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Shopify jockeys for big growth in B2B

Paul Demery — Thu, 15 Feb 2024 20:25:35 +0000

While Shopify Inc. reported robust 2023 financial results, with total gross merchandise volume on its clients’ ecommerce sites up 23% to $75.1 billion, it noted even strong growth in its B2B business.

Harley Finkelstein, president, Shopify Inc.

Harley Finkelstein, Shopify’s president, said on a Q4 and year-end earnings call this week that the vendor’s B2B gross merchandise volume doubled last year. He added that, in the fourth quarter, Shopify’s business with B2B companies “was up nearly 150% year over year.”

Shopify did not immediately reply to a request for specific figures on B2B-related revenue and GMV, but executives said on the earnings call that that they see the B2B market playing an increasingly vital role in Shopify’s growth plans.

An ‘exciting’ B2B growth opportunity

Finkelstein — referring to B2B as a “big and exciting growth opportunity” — said Shopify is experiencing B2B market growth with two types of companies: existing Shopify retail merchants adding a B2B channel, such as The Home Depot, home furnishings retailer Lulu and Georgia, and jewelry retailer BaubleBar; and newcomers to Shopify like Carrier, a global manufacturer of heating and cooling and other building-management systems.

He added that getting a client company like Carrier, which signed on as a client in Q4, was “opening the door to a whole new opportunity of industries we previously didn’t serve.”

Jeff Hoffmeister, Shopify’s chief financial officer, added that Shopify is seeing more demand from large enterprise B2B companies for the vendor’s multiple technology offerings, including Shopify Plus, international B2B sales, online payments, and physical store point-of-sale systems that integrate with Shopify’s ecommerce platform.

“All those things are the growth engines for the future,” he said.

Shopify says its store point-of-sale terminal is designed to integrate with the Shopify ecommerce platform and support “over 1,000 physical stores.” Referring the POS systems as new “on-ramps or entry points into Shopify,” Finkelstein said they “substantiate our role as the unified commerce operating system for merchants, whether they come to us to sell online, off-line, or anywhere in-between.”

He added, “We are building on our commitment to help merchants sell to all of their customers from a single, unified commerce platform, with upgrades to our B2B offering, including headless B2B storefronts and support for sales reps.”

Among other new features, the ecommerce technology company has also launched for merchants on the Shopify platform:

Shopify Bill Pay, an expense management tool that lets merchants pay their vendors directly from their Shopify administrative application.
Shopify Credit, a “pay-in-full” business credit card designed to help manage monthly cashflow and earn cashback savings without paying interest or fees.
Shopify Collective, an application that enables merchants to source products from other companies on Shopify and have them shipped directly to customers.

Perks of unified commerce and integrated POS

A unified commerce environment, including integrated POS systems, can play a vital role for B2B companies trying to keep up with omnichannel commerce that extends to their physical branches and other outlets, B2B industry experts say.

“Key aspects such as ERP integration, branch-selling, and tools that aid the end customer in their job are crucial for a successful B2B platform,” says Justin King, managing partner of advisory firm B2X Partners. “Shopify’s acknowledgment and incorporation of these elements, along with their significant growth in B2B GMV and the acquisition of B2B-only merchants, position them as a potentially formidable player in the B2B e-commerce technology sector. Their commitment to providing a unified commerce platform for both online and offline B2B transactions further solidifies their intent to capture and expand their market share in this domain.”

Jay Schneider, the founder of digital advisory firm B2BSquared, adds that the Shopify platform still needs to show that it can handle complex online B2B interactions, such as those involving displays, configurations and quoting of products with extensive lists of attributes and complex pricing.

Finkelstein said that Shopify generated $441 million last year from its offline offerings, including POS hardware, “more than five times what our offline revenue was just four years ago.” Shopify estimates its total addressable market for offline and B2B business at “over $450 billion,” he said, adding, “We have barely scratched the surface of this opportunity and expect it to be a key growth driver in 2024.”

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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International commerce drives Alibaba’s biggest growth rate

Paul Demery — Wed, 07 Feb 2024 22:31:37 +0000

For an ecommerce company with $36.67 billion in revenue for its most recent quarter, Alibaba Group Holding Limited showed a respectable year-over-year growth rate of 5%.

Our top priority is to reignite the growth of our core businesses, ecommerce and cloud computing.

Eddie Wu, CEO

Alibaba Group

Alibaba owns the world’s two largest online marketplaces by gross merchandise value (GMV), Taobao and Tmall. Taobao ranks No. 1 in the Global Online Marketplaces Database, Digital Commerce 360’s ranking of the largest such marketplaces by GMV. Tmall ranks No. 2. Both operate in China.

Eddie Wu, CEO, Alibaba Group

Alibaba revenue in fiscal Q3

The lion’s share of revenue was in Alibaba’s China retail ecommerce operations Taobao and Tmall, which grew combined revenue 1% to $17.43 billion. At Alibaba’s China B2B ecommerce site, 1688.com, revenue increased 23% to $747 million. Sellers on 1688 include include such U.S. manufacturers as Avnet, 3M and Stanley Black & Decker.

But Alibaba’s sharpest ecommerce revenue growth came in its International Digital Commerce Group, where retail commerce revenue surged 56% to $3.28 billion and wholesale climbed 8% to $740 million, for consolidated international growth of 44% to $4.02 billion.

Alibaba’s international retail commerce sites include Lazada, AliExpress, Trendyol and Daraz. The company conducts its international wholesale sales through its Alibaba.com B2B ecommerce site.

The IDCG is headed by its CEO, Fan Jiang. The IDCG ‘s chairman is J. Michael Evans, a former vice chairman of investment bankers Goldman Sachs who joined Alibaba Group last year as president.

Alibaba also reported an 86% revenue increase in its Cloud Intelligence Group and a 24% increase to $4.01 billion in its Cainiao Smart Logistics Network.

Investing to drive Alibaba’s growth

CEO Eddie Wu said Alibaba intends to drive stronger growth across its operations.

“Our top priority is to reignite the growth of our core businesses, ecommerce and cloud computing,” he said today in a statement about its fiscal third quarter. “We will step up investment to improve users’ core experiences to drive growth in Taobao and Tmall Group and strengthen market leadership in the coming year. We will also focus our resources on developing public cloud products and sustaining the strong growth momentum in international commerce business.”

Alibaba said Q3 net income fell 77% to $1.51 billion. It attributed the decline to “impairment of intangible assets of Sun Art and impairment of goodwill of Youku.”

Alibaba earnings

For the nine months ended Dec. 31, Alibaba reported:

Taobao and Tmall Group China retail commerce revenue increased 5% to $45.94 billion.
China wholesale commerce revenue increased 13% to $2.19 billion.
Cloud Intelligence Group revenue increased 3% to $11.38 billion.
International retail commerce revenue grew 62% to $8.36 billion
Alibaba international B2B ecommerce revenue increased 6% to $2.22 billion.

In November 2023, Alibaba Group became the first Asian Internet technology company to join the World Business Council for Sustainable Development, a group of over 200 businesses, to support WBCSD’s drive to make global value chains more sustainable.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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

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An AI-backed ‘ecommerce insights’ platform gets $4 million

Paul Demery — Tue, 06 Feb 2024 18:00:24 +0000

Alon Partuk, CEO, Octup

Octup, an AI-driven ecommerce insights platform, says it “uncovers overlooked data” from brand manufacturers’ operations, including packaging, logistics and warehousing to last-mile delivery, returns management and customer support. In turn, it reveals opportunities to cut operating costs and boost profits, the startup says.

A group of investors led by Tal Ventures is backing Octup with $4 million in pre-seed funding. Octup says it will use the funding to “broaden the rollout of its 360-degree end-to-end discovery platform for ecommerce.”

Alon Partuk, founder and CEO, says he founded Octup in 2022 to “tap into deeper operational insights beyond standard metrics to uncover real opportunities,” adding, “We believe it’s crucial to understand how key business metrics like lifetime value and client retention relate to the quality” of a company’s service.

Prior to Octup, Partuk founded outdoor gear and apparel brand and merchant Apricoat, where he says he got the inspiration to develop Octup. He remains a director of Apricoat.

Octup says its technology helps global brands across such product categories as apparel, supplements, consumer electronics, skincare, and cosmetics jewelry.

John Michael Fabrizi, president and chief operating officer of outdoor apparel and hiking gear brand Coalatree, says in an Octup press release that Octup’s technology has helped Coalatree produce a 14% increase in customer retention, a 12% reduction in cost per order, and 9% revenue growth.

Fabrizi adds that, prior to Octup, Coalatree “grappled with data silos and missed opportunities due to disjointed insights across platforms, which limited our revenue potential.” He says Octup’s “user-friendly platform bridges these gaps, enhancing cost efficiency and profits.”

Ron Ostroff, the founder and managing partner at Tal Ventures, says his firm backs Octup for its ability to deliver “transformative benefits to ecommerce businesses, cultivating substantial growth and bolstering profitability.”

Octup says its financial backers also include Bullet Ventures, HCS Investors Group, World Trade Ventures, and the founders of unicorn technology companies Trax and Rapyd.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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An India B2B ecommerce company raises $1.2 million

Paul Demery — Mon, 05 Feb 2024 20:39:04 +0000

Recognizing India as an emerging B2B and retail ecommerce market, startup ecommerce technology provider Rupyz is developing its software-as-a-service platform for helping brands distribute their products through an omnichannel strategy.

Dhaval Radia, CEO, Rupyz

“Our commitment is to unlock the full potential of India’s B2B ecommerce and supply chain,” says Dhaval Radia, co-founder and CEO.

Rupyz recently received $1.2 million in seed funding from venture capital firm Merak Ventures, which says it focuses on “sector-agnostic, early-stage” investments, and other angel investors.

In announcing the funding, Merak noted that “numerous Indian small and medium businesses face significant obstacles in maximizing their growth potential due to inadequate digital commerce capabilities. This gap is particularly concerning in an era where B2B commerce is not just an advantage but a necessity.”

Merak added, “Rupyz brings its integrated SaaS solution to enable these businesses to have an omnichannel interface to automate and scale their existing offline and online distribution.

Rupyz focuses mostly on companies in the food, personal care, lifestyle and fast-moving-consumer-goods (FMCG) industries. It says it caters to a network of 85 brands and more than 6,500 distributors and 250,000 retailers.

The company also says it expects to onboard over 3,000 businesses to its platform over the next 12 to 15 months. It adds that a broad shift to a new generation of leaders of family-owned businesses in India is fostering a shift to digital commerce.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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2024 has mounting supply chain issues. Here are new ways to handle them.

Yikun Shao — Fri, 02 Feb 2024 22:20:41 +0000

Yikun Shao, head of supply chain for North America, Alibaba.com

Businesses have been carefully watching the state of global supply chains as they have had to maneuver around obstacle after obstacle to ensure they meet the increasing demands of customers. In 2024, businesses will continue to feel the brunt of existing challenges, as well as meet new ones, and it will be critical to anticipate and find new ways to manage these issues while living up to customer expectations.

Crowdsourced delivery allows businesses to scale their shipment operations and achieve delivery timeliness and efficiency.

Of note, nearly four in ten (38%) small businesses think the global supply chain outlook will have a negative impact on their business, according to an Alibaba.com survey, so it will be important to watch for changes throughout the year and monitor for potential concerns.

One of the most pressing challenges the industry faces is a shift of issues from the supply to the demand side. On the supply side, more raw materials are available, and there are fewer transportation obstacles.

However, on the demand side, there has been rising inflation globally, and backlogged inventory, especially in the U.S. and E.U., has led to a decrease in demand, compounded by decreased demand for certain products. While the U.S. saw a return to pre-pandemic consumer holiday season spending in 2023, businesses may still want a more conservative approach and order products in smaller quantities, meaning that meeting shipping requirements may become more difficult. Demand is not able to meet the products that the supply side is able to provide.

On top of this, recovery from the COVID-19 pandemic is ongoing as supply chains are still readjusting from related interruptions. There is more stability, but recovery takes time, especially as new challenges arise.

Mounting Concerns Businesses Should Monitor

Businesses are also facing a number of additional issues that could spell trouble for them throughout the year that they should be watching carefully:

Cyber attacks: Threats from bad actors continue to be a growing issue. Small businesses are three times more likely to be targeted by cybercriminals, and the cost of cybercrimes to small businesses reached $2.4 billion in 2021.
Labor and government shutdowns: 70% of small business owners say a government shutdown would negatively impact their business, and 93% say it would hurt their revenue. Additionally, labor strikes can also impact small businesses by disrupting vendors or shipping partners.
Natural disaster events: With 2023 on track to be the hottest year on record and extreme weather events increasing, supply chains could be increasingly disrupted by natural disasters and unworkable conditions.
Panama Canal disruptions: The drought in Panama, largely caused by the El Niño climate phenomenon, has caused major delays and bottlenecks for those in the logistics industry. Scientists believe climate change may be prolonging dry spells and increasing temperatures in Panama. As such, the situation has become dire and expected to continue into at least mid-2024, as the number of ships allowed through the canal will decrease into February.
The state of the U.S. economy: 47% of small business owners feel the economy will get worse in the next 12 months, and 58% said their business is being impacted by higher interest rates.

It will be crucial for businesses to monitor these and other issues and adapt as necessary by tapping into innovative industry tools and resources.

Digital Tools Address the Changing Supply Chain Landscape

As supply chain and logistics trends continue to evolve, digital tools can make it easier to manage operations to ensure on-time deliveries. There are a variety of tools on the market that can help businesses stay up-to-date on shipping and inventory processes. Companies can also invest in data analytics programs to assess patterns in inventory management and customer demands. There are even technology offerings that can help model and then execute on needs as supply chains come under greater stress. The goal in utilizing digital solutions like these is to predict trends, streamline processes and increase efficiency no matter the current supply chain landscape.

To make the biggest impact, specifically engineered intelligent tools, like Alibaba.com’s Smart Assistant, are also available, and they can provide better insight into the sourcing process. They can include features surrounding supplier transparency, direct communication with translation, shipment tracking, protections for wrong or delayed orders, and digital inventory awareness. These functions allow businesses to keep tabs on their orders and adjust to changes to time orders accordingly and, most of all, have peace of mind when sourcing their products.

However, employing digital tools is just one avenue businesses can take for upping their supply chain game.

Alternative Shipping and Warehousing Methods

Thinking outside the box when updating your shipping practices can also help to increase efficiencies, meet the growing demand for faster deliveries and stay resilient during supply chain setbacks.

There is a newer phenomenon in the form of crowdsourced delivery. This allows businesses to scale their shipment operations and work with other businesses to achieve timeliness and efficiency in deliveries. This communal form of shipping will continue to grow and become highly utilized in the coming years as technology becomes more widely adopted.

Beyond crowdsourced delivery, the localization of supply chains is also helping keep things closer to home, reduce logistics costs and cut order fulfillment time for small businesses. Localization may take the form of strategically built warehousing networks to maintain inventory closer to major customer bases. Some businesses are also using third-party warehouses, but these can have numerous and complex restrictions, which are constantly evolving. With that in mind, regional warehousing could be a viable alternative.

The world of ecommerce logistics and supply chain is constantly changing, but digitization, localization and omni-channel distribution are the three areas of innovation that businesses should consider taking advantage of. New technologies are bringing more transparency to the process than ever before. While these trends are growing, it will be critical for businesses to stay vigilant and monitor for new innovations and supply chain developments in order to be ready to tackle future challenges and seize new opportunities to evolve and improve their supply chains.

About the author:

Yikun Shao is Head of Supply Chain for North America at international marketplace Alibaba.com.

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The dual imperative: Transforming the B2B front and back office

Paul do Forno — Tue, 26 Dec 2023 14:00:05 +0000

Paul do Forno

The impending surge of 16,000 SAP S/4 upgrades spotlights the back office as a pivotal and well-understood element foundational to business operations. Yet, within this widespread acknowledgment, a strategic opportunity surfaces: the front office, though often overshadowed, emerges as the key to unlocking new revenue and seizing untapped opportunities.

A robust, well-oiled front office has the potential to unlock more revenue, covering the investment made in upgrading both back- and front-office systems.

While the back office provides core capabilities, the front office presents a new pathway for businesses to venture into innovative realms or channels, driving growth and capitalizing on newfound potential.

Navigating the SAP S/4 wave

The heartbeat of this transformation lies in the need to upgrade back-office systems, specifically SAP S/4HANA. These SAP updates are triggering a surge in upgrades, aligning with the broader trend of technological advancements. The focus is not solely on customer-facing roles but encompasses the entire operational spectrum. Many companies find themselves at a crucial juncture — a crossroads that demands a holistic approach to updating both the back and front office.

The role of the back office in supporting and facilitating seamless operations and financials is paramount. Upgrading and maintaining these systems is not just about internal efficiency; it is a critical move to ensure customer satisfaction and drive overall business success. The synergy between the back and front office becomes evident as companies explore streamlining their back-office processes. Synchronizing the upgrade of the front office can help to pay for the back-office updates, ensuring a cohesive ERP system.

The front office, encompassing marketing, sales, service, and commerce, is the face of the company. Recent technological strides enable the synchronization of front- and back-office functions. This synchronization eradicates manual data entry, minimizing errors, and ensuring real-time access to customer data for the front office. Such streamlined operations facilitate personalized service and swift responses to market changes.

B2B commerce stands as a linchpin in the front office, seamlessly connecting with the back office. Think of B2B commerce as the digitization of B2B sales. The omnichannel view of B2B commerce, spanning direct commerce, B2B marketplaces, procurement commerce, and sales-assisted channels, is critical. This importance is further emphasized by a Forrester Research study projecting a 50% increase, reaching $3 trillion in B2B ecommerce over the next four years.

B2B Commerce: The Catalyst for Front-Office Growth

Today, customers prioritize companies who offer digital tools — officially putting the paper catalogs on the back burner. And if companies want to remain competitive and grow, they will need to have robust self-service options that users can not only opt into, but a system that allows for a smooth and seamless experience. And a robust, well-oiled front office has the potential to unlock more revenue, covering the investment made in upgrading both back- and front-office systems.

When companies firm up their front office by tapping into the array of digital tools that help them sell across channels — Omni-Channel B2B Commerce — the potential is limitless. They can provide an end-to-end digital sales experience that empowers them to more efficiently and effectively serve their customers through:

Direct commerce / Customer Portal / Dealer Portals – a website that supports marketing and catalog management online. This also includes mobile responsive design.
B2B marketplaces – a company’s own and third-party marketplaces in which companies can sell both their own products and facilitate others to sell via online marketplaces.
Procurement commerce – a platform that facilitates buyers to access a supplier’s storefront from within the buyer’s own procurement application.
Sales Assisted – allows direct connection with customers through call centers and online chats to complete orders or resolve any issues in a timely manner.

As B2B commerce is expected to grow over the next four years, digital transformation should be seen as a growth channel for any B2B company.

Success has been proven through a manufacturer’s recent digital transformation. While the investment was 24% for the front office, it resulted in 57% of the overall business value case in both the front and back office.

By investing in their front office, companies can help pay for their back-office upgrades — continuing to fuel strong revenue growth, building strong relationships with their customers as well as creating new efficiencies across their business, ultimately leading to easier sales processes and increased return of investment (ROI).

About the author:

Paul do Forno is the managing director of Deloitte Digital’s Commerce Practice.

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Nike Digital sales grow slightly in Q2 despite declining traffic

Mary Meisenzahl — Fri, 22 Dec 2023 14:00:14 +0000

Nike Inc. reported both digital sales and total revenue grew in its second fiscal quarter of 2024 ended Nov. 30. Revenue grew 1% year over year to $13.4 billion, Nike said. The athletic apparel retailer did not disclose revenue from digital sales.

Nike ranks No. 9 in the Top 1000, Digital Commerce 360’s database of the largest North American e-retailers by online sales.

Nike Digital sales grow despite challenges

Online sales grew in most regions but faced challenges from price-conscious consumers this quarter, the retailer said. Nike Digital, encompassing global sales through the retailer’s website and mobile app, grew 4% in Q2. Digital sales grew 2% in North America, Donahoe said. That’s on top of 31% digital growth in Q2 of fiscal 2023. Meanwhile, online sales grew more than three times as quickly in Europe, the Middle East and Africa, increasing 7% year over year. Digital sales grew 14% in Asia Pacific and Latin America.

Sales were bolstered by the retailer’s strongest Black Friday week ever, CEO John Donahoe told investors. Holiday sales in both digital and brick-and-mortar channels grew 10%. However, outside of major shopping events like Black Friday, consumer demand was down online, even as in-store traffic grew over the quarter.

“While Nike’s store traffic continued to grow, we saw softness in digital traffic and higher levels of promotional activity across the marketplace,” chief financial officer Matthew Friend said. “We are seeing indications of more cautious consumer behavior around the world in an uneven macroenvironment.”

The retailer is planning to keep a tight leash on promotions going forward. “We’re not going to race to the bottom on digital. We’re going to focus on prioritizing brand health and brand strength,” Friend said.

Nike Digital sales in China

Nike Digital revenue declined 22% year over year in the Greater China region, the retailer said. At the same time, total revenue in China grew 8%. The retailer faced the same problems in China as in the rest of the world, with high promotions eating into margins as consumer demand online dwindled. However, in-store traffic remained strong enough to offset some digital losses.

Double 11 Day, also known as Singles Day, was a bright spot for digital sales in the otherwise disappointing quarter. Nike was the top sports brand on Tmall for the shopping holiday.

Tmall is an Alibaba-owned marketplace, along with Taobao. Taobao ranks No. 1 in the Global Online Marketplaces Database, Digital Commerce 360’s ranking of the largest such marketplaces by gross merchandise value. Tmall ranks No. 2.

Female Nike members drive sales

Nike members remain a key sales group, the retailer says of its loyalty program. Women now make up 40% of members and are poised to become a more significant portion of the total as they sign up in greater numbers.

Female Nike members are exhibiting greater demand than members as a whole, presenting an opportunity to sell more performance and lifestyle products, Donahoe says. Nike added new lines of leggings and bras, with pieces priced above $100, a higher price point than the retailer’s regular offerings.

“More and more women are joining our brand by purchasing these leggings. In fact, statement leggings fueled our fitness apparel growth in women’s for the quarter,” Donahoe said. He noted similar results from appealing to women in footwear through both new brands and established franchises like Air Force 1s and Dunks.

Average order value grew among members in the quarter, although Nike did not specify by how much.

For the fiscal second quarter ended Nov. 30, 2023, Nike reported:

Revenue grew 1% to $13.4 billion, from $13.3 billion.
Nike Digital sales grew 4% year over year.
Gross profit grew 5% to $6.0 billion from $5.7 billion.

For six months ended Nov. 30, 2023, Nike reported:

Revenue grew 1% to $26.3 billion.
Gross profit increased 3% to $11.7 billion.

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

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Global shippers get ready for a vibrant but challenging 2024

Paul Demery — Thu, 21 Dec 2023 22:21:20 +0000

B2B and retail companies that rely on importing and exporting goods will face global challenges next year, and many of them are investing in and adopting technology to smooth out their supply chains, online logistics platform Container xChange says.

Planning ocean freight shipments in 2024 will run into several issues, as consumer spending caution, geopolitical impacts on trade routes, and supply chain diversification beyond China may disrupt the shipping industry and the steady supply of ocean shipping containers, Container xChange says in its second annual report on shipping industry trends.

Christian Roeloffs, CEO, Container xChange

“In 2024, the shipping industry will grapple with reduced demand and oversupply [of containers], potentially leading to fierce competition, reduced profits, and possible mergers and acquisitions,” the report says. It adds, “Blank sailings are expected to rise in response to market volatility, while imbalanced container availability, driven by economic crises may continue.” Blank sailings occur when an ocean carrier cancels as planned port of call because of changing market dynamics.

Container shortages resulting in higher container prices are also a concern in some markets, such as those most affected by recent attacks against container ships in the Red Sea, the report notes.

“Some of the main ports in Germany like Rotterdam, Hamburg, Bremen are posting significant week-on-week price increases and, of course, the interpretation is that the situation in the Red Sea has contributed to this increase,” Christian Roeloffs, CEO of Container xChange, said this week.

He added, “The market anticipates that, especially in Europe, which is on the receiving end of import containers from the Middle East, India, southeast Asia and China, that container scarcity will lead to an increase in container prices and the market.”

‘China plus one’ supply chain strategy

The report also notes that 50% of companies expect to modify import strategies in 2024 that rely on a “China plus one” strategy of sourcing products from at least one other country in addition to China.

“Importers in the U.S.A. have diversified their sources to include Southeast Asia, India, and Pakistan,” Josilene Mattos, senior global account manager, container-shipping company Hapag-Lloyd AG, says in the report. “This strategic move has proven to be a successful business practice and should be sustained in the years to come.”

Much of that diversification will result in increased trade with India and other Southeast Asia countries, Roeloffs says.

“As it is difficult for manufacturers to move their entire value chain away from China, we expect an increase in cargo volumes, specifically of semi-finished goods, within Asia,” he says. “This increase in trade is expected between China and Southeast Asia, India, and other similar destinations, before finished goods are transported to the ‘consuming’ countries. Ultimately, this will benefit strong niche carriers and the smaller vessel sectors.”

Overall, companies are largely positive about the global container shipping industry’s growth this year, according to a recent survey Container xChange conducted of 1,200 supply chain professionals.

The survey found that nearly three-quarters, or 74%, of respondents foresee positive growth in the global container shipping industry this year. In addition, 53% said they expect container prices to increase in 2024.

The survey also found the following percentages of respondents investing in technology:

31%, forecasting and planning.
27%, trading partner collaboration and connectivity.
24%, real-time visibility and tracking.
18%, process automation.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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How PIM vendor Akeneo is expanding in the U.S.

Paul Demery — Wed, 13 Dec 2023 20:54:31 +0000

Kristin Naragon, the new chief strategy and marketing officer of Akeneo, says the “product experience” company is on a mission to help companies tell their product story effectively across multiple channels.

Naragon asserts that companies have focused in large part on customer experience and customer journey mapping but that “there hasn’t been the same awareness from CEOs that, my gosh, we should also have a strategy with a chief product officer and technology to support really articulating our product story consistently wherever our products are being showcased.”

She adds, “There’s nothing more frustrating for a CEO to go searching for a product of their own company and to see incomplete, inaccurate information and bad images.”

To address such concerns, Akeneo has taken several steps in 2023 to expand its suite of product data management technology offerings, including:

Its September acquisition of Unifai, an AI platform designed for the automated collection, cleansing, categorization and enrichment of product data.
The March launch of Akeneo Activation for Retail, which connects product data from Akeneo PIM to product detail pages of retailers and marketplaces worldwide.
Extending the availability of Akeneo PIM by making it available through the online marketplaces SAP Store and Google Cloud Marketplace.

Akeneo says it now has more than 850 customers worldwide, including North America-based companies CarParts.com, Arc’Teryx, DSW, Nautica, Belvins, TaylorMade and Chico’s.

Akeneo also expanded its management team this year. In addition to Naragon, who joined the company in January to head strategy and marketing, others include:

Andy Tyra, chief product officer, who is a former executive of Amazon Fresh and the Amazon Web Services.
Nadine Pichelot, chief financial officer, a veteran technology industry executive most recently with Anaplan.
Sabrina Jaksa, chief people officer.
Tim Kohn, technology and product advisor, who formerly was vice president of technology and product at Amazon.com Inc.

Akeneo also appointed former director of product strategy Camille Fant as head of corporate social responsibility. Along with overseeing diversity, equity and inclusion (DEI) initiatives, Fant will spearhead Akeneo’s plan to reduce its carbon footprint per customer by 30% within the next year.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.

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The post How PIM vendor Akeneo is expanding in the U.S. appeared first on Digital Commerce 360.

Interview: Under Armour CEO talks ecommerce expansion

Abbas Haleem — Tue, 12 Dec 2023 22:37:35 +0000

“You could have the world’s most functional website, but if what you have on it isn’t beautiful and popular and selling well, and you’re not merchandising it well, it doesn’t matter,” said Stephanie Linnartz, president and CEO at Under Armour Inc. In a one-on-one interview with Digital Commerce 360 at Under Armour’s Michigan Avenue store in Chicago, she explained where she wants to take the 27-year-old sportswear company, both as a business and brand.

Linnartz joined Under Armour in February and is the company’s first female CEO. In her previous role, she served as president at Marriott International. She said that she has a vision for where she wants to take Under Armour’s website and app. To start, she believes the sportswear brand has “a lot of work to do” to improve its ecommerce functionality and how it sells its merchandise.

Under Armour is No. 97 in the Top 1000. The Digital Commerce 360 database ranks North America’s leading online retailers by their web sales.

Under Armour focuses on ecommerce platforms

Ecommerce at Under Armour represents “a mid-teen percentage rate” of global revenue, Under Armour shared with Digital Commerce 360. Under Armour also shared that ecommerce represents about 40% of the brand’s direct-to-consumer business.

The brand defines direct-to-consumer sales as those that originate in its physical stores or on its website or app. It also sells wholesale through merchants including Dick’s Sporting Goods, Amazon and Foot Locker.

Under Armour already uses artificial intelligence on its website for search and for personalization, Linnartz said. It also uses AI in its supply chain for end-to-end planning. And whereas many retailers have jumped to implement generative AI into their technology suites, Linnartz wants her company’s investment to be intentional and impactful.

“Whether it’s AI or anything else, you need to be very purposeful in the use case,” Linnartz said. “I think companies can run around trying to do a gazillion things. We’re going to be very focused. Where does this technology, AI or otherwise, help us drive our business results?”

Under Armour’s holiday sales numbers are not public yet, but the attention paid to its website in advance can be seen in its load times. Web performance vendor Blue Triangle found that Under Armour had a strong day among online retail’s best performers during the Cyber 5. Blue Triangle bases its website performance ranking on metrics such as Largest Contentful Paint (LCP), which measures the time a website takes to show a user the largest content on the screen, complete and ready for interaction.

Under Armour ranked No. 11 among Top 1000 retailers for best LCP on Cyber Monday, according to Blue Triangle data. The retailer’s LCP was 0.452, according to the platform. The retailer with the fastest LCP was Thread Pit Inc., at 0.200, according to Blue Triangle. According to Google’s Core Web Vitals Team, an LCP of 2.5 seconds or faster is considered good. An LCP between 2.5 and 4.0 seconds needs improvement, and greater than 4.0 seconds is considered poor.

Ecommerce growth plans start with youth, digital marketing

Under Armour’s target audience is 16-to-24-year-old team-sport athletes, according to Linnartz.

“We want to appeal to that target consumer across every demographic, across every religion, across every part of the world,” Linnartz told Digital Commerce 360. She added that Under Armour wants to “focus on being a company that values diversity, equity and inclusion.”

Linnartz said more than 75% of Under Armour sales are to men. Among her goals at Under Armour is to increase the brand’s sales to women. Part of that comes with effective marketing. She explained that the way Under Armour markets and speaks to women is different than how it does to men. She also said Under Armour inventory will begin to appear in more boutiques and department stores to help grow the brand’s presence.

To reach more women and youth, Linnartz stated, Under Armour is going where they are. Social media plays a large role in that, specifically Instagram and TikTok.

“A lot of 16-to-24-year-olds are not watching linear TV,” Linnartz said. “It’s not that we will do nothing on TV or outdoor or any of that, but we are really shifting our marketing spend to more digital, to more ‘always on.’ Furthermore, more product-based marketing, really using our assets.”

Under Armour CEO Stephanie Linnartz said integrating experiences and omnichannel functionality will help boost its ecommerce sales. Photo credit: Abbas Haleem

Loyalty program boosts digital expansion

Linnartz said engaging Under Armour customers where they are is a “top priority with web and app engagement.” Included in that push for engagement is the late-July launch of Under Armour’s loyalty program, UA Rewards.

“The launch and success of our loyalty program has been an important piece in engaging new and existing customers, where results have shown increased engagement and conversion levels,” Linnartz assessed. She added that Under Armour is “always looking for additional ways to drive omnichannel value.”

In the retailer’s 2024 fiscal second quarter ended Sept. 30, 2023, Under Armour reported that UA Rewards had surpassed 1 million members in its first few months.

“So far, UA Rewards members are almost twice as likely to make a repeat purchase and return to the brand within 90 days. So early points on the board in building greater brand love and loyalty,” Linnartz had said in an earnings call with investors at the time.

When the brand launched UA Rewards, Linnartz told Digital Commerce 360, “a lucky winner got to take an all-expense-paid trip to Baltimore to spend the day with Steph Curry. So it’s all about experiences. Of course, you get points for every dollar you spend, but it’s also, ‘How can we have lucky winners go to a Notre Dame game or meet with one of our athletes? How can we give points for challenges or exercise? How can we do exclusive drops for our loyalty members?’ You’re going to get first, early access.”

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The post Interview: Under Armour CEO talks ecommerce expansion appeared first on Digital Commerce 360.