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Period: February 1, 2014 to February 15, 2014
Comment & Opinion or Companies, Organizations or Consumers or Controversies & Disputes or Deals, M&A, JVs, Licensing or Earnings Release or Finance, Economics, Tax or Innovation & New Ideas or Legal, Legislation, Regulation, Policy or Market News or Marketing & Advertising or Other or People & Personalities or Press Release or Products & Brands or Research, Studies, Advice or Supply Chain or Trends

Wal-Mart Stores Expects New Office In California Will Employ 1,000 E-Commerce Pros

Wal-Mart Stores, which ranks fourth on the Internet Retailer 2013 Top 500, has opened an office for its global e-commerce unit in Sunnyvale, Calif. The office will eventually support 1,000 professionals; the San Bruno, Calif., office employs 1,500. Staff at the new office will focus on projects related to online and mobile shopping. The company chose the Sunnyvale location because of the “talent density” in the area, including design, app and user interface expertise. Wal-Mart Stores is expanding its e-commerce capabilities, including through its San Bruno @WalMartLabs division whose mission is e-commerce research and development.

"Wal-Mart opens a second e-commerce office in Silicon Valley", Internet Retailer, February 07, 2014

Independent Pizza Shops Take It On The Chin As “Big Pizza” Thrives On Web Ordering

The move by big pizza chains to Web-based ordering systems – now accounting for 40 percent of total sales – has put the squeeze on less technologically savvy, poorer independent chains and shops. Large pizza chains, which already have marketing clout and lower cost ingredients, accounted for 52 percent of pizza orders, while the share for independents dropped to 29 percent from 31.5 percent. One pizza shop owner in Ohio reports a 20 percent decline in sales as a result of the Webification of pizza ordering. One possible solution for the little guys is online food ordering companies like Chicago-based GrubHub Seamless, which usually take a cut of online sales transacted via their platform.

"Big Pizza Chains Use Web Ordering To Slice Out Bigger Market Share", The Wall Street Journal, February 06, 2014

Online Grocery Shopping Debuts Again, This Time Without Heavy Start-Up Costs

Though a bust in the early 2000s – remember dot-com flop Webvan? – online grocery shopping and delivery are experiencing a revival, thanks to the efforts of “tech-savvy retailers and retail-savvy tech companies”. One of the reasons it’s working better these days is that companies are not trying to develop their own expensive delivery infrastructure, but are tapping into existing resources and taking advantage of smartphone app technology. Lean, mean companies like San Francisco’s Instacart avoid spending millions by using existing fulfillment centers (i.e., grocery stores) instead of building their own facilities and inventory. The company streams inventory lists from brick-and-mortar stores to its mobile app where users can fill virtual shopping carts, customize requests and identify acceptable substitutes.

"The Next Big Thing You Missed: Online Grocery Shopping Is Back, and This Time It’ll Work", Wired.com, February 04, 2014

Companies, Organizations  

Tide Chooses To Do Twitter Instead Of Spending Millions On A Super Bowl Ad

Procter & Gamble’s Tide laundry brand chose not to advertise during the 2014 Super Bowl and instead went to Twitter during the game. In addition to saving $4 million the brand would have spent otherwise on a Super Bowl ad, Tide was able to generate 3.6 million impressions via thousands of retweets of the 22 Vines and related tweets it made. Although it was not as widespread as the 111.5 million people who watched the most famous sporting event, Tide is happy with the results, as well as with how it was able to make jokes about other brands’ ads during the Twitter campaign.

"Why P&G's Tide Ditched Its Super Bowl Ad For ... Twitter?", Advertising Age, February 04, 2014

JD.com's IPO Prospectus Comes With Too Much Candor

Chinese online retailer JD.com filed the prospectus for its planned $1.5 billion U.S. public offering with the Securities and Exchange Commission. Apparently, the paperwork came with too much honesty, according to some observers. It detailed the company’s lack of experience in doing some of its businesses, such as Internet finance. It highlighted losses suffered by the company and warned potential investors it might not be able to make money. Also, the company admitted it is huddled by weak internal fraud controls and its financial reports may not be accurate. Its very strong sales growth, however, is expected to attract US investors. That is, if the company could overcome potential legal roadblocks and could actually get its shares listed in the country.

"This Chinese online retailer’s IPO documents could be a bit too candid", Quartz.com, February 04, 2014

Groupon buys flash-sale e-retailer ideeli

Internet Retailer, January 13, 2014


Russia's Booming Online Market Poses Some Hurdles For Foreign Brands

Online sales in Russia is forecast to account for 5 percent, or $46 billion, of the country’s total retail sales by 2015 from the current 2 percent, according to market research firm Morgan Stanley. Also, Russian consumers who use the Internet are fond of foreign brands, which made it to the top 25 list of brands searched on local search engine Yandex in 2013. There are, however, several obstacles that international brands need to overcome before they can expand into the Russian market, including a more complex shipping policy since the country adopted new import laws in December 2013, problems related to shipping and payments, and the exit of many major carriers, such as DHL and FedEx. Nevertheless, the pros outnumber the cons —for example, the current 70 million Internet users in the country are forecast to increase to 80 million by the end of 2014.

"What you should know about ecommerce in Russia", Econsultancy, February 07, 2014

Political Unrest Boosts Sales Of Thailand's Online Retailers

During Thailand’s months of political turmoil, the country’s online retail market experienced strong sales growth, as more consumers opted to stay home instead of braving potential safety risks posed by widespread protests in the country’s capital. To deal with this inconvenience, and help promote their business at the same time, online retailer deployed motorcycles as a way of delivering products to shoppers. For example, Rakuten’s Tarad.com partnered with Alpha Performance Group to launch the Hotline Express Messenger Post, a motorcycle and hand delivery service that covers even addresses located inside protest areas. Its smaller rival, Pomelo, which sells high-street fashion products from Tokyo, Hong Kong, and Seoul, launched a motorcycle delivery service using Vespa scooters.

"During the Bangkok Shutdown, motorcycle delivery is a major selling point for online shoppers", Tech in Asia, January 31, 2014

It’s not an e-commerce world, but maybe soon

Canadian Grocer, January 29, 2014

Adobe Social Intelligence Report Q4 2013

Business Wire, January 27, 2014

Innovation & New Ideas  

Kroger Acquires Digital Coupons Company YOU Technology

Retailer Kroger Co. acquired the assets of digital coupons and promotions company YOU Technology Brand Services, Inc. Established in 2008, YOU Technology offers retailers cloud-based technologies that help combine online engagement and in-store purchases. Also, the company helps retailers and brands promote their products and encourage consumers to buy online, in-store, and via their mobile gadgets. Despite the acquisition, YOU Technology said it plans to continue serving current and future retail customers.

"Kroger Announces Acquisition of YOU Technology", Kroger, February 11, 2014

Visa, SAP Partner To Offer Electronic Payment Systems For Corporate Customers

Credit card company Visa said it plans to let corporations pay through the Visa Commercial issuer linked to software vendor SAP’s Financial Services Network, a cloud-based electronic payment system for corporate customers. Launched at the Swift Sibos conference in Dubai in September 2013, FSN is designed for use by customers, which use the SAP ERP system link to different banks. According to Visa, the service is aimed at corporations that want to adopt electronic business-to-business payments. Currently, retail banks and small businesses are outpacing their bigger counterparts in terms of adoption of electronic payment systems.

"Visa And SAP Want To Reduce Checks In E-Commerce", Forbes.com, February 03, 2014

Market News  

Southeast Asia Sees E-commerce Boom

Southeast Asia’s e-commerce segment grew strongly in 2013, driven by expansion moves by international and local startups seeking to promote their online retail platforms. Several factors make the region an attractive market for e-commerce companies: strong economic growth, growing middle and upper classes, abundance of young and technology-empowered consumers, and popularity of social media. Seeking to grab a piece of the action, investors poured more than $500 million into fledgling e-commerce companies in the region. While consumer-to-consumer operators currently dominate the market, business-to-consumer is the fastest-growing segment, with German company Rocket Internet leading the B2C trend with its Lazada and Zalora online stores. Other online retailers, such as Japan’s Rakuten and China’s Alibaba, are not too far behind.

"Southeast Asia E-Commerce Surge Boosts Region", Techonomy Exclusive , February 06, 2014

PayPal Goes After Users Selling Bitcoin Virtual Currency

Online payments company PayPal is purging its networks of people selling Bitcoin and may include related goods and services, such as Bitcoin mining rigs or computers that prospect for the virtual currency. Some market observers said the move did not come as a surprise, with PayPal perceiving the virtual currency as a serious threat to its transaction-fee-based business model. Although a PayPal representative said that merchants selling Bitcoin mining equipment can continue using PayPal as a payment option, the company’s Bitcoin policies may have changed. However, details of the revisions and their implications for PayPal users are not yet available.

"PayPal Is Cracking Down on Bitcoin Sellers", Entrepreneur, February 06, 2014

Millennials More Likely To Be Influenced By Peers' Social Media Posts, Survey Shows

Millennial consumers who use social media are more likely than older generations to be influenced by their friends’ social media posts, according to a January 2014 survey by Harris Interactive for The Webb Awards. Results of the survey revealed 68 percent of 18–34-year-old respondents said they are at least likely to buy after seeing a friend’s post, while 78 percent of social media users who are 65 years and older said they are not likely to make purchases based on what their friends post online. Also, majority of posts on social networks about new products and services were posted by women, with more than half of 35–44-year-old women posting at least sometimes.

"Millennials’ Social Media Posts Influence Peers to Buy New Products", eMarketer, February 04, 2014

Asia-Pacific To Grab Biggest Share Of Fast-Growing Global B2C Ecommerce Market, eMarketer Forecasts

Global business-to-consumer ecommerce sales are forecast to grow 20.1 percent to $1.5 trillion in 2014, according to market research firm eMarketer. Details from the company’s latest predictions suggest that the market growth will be driven by the fast-expanding online and mobile user bases in emerging markets, growth in mobile commerce sales, new options in shipping and payment, and major brands’ expansion into international markets. Also, Asia-Pacific consumers are forecast to spend more on ecommerce purchases than their North American counterparts, with B2C ecommerce sales in the region reaching $525.2 billion, compared with $482.6 billion in North America. China will account for more than 60 percent of the ecommerce market in Asia-Pacific, with the country forecast to overtake the US in terms of online spending by 2016.

"Global B2C Ecommerce Sales to Hit $1.5 Trillion This Year Driven by Growth in Emerging Markets", eMarketer, February 03, 2014

China's Number 2 Online Retailer JD.com Files For U.S. IPO

China’s second-largest online retailer JD.com filed for an initial public offering of its shares in the United States. Formerly known as 360Buy, JD.com has raised $2.23 billion in the past six years, with notable investors including the Ontario Teachers’ Pension Plan and Saudi Arabia’s billionaire Prince Alwaleed bin Talal’s Kingdom Holding Co. Company founder and CEO Richard Liu controls about 46 percent of the company’s shares. In 2012, local media reports put a $7.3 billion for the company, which has tried to differentiate itself from rival ecommerce companies, including market leader Alibaba, by operating its own network of delivery providers and warehouses.

"Alibaba rival JD.com files for U.S. listing", Reuters, January 30, 2014

Online Retailers Likely To Focus More On Mobile In 2014, Study Shows

With transactions on smartphones and tablets accounting for 21 percent of online sales revenue in 2013, it is no surprise that 53 percent off online retailers are looking to expand their mobile business, according to a survey from Shop.org and Forrester Research. Data from the State of Retailing Online 2014 report revealed 46 percent of the 70 online retailers that participated in the survey say they plan to revamp their online stores, while 36 percent plan to improve their marketing efforts. Online retailers said sales grew an average of 29 percent in 2013, much higher than the market research firm’s 13 percent forecast. Also, retailers said their site conversion rate was 2.7 percent, with 58 percent of respondents claiming conversion rates had risen from the previous year.

"E-retailers will focus on mobile and site design in 2014", Internet Retailer, January 29, 2014

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