The 10 ecommerce stories for the week of 9 August 2013

Assessing Zimbabwe’s readiness for eCommerce, Google launches a vehicle insurance comparison service, The battle in China between Tencent and Alibaba is on and much more.

It is Wednesday and if I look back in the last week on my twitterfeed, RSS reader (yes – it is not dead) and by all the email I read then I can categorically say we are in for a very interesting 12 months ahead. In China, the 2 super powers are beginning to battle one another. Alibaba in my mind is a company that scares me (I have a long post coming on the East’s ecommerce powerhouse) it has scale, has 2 dominant platforms (Taobao and TMall) and increasingly is showing their intentions. Their biggest direct competitor Tencent is the social powerhouse that has most of China on their networks. They have a trojan horse called WeChat I think is going to be a big deal. Tencent wants to play in ecommerce but Alibaba is ensuring that their walled garden is protected. Alibaba blocking WeChat is a big deal and I think is a sign that we are going to see these businesses spend millions of dollars to disrupt one another.

In the US – last week was literally the Jeff Bezos show. There was so much news that I wrote a separate post on it. Did anyone notice the timing of this PR fest? Suddenly all the negativity in Germany regarding labour relations is no longer front of mind. I personally think that Bezos is leveraging something that he can control. He speaks seldomly to the press and does a good job of repeating the trusted customer focus gospel. AmazonFresh is Bezos going after retail and creating a defensible against any competitor (Walmart, Google and the rest). Amazon and Alibaba are the same in my mind – they have the potential to shut businesses down.

In South Africa, there is a battle looming between the banking sector and ecommerce businesses. The biggest loser is the ecommerce industry. I am all for secure payments but surely the process should not have a negative effect on transactions and the ability to complete them. This is one of the reasons I think mobile has another potential impact on ecommerce – being able to act as a digital pass to allow transactions.

The 10 stories that caught my attention for the week ending on 9 August 2013:

  1. M-commerce in China Surges More Than 40 Percent in Q2 [Charts] – Chinese ecommerce businesses are increasingly at the fore front of global ecommerce.  Almost 9% of all ecommerce is done by mobile in China and the growth in quarters is spectacular.
  2. Google quietly rolls out a car insurance price comparison service for drivers in France – So that is a second market in which car insurance comparison is available. I would love to know what the impact is on Adwords costs for vehicle insurance keywords and the impact that this had on Organic listings for car insurance comparison services (I think I know the answers to both questions..)
  3. How Kevin O’Connor, and FindTheBest Got Lean – FindTheBest is one of the websites I love playing on. As someone who works in the comparison engine space, the fact that this post has been written is great.
  4. Brutal Conditions In Amazon’s Warehouses Threaten To Ruin The Company’s Image – Working at an Amazon Warehouse is tough and increasingly the purchase of Kiva looks like an answer to this situation. However, I think this is something that Amazon will have to manage well as if not it could become a big potential reputation issue.
  5. Author of Bezos Book: ‘He’s Buying a Lot of Political Influence’ – I must say I think Brad Stone’s book has all the makings of a best-seller. This article contains a few nuggets of information that will make any Amazon watcher happy.
  6. Fab.com’s Global Expansion Falls Into a Familiar Trap – Is fab going to be around in 5 years time? That is the question as increasingly it looks like they grew too fast. All of the funding they raised and the sudden interest in Asia has some very interesting nuances. How many more investors will take part in their Series D?
  7. Here’s why a war has started between Chinese Internet giants Tencent and Alibaba –  “Why would Alibaba be so afraid of Tencent though, given that Tencent has not yet made its big jump into e-commerce? The reason is simple: Tencent’s dominance in the social market”. Sounds a lot like Google vs Amazon but this is a must read on Chinese ecommerce.
  8. Online retail giant Amazon weeds out customers who complain too much – “Shopping online may not be so easy anymore for Amazon customers in Germany. Shoppers who take advantage of the return policy one time too many may be prevented from future buying.” I reread this post a few times as I thought it was not possible but it makes sense why Amazon would do this in Germany. Can anyone think of a business that does something similar.
  9. EBay’s John Donahoe on E-Commerce and Mobile Payments’ Future – Newspaper trucks are supposedly the answer to eBay’s same day delivery shortage. Donahoe has either not thought this through in detail as the impractical nature of this makes the idea a non-starter for me.
  10. Try before you buy: IKEA’s mobile app puts virtual furniture in your living room – Augmented reality has a place in the ecommerce toolbox and I think increasingly we are going to see these ideas being presented to customers.

Must read: (This is something that I will do on special occasions)

  1. Amazon’s profits – Ben Evans has fast become a favorite analyst of mine. Fantastic post on Amazon’s potential to fly below the radar as the profits are reinvested. “Amazon is LOTS of different startup ecommerce businesses on one platform. All the profits from the ones that work are spent on new, loss-making ones.”
  2. The Anti-Apple – Horace Dediu makes a very interesting observation and one that I agree with. As soon as Bezos wants to press the switch Amazon will be able to make a lot of revenue. “I would argue that Amazon’s existing business model is a direct consequence of the market it’s in: that it could not be anything else given the circumstances it finds itself in.”

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