The Webretailer News Digest for September 9, 2022
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Meta to dissolve ‘Shopping’ page from Instagram
Most of the focus in the retail world this week is on the new iPhone, but we’ve got the headlines web retailers care about.
Tech Industry news outlet The Information obtained an internal memo (paywall) from Instagram stating the company will be removing the platform’s Shopping page. Instead, Instagram will pivot to a ‘Tab Lite’ version of ‘Shopping’ that includes less personalization.
Their reasons behind the shift, according to the memo, are “shifts in company priorities.” The memo also stated the changes reflect, “a new Northstar and goals for the commerce organization that is more directly tied to advertising revenue for Meta.”
Next Steps…
Meta launched a new public test of Instagram on Wednesday that includes the ‘Tab Lite’ version of ‘Shopping’. And by March of next year, Meta also has plans to remove a button that directs users to the current ‘Shopping’ tab.
What’s up with eCommerce and Meta?
Overall, Meta is pulling back on eCommerce across the board. According to The Information, this summer, the company told staff that it will be tabling a large number of eCommerce features including:
- ‘Creator commerce’ investment
- The ‘Friends & Family Shopping’ section
- Visual Search
- Community-driven shopping projects
However, the company apparently isn’t done with shopping on Instagram completely. A Meta spokesperson told The Information, “we remain committed to the goal of making Instagram the best place for people to discover and buy products from brands and creators they love.
Final thoughts
Meta reported in July that its ad revenue shrunk for the first time in company history, so it looks like they’re shifting focus to make up for the decline. Apparently, shopping isn’t a high-investment priority for the company.
Instead, according to a report from The Verge last week, the company is considering adding paid features to each of its platforms. They even set up a new division called ‘New Monetization Experiences’ to research and create new features. But Meta’s VP of monetization overseeing the group, John Hegeman, declined to let anyone in on the details of what they’re planning.
Big Retailer News
Shopify sends a warning regarding the ‘Buy With Prime’ button
Back in April, Amazon announced the launch of its Buy With Prime initiative to directly compete with Shopify and a host of logistics providers. The button gives merchants and buyers access to Prime shopping and fulfillment on Amazon sellers’ direct-to-consumer websites.
But now, Shopify is starting to push back on the move.
Shopify sends a warning
- Last week, the company warned merchants who attempt to install Buy with Prime on their storefront that it violates Shopify’s terms of service.
- They also stated that it raises security risks stating that Amazon could potentially charge customers incorrectly and steal their data.
- Last, Shopify reminded merchants that Shopify will not provide protection when merchants fulfill a fraudulent order.
Mixed messages
Whether the warning will be effective or not is yet to be seen. Regardless, Shopify has sent mixed messages with Buy With Prime. When it first launched, Shopify CEO Tobi Lutke indicated he would like to integrate the feature. But that apparently sparked an internal debate, according to The Information (paywall). And now, they’ve sent this warning to their merchants.
Amazon struggling in India according to Berstein
A recent report from Sanford C. Bernstein Wealth Management is making the rounds with many outlets this week. The blistering report states that Amazon is trailing Flipkart in India on key metrics, and the company is floundering in its attempts to break into smaller Indian towns.
TechCrunch was able to get a copy of the report that states Amazon’s gross merchandise value (GMV) for 2012 in India stands around $19 billion minus the $6.5 billion in investment. And it’s lagging behind Flipkart which has $23 billion in GMV in the country.
What’s at stake?
India’s eCommerce market is the fastest growing in the world and is expected to hit $130 billion by 2025 — doubling where it is now.
What can Amazon do about it?
Not much. Amazon is competing with Reliance Retail — who launched a grocery store WhatsApp integration with JioMart last week — Walmart-owned Flipkart, and a few other big names in India.
Because of regulatory requirements, Flipkart (Walmart) and Amazon must operate as marketplace businesses. That means it has to go through a lot of red tapes including:
- They must not have a controlling stake in sellers in their marketplace.
- They can’t mandate a merchant to sell exclusively on the platform.
- Individual sellers can’t have more than a 25% share on a foreign-owned online marketplace.
On top of that, the country has “also clamped down on deep discounts,” according to the report. And if a new guideline from India’s central bank goes through, it will affect BNPL on Amazon as well.
A key point from the Berstein report:
“Regulations don’t allow for an inventory-led 1P model for a foreign entity like Amazon. The company has made investments into local retailers like Shoppers Stop (fashion), More (grocery), and a rumored stake in Ecom Express (logistics) but integration has been limited as the regulations don’t allow for full control.”
Also in the News:
- Etsy will hold a holiday shopping virtual event to help sellers this year. EtsyUp.
- eBay dropped Media Mail to become USPS compliant. eBay.
- CommerceHub will acquire ChannelAdvisor at $23.10 per share. PRNewswire.
International eCommerce News
eCommerce anti-counterfeiting consortium launched by Lazada
Lazada, BMW, and HP all banded together this week to launch the first eCommerce anti-counterfeiting consortium in Southeast Asia. The Southeast Asia eCommerce Anti-Counterfeiting Working Group (SeCA Working Group) will operate from Singapore and work to “address rapidly evolving issues” regarding counterfeit trade in online retail.
Origins
Lazada stated they proposed the idea back in 2021 at the tail end of the pandemic when they noticed a severe need for companies in Southeast Asia to collaborate on intellectual property rights protection issues.
A final quote
“We are proud to be a founding participant of the SeCA Working Group, and look forward to playing an active role in driving progress as well as development in IPR protection standards and industry-wide awareness. Together, we can build a sustainable and fair eCommerce ecosystem for all participants across Southeast Asia.” – Alan Chan, chief risk officer of Lazada Group.
India’s ONDC changes philosophy on the big platforms
India’s The Business Standard pointed out a big change in the Indian government’s concept for their Open Network for Digital Commerce (ONDC). The original idea behind the marketplace was to push back against Flipkart (Walmart) and Amazon’s dominance of Indian eCommerce.
Playing a different tune
It seems the goals of the ONDC have now changed. They’re currently in talks with those same eCommerce giants regarding partnerships and integrations on their network.
Why the change of heart?
The ONDC apparently wants to be sure they’ve invested their $6.5 billion on a platform that has a solid architecture. And from there, they need the help of companies like Amazon, Flipkart, Reliance Retail, Google, and more to get the ball rolling on supply chains and fulfillment.
Also in the News
- The Indian government asks Amazon to remove seat belt safety blockers from the platform. Reuters.
- eBay Germany launches a loan service with financial services provider iwoca. eBay Germany (in German).
Webinars
For everyone
Various dates: Amazon advertising’s global webinar program continues with 20+ webinars scheduled, covering Prime Day Preparation, Sponsored Products, Sponsored Brands, reporting, optimization, and other tips. Amazon.
September 13: BigCommerce: Make it Big 2022 Conference. ChannelX.
For US sellers
September 13: Walmart DSP & Beyond: Leveraging Offsite Tactics to Fuel Omnichannel Growth. Tinuiti.
September 15: In Need of a Banner Q4? Harness Social Creative. Tinuiti.
For UK sellers
Various dates: Amazon advertising’s global webinar program continues with 20+ webinars scheduled, covering Prime Day Preparation, Sponsored Products, Sponsored Brands, reporting, optimization, and other tips. Amazon.
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