a hospitality e-commerce provider that enables hotels to manage multiple online property stores, products, and logistics in one centralized platform. Today is gonna be a good day! Techsembly and Sabre!
Amazon announced a revised acquisition bid for iRobot Corp, the creator of the Roomba, now offering to pay $51.75 per share, or 15% less than its previous $1.7B bid a year ago. The UK approved the deal last month, but the European Commission launched an investigation earlier this month that will conclude in November, and the U.S. FTC may launch its own inquiry on the deal.Â
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See you next Monday,
PAUL
Paul E. Drecksler
www.shopifreaks.com
[email protected]
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PS: I was surprised when the local billboard company went out of business. I never saw the signs.