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Amazon Targets Low-Priced Fashion Market
Security and Convenience: The Pillars of Digital Commerce Success
E.l.f. Expands Real-World Commerce with Roblox Partnership
Levi Strauss Faces Industry Challenges but Sees Digital Growth
UK Shoppers Prefer Retailer Websites Over Social Media
ECOMMERCE NEWS
Amazon Targets Low-Priced Fashion Market with New Chinese Seller Storefront
Amazon plans to launch a new section dedicated to low-priced fashion and lifestyle items, allowing Chinese sellers to ship directly to U.S. consumers, CNBC has learned.
Revealed at an invite-only conference for Chinese sellers, this move is Amazon’s most aggressive yet to fend off competition from e-commerce upstarts Temu and Shein. These rivals have been capturing U.S. market share with their rock-bottom prices on various products.
The new storefront will feature unbranded items, many priced under $20, according to a presentation viewed by CNBC. Items like a gua sha facial massaging tool, arm weights, and phone cases will be available.
Amazon will ship products directly from China to the U.S., aiming for delivery within nine to eleven days. This direct shipping model promises cost savings for Chinese sellers and allows for small-batch production to test new items, similar to Shein’s on-demand manufacturing.
“We are always exploring new ways to work with our selling partners,” said Amazon spokesperson Maria Boschetti. Amazon’s renewed push includes a new innovation center in Shenzhen and reduced fees for merchants selling low-priced clothing.
In 2023, the number of items sold by Chinese sellers on Amazon grew over 20% year over year, with a 30% increase in Chinese merchants achieving sales over $10 million.
ECOMMERCE DIGITAL PAYMENTS
Security and Convenience: The Pillars of Digital Commerce Success
Success in today’s digital landscape hinges on security and convenience, crucial for digital payments and eCommerce.
“Digital commerce is booming, it’s a nonstop train,” said Greg Esser, director of partnerships U.S. at Entersekt. However, he noted, “fraud remains an immutable challenge.” With eCommerce making up about 15% of total retail sales, this is expected to rise to 16% in 2024 and potentially 20-22% by 2027.
Businesses must enhance user experience while mitigating fraud using advanced technologies like 3-D Secure (3DS). Esser emphasized a layered approach to fraud prevention, including biometrics, risk-based authentication, and EMV 3-D Secure.
As eCommerce grows, so does fraud sophistication. Solutions like 3DS have evolved, leveraging intelligent data and biometrics for a seamless experience. “Issuers are becoming smarter and faster,” said Esser, noting many now allow consumers to choose their preferred authentication methods, enhancing both security and user satisfaction.
Innovations like machine learning (ML) and artificial intelligence (AI) revolutionize fraud prevention by analyzing vast data to predict and prevent fraud. Effective data sharing between merchants and financial institutions is crucial.
Esser anticipates advancements in passkeys, buy now, pay later (BNPL) solutions, and digital wallets to enhance consumer experience. Entersekt is committed to driving innovation in authentication technology, envisioning a future where Context Aware Authentication creates a seamless and secure user experience, driving digital commerce forward.
ECOMMERCE VIRTUAL REALITY
E.l.f. Expands Real-World Commerce with Roblox Partnership
Beauty brand e.l.f. has expanded its partnership with Roblox to include real-world commerce, the company announced on Monday (July 1).
In the new virtual kiosk within the e.l.f. Up! experience on Roblox, powered by Walmart, U.S. visitors can purchase a Roblox-exclusive limited-edition hoodie and other physical products like skincare, lip balm, and sunscreen. Buyers will also receive a “virtual twin” item for use on Roblox.
“E.l.f. Up! has been lightning in a bottle since day one and continues to surpass all expectations, especially among our Gen Z community,” said Kory Marchisotto, chief marketing officer at e.l.f. beauty. “Testing commerce on Roblox is the next evolution in our journey of merging beauty with immersive platforms.”
Since its launch on Roblox in November, e.l.f. has seen over 12 million total visits and given out more than 1 million free limited-edition virtual items to Roblox users. The brand is working with Roblox community creators to design the digital items included with each purchase.
“E.l.f. continues to break new ground on Roblox with its thoughtful iterations to the community experience and exclusive offerings tailored to our platform,” said Stephanie Latham, vice president of global brand partnerships at Roblox. “We are excited to continue taking steps with brands like e.l.f. towards building the future of shopping, making it immersive, 3D, and social.”
Roblox, a platform where users create and play games, has become a vital avenue for brands to vend products and curate user experiences, fostering loyalty and attracting discerning customers.
ECOMMERCE SALES TRENDS
Levi Strauss Faces Denim Industry Challenges but Sees Digital Growth
Levi Strauss & Co. reported $1.4 billion in net revenue for Q2, missing analyst expectations of $1.45 billion. Despite ongoing challenges in consumer denim interest, the brand is optimistic about its transformation into a digital and direct-to-consumer (DTC) retailer.
Levi’s second-quarter net revenue of $1.44 billion marked an 8% increase over the same period last year. Adjusted for wholesale shipments related to its U.S. enterprise resource planning (ERP) implementation, net revenues showed 1% growth year over year and 2% growth in constant currency.
Key highlights from Levi’s earnings report include:
Net revenues in 2024 are expected to increase 1% to 3% year over year, likely toward the upper end of that range.
Cash and cash equivalents stood at $641 million, with total liquidity at approximately $1.4 billion.
Total inventories decreased 7% on a dollar basis and 19% excluding the impact of modified terms with suppliers.
CEO Michelle Gass emphasized the strength of legacy products like the 501 brand, stating, “Our original icon, the 501, continues to deliver impressive growth, up 16% in DTC in Q2.”
Levi’s strategic shift to DTC channels proved beneficial, with revenues increasing 11% overall and 22% in women’s DTC channels. Ecommerce grew 19%, reflecting double-digit growth across the Levi’s and Beyond Yoga brands. DTC comprised 47% of total net revenues in Q2.
Chief Financial and Growth Officer Harmit Singh praised the company’s ecommerce performance, highlighting improvements in profitability and operating margins. Singh noted, “DTC continues to be our fastest-growing business, with significant improvements in ecommerce profitability.”
However, Singh cautioned about consumer spending amid inflation, noting that consumers are “generally cautious” about discretionary items.
ECOMMERCE BUYER JOURNEYS
UK Shoppers Prefer Retailer Websites Over Social Media for Final Purchases
A recent survey reveals that while two in ten UK online shoppers start their product search on social media, only 7% complete their purchases through these platforms. Instead, most finalize their orders on retailers’ websites or apps.
These insights come from the 2024 Elusive Consumer Survey by Capterra, conducted in April with 499 UK citizens over the age of 18.
The report highlights that 75% of consumers initiate their online product searches on internet search engines. Additionally, 55% start their search on retailers’ websites and apps, which are also the most common places where purchases are completed.
Although social media is not yet a dominant channel for online shopping, it serves as a significant source of shopping inspiration. Among social media platforms, Instagram is the most popular for shopping, used by 69% of social shoppers, followed by Facebook (54%) and TikTok (50%).
The survey found that 46% of shoppers use social media to discover small or local brands. 73% use it to find products they are interested in, 61% for discounts, and 58% to discover new brands. This trend indicates that social media marketing is an effective tool for brands to reach relevant audiences.
Signing off,
The Merchant @CartHustle