Welcome to our new E-Commerce Insider newsletter, a morning email with the top news and analysis on the e-commerce industry, produced by BI Intelligence.
ALIBABA TRIES SELLING VIA NEWSPAPERS: China-based e-commerce giant Alibaba is partnering with media organisations to allow consumers to purchase things that they see advertised or mentioned in newspapers. Readers will be able to scan a QR code that’s printed throughout Chinese newspapers, and it will direct them to purchase an item via one of Alibaba’s online shopping sites, such as Taobao. China has more than 1,000 daily newspapers with a circulation of over 100 million readers, so the partnerships should help Alibaba raise awareness among consumers who might not have a lot of exposure to online shopping.
Alibaba says it views newspapers as a mobile product, though, in our view, it’s more like a portable product. Nonetheless, it goes to show how e-commerce companies are not afraid to experiment with platforms — new and old — to sell their merchandise. We reported earlier that some e-commerce companies are now printing their own shopping catalogues in an attempt to appeal to a broader range of consumers. (Quartz)
RUSSIAN E-COMMERCE: Russian consumers are purchasing more online than ever before. E-commerce retail sales grew 26% last year, and approximately 57% of overall non-grocery retail spending now occurs online, according to a new report from PricewaterhouseCoopers. Driving the growth is rising Internet penetration, which is helping introduce more people to online shopping for the first time. In 2013, the number of Russian households with Internet access exceeded the number without access for the first time. Furthermore, a lack of trust in credit card security has made online payments more attractive, which is also helping boost online retail. E-wallets now account for between a quarter and a third of all commerce consumer spending in Russia, according to Ieuan Owen, senior vice president of commerce strategy at WorldPay. (PricewaterhouseCoopers)
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FTC CRACKS DOWN ON RETAILERS: The Federal Trade Commission is cracking down on retailers that host contests requiring participants to endorse a product or brand. Many online retailers run these types of promotions asking customers to share a product with their friends on social media, and in exchange they might win some sort of prize. The FTC specifically called out shoe retailer Cole Haan, saying the company should have alerted shoppers on Pinterest that certain pinned items they were seeing were pinned by shoppers who were offered an incentive by the brand. The FTC is not taking any legal action and is working to clarify its policy. (Internet Retailer)
UNIQLO CMO ON CONSUMER CULTURE: Uniqlo chief marketing officer Jörgen Andersson says a big part of the retailer’s success is understanding why consumers are captivated by fashion and what drives people to purchase luxurious clothing. “I think today a lot of consumers talk about wanting to be unique and having their personal style, but in actual fact, almost everyone belongs to one of a few sub-groups of style. Since fashion went digital, everyone has access to the same information at the same time.” Andersson seems to be suggesting that retailers should make consumers feel that a customer’s style is unique, when in fact it’s probably very generic — and balancing that perception is more difficult than it seems. (Business of Fashion)
SILICON VALLEY DOESN’T UNDERSTAND FASHION: Technology veteran Sramana Mitra says innovation in e-commerce has left much to be desired. “If I synthesize what I see is the core issue with online fashion, it is that entrepreneurs are thinking of the industry as a distribution channel a la Amazon, with price being the core differentiator.” Mitra argues that only so many companies can compete on low pricing and so new e-commerce ventures need to do a better job of understanding the fashion business so they can identify opportunities that add real value to consumers. She does have a point — the Web has disrupted a lot of industries, but often the people behind those innovations fail to understand the very industry they are trying to change. E-commerce is an example where few people have experience in both the technology and fashion aspects of the business,.(Sramana Mitra)
BROOKSTONE FILES FOR BANKRUPTCY: Gadget retailer Brookstone filed for Chapter 11 bankruptcy. The company said it lost $US18 million during a thirteen-week period last fall, and has been struggling to recover from declining sales. Brookstone executive James Speltz said the company has fallen victim to the rapid evolution of the retail industry. (New York Times)
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