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Intro: This week in e-commerce, companies are getting more serious about three things:
- Creators
- Rewards
- and launching the holiday shopping season as early as possible!
In this week's edition of Shopifreaks, I report on PayPal's new rewards program, Walmart and Klarna's new creator platforms, and Walmart, Amazon, and Target's push to get consumers shopping early this year.
I also share stories about the FTC cracking down on fake reviews, Uber launching ads inside cars, and Flipkart's new shopping metaverse.
All this and more in this week's 92nd edition of Shopifreaks. Thanks for subscribing and sharing!
Poll of the Week 🗳️
“Should consumers tip Amazon delivery drivers?”
Startup Drivr wants consumers to tip last-mile delivery drivers, but others feel that tipping culture has gotten out of hand and this is just another example of that. What are your thoughts? Take the poll.
➡️ Click here to vote and discuss. ⬅️
Last Weeks Poll Results: 62.5% of respondents DO NOT want drones flying through the air and delivering packages in their city. [View Poll]
Stat of the Week 📈
78% of Indian consumers are now shopping online more than before the pandemic. 85% plan to spend more than ever this festive season. – According to Shopify
Share this week's stat on Twitter & LinkedIn.
1. PayPal debuts Rewards
In 2019, PayPal acquired the Honey brand, a browser extension that curates and auto-applies discount codes at checkout to major brands and retailers, for $4B. Honey also offers Honey Gold (rewards) on select purchases.
I've used the extension for many years (including prior to PayPal's acquisition), and I love it. Honey makes searching for discount codes easy, and it reminds me to do so when I forget.
The rewards are only okay, but to be fair, I'm not a big shopper, so other people probably earn a lot more than me. After like 5 years of being a Honey user, I just cashed out my first $10 gift card to Amazon through Honey Gold. However the discount code feature is great. PayPal reported that consumers have collectively saved over $200M through the Honey cash back and discounts program.
Well, flash forward three years after its acquisition, and PayPal is now replacing the Honey Gold rewards with its new PayPal Rewards, which launched last week.
With the new PayPal Rewards, consumers will be able to track and redeem their points directly inside the PayPal app, and will have new ways to earn.
With the launch of PayPal Rewards, the company is combining earned rewards across multiple PayPal products including:
- Honey browser extension
- PayPal app
- Various card products
- Personalized engagement in the PayPal app like linking a debit card or bank account to their PayPal
Rewards points can be converted to cash back at a rate of 100 points equaling $1, which can then be left in the users' PayPal balance or transferred to their bank account of choice.
Everyone's jumping on the rewards bandwagon lately.
In August I reported that Walmart introduced a new digital cash back perk for Walmart+ members. In September, Revolut launched Revolut Pay with cashback rewards. And last week, I reported on Apple's new high yield savings account which iPhone users can put their Daily Cash rewards from their Apple Card.
For a long time, rewards were mostly in the hands of credit card companies, who'd partner with retailers to offer branded cards. However now that there are a MILLION AND ONE different payment options available for consumers, it makes sense that retailers are taking back ownership of their cash back and rewards programs.
2. Walmart's content creation platform
Walmart is launching a new content creation platform to allow influencers and other creators to make social media posts and earn commission on the products they sell. The platform encourages two-way engagement, where creators apply to the partnership directly through the retailer.
So, they're finally doing the bare minimum it takes to run an affiliate program? They've technically had one for years, but put minimal effort into it.
The new Creators program is powered by Impact.com, which is hilariously not mentioned at all in Walmart's press release, but proudly boasted by Impact on their announcement. That doesn't seem very appreciative of your tech partner, Walmart!
Through their new Walmart Creator portal, the company hopes to “democratize” the creative process for e-commerce and social media by letting artists monetize shoppable products.
The platform also comes with a full set of traffic analytic tools that users can access to track and analyze the performance of their own sites. It is currently in Beta, but Walmart plans to expand the program with a full launch in 2023.
William White, chief marketing officer, Walmart U.S., said, “We know our customers are inspired by the content and stories they see from their favorite influencers in their social feeds every day. This next step in our strategy will help fuel inspiration for our customers by connecting their favorite creators directly with our brand and the brands they love at Walmart.”
Good for Walmart for bringing their affiliate program into the 21st century. Jokes aside, I hope that it's a tremendous success for them, but at the same time, those creators on their video seem way too excited to be promoting Walmart!
3. BigCommerce News (Sponsored)
BigCommerce announced Jimmy Brings, one of Australia's largest express alcohol delivery services, has launched a progressive web app (PWA) storefront built on BigCommerce’s headless architecture. Jimmy Brings is also one of the first ecommerce platforms hosted locally by BigCommerce in the region, minimizing the potential for disruptions to occur.
“Delivering customer satisfaction is paramount to the Jimmy Brings brand,” said Elliot Krass, head of product at Jimmy Brings. “Our business is hyper-localized, with a complex operational model which operates at speed. We need certainty that when anyone visits our website or app, they can onboard and purchase with the least friction. Otherwise, the Jimmy Brings experience is diluted.”
Jimmy Brings joins a growing list of food and beverage merchants using BigCommerce including Santa Monica Seafood, King Arthur Baking Company, Marquis Wine Cellars, Shopwine Direct, and Con' Olio Oils & Vinegars.
4. Klarna's newest features
Klarna announced a number of product innovations branded under the Klarna Spotlight name, including:
- Search tool that allows users to compare prices across thousands of retailers with the ability to sort results by color, size, features, customer ratings, store availability, and shipping options.
- Shoppable video stream where users watch a video in the Klarna app, such as unboxing a product or a review video, and then shop for the item right from the video.
- Upgraded CO2 and charitable donation features to give Klarna users deeper insights into the environmental impact of their purchases.
- Creator Platform which aims to be a one-stop shop for retailers and creators to work together to automate everything from initial outreach, to partnerships, to tracking sales, and commissions. More on that below.
Through the platform, creators have direct access to Klarna's largest retailers and hundreds of thousands of products that they can recommend to their followers. In turn, retailers on the platform can connect with Klarna's more than 500k creators and track their performance in real time.
In August, I reported on the launch of Shopify's internal affiliate marketplace called Shopify Collabs that's powered by the influencer marketing app, Dovetale, which Shopify acquired in April.
At the time, I mentioned that launching an affiliate network could be a game changer for the company… if done right.
Operating as an affiliate network makes you the middle man between merchants and affiliates — who sometimes can be at odds with one another. Commissions need to be paid out on time… Brands have advertising guidelines that need to be followed by affiliates… There's also fraud and unscrupulous affiliate tactics to deal with. It's not as simple as merely connecting creators with brands and letting the good times roll. It's not as easy and hands off of a cash grab as it may seem to these companies.
So while Shopify Collabs — or Klarna Creators — or Walmart Creators — could be gamechangers for those companies, proper execution is going to be key to their success.
5. Early, early, early Black Friday
Walmart is expanding its Black Friday deals for the entire month of November in an effort to get customers spending more, at a time when many shoppers are cutting back.
Last week I reported that Affirm expects only 42% of Americans will buy gifts for co-workers this year, down from 79% last year, as they begin to dial back their spending.
Walmart will kick off the first of four “Black Friday Deals for Days” events on its website Nov. 7, followed by three other week-long sales that end with its Cyber Monday.
This year Amazon also got an early start to holiday promotions with its first ever Prime Early Access Sale which ran from Oct 11-12th, during which Walmart also ran its “Rollbacks and More” savings event.
Target also launched deal days Oct. 6-8th this year.
Take a chill pill retailers! What's next — “Back to School Holiday Shopping Black Friday Prime Day Extravaganza Diwali” promotions?
It seems that big box retailers know something about the state of our economy right now — which is that it's going to be a dismal shopping season — and are trying to get out ahead of each other in earning your holiday dollars.
6. FTC cracks down on fake reviews
The FTC on Thursday voted 3-1 to solicit public comment on the potential for new regulations around fake reviews online.
The notice will call for comments about the prevalence of fake reviews and how they affect consumers, in advance of the FTC potentially crafting new regulations, and will last for 60 days.
For online brands and sellers, this could mean further penalties for hiring people to write fake reviews or changing rules around incentivizing reviews.
Commissioner Christine S. Wilson voted against the measure and warned that the agency may be over-reaching, claiming that there’s already a strategy in place to address fake reviews, which includes endorsement guidelines and civil penalties up to $44k per violation.
She's right, but does the FTC actually enforce their rules?
Historically, one could have easily made the argument, “No, they do not enforce their rules.” However in recent years, that's started to change:
- Feb 2019 – FTC brought its first case challenging a company's use of fake reviews against Cure Encapsulations and its owner, Naftula Jacobowitz.
- Oct 2021 – FTC sent a Notice of Penalty Offenses to more than 700 companies, placing them on notice they could incur significant civil penalties if they kept up their shenanigans.
- Jan 2022 – FTC announced a settlement with Fashion Nova for $4.2M over allegations it suppressed bad reviews on its website for roughly four years.
- Aug 2022 – FTC along with six states filed a lawsuit against rental housing platform Roomster over allegedly paying for fake reviews and putting up fake listings.
Wilson said, “Rather than churning out another proposed rule, perhaps we should stay the course on these initiatives and devote the incremental resources to enforce other critical areas.”
What do you think? Should the FTC create more rules or further enforce the ones they've got first? Hit reply and let me know.
7. Flipkart's shopping metaverse
Flipkart, in partnership with Web3 entertainment firm eDAO, announced the launch of Flipverse, a metaverse space where consumers can discover products in a photorealistic virtual destination and shop on Flipkart App.
Flipverse will offer a gamified and interactive virtual shopping experience for consumers in a digital world by giving them access to brands, Supercoins and digital collectables.
The virtual world will be available on Flipkart's newly launched platform FireDrops, which can be accessed from the app.
And get this… phase one will only be available on Android! Finally, something cool comes to Android before iOS!
Earlier this month, I reported on Walmart's entry into the metaverse through two new Roblox experiences: Walmart Land and Universe of Play.
Between Walmart's meta worlds and Flipverse in India, the company is showing its global efforts of being an early adopter of metaverse technology. Sure beat's Mark Zuckerberg's avatar legs.
8. Enjoy this ad in your Uber
Uber launched a new advertising unit that will enable brands to deliver ads to their 122M monthly active users.
- Car Top Ads will allow brands to display promotions on a sign installed atop an Uber vehicle.
- Tablets attached to the back of seats will allow brands to display promotions inside vehicles.
- Restaurants will gain the ability to promote menu items in the Uber Eats interface and deliver shopping recommendations after purchase.
- Sponsored Emails will make it possible to deliver promotions to users’ inboxes.
- Lastly, Uber plans to roll out an advertising service focused on consumer packaged goods companies.
Mark Grether, the general manager of Uber’s new ad unit, said, “We have a global audience of valuable, purchase-minded consumers who, as part of our core business, tell us where they want to go and what they want to get. While these consumers are making purchase decisions and waiting for their destination or delivery we can engage them with messages from brands that are relevant to their purchase journeys.”
All these ads will subsidize the cost of the rides and make ridesharing cheaper for users, right? LOL don't hold your breath. Uber hopes these new ads units will grow its annualized ad revenue to $1B by 2024.
More than 40 brands have already partnered with Uber's new ad unit, which is available in several dozen countries with further expansion happening next year.
I can see it now in 2024…
“Introducing Uber Premium, a new ad-free experience. Turn off those pesky in-vehicle ads that we introduced last year with our $29.99/month premium subscription.”
9. Other e-commerce news of interest
Shopify hired Elwood Edwards, the iconic voice behind AOL's “You've got mail” to inform sellers that “You've got sales” as part of its new campaign. The ads featuring Edwards' voice will run through the end of the year.
Six months into the crypto downturn, many crypto firms are continuing to cull jobs in an effort to stabilize their businesses, except for Block, which is on a hiring spree to build out its Bitcoin mining and wallet hardware businesses. The company is hiring heads of Bitcoin mining policy, communications, and partnerships, according to several job postings.
Meesho, a Bengaluru-based social commerce platform backed by Meta, is beating Amazon and Walmart when it comes to attracting new shoppers in India. Meesho was the world’s most-downloaded shopping app during the first half of this year, with over 127M downloads, compared to 81M downloads for Amazon and 50M for Flipkart.
Amazon says over half a dozen hardware vendors have indicated that they cannot enter into a TV manufacturing relationship with them over fear of retaliation from Google. The manufacturers had concerns that by working with Amazon on Fire OS-powered TVs, they might be risking their GMS license from Google for other businesses.
Amazon will stop supporting its Glow video calling device for kids. Last month, the company announced it was discontinuing sales, and it recently confirmed that the devices themselves will stop working entirely at the end of the year.
Amazon is also shutting down Fabric.com, one of the largest online fabric stores that it acquired in 2008. Insiders say that Amazon didn’t understand even the basics of selling fabric and weren't very committed to selling the product. Sell the business to someone who knows fabric!
Visa is bringing its BNPL program to more Canadian retailers through its Visa Installments and Visa Direct solutions. Visa research found that when Installment options are available at the checkout, retailers see an increase in spend and conversions.
Amazon is launching a home insurance portal in Britain and has signed up three big-name insurers. The new portal, Amazon Insurance Store, will include customer reviews and ratings on insurance companies and the rate at which the claims were accepted for policies offered.
Revolut has launched Homes, a holiday home rental feature with cashback in travel services, as part of its accommodation booking service, Revolut Stays. Customers can book a stay on Homes and get up to 4% cashback in the UK and Europe.
Sun Finance is launching its new BNPL service in Latvia, where the company's headquarters are located. The fintech operates in seven countries and has more than 9M registered users of its credit products.
Taobao announced that it will launch an updated version of its senior citizen shopping feature that will include new features to protect senior customers' rights by supporting them in the product refund process, offer them the option to shop for medicine and groceries, and connect them with free pharmacist consultations. When surveyed whether they like the new features, senior customers said, “WHAT??”
Speaking of helping elderly shoppers, JDopened a service section dedicated to educating elderly shoppers at its JD Home Appliance Flagship store in Deyang, Sichuan, where the service team will suggest electronic products that are simple to use as well as teach them how to use them.
Advertising Standards Association (ASA) has banned a series of Instagram posts by Clearpay, the European division of the BNPL firm Afterpay, for being “socially irresponsible” and “making light” of not having self-control when shopping. Clearpay said the ad suggested turning off notifications to avoid irresponsible spending and that its intention was to educate about irresponsible lending. Uh huh…
The European Commission is looking to make good on its 2017 antitrust decision against Google Shopping abusing its dominance by banning the search engine from displaying its own shopping comparison ads units in search results. The commission argues that the revenue-generation ads are self-preferencing and constitute and ongoing competition abuse by the company.
Square launched Square for Retail and Square Appointments, enabling sellers to offer on-the-go checkout experiences at almost any location throughout the store. Earlier this month I reported that Shopify launched POS Go, a new handheld tool that operates as a fully functioning mobile POS terminal.
Karma, an Israel-based shopping app, rolled out a new payment feature called Pay with Karma (very creative) that offers one-swipe purchases with multiple payment options. The feature offers popular payment options like credit/debit cards, Apple Pay, Google Pay, etc, and introduces BNPL to their mix.
Pinterest Trends Tool is expanding with a new API for Conversions that gives advertisers a full view of their campaign performance and actions their audience took on the site. It also added three new features including a widget on the homepage, filters by demographic, place, time, and topic, and new trends types including seasonal trends.
Jane Technologies launched its new iOS app called Jan app, which enables users to discover cannabis products based on local inventory, verified reviews, feelings & effects, and personalized recommendations. I'm honestly surprised that made it into the Apple app store, but good for them!
Speaking of chronic, Uber Eats and Leafly partnered to bring cannabis delivery to Toronto. This is the first time cannabis delivery will be available on a major third-party delivery platform in the world. Don't forget to tip the driver!
Instacart saw its sales grow 4% YoY and 3.5% YTD, a stark drop from their sales growth earlier in the pandemic. Now the company is facing more competition, including internally from their own partners, as retailers build out their own logistics operations, which often provide better value propositions to customers compared to Instacart’s model.
UPS is raising the cost of shipping by almost 7% after Christmas to match FedEx's increase for 2023. Sellers will also see higher fees for late payments and address corrections.
YouTube is expanding its access to social shopping tools, which was previously in beta with just 1000 creators, so that more creators can make their videos shoppable. By year's end, YouTube members of the Partner Program in the US, UK, Brazil, and India with at least 20k subscribers will be able to tag their videos, Shorts, and live streams with shoppable links.
Etsy introduced Boosted Listings on its Depop marketplace, which it acquired last year for $1.6B. Sellers who use the ads will pay 8% when an item is sold.
10. Seed rounds, IPOs, & acquisitions
Amazon is poised to take a stake in Hawaiian Holdings, Inc., the parent of Hawaiian Airlines, as part of a deal to expand its cargo-hauling operations using a fleet of Airbus SE freighters. The group issued warrants allowing Amazon to acquire up to 15% of its outstanding shares, exercisable over the next nine years.
Credit Key, a B2B payments startup that serves SMBs with POS solutions with built-in BNPL functionality, raised $15M in equity funding in a round led by RedBird Capital, Bonefire Ventures, and Greycroft, and $100M in debt facility from affiliates of Fortress Investment Group. The funds will be used to expand the capital it can offer the businesses using its POS solution.
Banyan, a startup that helps companies more closely align their products and sales promotions with customer preferences, raised $28M in equity funding and $15M in venture debt in a Series A round led by Fin Capital and M13. The platform has so far processed data on a combined GMV of over $400B and is primarily used by banks, financial technology startups, hotel operators and retailers.
Kudos, a Chrome extension that holds all your cards and then calculates the rewards and benefits for each purchase to recommend the right card, raised $7M from its existing investors which include Patron, QED Investors, and a group of over 40 angel investors from Google, Affirm, AfterPay, Honey, and more. The extension has been in beta the past three months and didn't have a waitlist, but the company said it's seeing 36% MoM growth and 90% retention so far.
Blibli, an Indonesian e-commerce group that's backed by of one of the country's biggest conglomerates Djarum Group, aims to raise $528M through its upcoming IPO on Nov 7, which could boost its valuation to $3.5B. The company will use the proceeds to pay back bank loans, with the rest to be used as working capital to develop its platform.
General Atlantic, a New York-headquartered growth equity investor, is in talks to invest $50M in Acko, an India-based digital insurance platform that sells bite-sized auto insurance products, healthcare protections to employers, and protection on gadgets. The new round is likely to move ahead at a flat valuation of $1.2B, but the investment hasn't closed, so terms of the deal may still change.
Bumpa, a Nigerian retail automation platform that enables African small business owners to start, manage, and grew businesses from their mobile devices, raised $4M in a round led by Base10 Partners. In August, the company integrated with Meta to allow merchants to receive DMs from their customers on Instagram, Facebook, and WhatsApp, where 40% of orders on its platform were originating from .
Aramex, a multinational logistics, courier and package delivery company based in Dubai, acquired MyUS, a US-based cross-border e-commerce enabling platform that delivers over 1M packages a year. MyUS will retain its brand name and form part of Aramex’s subscription-based last-mile e-commerce solutions platform, Shop & Ship.
MaxAB, an Egypt-based food and grocery B2B e-commerce and distribution platform serving Egypt and Morocco, raised $40M in a pre-Series B round, bringing its total amount raised to $100M. The funds will be used for growth and expansion across the MENAP region.
Fundiin, a Vietnam-based BNPL firm with more 300 partners, raised $5M in a Series A round co-led by Trihil Capital and ThinkZone Ventures. The company will use the funds to develop new products and accelerate its expansion plans into Indonesia during its upcoming Series B raise.
Ambi Robotics, a company that enables warehouses to pull items from bulk inventory by using vision to guide robotic arms to grasp and then sort items, raised $32M in a round led by Tiger Global, Bow Capital, and Pitney Bowes, bringing its total amount raised to $67M. Ambi is completing installation of more than 80 of its Ai-powered parcel sorting systems across the U.S.
Sezzle, a U.S. BNPL firm, signed a new $100M credit facility with affiliates of Bastion Management, which will work as an administrative agent for the lenders. The new credit facility offers a secured overnight financing rate of 11.5% and will offer the company expanded capacity into 2024
Bolster, a deep learning-powered fraud prevention platform, raised $15M in an extended Series A round led by Cervin, Liberty Global Ventures, and Cheyenne Ventures, bringing its total amount raised to $32M. The platforms scans 2M URLs daily and claims to deliver phishing detection verdicts at under 100 milliseconds with a one-in-100k false-positive rate.
Enable, a platform that helps B2B companies manage their rebate programs, raised $94M in an oversubscribed Series C round led by Insight Partners, bringing its total amount raised to $156M. The funds will be put towards increasing their headcount and expanding to new markets, particularly Europe.
Kenzz, an Egyptian e-commerce platform that sources products directly from local manufacturers and offers them to consumers, raised $3.5M in a round led by Outliers Venture Capital. The company will use the funds to grow its product categories, hire talent, and invest in tech as it launches its app.
Maplerad, a Nigerian banking-as-a-service platform targeting Africa, raised $6M at a $30M valuation in a round led by Peter Thiel's Valar Ventures. The startup will use the funds to acquire more customers, get additional licenses, and build its team.
Mason, a Swedish productivity app for data analytics that just launched their limited beta, raised $1.7M in a pre-seed round led by Creandum. The funding will be used to grow their team and evolve the product.
Starboard Value announced that it's taking a significant take in Salesforce, as well as interested in Wix and Splunk. Starboard concluded that Salesforce could be offering investors a better return on its $50B revenue target for 2026.
Kudos, a smart wallet that helps users maximize their credit card rewards and hidden benefits when shopping online, raised $7M in around led by Patron. The company will use the funds to launch additional cashback boosts across 12k merchant partners.
What'd I miss?
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PAUL