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PDD Holdings’ Stock Plunge Seen as Overreaction, Says Analyst
California’s AI Safety Bill: A Game Changer for Tech and eCommerce
Davidoff Wins Top Design Award for Digital Storefront
OEM Advertising: The Future of Targeted E-Commerce Engagement
Best Buy CEO Pushes for Personalized Customer Experience
ECOMMERCE STOCKS
PDD Holdings’ Stock Plunge Seen as Overreaction, Says Analyst
PDD Holdings’ stock dropped nearly 30%, but Shaun Rein, founder of China Market Research Group, believes the reaction is “too much of a correction.” Speaking to CNBC’s “Street Signs Asia,” Rein suggested the “panic was overblown” and viewed the drop as a buying opportunity.
The plunge came after PDD Holdings reported second-quarter revenue of 97.06 billion yuan ($13.6 billion)—up 86% from a year earlier but below the expected $14.034 billion. Operating profit surged 156% to 32.56 billion yuan, while income rose 144% to 32.01 billion yuan.
Rein noted that brands like Pinduoduo, Costco, and Walmart’s Sam’s Club could benefit as Chinese consumers seek value amid economic concerns. However, PDD’s leadership issued cautious outlooks, with Co-CEO Lei Chen warning of “challenges ahead” and a potential decline in profitability as the company invests in key areas.
Ben Harburg, of CoreValues Alpha, pointed out the saturated Chinese e-commerce market, with PDD facing competitors like JD, Alibaba, and Amazon, along with weak consumer growth. “PDD was holding out longer than others,” he noted, referencing similar struggles at JD.com and Alibaba.
ECOMMERCE AI
California’s AI Safety Bill: A Game Changer for Tech and eCommerce
California’s new AI safety bill, Senate Bill 1047, could reshape the AI development landscape. The bill, which awaits Gov. Gavin Newsom’s signature, introduces strict safety testing for AI models costing over $100 million or requiring substantial computing power. It also mandates fail-safe mechanisms to shut down AI models during emergencies, aiming to mitigate AI risks.
Proponents, like State Sen. Scott Wiener, see this as a step toward safer AI, emphasizing its promise to improve the world. However, critics argue that these regulations could drive AI firms out of California, threatening its status as a tech hub. “The California legislature is passing laws based on science fiction fantasies,” said Todd O’Boyle, Senior Tech Policy Director at the Chamber of Progress, suggesting that the bill could stifle innovation.
Interestingly, Elon Musk, Tesla CEO, supports the bill, highlighting a divide among tech leaders on AI regulation. This has sparked debate within the industry, with some worried about the potential brain drain and economic impact on Silicon Valley.
For eCommerce, where AI drives personalized shopping and dynamic pricing, the bill could create hurdles, particularly for startups. Critics note the bill’s broad language might present challenges for smaller firms, raising concerns over innovation barriers.
Yet, some analysts suggest that the bill could build a more trustworthy AI ecosystem, setting clear safety standards that could enhance public confidence in AI technologies.
ECOMMERCE OPTIMIZATIONS
Davidoff Wins Top Design Award for Digital Storefront
Oettinger Davidoff AG, a Swiss luxury goods company specializing in tobacco products, has received top honors for its digital storefront design. The company’s revamped Davidoff of Geneva online platform won first place in the design category at the 2024 Big Customer Awards presented by BigCommerce, an eCommerce platform known for recognizing creativity and innovation.
The redesigned storefront aims to provide a seamless user experience that reflects Davidoff’s heritage. “Our goal was to develop a storefront that guides customers smoothly and immerses them in the Davidoff world,” said Mario Martic, Manager Team Leader Digital Business, Global Marketing & Innovation at Oettinger Davidoff AG.
The new design features clear navigation, intuitive architecture, and immersive marketing assets to enhance the Davidoff experience. It combines extensive product information, intuitive product placements, and gift-giving guidance, aiming to support customers in discovering their ideal Davidoff products.
Martic highlighted the challenge of balancing the needs of both connoisseurs and newcomers while aligning with Davidoff’s philosophy, “Time Beautifully Filled.” The design also uses innovative graphics and videos to bring the Davidoff lifestyle to life, showcasing the brand’s commitment to quality and craftsmanship.
Success metrics such as conversion rate, average order value, and net promoter scores (NPS) are used to measure the design’s impact. Judges praised the site for its informative content and interactive elements, making it highly engaging for both seasoned enthusiasts and those new to the brand.
ECOMMERCE AD TECH
Mobile OEM Advertising: The Future of Targeted E-Commerce Engagement
E-commerce brands face increasing challenges in reaching the right audiences on mobile platforms. The COVID-19 pandemic and the resulting shift to online shopping intensified competition, with over 26 million e-commerce websites globally. To stand out, brands need more innovative solutions than traditional advertising methods offer.
Enter Mobile OEM Advertising. Unlike conventional platforms that depend on third-party data, mobile OEMs (Original Equipment Manufacturers)—companies that design and manufacture smartphones—can leverage first-party data directly from their devices. This allows for more precise targeting based on user behavior, demographics, and app usage, enhancing ad relevance. “Consumers are more likely to engage with ads that speak directly to their needs,” said Ashwin Shekhar, CRO and Co-Founder of AVOW, specialists in mobile OEM advertising.
Mobile OEM app stores also offer brands a less crowded alternative to mainstream app stores. These stores provide localized content and events, boosting visibility and engagement. For instance, during Diwali, certain apps are featured with exclusive discounts in India.
Brazilian retailer Magalu used mobile OEM advertising to expand its user base, resulting in a 25% increase in basket size. As privacy concerns rise, partnering with mobile OEMs offers e-commerce brands a way to engage users more effectively and respectfully.
ECOMMERCE TRENDS
Best Buy CEO Pushes for Personalized Customer Experience Amid Challenges
For Best Buy CEO Corie Barry, enhancing customer experience is a top priority, even as the company faces challenges in categories like home theater, gaming, and appliances. Barry is focused on a more personalized and engaging shopping journey to attract and retain customers.
“We are focused on sharpening our customer experiences,” Barry said during the company’s second-quarter earnings call. She noted that while some customers are seeking value and sales events, others are still willing to spend on high-priced products and new technology.
To this end, Best Buy is revamping its app for a customized homepage and tailored notifications, and adding AI-driven delivery tracking to provide real-time updates. Barry emphasized the importance of personalized experiences, stating that customers with a personalized homepage engage 70% more than others.
While the company saw a 2.3% decline in comparable sales last quarter, revenue in domestic tablet and computing categories rose 6%. Barry also highlighted Best Buy’s employee certification program as key to elevating customer service, with 60% of employees certified in multiple categories.
Barry is optimistic about the company’s new branding and membership programs like My Best Buy, which are driving higher engagement and retention rates among customers.
Signing off,
The Merchant @CartHustle