Tag Archives: ecommerce

Digital Commerce Continues to Grow

More than any single factor, the pandemic has impacted virtually all industries, but it has most impacted how consumers shop. Prior to 2020, consumers may have shopped online for many different products and services, but since mid-2020 buying habits have changed significantly. Consumers now feel more comfortable buying what were once in-person purchases such as cars, food, and medical or health care needs.

A recent survey by McKinsey & Co. highlighted that since the pandemic began, three out of four people have tried new shopping and delivery methods. More than half of the consumers surveyed intend to continue to use curbside pickup or delivery services after the pandemic ends. Roughly 70% of those consumers intend to keep buying online. Among the changes are increases in online streaming, grocery delivery, restaurant curbside pickup and delivery, and store curbside pickup. Consumers are going online not just for shopping; they now go online for medical appointments, fitness classes, tutoring, and more.

While these changes are good for digital commerce providers, they are not so good for traditional brick-and-mortar retailers. This year will likely see a record of store closings, bankruptcies, and liquidations. And, retailers have had to shift how they deliver services, including more online experiences such as digital events, contactless payment methods, virtual online services, and curbside pickup.

Overall, ecommerce in the U.S. rose to 16.1% from 10.8% a year ago. New shopping habits also extend to a decline in cash and an increase in credit and debit card use.

To quote Bob Dylan, “the times they are a changing.”

Group Activities and Discussion Questions:

  1. As class begins, poll students about their shopping.
  2. What are the last three websites they visited? Did they buy anything? Why or why not?
  3. How have their shopping habits changed this year?
  4. Do they have new online shopping habits?
  5. Will they keep these new habits once the pandemic is contained?
  6. Show video about how pandemic has changed shopping habits: https://www.wsj.com/video/the-future-of-retail-how-will-the-pandemic-change-how-we-shop/526ADB88-F6D1-4B77-AA97-BAA323496D4D.html

Source:  Wall Street Journal

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Singles Day 2020 Hits $75 Billion!

Once again the world’s biggest shopping event has occurred. And, no, it’s not Black Friday and Cyber Monday in the U.S. By far, the biggest shopping day of the year is on November 11, Singles Day, in China. The holiday was originally started in 1993 by college students as a celebration for people who are single, chosen because of the connection between singles and the number ‘1’. Eventually, Chinese ecommerce company Alibaba forged an online shopping event to take advantage of the interest, and the rest is history.

November 11 is now the globe’s largest shopping event. This year, sales (stated as Gross Merchandise Value – GMV) reached the astonishing amount of $75.1 billion over an 11-day period, including 11/11 as the finale event!

Singles’ Day has become an event on its own, including celebrities, fashion shows, TV galas, virtual reality, and augmented reality shopping. This year the shopping started with a November 1 evening event with a live-streamed, star-studded gala starring Katy Perry. There was also interactive entertainment and sport via Alibaba’s app to increase audience and shopper participation.

Highlights this year included:

  • 100 brands sold $15 million within two hours.
  • 60 million consumers used Tmall’s 3D shopping app.
  • S. brands accounted for more than $5 billion of the total spent.
  • Livestream technology included real-time translation into English, Russian, Spanish, and French.
  • At its peak, orders reached 583,000 orders per second.

Why is it so important for global brands to enter this shopping day? Consider that there are roughly 300 million middle-class shoppers in China, rising to an estimated 500 million in the next 8-12 years. While Singles Day may have originally started for lonely Chinese consumers, the shopping day now is seen as critical to driving China’s – and the worlds – economy.

Group Activities and Discussion Questions:

  1. Most students will not have previously heard of China’s Single Day. Discuss the shopping holiday and its importance in China.
  2. This is likely the first time students have heard about Singles Day. There are a number of videos that can help explain the event:
  1. Discuss how this holiday compares to Black Friday and Cyber Monday in the U.S.
  2. Video report on 2020: https://youtu.be/5OJePCHi0Gw
  3. WSJ video report: https://www.wsj.com/video/alibabas-singles-day-gets-boost-from-pandemic-spending-shift/868C7DAA-F76E-44EF-AFCE-BF000A185B2E.html
  4. How should U.S.-based companies participate in Singles Day?

Source: AdWeek; CNBC; Forbes; New York Time; Wall Street Journal; other news sources

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Walmart Launches Walmart+ Membership

Walmart has announced a new service called Walmart+, an annual membership service which will give shoppers free delivery of groceries and other products. Walmart+ will cost $98/year and offers free delivery of food and other items from nearby stores “as fast as same-day.” However, shipping is free only is orders are at least $35.

Walmart stores carry about 160,000 items which qualify for free shipping. And, when the online store is added, Walmart offers roughly 35 million products. Other Walmart+ perks are expected to expand to a gas discount at Walmart gas stations and the ability to skip checkout lines in stores by paying by mobile phones.

Will this be a significant rival to Amazon Prime? Amazon Prime has been around since 2005 and already has an estimated 150 million subscribers around the world. Prime is definitely an attraction for shoppers and Amazon offers not only free shipping, but free videos, original entertainment content, music, books, and more. It has certainly been a reason why Amazon has grown to a dominant ecommerce market position. Amazon carries more than 12 million products, and when that is expanded to its Amazon Marketplace sellers, reaches 350 million products.

Where will you shop?

Group Activities and Discussion Questions:

  1. Poll students: Who has Amazon Prime? Who shops online from Walmart?
  2. Show video: Video: https://youtu.be/U1p1RDxhvps
  3. Divide students into teams. Have each team compare the attributes of Amazon Prime and Walmart+. (Can include: price, services, products, shipping, and more.)
  4. Next, have each team build a chart comparing the strengths and weaknesses of each company.
  5. Optional: Include Target in the analysis, even though it does not (yet) have a membership service.
  6. Should Target also offer a membership service similar to Prime and Walmart+?

Source:  Associated Press; New York Times; Wall Street Journal; other news sources

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