UPS fails to deliver, Jingdong has 16 billion reasons to celebrate 2013 and the hidden side of ecommerce returns – eCommerce stories of the week

UPS fails to deliver, Jingdong has 16 billion reasons to celebrate 2013, the hidden side of ecommerce returns, Alipay flexes its financial muscles, Line partners with Rakuten’s Tarad.com and much more

The festive season is over and one company got badly burnt by the bad weather and lateness of orders – UPS. UPS has been getting quite a bit of press over their inability to deliver all Christmas packages by Christmas day. A few things need to be kept in mind – global economics ensured that customers shopped until the last minute for Christmas in the hope of better deals. Amazon gained a million customers for their Prime membership which I am guessing leads to 20 million customers paying for expedited shopping. I cant believe that UPS did not plan for this – in actual fact I think the last minute shopping lead to a surge in packages that nobody took into consideration.

UPS ships 40% of Amazon’s deliveries annually but I wonder whether this issue will lead to a strained relationship in 2014? The one company that gained from UPS’s misfortune – Target.

2014 is going to contain a storyline which will be worth following. The move by messaging platforms like WeChat and Line to bring commerce into their products. “In fact, Line did help the e-commerce platform grow quite impressively. According to Pawoot, the company received 600 orders of various types within the first half an hour after it sent out a link through a Line message.” If you think about it, all these messaging platforms are like social media in the beginning, where the platforms were trying to leverage their user base outside the traditional usage (communication or social media). My simple question is whether this is going to work in non-Asian markets?

The stories that caught my attention for the week ending 27 December 2013:

  1. eBay Heyday: Inside Retailer’s Data-Enhanced Media Business – “Large digital commerce brands like eBay are well positioned to seize on this influx of interest, with their prodigious transaction data and inventory. But it requires a smart approach. The online retailer and auctioneer not only sells its own ad space, but through the nascent eBay Audience Platform has also used its dataset to identify audiences through open exchanges and property-specific inventory sources like Facebook.” Fascinating article in a part of ecommerce that is growing at an astonishing rate.
  2. Wake up, retailers: Amazon’s seven-day shipping means you need to regroup. Now – The truth is out – retailers need a plan to combat Amazon or for that matter online shopping. The most important point mentioned is omnichannel – the customer has to be able to seamlessly be able to act with your retail brand. Whether it be in store, online, with a mobile or with a tablet.
  3. Online shopping puts traditional jobs at risk in South Africa – I read this article and shook my head at the shortsightedness presented by the author. Online shopping is 2% of retail in South Africa yet it is seen as jobless growth factor. Globally the move is towards commerce (online and offline) providing jobs to many, yet it seems that certain parts of retail still sees ecommerce as a negative.
  4. Chinese e-store Jingdong set to pull in over $16 billion in sales in 2013 – “Jingdong – formerly called 360Buy – is the second largest Amazon-like site in China. It’s behind Alibaba’s Tmall in terms of market share, according to data from iResearch. With China’s whole business-to-consumer e-shopping sector worth $71 billion in Q2 this year, Jingdong has 17.1 percent market share to Tmall’s dominant 50.7 percent.” The scale of ecommerce businesses in China is just mind blowing.
  5. This Electronics Company Has Figured Out How To Make Camera Sales Directly On Instagram – “Leica has asked customers to register with the Brazilian e-commerce company Arco, which ties customer PayPal accounts to their Instagram handles.” Very clever usage of a platform (Instagram) that is used by the purchasers of the product. An example of a semi-seamless integration between social networking and ecommerce.
  6. 9 ways that e-commerce titan Alibaba diversified and went social in 2013 – It is clear that Alibaba used 2013 as a building year before their IPO. They have spent close to $2 billion on partnerships, acquisitions and investments this year and in 2014 will most probably continue doing it.
  7. Russia targets cross-border online shoppers with new duty rules – “Russia plans to start charging duty on purchases worth more than 150 euros ($210) from foreign online stores, lowering the threshold from 1,000 euros and potentially slowing the fast-growing market while benefiting domestic online retailers.” This is a massive change that will open the Russian ecommerce market to cross border ecommerce businesses that are outside Russia.
  8. Uncovering the Magic of Alipay’s Money-Making Wallet – “The ad copy translates to “Alipay Wallet. The Wallet that Makes Money for You.” My initial reaction was, “Wow. What is this sorcery?” But then, I realized that growing money like this was nothing new; banks have always done this. The big difference was that the company behind this ad was no bank. It was Alibaba – one of the biggest and boldest internet companies in the world.” A fascinating read about Alibaba’s move into financial products.
  9. Alibaba International Platforms to Merge into One Marketplace -“Alibaba’s AliExpress, Tmall International and the international division of Taobao, reportedly will merge into one marketplace, targeting individual consumers overseas.” This is a massive piece of news that has gotten very little coverage in ecommerce news circles. This reads to me as the calm before the storm as international is going to be where Alibaba will be focusing on in 2014.
  10. UPS backlog means missing Christmas gifts; Amazon responds – In a statement, the company explained that “the volume of air packages in our system exceeded the capacity of our network immediately preceding Christmas so some shipments were delayed.” Amazon reached out to customers alerting them of the “failure in the UPS transportation network.” In the message, the company offered to refund shipping charges and provide gift cards.

Bonus links:

  • Ecommerce in 2013: have online retailers finally figured out mobile? – In short the answer is not really. The eConsultancy article provides a whole bunch of feedback from a variety of sources regarding anything from SEO to responsive design. Look at the successful mobile commerce companies and learn from them but build an experience that is easy to use and is intuitive..
  • In A Post-Amazon World, E-Commerce Site Wayfair Wants To Win At Selling Home Goods And Furnishings – In fact, Shah believes that home furnishings, jewelry and fashion are the only areas in e-commerce where there is room for a number of large companies. That’s because, he explains, the consumer is looking for uniqueness in these categories vs. electronics, books, household supplies, grocery and more. Fascinating post on a company which I believe will IPO in late 2014.
  • Why e-commerce site Namshi stopped using ‘Sukar’ as a keyword – “At the request of Souq’s management, we agreed to stop targeting the word ‘Sukar,’ in order to maintain friendly ties between the two companies,” explains Amr Abu El Aynayn, the Online Marketing Manager at Namshi.com. eCommerce in the Middle East is super competitive and this practice is widely seen in global ecommerce but it has an adverse reaction to the business doing it’s Google ad quality score..
  • E-commerce firms have a hard core of costly, impossible-to-please customers – This is the hidden side of ecommerce that is becoming a problem for e-retailers. Returns and the impact it has on logistics and bottom line for the business. Is it a case of a fair use policy that is needed for these customers or is it a case of taking them on a case by case basis and incentivize them to spend more?
  • Alipay Wallet to Launch 8.0 Edition and An English Version – Alipay, the mobile payment and service provider of Alibaba Group, will launch an 8.0 version of Alipay Wallet mobile app in the coming January. The biggest change with the update is that merchants can move physical loyalty cards onto the platform. Sounds familiar hey? Apple Passbook with Paypal mobile..
  • Will Tiki.vn go head-to-head with Lazada in Vietnam’s e-commerce battle in 2014? – Vietnamese ecommerce seems to be a battleground between local companies and Rocket Internet businesses. The problem for competitors of Rocket Internet companies is that in most cases are they really well funded..
  • RetailMeNot wins the holidays by not overthinking it – Coupons will in most cases always be successful and RetailMeNot is dominating in North America.

Onwards.. Till next week!