The Otto Group is partnering with Covariant, a company specializing in AI-driven warehouse robots. With the partnership, Otto wants to automate its fulfilment activities and increase its operational efficiency. Otto’s German fulfilment locations will be robotized first.

The German Otto Group is the owner of leading ecommerce brands such as About You and Bonprix. Recently, Otto announced it is disbanding its toy platform MyToys as it was not able to become profitable.

Covariant was founded in 2017 in the United States. The company offers AI-driven warehouse robots for automated order picking, placement and sorting. Only a month ago the business raised 75 million dollars, with the total amount raised of over 200 million dollars.

By partnering with Covariant, Otto wants to ‘automate a variety of manual fulfillment activities that previously required hand-eye coordination’, the company writes. The aim is to install hundreds of Covariant’s robotic solutions in Otto Group’s fulfilment centres, starting with the German locations Haldensleben and Altenkunstadt.

Logistics needs to be as cost-efficient as possible. By using generalist AI, Otto can find an answer to the massive shortage of workers on the market.  According to CEO Services Kay Schiebur from the Otto Group, as transshipment is often outsourced to cheaper locations now, Otto is particularly pleased to be able to continue to be close to their customers and to strengthen the European and especially the German locations.

Shopify Inc. will cut jobs for the second time in 10 months and has agreed to sell the majority of its logistics business to Flexport Inc., according to a memo issued by the company’s Tobi Lütke. The company faces a challenging climb back from last year’s slump.

Shopify Inc. expects to incur severance charges of $140 million to $150 million.

The ecommerce platform provider also announced its fiscal first-quarter earnings on May 4. It said itsrevenue increased 25% to $1.5 billion compared to the prior year.

Gross merchandise volume, the total value of merchant sales across Shopify’s platforms, was $49.6 billion. That’s above Wall Street projections of $47.68 billion, and some $6.4 billion higher than comparable quarter of 2022.

The Ottawa-based company also gave an outlook for the second quarter, saying it expects revenue to grow at a similar rate to the first quarter growth rate on a year-over-year basis. It also expects to achieve free cash flow profitability for each quarter of 2023.

At the beginning of the pandemic, Shopify hoped that the rapid growth of online shopping would become permanent. When the hopes were not fulfilled, Lutke tried to rebuild the company. Last summer, they cut about 1,000 jobs, raised prices and focused on creating offers for their customers and their own fulfillment network. At the end of 2022, Shopify had 11,600 employees.

U.S. ecommerce sales reached $1.03 trillion in 2022, according to a Digital Commerce 360 analysis of U.S. Department of Commerce figures released Friday. That marks the first time ecommerce revenue has topped the $1 trillion level. It’s also well above 2021’s $960.44 billion.

Digital Commerce 360 had earlier forecast ecommerce sales of $1.03 trillion for 2022 in its mid-year U.S. Ecommerce Market Report.

That remarkable level of sales comes with a slight bump in ecommerce penetration to 21.2% for the year from 21.0% in 2021.

Ecommerce sales grew 7.7% in 2022 year over year. That’s a dramatic drop from the double-digit ecommerce growth in each of the past five years. It’s also the slowest growth rate since the 2.8% growth in 2009. Ecommerce sales growth in 2022 was stayed slightly higher than the total retail sales growth of 6.8% that the Commerce Department reported in 2022. That’s the closest yearly total sales growth has come to reach ecommerce sales growth since the Commerce Department started tracking online sales.

Ecommerce’s share of total retail growth in 2022 was 23.8% year over year. That’s down from the 25.2% share of total retail growth in 2021 and well below the record-setting share of 84.2% during the pandemic in 2020.

Small businesses counted on ecommerce to get them through the pandemic. These expectations habe been met, but growing sales online remains a top priority, as says a new survey data from Alibaba.com.

Alibaba’s vice president Andrew Zheng admits that 2022 brought significant challenges for micro, small and medium enterprises (MSMEs) by volatile energy prices and soaring inflation.

Using ecommerce was the top strategy for survival, with 36% of small businesses attempting ecommerce or digitalization.

The survey of 1,000 small business owners finds that:

• 70% of small companies surveyed said the impact of COVID-19 drove them to make greater investments in digital technologies.
• B2B online sellers will likely see greater competition in 2023 as businesses continue to adapt to the rising need for digitization.
• Businesses with the smallest number of employees were more negatively affected by last year’s challenging market.
  • 25% of survey respondents with under 10 employees shut down completely.
  • Only 13% of respondents with over 250 employees had the same results.
• Small businesses got creative to keep sales up and survive the post-pandemic pressures.
  • Using ecommerce was the top strategy for survival, with 36% of small businesses attempting ecommerce or digitalization throughout and directly following the pandemic.
  • Many flocked to B2B ecommerce marketplaces and continue to use those resources in today’s market.
  • 54% of small businesses surveyed responded that B2B ecommerce platforms remain critical to their current operations.
• To capture more sales and increase customers, over a third (32%) of small businesses took to expanding sales channels in order to survive the pandemic’s effects. Other tactics used included:
  • Cutting expenses (13%).
  • Seeking support from local governments or institutions (11%).
  • Investing in research and development to upgrade products (8%).

Digital selling provided an opportunity for these businesses to reach customers locally and globally without stretching operating budgets, Zheng says. But B2B sellers must stay ahead of digital export trends in 2023 to find continued success.

Italian officials have begun seizing what could be one of the world’s largest networks of fake ecommerce websites, which have deceived potential customers by appearing to offer discounted goods from luxury brands such as Giorgio Armani SpA and Prada SpA that never materialize.

A group of Chinese cyber-criminals allegedly manages the illicit network of more than 13,000 fake ecommerce websites, as suggested by infrastructure code and the payment system’s gateway, according to people familiar with the matter.

It is Cybersecurity firm Yarix that discovered the illicit network. A spokesman for this company has confirmed that the company is actively assisting a large-scale investigation aimed at taking down fake ecommerce websites. Law enforcement agencies from other European countries and the U.S. could later join the investigation, the spokesman added.

Officials at Italian law enforcement agency Polizia Postale on Jan. 25 started taking down some of these fake ecommerce websites related to Italian brands, the people said.

These sites are well-designed imitations of genuine corporate websites. Discounted prices usually attract customers. But no deliveries are made, and the websites generally include a real credit card payment platform used to steal buyers’ financial data.

A representative for Italy’s Polizia Postale confirmed the operation and declined to comment on details.

What they have revealed is a coordinated, infrastructured network of well-designed fake shops across the world that in the last two years have probably stolen tens of millions of euros, dollars from unsuspecting clients.

The criminal network have targeted such Italian fashion brands as Brunello Cucinelli, Dolce & Gabbana, Ermenegildo Zegna, Moncler, and international sports brands such as Nike, Adidas and New Balance.

Most of the fake shops’ servers and digital platforms searched in the current probe are located in Panama, Turkey and the U.S.

May Peace, Happiness and Prosperity be yours during this Holiday Season and throughout the New Year.

HG Alliance

The pandemic thrust many retailers into ecommerce and shoppers became comfortable shopping online. Retailers are now taking a step back to reassess what technologies will help retain existing customers and entice new ones. Digital Commerce 360’s 2023 Leading Vendors Report includes survey data and case studies demonstrating how technology helps retailers.

According to Digital Technology survey, conducted by this source from September to October 2022, three-quarters of surveyed retailers (76%) plan to increase their investment in technology to attract new and retain loyal customers in 2023.

The next question for the retailers to be solved is whether to outsource technology or build it themselves. According to the survey, 70% plan to outsource the task rather than attempt to build a tech stack in house.

Online retailers want to automate where possible and learn how to decipher and use data to their advantage. That requires investment. Three in four retailers expect to increase spending by 15% or less. Meanwhile, 39% predict they will spend 10.1% to 15% more.

Narrowing down their top priorities,

46% pointed at investing in an ecommerce platform.

Other priorities included:

• customer relationship management technology – 34%,
• online marketing – 30%,
• content management – 27%,
• customer service software- 27%.

Fulfillment services were ticked by 24% of respondents,

• marketplace/channel management (selling on 3^rd party marketplaces) – 19%,
• email marketing – 19%,
• payment security systems and fraud prevention – 19%,
• customer reviews /ratings – 18%,
• search engine optimization – 17%,
• order management – 17%,
• affiliate marketing – 16%,
• international ecommerce services – 15%,
• supply chain management – 13%,
• warehouse and fulfillment management – 13%,
• web hosting/cloud services – 10%,
• social media – 10%,
• omnichannel – 8%,
• personalization – 8%,
• web analytics – 8%,
• website performance management – 7%,
• PIM and other product data management- 7%,
• sales tax management – 7%,
• site search – 4%.

It’s important to more than half (54%) of retailers that any new software is easy to implement as well as use.

Macy’s joins a growing list of top retailers that operate a marketplace alongside their ecommerce site. Macy’s says the marketplace will boost their product assortment, add incremental revenue at a ‘low incremental cost.’

Macy’s Inc. announced Sept. 28 that it officially launched its marketplace. The retail chain announced in November 2021 that it would launch one, and it has been working on it since then.

The marketplace will bolster Macys.com’s assortment, as it is adding 400 brands across 20 product categories. Those include apparel, beauty, home improvement, toys and pet products.

Macys.com notes a product is sold by a marketplace merchant with the “shipped and sold by” text at the top of the product detail page, beneath the product name. Shoppers should feel “minimal difference” in the overall shopping experience, the retailer says.

Macy’s says marketplaces sales will continue to be counted in the Macy’s loyalty program, however there are some restrictions when using loyalty points for marketplace purchases, according to a Macy’s spokesperson.

Returns, however, operate differently. Shoppers can’t return items to a Macy’s store and have to return products to a seller within 30 days, Macys.com’s FAQ page shows. This is a deviation from the merchant’s typical 90-day return policy to stores or by mail.

Customers are encouraged to ship returns directly back via UPS, but our stores are available to assist our customers if needed, the spokesperson says.

“Our digital business is targeted to generate $10 billion in sales by 2023,” said Matt Baer, chief digital and customer officer, in the 2021 press release announcing the marketplace. “And we expect the new marketplace platform to produce incremental revenue on top of that target.”

Macy’s has selected the marketplace software provider Mirakl to build its marketplace. Macy’s declined to reveal the cost of building the marketplace.

Retail chains launching a third-party marketplace is a recent trend. For example, Target Corp. (No. 5 in the Top 1000) launched its marketplace in 2019.

Goodwill Industries International Inc., the federation of nonprofits that sell pre-owned goods to fund employment services for the disadvantaged has launched a second online marketplace 23 years after launching its first. The move is the latest effort to expand 120-year-old Goodwill’s presence in digital commerce.

The new marketplace dubbed GoodwillFinds.com comes more than two decades after the 1999 launch of Shopgoodwill.com, an online auction site that did $21.2 million in sales in September.

Goodwill did not provide more information about the relationship between the two ecommerce sites.

GoodwillFinds is launched as interest in secondhand goods retailers has skyrocketed. Pre-owned/secondhand goods market is growing eight times faster than retail.

GoodwillFinds, like ShopGoodwill and the local affiliates, is structured as a nonprofit organization. After the cost of overhead, such as shipping and labor costs and the technology to power the ecommerce site, GoodwillFinds will return all revenue to participating affiliates.

GoodwillFinds launches with six local Goodwill affiliates representing 338 stores in the USA.

The site went live with more than 100,000 unique items for sale.  Those items were donated to participating Goodwill donation centers, which then listed them for sale on GoodwillFinds.com. Those same local donation centers will handle shipping and fulfillment for now, but GoodwillFinds.com will roll out centralized shipping and returns management in the near future.

By contrast, 135 Goodwill stores from across the United States and Canada list goods on ShopGoodwill.

GoodwillFinds is built on Salesforce Commerce Cloud, the cloud-based ecommerce system sold by Salesforce Inc.

Kaness, CEO at GoodwillFinds said GoodwillFinds will also operate as a technology services company for local federation members, building systems for inventory management, customer-relations, online payments and digital marketing.

2022 won’t be a breakout year in digital sales for the six public bellwether distribution companies that break out actual or at least some ecommerce metrics — Fastenal, Global Industrial, MSC Industrial Supply Co., MRC Global Inc., W.W. Grainger Inc. and Watsco Inc. But it will accelerate a shift that makes it an even bigger priority to serve an increasingly digital-first customer.

Digital sales, or sales that occur through ecommerce, electronic data interchange, e-procurement, and marketplaces, for many of these bellwether public distributors is now the (or close to becoming) dominate sales channel.

MRC, distributing pipe, valve and fitting products and services to the energy and industrial markets, says ecommerce accounted for 48% of total $848-million sales in the second quarter ended June 30, compared with 40% in the second quarter of 2021. That’s a 23.6% increase from $686 million in the second quarter of 2021.

At Grainger, sales for the first half of 2022 grew to $7.48 billion. That’s up 19% from $6.29 billion between January 2021 and June 2021.  In recent years, Grainger has said B2B ecommerce represents about 60% or more of total sales.

A big ecommerce growth driver for Grainger so far this year is Zoro.com, a web-only MRO products distributor. Zoro.com posted a 23% year-over-year gain in second-quarter sales as it expanded its numbers of registered customers and SKUs.

MSC Industrial, the metalworking and industrial products distributor, reported record fiscal third-quarter revenue for the period ended May 28. A 13.8% year-over-year increase in ecommerce sales helped drive 10.7% growth in total net sales. That brings sales up to $959 million. MSC is focusing growth strategies on digital operations.

Watsco Inc., one of the biggest distribution companies in the heating, ventilation and air conditioning market, believes its digital technology base is the best way to keep in step with the times. For the quarter ended June 30, Miami-based Watsco reported sales of $2.13 billion. That’s a 15.1% increase from sales of $1.85 billion for the second quarter of 2021. B2B ecommerce now represents about 33% of Watsco’s total sales, and its online channel grew 25% in the second quarter, the company says.

Digital commerce is vital to distributor Global Industrial’s sales and getting more so, says CEO Barry Litwin. Global Industrial sales for the second quarter ended June 30 increased 16.8% year over year to a record $318.5 million. Global Industrial does more than half of its customer transactions through digital commerce. For the first six months of 2022, total sales grew to $607.1 million. The company sells more than 1 million SKUs of maintenance, repair and operations (MRO) products.