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Two proposed new Instagram features are especially significant for the retail world: Instagram’s planned branded content marketplace and its new affiliate program. Both tools, depending on their ultimate scope and rollout, could potentially shift how brands recruit and interact with influencers, and they could also precipitate changes in where -- and how -- customers discover products.
When office lunches were put on pause at the beginning of the pandemic, delivery services that cater to the rush had to pivot quickly. This included New York City-based Stadium, which aggregated orders from different restaurants for corporate teams. When orders dried up, the founders repurposed the existing tech to build SnackMagic, a CPG-focused gifting service.
Historically, 70% of furniture brand Industry West's sales have come from business-to-business transactions, namely from restaurant or hotel owners opening new spaces. But in 2020, Industry West's revenue makeup flipped. Last year, 70% of its sales came from individual consumers, as more people were driven to refurnish their new or existing houses during stay-at-home orders. Now, spurred by the increase in DTC sales, Industry West is aiming for more aggressive growth, projecting this year that it will do just under $40 million in sales.
J.Crew-owned Madewell is launching its first mobile app, aimed squarely at getting more out of its loyalty program members. Madewell started developing the app last fall, after seeing a spike in mobile traffic during the pandemic, according to Chris Maliwat, vice president, head of digital and consumer experience at J.Crew. Longterm, Maliwat said that Madewell's app strategy is to make it "easier and faster for [loyalty members] to access the goods that we think she wants to browse."
Like a number of other resale-focused platforms, OfferUp has experienced a surge in growth throughout the pandemic. The company's approach to resale is similar to Facebook Marketplace, with emphasis on local selling over shipping. After a year of facilitating quarantine-friendly home goods and furniture, the company is planning for retention by building out a mobile-focused app.
On Wednesday, Affirm announced that it intends to acquire Returnly, a software startup that helps retailers manage returns, for $300 million in cash and equity. The acquisition gives more insight into exactly how Affirm -- and some of its other competitors -- are mapping out their strategies for what else they can offer retailers, beyond just a digital form of layaway.
As more consumers shop online, brands are looking for ways to minimize return rates and keep logistics costs low. One solution for this is "try before you buy," which allows customers to test out their order and pay for what they want to keep. While services like Amazon's Prime Wardrobe and Stitch Fix helped popularize this model, smaller fashion brands are testing it out to drive conversion and keep returns minimal.
Used car e-commerce companies are in high demand. The rise of companies like Vroom, Carvana and Shift shows that, as e-commerce continues to sweep the retail world, it has begun to ensnare even nontraditional online purchases, including big, expensive items like cars.
With the e-commerce boom comes a costs -- for shipping that is. Over the past year, shipping carriers FedEx and UPS imposed surcharges on large fulfillment orders, which are still in place. These additional costs, on top of fixed annual increases, are expected to keep delivery costs rising. The issue is prompting small and medium sized brands are looking for ways to minimize e-commerce costs to improve margins.
For the past several years, Target has centered its e-commerce strategy around using its stores to fulfill online orders. Now, Target is starting to look beyond its stores to more efficiently fulfill online orders.
On Tuesday, Katrina Lake, announced that she would be stepping down as CEO in August. Replacing her is Elizabeth Spaulding, who joined Stitch Fix as president last January after spending 20-plus years at Bain & Company. Lake's resignation comes as Stitch Fix has been investing in giving customers more ways to buy and select clothes, which hints at what Stitch Fix's next phase of growth under Spaulding might look like.
Verizon Media is launching a new marketplace called Yahoo Shops. This is Yahoo's biggest, but not its first, step into the e-commerce landscape. Yet while Yahoo might be helping customers discover products, it isn’t capturing the actual purchases on its own platform. By building a marketplace that contains those purchases in-house, Yahoo can both keep a cut of the commission and refine their ad targeting.
Last year, grocers like Kroger reported unprecedented growth in grocery delivery and pickup, driven largely by customers who were too afraid to step inside stores while the coronavirus pandemic is still raging. Now, the company is thinking about how to keep those customers using its e-commerce services, now that they have more options. At its investor day yesterday, Kroger outlined what areas it will be investing in to increase its market share in online grocery.
Two resale apps, Poshmark and ThredUp, have gone public within the past three months, and as a publicly-traded companies, now face more pressure to maintain revenue growth, namely expanding into new products and services. But, the biggest challenge standing in the way of these companies' expansion plans, analysts say, is in ensuring that people keep wanting to sell products through their sites.
Even after the introduction of Walmart Fulfillment Services last year, most Walmart sellers continued to opt for third-party fulfillment services, and those that wanted to join WFS often faced long wait times. But a sharp jump in the numbers of sellers enrolled in WFS this month reflects the increasing priority that Walmart is placing on WFS -- and as Walmart expands its marketplace, its fulfillment services are likely to balloon with it.
E-commerce technology is the new gold rush. New data from CB Insights showcases just how hot the e-commerce space is. In the first quarter of 2021, funding for e-commerce startups hit $11.7 billion -- up from $2.8 billion in the first quarter of 2020 and $5.2 billion in the first quarter of 2019. It showcases an industry-wide realization: more VCs are investing in e-commerce startups and more businesses are adopting digital features to make their businesses omnichannel.
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