Where do you start your search for products when shopping online? On Amazon or Google? Or on Craigslist like a psychopath?
Do you know what the top “wants” of online shoppers are? Are they different from yours?
Is the recession we've all been waiting for finally here?
Should governments do something about the massive amount of fake reviews online?
Is 30 days enough time to switch bookkeeping software?
I address these questions and more in this week's 71st Edition of the Shopifreaks newsletter. Thanks for being a subscriber.
Stat of the Week
1. New Google E-commerce Features
Last week at their Google Marketing Live event, the company dove into their e-commerce strategy and showcased the features they are using to attract shoppers to their platform. Here's a recap:
- Visual Search Results – including product recommendations
- Multisearch – shoppers can search by taking a photo and asking a question at the same time through the Google App
- 3D & AR Search – brands can provide 3D content feeds
- Streamlined Shopping – customers can go directly from Google to the checkout flow of your website
- Visual Shopping Ads – including new ways to showcase multiple product images
- Web to App Connect – send customers directly from mobile search to your app if they have it installed
- Product Feeds – show curated product images to people watching YouTube Shorts (coming soon to ads)
- Performance Max – measure omnichannel impact and optimize for store sales including brick-and-mortar locations, as well as drive foot traffic during seasonal promotions
- Showcase Loyalty Benefits – show your deals, free shipping, and points to shoppers in the U.S. (coming soon)
- Products Tab in Google Ads – access this at the account level to spot inactive offers in Shopping Campaigns, and coming soon you'll be able to identify products with missing attributes
Google is getting serious about e-commerce. It's about time! For the past decade, they'd been losing market share to Amazon as the starting point for where shoppers began searching for products. Consumers were bypassing Google and going straight to the source of where they'd inevitably purchase (Amazon). Now Google is working to regain that position and become your consumer entry point to e-commerce. Let's see if they can make it happen.
2. Top 10 Wants of Online Shoppers
PYMNTS and Riskified surveyed over two-thousand U.S. consumers to determine what's most important to them when shopping online. Here are the top results:
- Ability to pick up curbside – 24.7%
- An online experience that's easy and works all the time – 17.5%
- Same-day delivery – 14.1%
- Ability to use preferred payment method – 6.7%
- A physical location for service and returns – 6.2%
- Coupons, discounts, and promotions – 6.2%
- Loyalty and rewards programs – 5.4%
- Product descriptions and reviews – 4.3%
- Ability to track purchase history across channels – 3.8%
- Expedited shipping option – 3.3%
Did you know that I've never actually shopped curbside pickup before? Maybe I'm missing out! Apparently that's really important to a lot of people. I'm going to give it a shot this week.
How that does list above compare to your personal wants and expectations as an online shopper? And if you run your own online store, does your business currently live up to shoppers' expectations?
3. The recession is here
Did the recession that everyone knew was coming eventually sneak up on us? It seems to have hit the tech world this month as companies made massive layoffs.
- Klarna cut 10% of its workforce
- Bolt let go 33% of its workforce (around 250 employees)
- Getir cut 14% of its workforce
- Gorillas let go 300 employees
- Vtex is laying off 193 employees
- PayPal laid off 83 employees
- Latch cut 30 positions
- Meta and Twitter announced hiring freezes
- Snap is slowing hiring after missing revenue targets
- Instacart is slowing down hiring as well
According to layoffs.fyi, around 15,000 tech workers lost their jobs in May.
Meanwhile Amazon employees are quitting at twice the rate of recent years, which former employees attributed to the company's relatively low pay, stagnant stock price, and grueling work culture. The way things are going in the tech world this month, maybe some of them should stay put!
4. TikTok's new WooCommerce integration
TikTok announced a new integration with WooCommerce that will enable WooCommerce merchants to sync their store catalogs with their TikTok profile, powering its more advanced product display offerings
The new plugin / integration lets merchants sync their store catalogs, install the most advanced TikTok pixel for tracking campaign performance, and create ads to target audiences.
WooCommerce is surprisingly late to the TikTok party, especially given its e-commerce market share. TikTok has offered this integration with Shopify since late 2020, as well as with Equis, PrestaShop, and Wix since October, and with Pinterest since last month.
Better late than never! The TikTok integration is a welcome addition for WooCommerce users like myself.
WooCommerce also announced an integration with Affirm to offer BNPL services to merchants at checkout in the US, and via their sister-company PayBright in Canada.
So now customers of WooCommerce stores can discover products for sale on TikTok and pay for them in 3-interest free installments. Can life get any better?
5. Shop Promise vs Amazon Prime
In April, I reported on Amazon's new “Buy With Prime” feature for e-commerce websites. Participating websites will be able display the Prime logo and expected delivery date next to their products, and the checkout will happen on their store, however, Amazon will fulfill the orders and manage the free returns for the seller.
It didn't take long for Shopify to respond and create a badge of their own called “Shop Promise”. Participating merchants will be able to display a Shop Promise badge on eligible products that lets customers know the product is covered by two-day shipping and an easy return policy.
Most likely the service is being built to compete with Amazon in preparation for their acquisition of Deliverr, which would allow them to have tighter control over delivery time, since they'd be fulfilling the orders.
The service is currently not widely available, but interested merchants can sign up for a waitlist.
6. India is tired of fake reviews
India's consumer affairs ministry and Advertising Standards Council of India (ASCI) held a virtual meeting last week with e-commerce entities including Amazon, Flipkart, Tata Sons, Reliance Retail, and others, to discuss the magnitude of fake reviews on their platforms, which the government feels misleads consumers into buying online products and services.
Consumer affairs secretary Rohit Kumar Singh said, “Given that e-commerce involves a virtual shopping experience without any opportunity to physically view or examine the product, consumers heavily rely on reviews posted on e-commerce platforms to see the opinion and experience of users who have already purchased the goods or service”
Fake and misleading reviews violate consumers' right to be informed, which is granted under the Consumer Protection Act of 2019.
The purpose of the meeting was to prepare a road map ahead. All entities agreed that the “traceability” of product reviews is the first important step in addressing the issue of fake reviews. In other words, did the person leaving the review actually buy the product?
The group also discussed whether or not the platforms should be held responsible for whether the review is positive or negative since it is the view of the consumer.
Also in India, Google is in talks to join their new Open Network for Digital Commerce (ONDC). Currently, Google's shopping business works solely as an aggregator of product listings and doesn't carry offer any order fulfilment like Amazon and Flipkart, so it'd be an easy decision to join. Two weeks ago, I reported that Amazon, Flipkart, and Retail Alliance were also in talks to join ONDC.
7. GoDaddy Bookkeeping shuts down
Last week, GoDaddy sent an e-mail to their bookkeeping software clients, which is used heavily by online sellers, particularly eBay sellers, announcing that they will be shutting down the service on June 23rd, 2022.
What bookkeeping service do you use to run your business? QuickBooks, maybe? Xero? Freshbooks? An Excel spreadsheet?
Whichever you're using, imagine that you were told today that you have 30 days to find a new solution for your bookkeeping — which currently integrates with your e-commerce website, your POS system, and various online marketplaces via Zapier connections that you paid some developer on Fiverr to help set up for you eight years ago….
Would 30 days be enough time for you to find a new solution?
Small business owners are not experts, or even up-to-date, on the latest bookkeeping software options. Most businesses make this decision once, and then the software runs in the background for eternity. Choosing a new bookkeeping software is not a decision that business owners expect to reevaluate often, especially on short notice.
Two weeks ago, I reported that Selz (owned by Amazon) gave their clients 60 days notice that they'd be shutting down their e-commerce platform. And even I thought THAT amount of time wasn't enough!
I hope that this isn't going to become a trend, where SaaS products start giving their clients 30-60 days notice that the products, which they've built their online businesses around, are shutting down. I'd imagine that the management at Amazon and GoDaddy who made these decisions have never owned and operated a small business before.
So while they may rationalize, “30 days is enough time. You just simply export your data here and then you import it to this other service and then reconnect all your banks and integrations, and then you're all set. Easy peasy.”
What they fail to realize (or care about) is the untimely interruption to a small business that's involved with choosing a new software, finding a developer to implement it, troubleshooting and learning the new software, and training your staff on how to use it — all in 30 days.
What really grinds my gears is that both recent culprits — Amazon and GoDaddy — are international companies with many arms to their businesses. In other words, they aren't a small startup that only has 30 days of runway capital left and are having to unexpectedly close their doors and shut down their servers.
We're talking about two goliath companies that could have easily offered 6 months notice to their customers. Transitioning to a new online marketplace or bookkeeping software is still a pain no matter what, but six months would have been a reasonable amount of time to make it happen. (Believe me, I know what I'm talking about here. I'm a developer.)
What are your thoughts? Is 30-60 days a reasonable amount of notice to give customers before shutting down a SaaS product?
8. Other e-commerce news of interest this week
- Amazon tried to put off multiple FAA investigations into its drone crashes by claiming that the company has the authority to investigate its own crashes. Amazon has experienced at least eight drone crashes in the past year, including one that sparked a 20-acre brush fire in eastern Oregon last June after the drone's motors failed.
- Amazon opened its first brick-and-mortar clothing store, Amazon Style, in Glendale CA, which uses QR codes to make trying on clothes easier. Customers can use an app to do things such as requesting items without leaving a fitting room.
- Microsoft launched its low-code website builder, Power Pages, as a stand-alone product to help developers design, manage, and publish sites for desktop and mobile.
9. This week in seed rounds, IPOs, & acquisitions….
- clickOH, an Argentina-based shipping technology company that enables sellers to track shipments in real time, raised $25M in a Series A round led by Tiger Global, bringing their total amount raised to $33M. The company will use the funds to expand throughout Latin America.
- Nomagic, a Polish startup that's built a robotic arm that can identify and pick out an item from an unordered selection and then move or pack it into another place, raised $22M in a round led by Khosla Ventures and Almaz Capital. The company will use the funding to expand and grow its technology, including developing radio-wave scanning to identify items.
- Zowie, a conversational AI chatbot for e-commerce brands to offer customer support and sales, raised $14M in a Series A round led by Tiger Global Management, bringing their total amount raised to $20M. It will use the funding to improve its automation and bring its platform to email and other channels.
- Firework, a livestreaming commerce platform, raised $150M in a Series B round led by SoftBank Vision Fund 2, bringing its total amount raised to $235M. The company will use the funding to focus its efforts on growth of their headcount, user base, and technology.
- JABU, a Namibia-based last-mile distribution e-commerce company that allows merchants to order, stock and pay for their products and receive same-day delivery, raised $15M in a Series A round led by Tiger Global. The company will use the funds to deepen its presence in Southern Africa and expand to new markets later this year.
- Staytuned, a provider of revenue growth tools for Shopify merchants, acquired Moonship, a Shopify app that creates personalized discounts for on-the-fence shoppers, for an undisclosed amount.
- Astro, a Jarkata-based 15-minute grocery delivery service, raised $60M in a Series B round led by Accel, Citius, and Tiger Global, bringing its total amount raised to $90M since launch nine months ago. The company will put the funds towards user acquisition, product development, and hiring more staff.
- ShipX, a New York-based e-commerce delivery startup, acquired Princeton Logistics group and its subsidiary, TriStar Carriers, for an undisclosed amount to expand its transportation portfolio beyond final-mile parcel delivery. The acquisition will allow ShipX to arrange first-and middle-mile transportation services to e-commerce customers needing specialized trucking options, as well as strengthen its door-to-door parcel delivery services across North America.
- BUD, a virtual platform for users to create interactive shared 3D content, raised $36.8M in a Series B round led by Sequoia Capital India, bringing its total amount raised to $60M. The company will use the funding to add NFTs to its platform as part of a push into Web3.
- Tranch, a London-based BNPL platform for SaaS sellers, raised £3.5M in a pre-seed equity and debt funding round led by Flash Ventures. Tranch combines traditional credit reports with Open Banking to offer a way for suppliers to provide their clients with flexible payment terms on contracts, while they receive payments upfront.
- Bubblehouse, a social NFT marketplace, raised $9M in a round led by Cassius Family. The company will use the funds to expand its marketplace and portfolio of partners across brands, art, athletics, hospitality, music, fashion, and influencer categories.
- Paddle, a London-based payments platform for SaaS companies that recently raised $200M at a $1.4B valuation, acquired ProfitWell, a set of tools to provide analytics and retention tools to companies that sell subscription products in a deal valued at $200M. Paddle is acquiring the company for ProfitWell's technology and 30k customers.
- Finn, a German-based car subscription platform, raised $110M in equity and $720M in asset-back debt in two separate rounds. The company will use the funding to purchase new vehicles and scale its fleet in existing and upcoming markets.
- Buywith, an Israeli-based livestreaming shopping platform, raised $9.5M in a round led by igniteXL Ventures. The company will use the funds to grow its sales, marketing, and R&D teams, as well as create a self-serve marketplace where brands can select the host for livestream shopping sessions among a community of creators.
- ZoodPay, a Switzerland-based BNPL platform operating in the Middle East and Asia, acquired Tez Financial Services, a Pakistani consumer lending fintech, for an undisclosed amount. Through the acquisition, ZoodPay will enter Pakistan as a new player in its digital lending and fintech space.
- Bloom, a European revenue-based financing platform that offers a pay-as-you-go feature, raised £300 in a round led by Credot Capital and Fortress Investment Group LLC, bringing its total amount raised to £307M. Bloom concentrates its service on online commerce companies.
- Assembled, a workforce management platform for customer support teams, raised $51M in a Series B round led by New Enterprise Associates, bringing its total amount raised to $71M. The new funding will be put toward product development, including schedule optimization algorithms and integrations with HR software, as well as towards a continuing educational initiative for their support workers.
- OlaClick, a platform that enables restaurants in Latin America to facilitate D2C commerce by providing them with POS and CRM services and digital menus, raised $4.4M in a round led by Gradient Ventures, Google's AI fund. The company will use the funds to expand its engineering and product team and broaden the offerings to restaurant partners.
What'd I miss?
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See you next Monday!
Paul E. Drecksler
PS: Why do seagulls fly over the sea? If they flew over the bay, they would be bagels.