Electric Thoughts in a Digital Era

Category: 10 stories that got my attention

  • The 10 e-commerce stories for the week ending 01 February 2013

    Google Shopping taking market share from Amazon, Amazon posts results and Andreessen predicts the death of retail.

    The second month of the year has started and last week was dominated by Amazon’s results. Amazon posted results that lead to a stock price increase. I think anybody that keeps an eye on ecommerce in North America would not be surprised with the record number of sales that Amazon did in 2012. The results did contain a few interesting snippets; third party marketplace transactions were more than those of merchandise sold my Amazon. I believe strongly that this trend will continue in the coming months. Secondly, digital media and in particular eBooks created several Billion dollars in transactions. This was a significant disclosure by the CFO of Amazon during the analyst call. Will Amazon ever become a profit making machine or will it continue to be a low margin high volume business?

    Wired featured an article this week on Google’s Plan to Snatch Shopping From Amazon Is Working – It is linkbait and in all honesty contains thoughts that I don’t agree with. The big issue I have is that the author misses one thing. I agree with the fact that shoppers in the US either start shopping with a search on Google or open their browser on Amazon.com. The search on Google is being infiltrated by Product Listing Ads and in all honesty it is becoming more difficult to find non Google businesses in the search results in the US. What the author misses completely is that Amazon has a very successful loyalty program called Amazon Prime and that ensures that users don’t bother with doing any commerce related searches on Google. So my questions is simple, how does Google’s plan work with the users going directly to Amazon.com?

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  • The 10 e-commerce stories for the week ending 25 January 2013

    Will Google Shopping Become a Marketplace? Google exceeds expected financial results, Amazon invests in a  text to speech service and much more.

    The past week contained quarterly results for Google.  Google exceeded the market expectations primarily due to its advertising business. Google’s results were very interesting as international revenue was 54% of  Q4 revenue generated. The Motorola acquisition is in my mind a long term financial disaster for both companies. Google will continue to sell assets that Motorola Mobility business had until they are left with almost nothing. Did anyone else notice the lack of facts about Google Plus during the results presentation?

    One idea that continually raises its head is the thought that Google Shopping might become a marketplace. It makes sense as Google has a lot of services that can be used to create the commerce value chain. Google Wallet, Merchant feeds, Google Trusted Stores, Bufferbox which can be used as a logistics solutions and an advertising platform that be used to build a solid competitor against Amazon. Whether Google wants to play in the marketplace space is another question for another post.

    I missed mentioning eBay’s results from the 16th for some unknown reason. I think eBay is no longer a company that can be seen as a commerce nobody. Yes, I know their search is broken and that they are not seen a traditional ecommerce businesses. I must confess, eBay has flown below the radar for a while and I think 2013 is a year in which they make their case for being an Amazon competitor. Yes, I said it. Amazon competitor. Disrupt the disruptor and John Donahoe has done that with his mobile play. In my own mind, eBay is the furthest advanced in terms of of mobile commerce than any of the big players. Thus the lessons they have learned is going to benefit them greatly in the long run..

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  • The 10 e-commerce stories for the week ending 18 January 2013

    Jack Ma to retire, Hybris to IPO? and ecommerce in South Africa

    The past week has been an interesting one. IPO’s seems to be a topic of note in 2013 and Alibaba is seemingly getting their house in order to go public in the next 18 months. Ma is retiring in May 2013 from being CEO of Alibaba and moving away from being in charge is a strategic move. Ma has been accused in the past of not disclosing information regarding holdings and if he is seen as being in charge of Alibaba when they do go public it will hurt their potential of investment. Even if Ma is not CEO or President of the company, he will likely become chairman of the company, so he will still be in control of the long term strategy. Alibaba is his offspring and he will ensure that it does well in the long term.

    If Alibaba goes public, I think we will see an increasing amount of Alibaba businesses going into Asia and Australia. Asia is at the moment a straight battle between 2 giants (Alibaba and Rakuten) and upcoming ecommerce businesses which are either funded (Rocket Internet, MIH, eBay and Amazon) and unfunded (startups).

    At the moment ecommerce platforms or software providers is a vertical that is tightly monetised and scrutinised by corporates. The corporate owners of ATG, GSI Commerce, Magento and Hybris are all looking to own a specific part of ecommerce landscape and make considerable returns on investment. ATG is owned by Oracle and has flown by the radar for a very long time and service businesses like Walmart. GSI Commerce and Magento is owned by eBay and it is slowly becoming clear what the value of the holdings are for eBay. Hybris is a company that intrigues me and has flown below the radar. Enterprise ecommerce solutions is going to become increasingly important as ecommerce becomes more mainstream in developing economies.

    The stories that caught my attention for the past week:

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  • The 10 e-commerce stories for the week ending 11 January 2013

    Foundem starts legal proceedings against Google in the UK, Bezos does not care about profit margins and 2012 was a good year for South African ecommerce

    The first real  working week of 2013 is in the record books and the news from across the ecommerce globe confirms it. Legal issues is starting to make news again and it seems that the word “anti-competitive” is back in the lights. Google has been accused of being anti-competitive by UK vertical search engine Foundem. The European part of the Google ruling has not been done and may potentially not be like those seen with the FTC.

    Secondly, the Bazaarvoice acquisition of Power Reviews may also be potentially create results that ensures that the acquistion ensures changes to the Reviews market in North America. I am not a lawyer but it seems anti competitive acquisitions by companies that have potentially have huge implications on a specific market or vertical always creates activity for the Department of Justice.

    One other story that has really interesting implications is Rakuten’s decision to “retire” buy.com and rebrand the business to Rakuten Shopping. It is becoming clear that this is the strategy that Rakuten does. Acquire a business, rebrand it and then potentially change the business model. Marketplaces seems to be their business model of choice.

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  • The 10 e-commerce stories for the week ending 28 December 2012

    Logistics is now a battleground, Apple and Google fighting over mobile, Amazon says a lot but it has no meaning and news from China, India and Malaysia.

    As far as I am concerned 2012 is now in the record books. One working day left until 2013 and all the challenges it brings with it. Let me say this, I am looking forward to 2013 as I think we are in a bumper year of news. I am expecting a tough financial climate from April but in terms of ecommerce I think 2013 is a big year. Do Alibaba IPO? Is Groupon still around in 12 months time and does Rocket Internet have a plan for continued cloning or disruption (I think so, their businesses have raised big capital..).

    If I look back over my posts in the last 12 months (yes, readers I know the content was not flowing the entire year), a few things stand out for me:

    1. Amazon is a freight train that is going into territories that makes a wide range of competitors concerned. I am honest, I think Google and Amazon is going to headline 2013. Bezos wont relent until his creation owns the retail online space. No one is standing between him and the end goal.
    2. eBay is standing at the door and the more I think about what they are doing, the more I think they have potential to be a story for 2013. Their mobile business is going into territories that not many have gone to.
    3. Developing markets are now where the innovation happens. I spent a few weeks outside South Africa that made me realise that there is businesses across the globe pushing boundaries. I cant go into specifics but all I can say, is that ecommerce is now global.
    4. 2012 was the year in which logistics finally made it into the strategy meetings. Yes, I know logistics is only spoken about when things go bad but this past year, it became a battleground for entrepreneurs, retailers and corporates. Investment is going to determine survivors and speedy delivery will become like search on ecommerce business. Same day delivery is going to be expected by default.
    5. Social commerce ended up being zilch. I got sucked into this and I must say social with commerce is either a pipe dream or is not being executed at the moment. ROI for facebook ads for ecommerce businesses most probably raises eyebrows at finance and nothing more. Vanity metrics is becoming commonplace in meetings. Building businesses on another non-owned platform is never a good thing.
    6. The ecommerce business that made 2012 for me is fab.com. I really think that they potentially can be a business to outgrow the pack in 2013. Oh and they get mobile commerce. Starbucks almost got this “award”.
    7. Readers there is a disruptor operating below the radar.. it is called Kickstarter. B2C just got turned upside down and in time I think the concept could be even more fine tuned.
    8. I have a challenge for 2013 and that is to try and spend more time with startups. I met 3 this year and by all accounts, I think they will have a good 2013. There is one in Seattle, that I think will be a disruptor in 2013.
    9. Mobile is and will continue to be the light at the end of the tunnel for ecommerce businesses. There is still lots of thinking to be done about mobile commerce.

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