2PM - No 665: Shopify vs. Amazon Intensifies

eCommerce / CNBC: The Selz acquisition comes as Amazon’s third-party marketplace, made up of more than 2.5 million sellers, continues to thrive. The segment now accounts for more than half of Amazon’s eCommerce sales and has helped Amazon bring in record revenue.

2PM Summary: Selz has been around since 2013, and according to Crunchbase, has raised $11 million in funding, most recently a $5 million Series A in 2019. Its company descriptor pinpoints why Amazon might be interested: “Selz is a complete system for managing orders, processing and receiving payments, and for building relationships with customers – all in one simple place.” The company is a Shopify competitor, and the Shopify approach is currently one of Amazon’s biggest threats. Shopify is essentially bringing an Amazon style of e-commerce to direct-to-consumer, and the more sellers who see that as a viable or primary option are less reliant on Amazon (even if they do business there as well).

There’s still a lot unclear on Amazon’s interest in Selz, but here’s some speculation. The company’s price tag was likely a drop in the bucket for Amazon, and unlike a more well-known player like BigCommerce or Squarespace, Selz has little customer recognition, at least in the US. Its acquisition was on the site for a month and went unnoticed. Amazon appears to have wanted the acquisition to be a stealth move, and targeted a company it could quietly absorb into its folds. During a year of heightened antitrust scrutiny, less attention around acquisitions is better.

Amazon’s buy it over build it approach to a seller platform like Selz is also notable, considering Amazon has plenty of mechanisms at its own disposal to mimic the business model. Selz brings with it seller data, of course, which is always of interest to Amazon. Mark this as one to keep an eye on.

Amazon vs. Shopify: eCommerce companies whose stock price is predicted to grow the most by 2025

Celebrity talent has launched their own media — and you should too

Brand / Forbes: Owned media as a springboard into eCommerce has proven to be a tested and true strategy over the past decade. From Gwyneth's Goop Newsletter, launched 2008, foretelling her multi-hundred-million-dollar wellness empire, to Emily Weiss' Into the Gloss blog as a precursor to billion-dollar cosmetics juggernaut Glossier, the modern consumer products playbook is to first, build distribution and audience, then launch a product to serve them. 2PM's Web Smith dubs this fading of traditional demarcation between media and commerce: the "Law of Linear Commerce".

The Study: For the brands that are most suited to the modern retail economy: media and commerce operations combine to optimize for audience and conversion. This is the efficient path for sustained growth, retention, and profitability. More on the Law of Linear Commerce. 

Can luxury brands crack WeChat mini games in 2021?

Linear Commerce / Vogue Business: In 2020, some 500 million monthly active users played WeChat mini games, or almost half of all of WeChat’s monthly active users. Owner Tencent, which already makes 33 per cent of revenue from online gaming, has big plans for the format. At the 2021 WeChat Open Class Pro conference the company said it wants to further integrate mini games with video streaming and PC in 2021, while further developing in-app purchasing and in-app advertising — opening up a new world of marketing opportunity for luxury brands.

Apple Pay to accept Bitcoin via BitPay cards

DeFi / Retail Dive: BitPay's mobile wallet lets users convert cryptocurrencies into standard currencies and load them onto their Mastercard, the company said. The BitPay Wallet currently allows users to transact using Bitcoin, Bitcoin Cash, Ether, USDC, GUSD, PAX and BUSD, per the press release.

Amazon Live is becoming a destination for big product launches

Linear Commerce / Modern Retail: Live-stream shopping has long been hyped to become the future of eCommerce in the U.S., but this past year, tech giants finally invested in the new medium. TikTok, Instagram and Facebook all have — or are rolling out — live shopping features. Amazon’s event signals an escalation of those efforts — and hints at a possible future where Amazon Live becomes a hub of all kinds of live events and product launches for brands.

The Amazon effect

Human Resources / City Journal: Much is at stake. Though Amazon is popularly viewed as a giant tech company that dominates its marketplace, the company’s eCommerce business has low profit margins and only an erratic history of making money. A successful wave of unionization drives could fundamentally alter Amazon as we know it, threatening its eCommerce model.

Does Clubhouse mean bad things for podcasting?

Audio / Vulture: For one thing, on the consumption side, all media formats ultimately compete with each other for minutes of attention in a day, and within the specific frontier of audio, one could make the case for thinking in zero-sum terms: Time spent on Clubhouse or Spaces or whatever is time that could have been spent on, say, Apple Podcasts or Spotify.

Adidas is selling Reebok after defending the $3.8 billion purchase for years

Brands / Business Insider: Adidas did not specify the reason for the move, nor did it say whether it would look to spin Reebok off into an independent company or look to sell it outright. The firm said Tuesday it has developed a new five-year strategy that involves "further strengthening the leading position of the Adidas brand in the global sporting goods market."

Editor's Note: what a colossal failure for Adidas Group. At its current valuation ($1.2 billion), Reebok is worth less than Allbirds. 

Seven key business lessons from Peloton's breakout year

DNVB / Fortune: Peloton is a complicated company. Yet perhaps no other brand has met this past year of curveballs better: a global pandemic, civil unrest, a historically divisive election. Sure, it’s been a bumpy ride, from commercials called sexist to ongoing delivery woes underscoring said success. But much of Peloton’s reckoning and transformation have taken place in the public eye, which makes stealing from its playbook all the easier.

What was the Wing?

Brand / The Cut: Last week, the holding company International Workplace Group bought out a controlling stake in the Wing, closing a chapter in the annals of girlboss capitalism that feels increasingly remote. To the extent that the Wing is remembered, it will be as an artifact of the Trump era.

Here is an interesting thread on The Cut's coverage. 

Ex-Postmates VP of global public policy on the future of gig work

Gig Economy / TechCrunch: In his letter, Aiyer says “it would be a mistake for us to think that mild tweaks to worker classification, or a single state ballot measure, create a durable path forward for meaningfully addressing what Americans truly worry about: the chance to work, take care of their families, and not fret about what comes next.”

Retailers trade Fifth Ave. for Worth Ave. as Palm Beach scene thrives

Retail Real Estate / CNBC: The activity in the South Florida real estate market — towering cranes, the arrival of new tenants, escalating rents and few vacancies — paints a considerably different picture than the streets of SoHo and Fifth Avenue in New York City. And experts say real estate in the Palm Beach market, in particular, is more and more sought after.

There is no more undiscovered physical land; there are only ideas that may develop into new land of its own.

Consider Bitcoin, the first blockchain, and the idea of decentralized currency. An idea became new land, albeit digital. On that land, systems were built and exchanges were founded. New products like fungible tokens and non-fungible tokens enabled trade. Explorers mined and profited off of a new land that literally came of nothing but an idea. Consider the conclusion of the Bitcoin white paper, released in 2009.

Unstructured simplicity, needed rules, and consensus. The land analogy holds true. Ideas can become so powerful that new ground to build upon can take shape. It’s time that we develop new systems around the mining of ideas and how we compensate explorers for them. Those ideas may lead to the exploration of new land.

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