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:

1. An NRF Retrospective – Peter Sheldon from Forrester writes a summary of trends seen at the NRF show from early January. A few things that I note, Android is seemingly gaining in popularity for mobile POS solutions. It is also interesting to note the luke warm mention of mobile wallets. I am not convinced that NFC is ever going to become relevant..
2. Exclusive: Hybris planning mid-year IPO – If this happens in the coming months, it would create a landscape change in ecommerce solutions software. Hybris is competing with Oracle ATG, Magento and Demandware for revenue and I think we can expect a lot more competition between all of the players.
3. Internet puts squeeze on retailers – Ecommerce is definitely placing strain on retail operations across the globe.  In most cases it leads to sales volume dropping in bricks and mortar stores. In South Africa, the newly created iTunes store will be disrupting music and DVD sales for both online and offline stores.
4. How Particle Physics Is Improving Recommendation Engines – Recommendation engines are becoming a very important asset to have for ecommerce businesses. This article made for very interesting reading and thinking. It is not a new concept but science being added to ecommerce is becoming a necessity requirement for forward thinking businesses.
5. FEATURE-Turkey e-commerce firms set for shakeout – I am a big fan of Turkey as I loved visiting the country. Turkish ecommerce is a maturing emerging market which contains a lot of challenges. “According to a report on e-commerce in Turkey by consultants Deloitte, 17 merger and acquisition deals were closed last year. Nevzat Aydin, chief executive of online food delivery site Yemeksepeti, estimated foreigners had invested some $500 million in the sector over the past two years.”
6. Jack Ma steps down as Alibaba CEO, looks for younger blood – Jack Ma is moving on from being CEO of Alibaba. Alibaba is valued at $43 billion and Ma I think it getting ready to raise money via an IPO. Seperate businesses and seperate CEO’s is all ways to ensure that accountability of Profit and Loss occurs across the behemoth. I still think Ma, will be a powerful figure behind the scenes at Alibaba.
7. ShipStation Now Uses AWS And Amazon Fulfillment To Automatically Ship From eBay, Sears And Other Marketplaces – ShipStation is an enterprise solution for marketplaces that leverage Amazon technology (AWS, S3) to create a fulfillment solution. This for me is a part of the bigger picture that battling Amazon is about. Amazon is leveraged and makes revenue, name me any business that does this in ecommerce?
8. Getting Email From Amazon’s Jeff Bezos? You’re Not Alone! – I don’t reside in North America but I can attest to the large amounts of email I have received from Amazon in the last 12 months. I note one thing not mentioned in the article. If you have purchased an item from Amazon, keep an eye on the increased amount of email you receive based on that purchase. It is these little things that makes Amazon impossible to replicate.
9. Net-A-Porter sees sales increase by 55 per cent – Net-A-Porter is a business I keep an eye on. They execute the best in terms of editorial ecommerce in their tablet app. Fashion business will be attacking markets like China more aggressively as their dominant revenue making markets are battling economically.
10. Target hits bull’s-eye with online-only brands – Private label brands is nothing new in traditional retail. It is a profit making machine as in most cases it features lines of products with potential of  margins that is favorable for the retailer. In ecommerce it is seen in a variety of formats but it does seem that Amazon is creating fear that has forced rivals to create online exclusive lines of products.

Bonus links:

• Zalando tests Métail’s virtual dressing rooms – Virtual dressing rooms is something that I believe fashion ecommerce businesses will be testing a lot of. Ultimately showing the customer on them replicates the in store process.
• Orange denies link to eXpansys website woes – the last few weeks South African ecommerce has had a business whose franchisee went into liquidation. It is never nice to read about customer complaints about deliveries not fulfilled etc. Orange is looking to become a mobile operator in South Africa via MVNO but it does seems it was nothing more than an unrelated coincidence.
• Online grocery shopping still not big in South Africa, but retailers should prepare – Buying groceries in South Africa at the moment is a painful process online. Some retailers have invested in it (Woolworths) and some don’t even offer it (Shoprite). It is clearly open for disruption.

Onwards..