Hy-Vee will benefit from the nearly 600,000 shoppers in Instacart’s network that can pick up, pack and deliver orders, Instacart said.

The retailer is also able to accept EBT SNAP online payments through Instacart.

Instacart and Hy-Vee first worked together in 2018. At the time, Hy-Vee introduced same-day delivery through the Instacart app, with delivery in as little as an hour.

Hy-Vee ranks No. 199 in the Top 1000. The Top 1000 database is Digital Commerce 360’s ranking of the largest North American online retailers by web sales.

Instacart fulfillment as a service

Hy-Vee was able to integrate Instacart’s FaaS into its existing ecommerce operation using an API, the retailer said. Ecommerce operations platform company UpShop facilitated the integration between Hy-Vee and Instacart, the fulfillment operator said.

“We’re proud to strengthen our partnership with Hy-Vee and equip them with the technology and tools they need to meet customers’ needs,” Ryan Hamburger, vice president of retail partnerships at Instacart said in a press release. “Our goal is to empower our partners and offer seamless and personalized shopping experiences. We’ve spent more than a decade focusing on the care and craft of grocery and are continuing to push the envelope by creating even more fulfillment solutions that help our retail partners grow and meet the evolving needs of their customers and businesses.”

Instacart also just announced the addition of Whole Foods to the platform in 14 markets across Canada. Whole Foods is owned by Amazon, which ranks No. 1 in the Top 1000. Amazon is also No. 3 in Digital Commerce 360’s Global Online Marketplaces Database, which ranks the 100 largest such marketplaces by 2023 third-party gross merchandise value (GMV).

Where does Hy-Vee operate?

Hy-Vee has more than 550 locations across eight states in the Midwest, with headquarters in West Des Moines, Iowa. It has 75,000 employees. The supermarket chain is employee-owned. 

Hy-Vee records $13 billion in annual sales, according to the grocer’s website.

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The robots will run on artificial intelligence (AI)-powered software, also provided by RightHand.

Staples ranks No. 14 in the Top 1000. The Top 1000 database is Digital Commerce 360’s ranking of the largest North American online retailers by web sales.

Staples robots deployed for picking

RightHand Robotics RightPick system in use at a Staples fulfillment center. (Image credit: RightHand Robotics)

“We have always valued automation, and we see it as the future of ecommerce picking,” said Amit Kalra, chief supply chain officer at Staples, in a released statement. “After evaluating other solutions, the RightPick system met our high performance and reliability standards, picking items with different shapes, packaging, sizes, and weight.”

In a video explaining fulfillment center priorities more broadly, a Staples representative describes the modernized workflow as follows: “Once a customer order is received, our software determines the best way to get the order through the system — a partnership of the robotics and workers. These automated systems handle the manual work while workers review every customer order for quality assurance.”

Subsequently, orders are carried to shipping areas to go out to customers. In the resulting process, the company spokesperson says that “Staples technology combined with our exceptional warehouse team is the future of logistics.”

How RightHand’s robots work

RightHand Robotics RightPick robot in operation. (Image credit: RightHand Robotics)

“Our RightPick system sets a new standard in the flexibility, autonomy, and reliability of warehouse robotics,” Brian Owen, CEO of RightHand Robotics said in the companies’ press release. “We’re thrilled that Staples recognized the benefits of using our technology to further enhance their automation strategy. It’s great to team up with an established industry leader to optimize their fulfillment operations.”

The RightPick system includes hardware, sensors and software designed to prevent damage during the picking process.  In addition, RightPick indicates that they ensure certain performance and safety standards. According to the two companies, RightHand Robotics “nearly doubled the range of items” that its stations can accommodate, bringing the number of necessary human interventions down by 80% since the work with Staples began.

Ultimately, Staples hopes to leverage the technology to enable next-day delivery to “over 98% of the U.S.”

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Parentheses indicate the merchant’s ranking in the Top 1000.

Amazon.com Inc. (No. 1)

Amazon beat expectations with earnings for its fiscal fourth quarter ended Dec. 31, 2023. Its net sales in the quarter grew 14% year over year to $170.0 billion. 

Full-year sales grew 12% to $574.8 billion in 2023, up from $514.0 billion in 2022.

Read more about Amazon’s earnings here.

Boot Barn Inc. (No. 366)

Boot Barn reported that net sales grew 1.1% to $520.4 million in its fiscal third quarter ended Dec. 30. Ecommerce same-store sales declined 11.5%, and retail same-store sales declined 9.4%.

“Our online channel has felt pressure due to less efficient online marketing spend, partly caused by an increase in digital spend by a handful of vendors and competitors,” CEO Jim Conroy said. “Our objective continues to be to maximize profitability for our online business, so we will remain disciplined with our digital spend so as not to erode earnings and our desire to grow the top-line sales,” he said. The retailer expects further ecommerce declines next quarter.

Columbia Sportswear Co. (No. 149)

Columbia reported net sales declined 9% to $1.1 billion in its fiscal fourth quarter ended Dec. 31. Net sales declined 1% for the full year. U.S. net ecommerce sales declined by a high single-digit percent, the retailer said without specifying further.

“Softer consumer traffic and weather weighed on results. Our DTC business performed well during peak sales windows like Black Friday and Cyber Monday, but fell off during non-peak periods,” CEO Tim Boyle said.

Costco Wholesale Corp. (No. 6)

Costco said net sales grew 6.1% to $56.72 billion in its first fiscal quarter of 2024 ended Nov. 26, 2023. Ecommerce comparable sales grew 6.3% in the same period. E-gift cards, snacks and pet items were all strong in the ecommerce channel, the retailer said.

Read more on Costco’s earnings here.

Deckers Brands (No. 74)

Deckers reported revenue grew 16% to a record $1.56 billion in the fiscal third quarter ended Dec. 31.

“Our brands delivered Deckers’ largest quarter in history, with record revenue and earnings as both HOKA and UGG drove exceptional performance in the quarter, led by our DTC channel and high levels of full-price selling,” CEO Dave Powers said in a statement.

Pitney Bowes (shipping carrier to the Top 1000)

Pitney Bowes announced revenue declined 4% to $872 million in its fiscal fourth quarter ended Dec. 31. Full-year revenue declined 8% to $3.3 billion. Revenue from global ecommerce declined 7% in the fourth quarter to $381 million and was down 14% for the full year. Meanwhile, domestic parcel volume grew, it said. 

Pitney Bowes is a shipping carrier to 104 retailers in the Top 1000.

Sally Beauty Supply LLC (No. 523)

Sally Beauty said consolidated net sales declined 2.7% to $931 million in its fiscal first quarter ended Dec. 31. Comparable sales declined 0.8% during the period. Online sales remained flat with the year-ago period, comprising $91 million in sales.

The beauty retailer reported some improvements in demand, with a return to normalcy among customers over the holiday season.

Skechers USA Inc. (No. 302)

Skechers said sales for the fiscal fourth quarter ended Dec. 31 grew 4.4% to $1.96 billion. Annual sales grew 7.5% to a record $8.0 billion. Direct-to-consumer sales, which encompass ecommerce, grew 20.3% in Q4 and 24.3% for the whole year. Meanwhile, wholesale sales declined 8% for both the fourth quarter and full year.

Online DTC sales recorded double-digit growth, Skechers said.

“The momentum in our direct-to-consumer segment is indicative of strong consumer demand driven by the combination of our fresh and innovative product paired with effective brand marketing. We are excited about our omnichannel growth opportunities as we continue to deliver on our strategy to expand our direct-to-consumer presence worldwide,” said John Vandemore, chief financial officer. 

United Parcel Service Inc. (shipping carrier to the Top 1000)

UPS consolidated revenue declined 7.8% to $24.9 billion in its fiscal fourth quarter ended Dec. 31. Consolidated operating profit declined 22.5% during the same time period to $2.5 billion. The carrier said it will eliminate 12,000 jobs this year as a plan to generate $1 billion in cost savings as revenue and package volume decline.

532 online retailers in the Digital Commerce 360 Top 1000 use UPS for their fulfillment — either exclusively or in combination with other carriers.

Read more about UPS’ earnings here.

Target Corp. (No. 5)

Third-quarter sales declined 4.9% for the mass merchant, to $25 billion from $26.12 billion in its fiscal third quarter ended Oct. 28. Meanwhile, Target online sales decreased 6% year over year. Moreover, Target’s online sales declined 6.7% year over year for the first nine months of its fiscal year.

Read more about Target’s earnings here.

Tractor Supply Co. (No. 99)

Tractor Supply reported net sales declined 8.6% to $3.66 billion in its fiscal fourth quarter ended Dec. 30. The retailer did not share ecommerce sales for the quarter but said annual online sales topped $1 billion for the first time in 2023. It also reached 7 million mobile app downloads, with 2 million of those downloads in 2023.

“We continue to capitalize on opportunities to accelerate our growth,” CEO Hal Lawton told investors. “Between our website and our mobile app, we have more visitors online now than we do in our stores. These digital assets are essentially the front door to Tractor Supply. We’ll be focused this year on improving our digital customer experience and capability as we look to accelerate conversion rate.”

Lawton cited poor weather, high interest rates and inflation as headwinds facing Tractor Supply and impacting consumer demand.

Walmart Inc. (No. 2)

Walmart reported that U.S. online sales grew 24% for its fiscal 2024 third quarter ended Oct. 27. Global ecommerce sales grew 15% over the same period, while international ecommerce declined 3%.

U.S. comparable sales grew 4.9%, and total revenue grew 5.2% to $160.8 billion.

Read more about Walmart’s earnings here.

1-800-Flowers.com Inc. (No. 47)

1-800-Flowers revenue declined 8.4% to $822.1 million in the second fiscal quarter ended Dec. 31. Ecommerce revenue declined, but slightly more slowly. It was down 6.6% to $738.4 million. Average order value grew 3% year over year as higher-income consumers became a larger percentage of the customer base and tended toward more expensive gifting purchases, the retailer said. Meanwhile, lower-income consumers continued to be impacted by macroeconomic pressure and cut back spending. 

During the first half of our fiscal year, we have been prudent with our marketing spend in a challenging consumer environment in which we didn’t see an adequate return on investment,” president Thomas Hartnett said.

So what does it mean?

• UPS and Pitney Bowes both recorded declining revenue during the peak holiday season. UPS is still grappling with the fallout of its near strike last year and recovering volume it lost during that period.
• Footwear retailers Skechers and Deckers both recorded significant growth in their most recent quarters, with major gains in DTC sales. Other apparel retailers did not report the same gains in consumer demand.

Ecommerce earnings calendar

Here’s when other ecommerce earnings are scheduled to report this quarter:

• Amazon.com Inc.: Feb. 1
• Best Buy Co Inc.: Feb. 29.
• Costco Wholesale Corp.: Dec. 14
• The Home Depot Inc.: Feb. 20
• Lowe’s Cos Inc.: Feb. 27
• Target Corp.: March 5
• Walmart Inc.: Feb. 20

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Full-year sales grew 12% to $574.8 billion in 2023, up from $514.0 billion in 2022.

Amazon ranks No. 1 in the Top 1000, Digital Commerce 360’s ranking of the largest North American online retailers. Amazon is also No. 3 in Digital Commerce 360’s Global Online Marketplaces Database, which ranks the 100 largest such marketplaces by 2023 third-party GMV. Digital Commerce 360 has published the latest analysis of the industry as a whole within the 2023 Global Online Marketplaces Report.

How much did Amazon make in Q4 sales?

North American sales made up the bulk of revenue in the fourth quarter, growing 13% year over year to $105.5 billion. International sales, however, grew at a faster clip. The segment increased 17% year over year to account for $40.2 billion in sales. Sales from Amazon Web Services (AWS) grew 13% to $24.2 billion.

Operating income also grew in the quarter. It reached $13.2 billion in the fourth quarter, nearly five times the $2.7 billion in operating income Amazon recorded in the year-ago period. Net income totaled $30.4 billion, up from a net loss of $2.7 billion in Q4 2022.

Amazon records a successful holiday season

“This Q4 was a record-breaking holiday shopping season and closed out a robust 2023 for Amazon,” CEO Andy Jassy said in a statement. The online retailer said customers purchased more items on Amazon during the 2023 holiday season than in any previous season, culminating in a record-breaking Black Friday and Cyber Monday. 

Amazon customers ordered more than 1 billion items during the holidays, with 500 million of those orders coming from third-party sellers, it said.

During the same period, millions of new consumers signed up for an Amazon Prime Membership. Amazon has 176 million Prime members as of December 2023, according to research from Consumer Intelligence Research Partners (CIRP). That’s the highest level ever recorded by CIRP, which has monitored Prime membership since 2013. Membership is up about 5% from 168 million in December 2022, per CIRP. Those estimates are for Amazon customers with Prime membership, not households.

Amazon fulfillment improvements 

Ahead of the earnings release, Amazon announced results of fulfillment advancements in 2023 and plans to continue growing the area in 2024.

“The regionalization of our U.S. fulfillment network led to our fastest-ever delivery speeds for Prime members while also lowering our cost to serve,” Jassy said in a statement.

The ecommerce giant delivered 7 billion units by same-day or next-day delivery to Prime members in 2023. More than 4 billion of those deliveries took place in the U.S., and more than 2 billion were in Europe.

The number of items delivered on the same day or overnight grew 65% year over year in the U.S. in 2023, Amazon said. More than 70% of Prime orders in the U.K. arrived the same day or next day in the fourth quarter of 2023. Amazon celebrated its billionth same-day delivery in the U.S. in December.

“We’ve challenged every closely held belief for our fulfillment network and reevaluated every part of it, and found several areas where we believe we can lower costs while also delivering faster for customers. Our inbound fulfillment architecture and resulting inventory placement are areas of focus in 2024, and we have optimism there’s more upside for us,” Jassy told investors on Feb. 1.

Amazon will add incremental fulfillment capacity going forward, based on demand for same-day delivery sites and automation, said Brian Olsavsky, chief financial officer.

Amazon on generative AI

The company discussed its advances in generative artificial intelligence (AI) across the company in its earnings presentation, too. 

It announced the beta test of Rufus, a new generative AI shopping assistant trained on Amazon’s product catalog. So far, the assistant is available to a small subset of U.S. customers to answer shopping questions and make recommendations, Amazon said. It will roll out to all U.S. customers in a few weeks.

The retailer also introduced a generative AI tool that will allow brands to produce lifestyle imagery for advertisements, it said. 

Amazon also added generative AI capacity to Amazon Connect, the AWS cloud contact center, it said. Generative AI will give customer service agents suggestions on how to help customers and generate summaries of conversations, it said.

“2023 also was a very significant year of delivery and customer trial for generative AI or Gen AI in AWS,” Jassy said. “Customers are also excited about our approach to generative AI. Still relatively early days, but the revenues are accelerating rapidly across all three layers, and our approach to democratizing AI is resonating well with our customers. We have seen significant interest from our customers wanting to run generative AI applications and build large language models and foundation models, all with the privacy, reliability and security they have grown accustomed to with AWS.”

How did Amazon do financially in 2023?

For the fiscal fourth quarter ended Dec. 31, Amazon.com Inc. reported:

• Sales increased 14% to $170.0 billion, from $149.2 billion in the year-ago period.
• Amazon Q4 North America sales grew 13% to $105.5 billion.
• International sales grew 17% year over year to $40.2 billion.
• AWS sales reached $24.2 billion, growing 13%.

For the 12 months ended Dec. 31, Amazon reported:

• Amazon sales grew 12% to $574.8 billion, from $514.0 billion in 2022.
• Operating income reached $36.9 billion, increasing from $12.2 billion in 2022.
• AWS sales grew 13% to $90.8 billion.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s Amazon earnings article.

How big is Amazon’s total ecommerce business?

Amazon.com is the largest ecommerce retail company in the world with $412.1 billion in annual web sales (excluding all marketplaces and B2B companies such as Alibaba). Amazon’s business model is multifaceted, as it is one of the world’s largest marketplaces (No. 3) with over $650 billion in total GMV and over $400 billion in third-party sales. Its AWS unit climbed over $90 billion in sales in 2023, and its advertising sector brought in another $46.9 billion the same year.\

During 2020, Amazon grew its ecommerce business by over $54 billion. That’s nearly 10 times the size of Nordstrom’s annual ecommerce revenue.

Amazon’s first-party sales (online store)

If we split out Amazon’s online store sales, removing subscription services and its third-party seller fees, Amazon would still be the largest ecommerce player in the world by over $100 billion, as China’s JD.com (second largest, excludes Alibaba) sells over $125 billion annually. Those who follow Amazon.com closely can easily see the growing sectors of the ecommerce giant’s business. Its online store is not among them anymore. In fact, Amazon’s first-party sales are the slowest growing business arm with a 3-year CAGR of only 5.5%. Meanwhile, its third-party seller fees have a 16.4% 3-year CAGR, Amazon’s advertising services have a 22.7% CAGR, and its subscription services have a 12.5% 3-year CAGR.

How big is Amazon Prime Membership revenue?

Amazon makes over $40 billion annually just from its subscription services. To put that into perspective, if Amazon sold nothing else — without a single first-party product on its site, and all it sold was subscription services — Amazon.com would rank as the third-largest online retailer in North America. That would still make it larger than Apple (No. 3 with $35 billion in 2022 web sales) and Home Depot (No. 4 with $22.4 billion in 2022 web sales). Moreover, even comparing it to the combined total revenues from Nike (No. 9), Costco (No. 6) and Chewy (No. 13), Amazon’s subscription services alone would still be greater.

How large is Amazon’s advertising business?

Amazon’s annual advertising revenue sits at $46.9 billion. This is equivalent to more than half of Walmart’s entire ecommerce operation and more than twice the size of Target’s online revenue. 

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UPS consolidated revenue declined 7.8% to $24.9 billion in its fiscal fourth quarter ended Dec. 31. Consolidated operating profit declined 22.5% during the same time period to $2.5 billion. For the full fiscal 2023 year, consolidated revenue declined 9.3% to $91 billion and consolidated operating profit declined 28.7% to $9.1 billion.

“2023 was a unique and quite candidly a difficult and disappointing year. We experienced declines in volume, revenue, and operating profit in all three of our business segments. Some of this performance was due to the macroenvironment and some of it was due to the disruption associated with our labor contract negotiations as well as higher costs associated with the new contract,” Tome told investors.

532 online retailers in the Digital Commerce 360 Top 1000 use UPS for their fulfillment — either exclusively or in combination with other carriers. 65.6% of Top 1000 sales come from retailers using UPS. The Top 1000 is a ranking of North America’s leading retailers by online sales. 

UPS domestic revenue results

U.S. domestic segment revenue declined 7.3% to $16.9 billion in the quarter, UPS said. Average daily volume (ADV) ended the quarter 7.4% below 2022 levels. However, that still represented a step up from an “exceptionally low third quarter” that preceded the period, Tome said. Revenue per piece of mail was slightly positive, the carrier said without revealing more.

B2B made up 35.5% of domestic volume in the quarter, about flat from 2022. B2B ADV declined 6.8% year over year, due to declines in the retail, tech, and manufacturing sectors, UPS said. 

Total air ADV declined 15% year over year, while ground declined 5.8%. Macroeconomic pressures pushed UPS customers toward ground products to cut costs, it said.

UPS international revenue results

Revenue and package volume also declined internationally, largely due to softening demand in Asia and Europe, Tome said. Revenue declined 6.9% year over year to $4.6 billion, driven by an 8.3% decrease in ADV. Revenue per piece grew 3.1%.

The carrier highlighted a few bright spots in the international segment. Volume from China to the U.S. grew 2.7%. That remains the most profitable shipping lane, UPS said. The growth was largely driven by small and medium-sized businesses. Volume in the Americas also grew, up 11.9%. That was the result of Canadian and Mexican customers using cross-border ground shipping services, UPS said. 

2024 projections

UPS remains “cautious” looking ahead to 2024, it said. European export volumes are projected to increase, and the carrier expects volume from China to continue growing, too. 

In the fourth quarter, UPS recovered much of the volume lost to a potential strike earlier in 2023, Tome said. The business will be burdened by rising costs this year, including from the higher labor costs won in union negotiations with the Teamsters. Eliminating the 12,000 positions is intended to mitigate those rising costs, she said. Layoffs will impact managerial positions, not union jobs, it said. UPS has about 495,000 employees as of January, Tome said. That’s down from a high of 540,000 during peak COVID-era demand.

UPS said the first half of 2024 will likely be difficult, while projecting profit to grow 20 to 30% in the second half of the year.

UPS quarterly earnings

For the fiscal fourth quarter ended Dec. 31, 2023, UPS reported:

• Consolidated revenue declined 7.8% to $24.9 billion.
• Consolidated operating profit declined 22.5% to $2.5 billion.
• UPS average daily package volume declined 7.5%.

For the 12 months ended Dec. 31, 2023, UPS reported:

• Revenue declined 9.3% to $91.0 billion.
• Operating profit declined 28.7% to $9.1 billion.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports.

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The ecommerce giant delivered 7 billion units by same-day or next-day delivery to Prime members, CEO of worldwide Amazon stores Doug Herrington wrote in the blog post. More than 4 billion of those deliveries took place in the U.S., and more than 2 billion were in Europe.

It did not share comparable delivery figures for 2022, but the number of items delivered on the same day or overnight grew 65% year over year in the U.S. in 2023, Amazon said. More than 70% of Prime orders in the U.K. arrived same-day or next-day in the fourth quarter of 2023. Amazon celebrated its billionth same-day delivery in the U.S. in December.

Amazon ranks No. 1 in the Digital Commerce 360 Top 1000. The Top 1000 is a ranking of North America’s leading retailers by online sales. It also ranks No. 3 in Digital Commerce 360’s Global Online Marketplaces database. The database ranks the 100 largest such marketplaces by third-party gross merchandise volume (GMV).

Amazon changes logistics in 2023

Amazon achieved its record delivery speeds by shortening delivery distances, improving inventory placement, and expanding its same-day delivery range, Herrington said.

The online retailer divided its U.S. delivery regions into smaller areas, shipping 600 million more items from in-region fulfillment centers in Q4 2023 than in Q4 2022. Transporting orders from in-region fulfillment centers to delivery centers in the same region minimizes the stops per package and cuts down on the need for air transportation, Amazon said. Both factors lead to less time between order and delivery. Amazon made a similar move in the U.K., shortening the average distance a package traveled by 25 kilometers year over year.

Amazon prioritized sorting inventory in the right fulfillment centers where consumers were most likely to want to order those goods, it said. That allows Amazon to grow its same-day delivery footprint in the U.S. As of January 2024, Amazon operates 55 dedicated same-day delivery sites in the U.S., with 18 cities added in 2023. Those sites serve as both fulfillment centers and delivery stations, where orders are fulfilled, sorted and delivered all in one setting.

Amazon using AI to improve delivery speeds

Amazon will use artificial intelligence (AI) to further improve delivery speeds in 2024, Herrington said. The retailer is using AI to understand what products are most likely to be reordered on a recurring basis, like dog food or paper towels, and stock them in each delivery region in appropriate quantities. That will eventually mean shorter wait times for those deliveries, Amazon said.

The marketplace will also use AI on the other side, to monitor incoming inventory from vendors and sellers. The technology will give the operations team a better view of what inventory is coming into facilities and how often, he said.

Robots and drones part of Amazon’s fleet

Amazon’s Herrington shared information on other technologies the online retailer will use more of in 2024. It will expand the use of the Sequoia robot storage system, which launched in a Houston fulfillment center last year. Sequoia robots identify and store inventory at fulfillment centers up to 75% faster, Amazon said. That speed contributes to a 25% reduction in order processing time for the customer. The system will launch in more fulfillment centers this year.

The retailer made progress in its drone-delivery capabilities, too. The test recorded its fastest delivery to date in December at 15 minutes and 29 seconds from College Station, Texas. Prime Air will expand to the U.K., Italy, and a new U.S. location this year, Amazon said.

How many Amazon Prime members are there?

Amazon’s latest delivery speed figures encompass Prime members, who are eligible for expedited two-day, next-day and same-day delivery. It costs $14.99 per month, or $139 per year. 

Amazon has 176 million Prime members as of December 2023, according to research from Consumer Intelligence Research Partners (CIRP). That’s the highest level ever recorded by CIRP, which has monitored Prime membership since 2013. Membership is up about 5% from 168 million in December 2022, per CIRP. Those estimates are for Amazon customers with Prime membership, not households.

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Digital Commerce 360 was at the Javits Center for all three days of NRF’s Big Show to find the most important ecommerce stories. These were the most important takeaways from the event.

Top NRF Big Show takeaways

1. Unified commerce

Retailers across the show indicated that they’re not considering in-store and online sales as separate, siloed channels anymore. Increasingly, the same customer is shopping both ways.

“Everybody needs to think like an omnichannel retailer” if they want to be successful, said Michelle Gass, incoming Levi’s CEO. Retailers discussed creating consistent experiences across whatever channels a consumer uses to shop. For example, at Lowe’s, self-checkout uses the same technology as lowes.com, says Seemantini Godbole, chief digital and information officer.

Lowe’s ranks No. 12 in the 2023 Digital Commerce 360 Top 1000. The Top 1000 is a ranking of North America’s leading retailers by online sales. Levi’s is No. 192.

2. Every retailer needs an AI strategy

Artificial intelligence (AI) was the No. 1 topic of discussion at NRF’s Big Show. Every session had at least a brief mention of the technology that’s promising to revolutionize retail, with special attention on the possibilities of generative AI. Salesforce released a lineup of new generative AI tools for retailers and consumers who shop with them. The technology will work using Salesforce’s recently announced Einstein 1 platform. And the excitement around AI goes beyond just talk about future applications. Executives from e.l.f. Beauty (No. 950 in the Top 1000), Tractor Supply (No. 99), Saks (No. 28) and other retailers explained how they’re already using AI at the conference.

3. Data rules everything

AI was the buzzword, but all the most interesting applications are only as good as the quality of data fed into them. That’s the premise behind FedEx’s announcement of fdx, its new commerce platform for online retailers. The shipping carrier said it can help retailers track and manage demand, conversion, returns, and fulfillment based on insights from the 15 million packages it delivers each day. 

High-quality data is key for other buzzy AI applications, like personalization and demand forecasting, Marc Benioff, Salesforce CEO, told attendees in a keynote during the first day of the show.

4. Physical presence for online retailers

Online retailers see the appeal of stores and physical locations. Chewy (No. 13) has plans to open its first physical locations this year in Florida, CEO Sumit Singh said. The planned openings are clinics, rather than stores, to grow within the $40 billion pet-health industry. However, they’ll also provide an opportunity to upsell other pet products when owners bring their animals in, he said. 

Gen Z in particular shows a preference for stores, vice president of strategy at Aptos Retail Nikki Baird said. Reformation (No. 354) CEO Hali Borenstein noted younger consumers are more likely to visit the chain’s stores, too. 

5. Sustainability is something to consider

Sustainability remains a consideration for retailers, especially when they’re trying to appeal to younger consumers. Two retailers addressed its specific importance in session during the Big Show. Under Armour (No. 97) CEO Stephanie Linnartz discussed the brand’s efforts to appeal to women in Gen Z and Gen Alpha.

“They care about sustainability,” she said. That’s why Under Armour is working on replacing spandex with a more eco-friendly recyclable material.

Reformation’s Borenstein said the retailer passed up opportunities for athleisure growth during the pandemic because it couldn’t produce products sustainably and quickly enough. The decision paid off, she said. It made Reformation’s claims to sustainability come off as more authentic, she said.

6. DTC strategy is shifting

Direct-to-consumer retailers are finding their footing after the market became more crowded during the pandemic. The market is much more volatile and demand is harder to forecast now, Bombas CEO Dave Heath said in a session for DTC leaders. Bombas and Ritual are both finding the sweet spot of retail stores’ sales versus DTC sales, the executives said. For Bombas, that’s around 15% wholesale. Ritual, meanwhile, is seeing success in Whole Foods, meeting consumers who are willing to pay a premium for high-quality ingredients, CEO Katerina Schneider said. It also started selling on Amazon in 2022, which functions as a “giant search engine” where new customers find them, she said.

7. Retailers can’t ignore Shein and Temu

U.S. retailers would be wise to pay attention to the rapid growth of two low-cost competitors from China: Shein and Temu, says Jason Goldberg, chief commerce strategy officer at the Publicis Group. Coresight Research CEO Deborah Weinswig noted Shein’s advantages in supply chain and its on-demand production model in outpacing U.S. retailers. The model allows it to nearly perfectly match supply to demand, creating less waste and improving margins over competitors, she said.

Shein is No. 2 in Digital Commerce 360’s ranking of ecommerce retailers in Asia. Temu, which Pinduoduo owns, launched in 2022 and isn’t yet reflected in rankings. Pinduoduo operates an app-only marketplace for Chinese consumers. Because it doesn’t operate an ecommerce website, it is not included in Digital Commerce 360’s Asia Database.

Catch up on Digital Commerce 360’s daily recaps from the 2024 NRF Big Show:

• Here’s what you missed from NRF Day 1.
• Here’s what you missed from NRF Day 2.
• Here’s what you missed from NRF Day 3.

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Below, we recap some of Digital Commerce 360’s most insightful articles about online retailers from 2023 regarding 10 key coverage areas:

1. Industry news and trends (including the Bed Bath & Beyond saga)
2. Artificial intelligence
3. Digital marketing
4. Exploring new technology
5. Fulfillment and delivery
6. Livestreaming
7. Mergers and acquisitions
8. Online marketplaces
9. Payments and fraud
10. Sustainability

These stories highlight meaningful changes to online retailers’ ecommerce operations in 2023. Most notably, they include new and improved technologies and strategies that online retailers have implemented. We published roundups specifically for some of these coverage areas over the first couple weeks of 2024, and we link to them below. Those topic roundups — about artificial intelligence, fulfillment and delivery, and payments and fraud — include subtopics.

1) Industry news and trends

Silicon Valley Bank’s collapse hit the ecommerce world. See a list of impacted companies.

The bank had a history of investing in ecommerce startups, and Etsy, Shopify, and others had accounts with Silicon Valley Bank. 

Gathering data in the age of privacy 

Learning how to collect and use first-party data is key if retailers are to navigate a world without third-party cookies. 

Data shows online retailers with the highest carbon footprints

Websites emit carbon dioxide emissions (CO2). Recent data shows which retailers top the list of offenders versus those who don’t. 

Retail profitability rebounds but remains pressured by online costs

Retailers’ profits declined from 2012-2019, in part due to the costs associated with online and omnichannel sales, but bounced back during the pandemic, Deloitte says. Cutting costs, including by limiting free shipping and handling returns more efficiently, will be essential to maintaining profit margins.

What ecommerce retailers can learn from HomeGoods exit

Despite giving ecommerce a go, HomeGoods found out that off-price retailing is not well suited for its online sales.

1.5) The Bed Bath & Beyond saga

Amid all this ecommerce news and the largest online retail trends of 2023, one story remained at the forefront for months. Bed Bath & Beyond’s downfall had — and continues to have — a meaningful impact on the retail industry.

Bed Bath & Beyond says it’s not beyond help, but reports further losses

Coming just days after the retailer said it might seek bankruptcy protection, the poor earnings report paints a dismal picture for the beleaguered retailer. 

Which retailers will benefit from Bed Bath & Beyond’s demise?

Bed Bath & Beyond’s bankruptcy presents an opportunity for retailers to cash in on the shopping experience both in store and online. 

Overstock CEO says brand name is a “boat anchor” ahead of Bed Bath & Beyond relaunch

Revenue and other key metrics were down for Overstock, but CEO Jonathan Johnson says the Bed Bath & Beyond relaunch will be a “new phase.” 

Goodbye, hello: Buy Buy Baby preps to be born again

Under new ownership, Bed Bath & Beyond’s former baby-products retailing unit plans an ecommerce and brick-and-mortar revival.

2) Artificial intelligence

Perhaps the most-talked-about subject for months, if not the entire year, artificial intelligence had a resurgence in 2023. Many retailers were already using it — and machine-learning technology — to guide operating processes. But then, generative AI entered the arena at the end of 2022, and it drew global attention to its capabilities. Here’s how some online retailers are leading AI integration into ecommerce.

3) Digital marketing

How are digital marketers using AI to boost conversion?

Artificial intelligence allows digital marketers to quickly test how consumers respond to ads, images and emails. Over time, the algorithm learns, and its predictions become more accurate. Learn how three retailers increased their online sales after investing in AI.

Online flower retailer UrbanStems increases conversion 12% during Valentine’s Day season

Conversion through paid social channels drove that overall increase, growing 83% year over year.

Why wacky ads work on TikTok, while sober is better for Facebook

Four online marketers share ways they curate their brands’ social media content to cater to their target audience on each platform, and explain when it’s OK to repurpose content.

80% of Chico’s customers sign up for its loyalty program in the first nine months

Chico’s updated its loyalty program for the first time in 30 years, and after one year, more than 80% of customers are members.

Lights, camera, conversion: How some retailers use videos to entice shoppers to buy

Online retailers use video to provide shoppers with a rich customer experience that informs, engages and converts.

4) Exploring new technology

Generative AI wasn’t the only new technology to hit retailers’ tech stacks in 2023. Companies dived into the metaverse and other virtual realities. They also took advantage of atypical payment methods and found ways to change business models entirely.

American Girl invests in its virtual museum

The retailer’s digital museum provides content so girls can play, learn more about the brand’s doll characters and create product wish lists.

Crurated’s wine platform uses NFTs and memberships to find a younger market

70% of Crurated’s members using the blockchain wine service are under 45 years old.

Forever 21 caters to Gen Z shoppers with fast checkout, metaverse products

Despite an initially turbulent relationship, apparel brand Forever 21 and payment provider Bolt Financial are now touting positive results from the integration of the streamlined checkout button.

What online retailers can learn from Evite’s business model pivot

Evite’s customer experience suffered because of the company’s reliance on advertising revenue, CEO David Yeom tells Digital Commerce 360. Evite took the lull in parties during the pandemic to overhaul its revenue streams. 

UK crafts retailer uses data to guide website replatforming process

Hobbycraft had to learn what parts of its website did and didn’t make sense for its shoppers, what bugs to work out, and what changes its website wasn’t capable of. And after about 12 years with its previous website, it replatformed in March 2022.

5) Fulfillment and delivery

Online retailers continued learning how to cut and manage shipping costs in 2023. Some major retailers optimized fulfillment and delivery by using stores to fulfill orders, whether via delivering from them or urging customers to use in-store and curbside pickup options. These stories highlight meaningful fulfillment trends among online retailers in 2023.

6) Livestreaming

Natori invests in livestreaming to appeal to new generation of customers

Luxury apparel brand The Natori Co. believes livestreaming will enable the brand to appeal to new customers. 

Orchard Mile takes control by livestreaming its own shopping events

Luxury online marketplace Orchard Mile hosts livestreaming shopping events through its own website rather than other channels. 

Newegg livestreams more than 24 hours a day

Newegg livestreams 30 hours of content on weekdays, which includes livestreams across its six handles and in China. 

Women’s apparel retailer ‘Evereve TV’ attracts shoppers, increases conversion

Evereve staff model clothing and share their styling tips through video on the retailer’s Evereve TV — and it’s boosting sales.

7) Mergers and acquisitions

Although there were many more mergers and acquisitions in 2023, these are some of the most notable ones impacting the industry.

Walmart sells outdoor retailer Moosejaw to Dick’s Sporting Goods

It’s the latest example of Walmart selling off online-focused brands it acquired as it bulked up its ecommerce business several years ago. Moosejaw will be part of the Public Lands outdoor business unit that Dick’s launched in 2021. 

Unilever is selling Dollar Shave Club after seven years

Private equity firm Nexus Capital Management will acquire a 65% stake in Dollar Shave Club, with Unilever retaining 35%. The deal is expected to close by the end of the year. 

UPS to acquire Happy Returns

Happy Returns’ service for online orders will soon be available at more than 12,000 U.S. locations, the CEO of UPS says.

What Sycamore gets for $1 billion to buy Chico’s

Private equity firm Sycamore Partners unsuccessfully tried to buy Chico’s FAS in 2019. Why is Chico’s worth $1 billion? 

Why a serial ecommerce entrepreneur bought Blue Apron

Blue Apron is being sold to Wonder Group, an online food-to-home delivery company, founded by serial ecommerce entrepreneur Marc Lore.

8) Online marketplaces

Michael’s is the latest retailer to add a third-party marketplace

The digital marketplace will quadruple the number of products for sale, with the majority from third-party sellers.

Walmart and Amazon are growing their online marketplaces. Here’s how they compare.

They are both growing the number of third-party sellers on their online marketplaces, but Amazon has a significant lead. 

Selling on Amazon is key for SMBs, but it might not make money

Small and medium-sized retailers say selling on Amazon is a necessary part of customer acquisition, despite added costs. 

Amazon fee change ‘completely out of the blue’ for some Amazon sellers

Amazon announced it will end its Small and Light Program and introduce Low-Price FBA rates for all items priced below $10 (previously $12). 

Prime Day’s mixed message: some merchants boost prices during the event

Last year, retailers raised prices on 13% of top-selling items during the Prime Day promotion, according to new research. And this year, Amazon rolled out invitation-only deals that limit price drops to select shoppers. 

Amazon announces updates to Buy with Prime to stay competitive

Updating Buy with Prime is a way for Amazon to collect data and keep its market share while competing with Shopify.

What were the biggest ecommerce takeaways from Amazon’s Q2 earnings call?

CEO Andy Jassy said Amazon is developing more AI technology, making its fulfillment more efficient and improving its B2B division for business buyers.

EBay rolls out its generative AI listing tool to all marketplace sellers in app

The generative AI tool writes product descriptions for eBay’s app marketplace sellers based on their listing’s metadata. 

Michaels launches MakerPlace online marketplace

Michaels MakerPlace does not charge sellers a listing fee and allows them to sell access to virtual classes and how-to guides. 

9) Payments and fraud

Buy now, pay later was already on the rise going into 2023, when its popularity continued to grow. And as retailers considered implementing BNPL, even if late in the game, they also looked into other ways to make the payments process smoother for their consumers. These stories highlight meaningful payments and fraud trends from last year, showing how online retailers are staying focused on their bottom lines.

10) Sustainability

Grove Collaborative CEO talks sustainable shipping

With a goal to be plastic-free by 2025, personal care and home products brand Grove details ways it makes direct-to-consumer shipping more sustainable.

The secondhand retail industry grew 28% in 2022, according to ThredUp’s latest report

The report shows Gen Z and millennials are growing more open to buying and selling used clothing online. 

How an apparel brand eliminates polybags

Toad and Co. commits to less packaging by sending orders in reusable bags and switching to paper-based polybags that can be regularly recycled.

Bedding brand aims for luxury unboxing without extra tissue paper

Beflax, a small online business, ships its $300 linen bedsheets in reusable packages. The brand wants its customers to have a premium package without extra waste.

Jewelry retailer strives for sustainability on different levels

J’evar uses an in-house generative AI tool to boost its sustainability efforts, which also include using a solar farm to grow its own diamonds.

Archive helps retailers resell their own products

Hanna Andersson customers take advantage of store credit options as they list items on the retailer’s Hanna-Me-Downs resale site. 

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FedEx is a shipping carrier for 478 retailers in the 2023 Digital Commerce 360 Top 1000. The Top 1000 is a ranking of North America’s leading retailers by online sales.

FedEx introduces fdx

FedEx called the new platform “fdx.” Subramaniam said it will help retailers track the four most important areas of ecommerce across the customer experience:

• Demand
• Conversion
• Fulfillment
• Returns

“FedEx is transforming into a digitally-led business powered by our extensive physical transportation network, leveraging our scale and insights from moving 15 million packages per day,” Subramaniam said. “Through fdx, we will enhance our longstanding relationships with merchants of all sizes to help them optimize and grow their businesses through digital intelligence.”

The primary benefit of fdx over other ecommerce technology vendors is that everything lives in one platform, FedEx says. A single unified platform is more efficient than a siloed approach with many vendors and technology systems, Subramaniam told the audience at NRF. 

For example, FedEx can connect clients with high-value customers through ShopRunner, which it acquired in 2020. It can also give retailers delivery estimates to share with customers on product pages and in the cart, which it says will increase conversion.

FedEx has access to extensive data from its huge delivery network that it can put into practice for retailers to help them make strategic decisions across their business, it said. 

Fdx will be “FedEx 2.0,” Subramaniam said. The digital network will be built on the extensive physical network FedEx already owns. 

Fdx and returns

FedEx says the new fdx platform will also include a way to manage returns. It will “streamline, configure, and manage digital front-end return experiences, data exchange, and physical transportation for returns in one platform,” according to the press release. 

Subramaniam confirmed that the shipping carrier will process returns without boxes at FedEx locations. That news comes just a few months after rival UPS announced its acquisition of Happy Returns, which processes box- and label-free returns at UPS stores.

When will FedEx launch fdx?

FedEx plans to launch fdx in fall 2024. The carrier is also offering previews to interested retailers now. Potential clients can also visit FedEx’s booth at NRF to learn more ahead of the launch. 

See the other NRF stories Digital Commerce 360 is following here. 

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