ContextLogic will drop its current ticker symbol WISH within 30 days of the deal closing, according to its announcement. The acquisition price of $6.50 per share, however, will give investors a 44% premium on where the stock traded before the Monday announcement.

Wish.com is No. 25 in Digital Commerce 360′ Global Online Marketplaces Database. The database ranks the 100 largest such marketplaces by 2023 third-party gross merchandise value (GMV).

What Wish being acquired by Qoo10 means for its future

“Integrating the Wish platform into Qoo10 will create a true global cross-border ecommerce platform to support the massive market demand,” said Joe Yan, the CEO at ContextLogic. “Upon close, we expect the new Wish platform will have an improved customer experience through increased product assortment and merchant selection. And for our merchants, we will be able to offer fully integrated logistical capabilities to deliver unmatched cost-efficient services with high quality control and transparency.”

The acquisition also provides an end to Wish’s ongoing losses under ContextLogic. The company announced in November that it was exploring “a range of strategic alternatives to maximize shareholder value” at the end of third quarter when negative cashflow reached $86 million.

Who are Qoo10’s competitors?

By adding Wish to its portfolio, Qoo10 will push into a competitive discount space in online retail. There, Temu and Shein are aggressively pursuing expansion. Temu, for instance, likely spent tens of millions of dollars on Super Bowl ads, in 2024. In addition, it may have as much as $3 billion being readied for its total annual marketing budget.

“Wish has innovative technology that provides highly entertaining, personalized shopping experiences for its users while serving as one of the largest global ecommerce platforms,” said Young Bae Ku, the CEO and founder of Qoo10. “By combining our operating expertise and Wish’s technology and data science capabilities, we expect to drive greater success for merchants while providing an even greater marketplace for consumers globally.”

As Qoo10 eyes its own international expansion, it will look to leverage Wish’s existing reach and business.

“With the acquisition of Wish, Qoo10 and Wish will offer a comprehensive platform for merchants, sellers, buyers, and customers globally to realize the potential of a truly global marketplace,” Ku said. “With the strong commitment from Wish’s employees and staff combined with the Qoo10 family group of companies, we are well positioned to realize our long-stated goal of being a leading cross-border, ecommerce marketplace.”

Closing date for Qoo10’s Wish acquisition

ContextLogic anticipates a second-quarter closing for the deal in 2024 to finalize Wish being acquired. It will face a shareholder vote and other conditions before that can happen.

“The Board conducted a thorough review of strategic alternatives with the assistance of outside financial and legal advisors,” said Tanzeen Syed, chairman of the board at ContextLogic. “We evaluated a variety of potential outcomes and determined that the proposed sale of our operating assets and liabilities, while preserving significant NOLs, represents the best path forward to maximize value for shareholders. We also believe there is a significant upside potential to obtaining a long-term aligned capital partner that would support future value creation.”

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Emily Newton

A smooth customs process is essential for getting ecommerce goods to their destinations in the expected time frames. However, standard customs forms are extremely detailed, with dozens of fields to fill. People are increasingly interested in how artificial intelligence (AI) could streamline things.

1. Completing Customs Forms More Efficiently

Even conscientious people make errors when providing information on customs documents. That might mean they put details into the wrong fields, use the wrong tariff codes to classify ecommerce documents, or make other mistakes, ultimately extending the time frames for parcels reaching their destinations or resulting in the packages getting returned to the senders.

Many optical character recognition tools have AI features to improve their functionality. People can use these options to pull data from electronic paperwork automatically and use it for customs forms.

Phlo Systems is a digital forwarder based in the United Kingdom working on a chatbot to fill out customs forms. Training is underway and responses have about an 80% accuracy rate, showing the solution’s potential. As of November 2023, the company’s CEO and founder expected to complete customs forms with the tool in three to six months.

Although AI can shorten the time necessary to complete customs forms, humans should always supervise the process and double-check the results. Well-trained algorithms are not perfect, so computing power and human oversight are an excellent combination to assist those dealing with exported products.

2. Linking Customer Purchases to Customs Form Data

Businesses may also expand the functionality of existing ChatGPT tools that bring AI to ecommerce, making them improve customs documents, too. Technology ecommerce brand Newegg released a customer-facing ChatGPT tool in July 2023 that suggests products for people wanting to build computers based on details they input about budget, performance requirements and other specifics.

The tool compiles all the options into a list people can review before checking out at the site. It is easy to imagine an accompanying AI product Newegg team members could use to populate customs forms based on what a customer ultimately purchases from the suggested list. Then, the items are more likely to be classified and described correctly on the customs forms. Tariff classifications determine duty rates and taxes on imports, making their accuracy critical.

Ecommerce leaders could also use AI to track trends that enable more accurate customs data. Perhaps a large percentage of overseas shoppers purchase a specific in-demand item and nothing else. AI might accelerate the process by automatically populating the product-specific customs form fields in such cases. Then, there is less to do because people only need to check the information that varies with each customer.

3. Stopping False Declarations and Counterfeit Goods

Possibilities also exist for customs agents to use AI tools to highlight abnormalities associated with illegal goods or items declared incorrectly. Artificial intelligence excels at processing large quantities of information and catching things humans would miss. Many banks use it to monitor for fraudulent transactions because it can detect those instances more accurately than people

If people make false declarations on customs documents, they typically do that to reduce their import tax and duty-related obligations. Many border patrol agents use artificial intelligence to assess which shipping containers to open for further inspection.

Some ships reach ports bearing 24,000 containers, making it impossible to inspect them all. However, the customs officials working at a Belgian port rely on predictive AI models to flag which ones to check. The algorithms make decisions based on customs declarations and data from goods previously requiring inspections.

Even so, illegal goods can slip past border agents, which may result in counterfeit products reaching ecommerce sites. More companies are responding by using or offering AI tools to combat these emerging circumstances.

One enterprise specializing in the luxury goods and sneaker markets built an artificial intelligence-driven product to compare photographs of legitimate items with those sold online. The software compares approximately 2,000 to 4,000 characteristics so consumers or retailers can feel more confident about authenticity.

Some ecommerce marketplaces could use counterfeit protection as a selling point to attract new customers. Suppose first-time visitors to a shopping website sees a banner informing them that all products above a specific monetary value receive anti-counterfeit screenings before getting shipped to recipients. Such a claim gives consumers peace of mind, particularly before buying high-value, unique or collector’s items.

Will Artificial Intelligence Improve Customs Processes?

AI for customs declarations and processing is still in the early stages, with decision-makers from many businesses still in the planning process. However, as more of them try real-world applications, artificial intelligence should make a bigger and lasting impact on paperwork and goods movement. The results could assist ecommerce companies with administrative tasks associated with import and export paperwork, plus support border patrol officials with spotting suspicious cargo or incorrectly declared products.

About the author:

Emily Newton reports on how technology disrupts industrial sectors. She’s also the editor-in-chief of Revolutionized, covering innovations in industry, construction, and more.

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Located in Bellevue, Wash., the new Shein outpost in the city’s Key Center will occupy 10,000 square feet, according to Shein’s announcement.

As of November 2023, Shein ranked as one of the three fastest-growing online merchandise companies in Asia by web sales, according to Digital Commerce 360’s Asia Database. Shein is also No. 2 in Digital Commerce 360’s Asia Database ranking ecommerce retailers in the region by online sales.

Shein’s fulfillment and logistics office near Seattle

“The U.S. is an important market for Shein, and we are thrilled to establish a presence in the Seattle area as we continue enhancing our fulfillment process and improving the customer experience,” said Andy Huang, head of U.S. fulfillment and logistics at Shein, in a statement. “This expansion underscores our commitment to efficiency across our operations, and we look forward to contributing to the local community and fostering innovation in the heart of the Pacific Northwest.”

Shein, which is officially headquartered in Singapore, hopes to shorten its delivery times in the U.S. with the new move. It has already moved aggressively into the fast-fashion market, announcing a deal in 2023 to acquire one-third of Sparc Group. That deal gave Shein a stake in Forever 21. As a result, Shein paved the way to list Forever 21 products alongside Shein’s own inventory.

Jobs at the new Shein facility

The new Shein fulfillment and logistics location will be home to 50 workers, according to the company’s press release. It expects those positions to be filled by the end of 2024. To date, Shein counts 1,500 corporate and warehouse employees at its U.S. operations. Those jobs are located at existing offices in Los Angeles, San Diego, Philadelphia, Washington, D.C., and Whitestown, Ind., according to Shein.

IPO approval questions linger in China

Shein has faced questions from U.S. senators and other concerned parties over labor practices in its supply chain. Most recently, however, regulators in China appear to be holding up efforts for the company to go public.

Shein officially moved its headquarters to Singapore and does not collect revenue or sell to customers in China. Nevertheless, it engaged in talks with the Chinese government as an apparent safety measure to obtain approval for its IPO. Specifically, Shein is awaiting clearance from the Cyberspace Administration of China and China Securities Regulatory Commission, The Financial Times reported.

Currently, China’s sign-off on Shein’s IPO remains in question. The result could signal to other companies in the country whether regulators are open to new U.S. listings.

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Under Armour ecommerce represented 45% of total direct-to-consumer revenue in the quarter, the company announced Feb. 8. As a whole, Under Armour DTC sales increased 4% to $741 million. Part of that increase came from 5% growth of in-store revenue.

Meanwhile, Under Armour wholesale revenue decreased 13% to $712 million.

Total third-quarter Under Armour revenue decreased 6% to $1.5 billion, in line with the company’s outlook. Operating income was $70 million, and net income was $114 million. Meanwhile, Under Armour inventory decreased 9% to $1.1 billion.

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 ecommerce sales

President and CEO Stephanie Linnartz said in a call with investors that the retailer is working to improve mobile speed, search algorithms and product description pages, among other functionality fixes. She said the retailer’s ecommerce division has done “great work” to improve conversion and have a more functional website and Shop App.

“We need for ua.com and our Shop App to be the most premium expression of our company,” Linnartz said. “It’s our largest storefront when you think about it. So we are going to reduce our dependency on promotions.”

That could reduce the brand’s revenue, she added, saying it will drive profitability.

“Simply put, ua.com will become a showcase for our brand,” Linnartz said.

Under Armour revenue by region

In North America, Under Armour revenue declined 12% year over year to $915 million in Q3. Under Armour revenue in Europe, the Middle East and Africa (EMEA) grew 7% to $284 million. Asia-Pacific revenue grew as well, up 7% to $212 million. In Latin America, Under Armour revenue grew 9% to $70 million.

UA Rewards program continues to grow

Nearly 3 million members have enrolled in Under Armour’s loyalty program, UA Rewards, “which is well ahead of the target” for fiscal 2024, Linnartz said.

Members have purchased premium products more frequently than non-members program’s first few months, she said.

Under Armour earnings

For the fiscal third quarter ended Dec. 31, Under Armour reported:

• Under Armour revenue decreased 6% to $1.49 billion.
• Net income decreased to $114.1 million from $121.6 million in the year-ago quarter.
• Under Armour ecommerce revenue grew 2%. The retailer did not attach a dollar amount to the growth.

For the nine months ended Dec. 31, Under Armour reported:

• Revenue decreased to $4.37 billion from $4.50 billion in the year-ago period.
• Net income grew to $232.3 million from $216.2 million in the prior-year’s period.

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

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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.

Alibaba Group 

Alibaba’s revenue grew 5% to $36.67 billion in its third quarter ended Dec. 31.

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. Taobao and Tmall grew their combined revenue 1% to $17.43 billion.

Read more about Alibaba’s earnings here.

Bark (No. 186)

Bark reported revenue declined 6.9% to $125.1 million in its fiscal third quarter ended Dec. 31. Results were at the high end of Bark’s expectations. The retailer attributed the sales decline to fewer total orders due to a decrease in subscribers. Direct-to-consumer (DTC) sales, which make up the bulk of revenue, declined 7.6%. However, improvements to Bark’s website are driving increases in traffic and conversion, the retailer said.

Canada Goose (No. 218)

Canada Goose said total revenue grew 6% to $609.9 million in its fiscal third quarter ended Dec. 31. DTC revenue grew 14% due to growing in-store retail sales, partially offset by a decline in ecommerce. Wholesale sales, meanwhile, declined 28%. Canada Goose is evaluating its online product assortment to potentially make room for new categories going forward, said Jonathan Sinclair, chief financial officer.

The Container Store (No. 347)

The Container Store net sales declined 14.8% to $214.9 million in its fiscal third quarter ended Dec. 30. Online sales declined even more drastically, down 26.3% year over year. Website-generated sales, which include those designated for curbside pickup, declined 15.8%, accounting for 21.8% of net sales in the quarter. That’s flat with Q3 last year, the retailer 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.

E.l.f. Cosmetics Inc. (No. 951)

E.l.f. Reported it grew net sales 85% to $270.9 million in its fiscal third quarter ended Dec. 31. Online sales made up 24% of total revenue, compared to 18% in the year-ago period. Loyalty members are a driving force behind online sales growth, the retailer said, accounting for nearly 80% of online sales. The Beauty Squad loyalty program has 4.5 million members, and grew 30% year over year, e.l.f. said.

Estee Lauder (No. 43)

Estee Lauder reported net sales declined 7% to $4.28 billion in its second fiscal quarter ended Dec. 31. The retailer attributed much of the sales decline to waning demand in China. It will lay off 3% to 5% of its workforce in 2024.

Read more about Estee Lauder’s earnings here.

Mattel (No. 205)

Mattel reported net sales grew 16% to $1.6 billion in its fiscal fourth quarter ended Dec. 31, while sales were flat for the year. Dolls, vehicles, games and building sets were the most successful categories, the retailer said.

“We expect the toy industry to decline in 2024, although at a lesser rate than 2023. The anticipated decline is due to a lighter toy theatrical film slate and the impact of the shift in consumer spending patterns towards experiences and services, which we believe will moderate over the year,” CEO Ynon Kreiz told investors.

PetMed Express Inc. (No. 354)

PetMed Express reported net sales for its fiscal third quarter ended Dec. 31 grew 11% year over year to $65.3 million. Recurring orders through the AutoShip & Save and PetPlus programs made up the majority of sales, accounting for 52.2% of revenue. That’s an increase from 42.3% of revenue in the year-ago period.

The retailer noted that pet food is a small but fast-growing part of the business. PetMed Express recently added the brand Hill’s Science Diet and has plans to pursue more premium pet food partnerships in the future.

Ralph Lauren (No. 78)

Ralph Lauren said revenue grew 6% to $1.9 billion in its fiscal third quarter ended Dec. 30. Global direct-to-consumer (DTC) same-store sales grew 9% over the same period. Gross profit was $1.3 billion, the retailer said.

Read more about Ralph Lauren’s earnings here.

Tapestry (No. 44)

Tapestry reported a 3% increase in net sales to $2.08 billion in its fiscal second quarter ended Dec. 30. Online sales grew in the single digits, the retailer said, making up one-third of total revenue. Direct-to-consumer revenue grew 4% over the period. Tapestry also opened a new fulfillment center in Las Vegas as part of a plan to grow omnichannel capabilities, the retailer said.

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.

Under Armour Inc. (No. 97)

Under Armour reported 2% growth in ecommerce revenue during its fiscal 2024 third quarter, which ended Dec. 31, 2023. Total revenue declined 6% to $1.5 billion.

Read more about Under Armour’s earnings here.

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.

The Walt Disney Company Ltd. (No. 100)

Disney said revenue for its fiscal first quarter ended Dec. 30 was flat from the year-ago period at $23.5 billion. DTC revenue, which includes the company’s streaming channels, grew 15% to $5.5 billion in the quarter. The DTC segment led to an operating loss of $138 million, but that’s a decrease of 86% from the loss in Q1 of 2023. The company said it projects streaming to become profitable in fiscal 2024.

So what does it mean?

• The pet industry is subject to the same troubles facing other retailers. PetMed Express reported success with the same strategy that’s been successful for Chewy based on food and medications. Meanwhile, Bark felt a pullback in more discretionary pet items.
• e.l.f.’s 85% sales growth on top of the 49% it grew in Q3 2023 shows that the cosmetics retailer isn’t slowing down as it gains name recognition and expands on social media platforms.

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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But those investments led to a 388% drop in earnings before taxes and amortization costs to a net EBITA loss of $433 million for the Alibaba International Digital Commerce group, Alibaba said. They also contributed to Alibaba Group’s 77% drop in Q3 net income to $1.51 billion.

Consequences of Alibaba investing in AliExpress Choice

For AIDC, the “losses increased primarily because of the increase in investment in AliExpress Choice” and other expenses, chief financial officer Toby Xu said on the earnings call.

Still, AliExpress Choice provided more products and prices to customers on the AliExpress.com international retail site because of these investments. Meanwhile, it was also a primary contributor to AIDCG’s revenue Q3 revenue gain, AIDC CEO Jian Fang said.

“AliExpresss achieved year-over-year growth of 60%,” he said. “This was mainly driven by the new AliExpress Choice model that we launched in early 2023.”

Executives added that Alibaba will continue investing in its supply chain operations to support the Choice program.

“By offering entrusted cross-border logistics, marketing and other services, we lower the barrier for merchants to engage in cross-border business, bringing more certainty to their operations and more diverse assortment to the platform,” Fang said.

Alibaba’s Visable acquisition

Fang added that in Europe, Alibaba’s B2B unit, Alibaba.com, completed its acquisition of the European B2B digital trade platform, Visable. Thanks to that deal, Fang said Alibaba is “further expanding its supplier base in the region and further advancing Alibaba.com’s global expansion and dual brand strategy.”

“There is huge potential for AIDC to increase user penetration in the majority of overseas markets, building on our current resources and footprint,” Fang said. “We will increase our investment in select regional markets where we see opportunities and value to achieve opportunities for high certainty and healthy growth.”

Alibaba’s international retail commerce sites include Lazada, AliExpress, Trendyol and Daraz.

Alibaba Group conducts its international wholesale sales through its Alibaba.com B2B ecommerce site.

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

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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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The post International commerce drives Alibaba’s biggest growth rate appeared first on Digital Commerce 360.

Layoffs are part of a multi-year plan to rebuild profit margins in 2025 and 2026, Estee Lauder said. 

“We are focused on strategically leveraging our strengths to accelerate our return to more sustainable profitable growth while elevating our consumer activations and increasing our operating agility,” chief financial officer Tracey Travis said. “The restructuring program is designed to right-size and streamline select areas within our organization, which unfortunately necessitates us making the difficult decision of an expected net reduction in positions globally of 3% to 5%.”

Estee Lauder ranks No. 43 in the Top 1000, Digital Commerce 360’s database of the largest North American e-retailers by online sales. 

Wayfair (No. 10 in the Top 1000), Amazon (No.1), Macy’s (No. 17) and Levi Strauss (No. 191) all also announced recent layoffs.

What were Estee Lauder’s financial results?

Estee Lauder reported net sales declined 7% to $4.28 billion in its second fiscal quarter ended Dec. 31.

Skin care made up the largest portion of sales, accounting for $2.17 billion in the quarter. That was a decline of 10% from $2.43 billion in the year-ago period. Makeup sales also declined, down 8% year over year to $1.17 billion. Fragrance sales grew slightly to $737 million from $734 million. Meanwhile, hair care sales declined 5% to $173 million.

The retailer attributed much of the sales decline to waning demand in China.

“This decline was primarily driven by the slowdown of overall prestige beauty in mainland China,” CEO Fabrizio Freda said in a statement. Online sales in China also declined, with worse than expected performance on Double 11 Day, also known as Singles Day, on Tmall. Tmall is an Alibaba-owned marketplace. Tmall is No. 2 in the Global Online Marketplaces Database, Digital Commerce 360’s ranking of the largest such marketplaces by gross merchandise value. Brick-and-mortar sales increased in China, but they were more than offset by the online decline.

Net sales in the Asia Pacific region fell 7% year over year, and the retailer lost some market share there, Freda said. Net sales in the Americas declined 1%. That was driven by decreasing demand in North America, partially offset by growth in South America. In Europe, the Middle East, and Africa, net sales declined 14% in the period. Part of the decline is due to rightsizing inventory levels, Estee Lauder chief financial officer Tracey Travis said, with 2% attributable to “business disruptions in Israel and other parts of the Middle East.”

Estee Lauder earnings

For the fiscal second quarter ended Dec. 31, 2023, Estee Lauder reported:

• Net sales declined 7% to $4.28 billion.
• Gross profit declined 8% to $3.13 billion.

For the six months ended Dec. 31, 2023, Estee Lauder reported:

• Net sales declined 9% to $7.80 billion.
• Gross profit declined 12% to $5.57 billion.

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

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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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China’s internet regulating body, The Cyberspace Administration of China (CAC), is investigating the apparel retailer’s data and supply chain practices, The Wall Street Journal reported. That could have implications for Shein’s plans for an IPO in the U.S. The fast-fashion retailer reportedly filed for the move confidentially in November. A CAC investigation, however, could delay an IPO for months or remove the option altogether. Shein must wait on permission from Beijing before pursuing a U.S. IPO.

Shein is No. 2 in Digital Commerce 360’s ranking of ecommerce retailers in Asia by online sales. The online apparel retailer was valued at $66 billion in May when it closed its latest funding round. Shein reportedly reached $2.5 billion in income in 2023, according to Bloomberg.

Asia Database

Leading 300 online retailers headquartered in Asia. Access includes up to 5 years of web sales, company information, website traffic and features, shopper profiles and more. Web sales range from $32 million to over $125 billion annually.

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Why is China investigating Shein?

Shein was founded in China in 2012 but moved its headquarters to Singapore in 2022. It does not sell its low-priced apparel and accessories in China, but it does rely on contract manufacturers in the country. The U.S. is Shein’s biggest market of the 150 countries it sells in.

However, the retailer is still subject to certain Chinese regulations before it can get a green light to go public in the United States. Chinese companies planning an IPO outside the country must abide by recent listing rules, Reuters reported. Companies are bound by the listing rules if more than half of revenue, profit, or assets are generated in China, and either its main business is conducted in China, or senior management is mostly made up of Chinese citizens. 

The Chinese regulations are in part to ensure that data on Shein’s suppliers, partners, and staff in China are protected from leaks outside the country. China will also review what information Shein will share with regulators if it does go through an IPO.

By approaching China’s regulators ahead of an IPO, Shein could head off potential problems like those of ride-hailing business Didi. In 2021, Didi was subject to a regulatory review after raising more than $4 billion in an IPO with the New York Stock Exchange. Chinese regulators then ordered it to stop registering new users and to shut down some apps. Within a year, it was delisted in the U.S. 

Other Shein IPO obstacles

Shein faces other obstacles that could stall potential IPO plans, too. Those include U.S. lawmakers, who have raised concerns over the retailer’s labor practices.

Shortly after the retailer filed confidentially for an IPO in November, U.S. Representative Jennifer Wexton released a statement questioning the presence of forced labor at Shein’s contract manufacturers.

“If the fast-fashion giant Shein wants to go public in the U.S., they should have to prove to American consumers that their products are not sourced from forced labor,” the Virginia senator said. 

It faced criticisms for labor practices since a 2022 Bloomberg report linked cotton in some Shein products to China’s Xinjiang region. Human rights groups have accused China of using forced labor from the Uyghur ethnic minority in the region, which the government in Beijing denies.

Shein has said it has a “zero-tolerance policy for forced labor.”

“We take visibility across our entire supply chain seriously, and we are committed to respecting human rights. To comply with U.S. law, we require our contract manufacturers to only source cotton from approved regions,” the apparel retailer told Digital Commerce 360.

As of November, Shein said 1.7% of its cotton tested positive for cotton from the region.

“According to global supply chain tracing firm Oritain, these amounts are much lower than the industry average of 14%,” a spokesperson wrote at the time.

When will Shein’s IPO happen?

The CAC has not set a date for providing Shein with an answer to its investigation. The U.S. Securities and Exchanges Commission also has not responded in writing to Shein, according to The Wall Street Journal.

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