As business grew, so did Polywood’s fraud risk, Valencourt says.

“We were actually targeted by a fraud ring,” he says. The retailer received multiple fraudulent orders, to the point where its manual process for flagging suspicious orders could no longer keep up, Valencourt says.

The retailer was in danger of hitting the 1% threshold where financial companies won’t allow a retailer to process its credit cards anymore, he says. For example, Visa has a 0.9% threshold. The financial institution issues an “early warning” when the percentage of fraudulent orders reaches 0.65%.

“We hadn’t gotten to that point, but we were approaching a 1% threshold on fraudulent orders,” Valencourt says.

The retailer turned to online payment and checkout platform Bolt. Instead of relying on employees to manually flag potential fraudulent orders, the retailer automated the process. That freed up employees to serve customer inquiries directly instead, Valencourt says.

It also increased conversion, Valencourt says. Polywood began using Bolt in 2018. The first year after adding Bolt, Polywood’s conversion rate increased 10% in 2019. By the end of 2020, conversion increased 20%, he says. That’s increased to about 50% conversion currently, he says.

Customer checkout rate

A portion of Polywood’s customers order furniture for locations other than their main home. Some are for second homes or other properties, for example. These orders were often flagged as fraudulent because the billing zip code did not match the shipping zip code.

“A bank might flag it and it hurts checkout,” he says.

That’s a big deal when the average order value for a Polywood order is around $1,000, he says.

Instead, Bolt automates this process and catches these details.

“Now, our customer service agents can answer customer questions like what product is right for them or sizing and colors about products,” Valencourt says.

Polywood uses Bolt as its default checkout processor. Customers can check out as a guest. They can also use Bolt if they’ve purchased through other retailers that also use Bolt or are saved in the Bolt network. This allows shoppers to check out quicker because their information is already stored with Bolt.

Polywood preventing fraud

Bolt flags fraud and offers Polywood the ability to track deliveries. As Polywood expands its customer base, the shopping process has grown more complex. There are split shipping and multiple manufacturing centers and warehouses to navigate, Valencourt says.

“We actually did start offering split shipping a couple of years ago,” he says. “But we didn’t really let the customer know what was going on. A customer might get half an order and call in saying they were missing part of it. They didn’t realize it was coming in a separate shipment. The customer service team didn’t either. They would send a replacement for the missing items only to find out the rest of the initial shipment arrived later.”

That Bolt network is growing, says Shilpi Narang, chief customer officer. The number of Polywood shoppers who check out using a Bolt account has more than doubled since the merchant went live with the vendor. Shoppers with a Bolt account constitute 30% of Polywood’s total volume of checkout as of September 2023.

Merchants don’t typically want to outsource their entire checkout process, Narang says.

“We work with them so they can keep their branded look while tapping into elements of our technology,” she says.

While merchants want an automated fraud and checkout solution, Narang says they also find value in Bolt’s growing network. The vendor claims that its shopper network includes tens of millions of U.S. shoppers and has grown year over year in 2023 by 44%.

“As we work with more merchants, especially with larger more complex merchants, we heard they wanted to increase conversion and leverage our shopper network,” she says. According to Narang, when a U.S. ecommerce merchants turns “on” Bolt, “immediately about 17% of their site traffic is recognized by Bolt,” she says.

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To turn first-party data into a strategic business asset, more and more retailers are embracing customer data platforms (CDPs) to unify and act on customer data. Yet, one of the biggest barriers to making the most of a CDP is understanding the distinct ways retailers can take advantage of the technology to achieve transformation goals.

In this guide, we’ll unpack how other retailers are leveraging CDPs to transform customer relationships and unleash growth.

Compliments of Blueconic

The post CDP Use Cases in Retail appeared first on Digital Commerce 360.

Amazon ranks No. 1 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest online retailers in North America by web sales. It also ranks No. 3 in the ranking of top online marketplaces.

Fraud remains a major problem

Amazon acknowledges the serious nature of the counterfeit problem on the platform. It spent $1.2 billion and employed 15,000 people to fight fraud on the marketplace in 2022, per the report. Counterfeit products are a “huge problem,” according to Robert Freund, a lawyer who works on ecommerce and social media marketing cases.

Counterfeiters aren’t new to Amazon. In 2016, Birkenstock USA CEO David Kahan said in a letter the footwear company would no longer list its products on Amazon because it was an “environment where we experience unacceptable business practices, which we believe jeopardize our brand.”

In 2019, Nike also stopped listing products directly on Amazon, a decision in part reportedly due to struggles with fake products. Even Amazon’s own products are at risk of fakes.

For brands that rely on Amazon sales, it can be difficult and expensive to “play whack-a-mole in the courts against counterfeits,” Freund said. Some companies, like Disney and Nintendo, have a “war chest” for these legal battles, but many don’t. 

The swaths of knockoffs are making shopping unpleasant for some consumers, some of whom note a decline in quality. In 2020, The New York Times’ Wirecutter dubbed our time “the era of fake products.” A 2022 study from consulting firm Brooks Bell of more than 1,000 Amazon shoppers found that about one-third reported receiving items late or receiving a low-quality product at least monthly. Some consumers may be worried about counterfeit goods on other platforms, too. A March 2023 survey of 1,053 consumers from Digital Commerce 360 and Bizrate found that 12% of beauty buyers don’t shop online because of worries that they might receive counterfeit products.

Reasons to be optimistic

The state of counterfeit products on Amazon seems to be improving, Freund says. It’s encouraging that Amazon has a clear investment in making the marketplace usable for consumers.

“I think that part of the reason they’re [Amazon] so interested in addressing the issue and at least appearing like they’re doing everything they can do, in addition to restoring goodwill with sellers, is good publicity.” They also face potential liability themselves for allowing counterfeits on their platform, Freund says.

The report from Amazon also shows a decline in counterfeit attempts in 2022 compared to the previous year. According to Amazon, there were 800,000 attempts by bad actors to create seller accounts in 2022. That’s down from 2.5 million in 2021, and 6 million in 2020, an 87% decrease over the two year period.

Counterfeit products will probably always be an issue

Despite Amazon’s reports of fewer counterfeit reports, the problem is definitely not going away. 

“It’s hard to imagine setting up some kind of framework where you just completely eliminate the business of counterfeiting,” Freund said, pointing to the massive scope of Amazon.

In 2022, Amazon said its Counterfeit Crimes Unit pursued more than 1,300 counterfeiting criminals in the U.S., U.K., EU, and China, and disposed of more than 6 million counterfeit products. While that’s progress, Freund says it also shows the difficulty of wiping out counterfeits completely.

Selling counterfeit products is “so easy to do, especially if you’re located in a country like China,” Freund said, which is hard to prosecute from the U.S. 

China is responsible for 75% of pirated and counterfeit goods seized by the U.S., according to the Office of the U.S. Trade Representative 2022 Review of Notorious Markets for Counterfeiting and Piracy. Counterfeits from the Chenghai district of Shantou are particularly hard to stop, according to the report, because of “close relations businesses have with local administrative and criminal law enforcement authorities.”

“Right holders describe local officials as unhelpful or unwilling to pursue investigations recommended by either firms or enforcement officials from other cities,” limiting what U.S.-based retailers and marketplaces can do.

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So, too, is staying abreast of fraud trends. While B2B fraud does not receive as much media exposure as consumer-related fraud, it is a prevalent and growing problem nonetheless that sellers need to manage effectively.

A new report from The Merchant Risk Council, Cybersource and Verifi, 2023 Global Ecommerce Payments & Fraud Report, notes that North American merchants spend 10% of their ecommerce revenue on average to manage payment fraud. The report also says the percentage of ecommerce revenue lost to payment fraud is 2.4% in North America and 2.9% globally, down from 3.6% a year ago for both North America and worldwide.

The report is based on a survey of 1,072 merchants between November and December of 2022 across North America, Latin America, Europe and Asia Pacific (APAC), representing a broad range of annual ecommerce revenue.

66% of merchants accept digital wallets

On the payments side, bank transfers, digital wallets and cards continue to be the most widely accepted payment methods among ecommerce merchants, with 67% accepting bank transfers/direct debit, 66% accepting digital wallets, and 66% accepting payment cards, up 9% from a year earlier, the report says.

In addition, 50% of respondents accept mobile payments, such as Amazon one-click, down 7% from a year earlier, and 45% accept cash. Another payment option rapidly gaining traction is “buy now, pay later” (BNPL) loans. More than one-third (36%) of ecommerce merchants now offer BNPL, up from about one-quarter of respondents in 2021.

The primary reason ecommerce merchants add new payments is to improve the buyer experience. Other reasons include reaching new customer segments or markets. At the same time, about 90% of ecommerce merchants encourage customers to pay via preferred methods, primarily to minimize fraud risks, maximize how quickly funds become available, and lower processing costs.

Another key takeaway from the report is that ecommerce sellers continue to use multiple payment processors and banks to support omnichannel payments. On average, merchants rely on four payment processors or gateway connections, and three “merchant acquiring” banks to support omnichannel payments. Merchant acquiring banks, or merchant acquirers, manage merchants’ accounts for funds received through credit card payments. The top reasons why sellers utilize multiple merchant acquirers include operational flexibility, geographic coverage, and payment authorizations.

The deployment of new customer-facing and internal payment management approaches by ecommerce merchants is prompting them to track more of the key performance metrics (KPIs) around payments. The top four payment KPIs tracked by ecommerce merchants are payment success rate (50%), revenue (48%), cost of payment (45%), and authorization rate (34%). Respondents could cite the tracking of more than KPI.

Machine learning is more common in fraud management

Regarding payment authorization, ecommerce merchants tend to employ two to three different approaches or techniques. Over the past year, the use of machine learning to fine-tune fraud management, as well as intelligent payment routing, have seen increased adoption, with about 4 in 10 merchants using each of these approaches, up from 35% a year earlier, according to the report.

“While fraud management has historically been seen as a separate function to payment processing, sophisticated fraud management is also seen today as a means of optimizing payment authorization through its emphasis on lowering of false positives and even influencing issuer acceptance by achieving lower merchant fraud rates,” the report says.

On a global basis, merchants continue to spend about one-tenth of their annual ecommerce revenue on managing payment fraud, a figure that has stayed consistent for the three consecutive years the study has been conducted.

“We have also seen a notable decline in the share of merchants who tell us that they ‘don’t know’ or ‘don’t track’ this metric – from 30% in our 2021 study to 23% this year – suggesting that merchants are keeping a closer eye on fraud management spending as time goes on,” the report says.

On the plus side, respondents reported improvement across key fraud management metrics, such as the share of ecommerce revenue lost to fraud, domestic order rejection and fraud rates, and the share of ecommerce orders that led to fraud-related chargebacks. The improvement was most evident in North America, where spending on fraud management rose significantly in 2021.

At the same time, anti-fraud spending rose significantly in APAC and Latin America, as well as among small businesses, suggesting that these segments may hope to see improvement in their fraud metrics in the coming year.

Small and mid-sized merchants spend more to manage fraud

Small-and-medium-sized ecommerce merchants that generate between $50,000 and $5 million in ecommerce annually were among the most active spenders on fraud management solutions. Merchants in this category doubled their estimated fraud management spending over the past year, from 6% to 12% of ecommerce revenue, the report says.

Increasingly, ecommerce merchants are looking to reduce the manual review of suspect orders. About six in ten respondents said they are seeking to reduce or eliminate manual reviews as part of their fraud management strategy. Merchant size plays a significant role in a merchant’s decision to eliminate manual reviews. Small-and-medium-sized businesses are most likely to attempt to reduce manual reviews, while larger merchants are more inclined to continue the process, the report says.

Regarding the type of fraud that ecommerce merchants are experiencing, the top four   are phishing/pharming/whaling, friendly fraud/chargebacks, card testing,, and identity theft.

Phishing/pharming/whaling fraud showed the largest increase in attacks in 2022, with 43% of respondents saying they experienced such, up from 35% a year earlier.

Friendly fraud is also a significant problem, with 34% of respondents saying they experienced it in 2022. In addition, 62% of respondents reported an increase in friendly fraud disputes in 2022. It costs merchants $35 to manage friendly fraud for every $100 in disputes, the report says.

Overall, 18% of all fraudulent disputes should be attributed to first-party misuse, the report says.

When it comes to detecting fraud, the report says the leading tools ecommerce merchants rely on are:

• Credit card verification services. 55%;
• Identity validation / verification services. 50%;
• Two-factor phone authentication. 44%;
• 3-D Secure authentication. 39%.

Respondents could cite the use of more than one fraud detection tool.

Despite the ongoing challenges ecommerce merchants face in manageming payments and fighting fraud, ecommerce merchants are making meaningful progress on both fronts, the report says.

Peter Lucas is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy.

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The post Ecommerce merchants make gains in fighting payment fraud appeared first on Digital Commerce 360.

Learning Objectives:

• What fraudulent activities are top of mind for merchants in 2023
• The current state of chargebacks on card-not-present transactions
• Different avenues of approach and various solutions for preventing and fighting illegitimate chargebacks

Sponsored by:

The post Merchants & Consumers Weigh in: The 2023 Chargeback Field Report appeared first on Digital Commerce 360.

After three years of COVID-19, consumers continue to shop online with no signs of stopping. For the full year 2022, Digital Commerce 360 projects U.S. online retail sales will top $1 trillion for the first time, reaching $1.03 trillion. That would be a 7.7% increase over $960.44 billion in 2021.

But it was a tough year for online retail. Many retailers struggled to post year-over-year online sales gains, inflation hit record highs, surplus inventory levels soared and supply chain woes persisted.

But despite these challenging macroeconomic factors, online retailers continue to innovate and provide a top online shopping experience. Brands like L’Oreal used artificial intelligence to spot trends. A number of merchants committed to greater representation and continued support of the Black community. And retailers worked to make fulfillment more sustainable.

What’s more, online holiday sales may have been strong enough that merchants can put 2022 down in the win column. Over the Cyber 5 period (Thanksgiving through Cyber Monday) online sales reached $35.27 billion, a 4% year-over-year gain.

Below are more 2022 headlines, both news and in-depth features, that were the most popular on DigitalCommerce360.com.

Thank you for your readership in 2022. We look forward to another exciting year of online retail in 2023.

Most-read news stories in online retail

• Amazon plans Prime Day-like sales event in October
  The ecommerce giant will hold an October sales event similar to its annual Prime Day event, sources tell Digital Commerce 360.
• Lowe’s, Home Depot earnings show ecommerce growth, similar omnichannel paths
  Home Depot reported sales through its digital platforms grew approximately 6% for Q4 and approximately 9% for the year. That’s well below the 11.5% in Q4 and 18.4% for the fiscal year that Lowe’s reported.
• Coronavirus pandemic adds $219 billion to US ecommerce sales in 2020-2021
  The COVID-19 pandemic accelerated ecommerce growth years into the future. Other pandemic-caused shifts also have boosted ecommerce sales, such as inflation. Consumers paid $32 billion more online for the same amount of goods during the past two years, new data from Adobe finds.
• Inside the battle against ecommerce fraud
  Ecommerce fraud has gotten hard to detect and stop. More than half of fraud attempts against ecommerce retailers are now deemed “sophisticated.” That means professional criminals used state-of-the-art methods to circumvent anti-fraud systems.
• Toys R Us is opening shops in all Macy’s stores
  The in-store shops will range from as small as 1,000 square feet to 10,000 square feet for “flagship” locations in several cities. Since buying the Toys R Us brand in early 2021, WHP has worked to re-establish the brand’s physical and online presence.
• Amazon locates its warehouses near big cities
  Amazon has dramatically expanded its distribution network in the past decade, placing many new warehouses near population centers so it can deliver online orders quickly. Such major retail competitors as Walmart, Home Depot and Wayfair also have opened new distribution centers as they seek to match Amazon’s fast delivery options.
• Will Crocs Inc.’s acquisition of Hey Dude Shoes help it reach its $5 billion goal?
  A complementary union, Crocs looks to widen its reach beyond a loyal U.S. base by continuing to grow its ecommerce business worldwide with Hey Dude.

Most-read in-depth stories in 2022

The seven feature-length stories below received the most page views in 2022 on DigitalCommerce360.com. These articles, free to Digital Commerce 360 Strategy members, detail the topics our readers found most relevant this year. They include an in-depth piece on returns, how consumer brand manufactures need to remake their ecommerce playbook, True Religion’s path to profitability, how retailers can improve their marketing strategy on Amazon, how to manage customer data across platforms, the advantages of advertising on connected TV and how online retailers cater to their young, mobile shoppers.

• Retailers look for answers as returns grow more complex and costly
  Returns have become a major headache in ecommerce, cutting into profit and straining resources. The sheer volume of returns also puts additional pressure on an already overloaded supply chain pushing prices higher for shipping, warehousing and labor. Retailers are working hard to reduce the number of returns they receive. And they’re taking multiple approaches to doing so.
• What’s the state of the ecommerce market for consumer brand manufacturers?
  Brands were the fastest-growing merchant type in the Top 1000 last year. But the old playbook for digital natives isn’t producing the same explosive results as it has previously. With funding drying up as profitability takes center stage, digital natives will have to reassess their roadmap to compete.
• A peek inside True Religion’s plan to reach $250 million in ecommerce sales by 2025
  The iconic denim brand’s CEO and executive vice president of digital sit down with Digital Commerce 360 to discuss how it cut technology costs and overhauled its supply chain to get on the path to profitability. Now, it’s investing in digital tools to attract younger shoppers, such as a mobile app and buy now, pay later.
• Marketing on Amazon is all about keywords and presentation
  Retailers find different ways to stand out among competitors when selling on marketplaces.
• There is more than one way to manage customer data
  In an increasingly competitive ecommerce landscape, DTC retailers are figuring out how to reach new customers by linking up with larger merchants like Walmart or selling on marketplaces like Amazon — without losing too much control. The key is to take a step back and assess before diving into new ventures or technologies.
• The cord cutters: Retailers move to appeal to consumers on streaming devices
  As consumers cut the cord and stream entertainment, retailers are taking advantage of lower costs to reach an ever-expanding audience through CTV.
• How online retailers cater to their young, mobile shoppers
  Younger shoppers are on their phones and want to check out fast, with their preferred payment provider on-site or an app designed for their small screens. MVMT, Azazie and True Religion share how they fine tune their mobile shopping experience for young shoppers.

The post The most popular online retail stories of 2022 appeared first on Digital Commerce 360.

COVID-19 factored less into supply chain issues for most online retailers this year than in 2021. Instead, the war in Ukraine led to inflated prices for fuel, affecting shipping costs. United States retailers also had inventory surpluses that they struggled to sell off, as many consumers worried about a looming recession.

Online retailers joined or created their own marketplaces in 2022 in addition to selling on their own ecommerce websites. In doing so, they navigated how to manage their products across different ecommerce sites. E-retailers also changed their approaches to digital marketing this year to collect first-party data rather than relying on third-party tracking cookies.

Digital Commerce 360 editors have been interviewing online retailers and analyzing data trends in 2022 to cover all these subjects and more. Here are our favorite stories in 2022.

Industry news analysis:

2022 kicks off with a flurry of mergers and acquisitions 

1-800-Flowers.com, Evo, Club Champion, Worldwise and Thrasio each make an acquisition to build international expertise and add new ecommerce options.

Six ways to maximize the value of an Amazon brand in a tough market 

Buyers specializing in small brands that sell on Amazon raised $15 billion in recent years and purchased hundreds of companies, driving up the value of these businesses dramatically. Demand has cooled in 2022, but Amazon brand owners can still walk away with millions of dollars if they meet the requirements of increasingly picky buyers.

Keeping Score: Is inflation lower online than offline? 

There is some reason to believe it has been in the past year, with overall retail prices rising faster than online prices in 10 of 14 categories. If true, it could give online retailers a way of appealing to value-conscious shoppers.

How Black History Month inspired retailers’ February marketing campaigns 

More than a quarter of the top 100 online retailers mentioned Black History Month on their ecommerce sites while one in five spotlighted Black-owned or -founded brands, Digital Commerce 360 research shows.

Customer experience:

The Shopper Speaks: Is retail crime another reason to shop online? 

Post-COVID-19, both empty storefronts and retail crime can be seen as deterrents to shopping in physical stores. Digital Commerce 360 explored the sentiments of shoppers and found little impact regarding online shopping.

How online retailers cater to their young, mobile shoppers 

Younger shoppers are on their phones, and want to check out fast, with their preferred payment provider on site a or app designed for their small screens. MVMT, Azazie and True Religion share how they fine tune their mobile shopping experience for young shoppers.

OMG: Another Amazon sale? 

As Amazon rolls out its Early Access sale months after Prime Day, consumers wonder how many sales retailers can offer around the holidays.

How Bed Bath & Beyond’s rewards program stacks up against other retailers’ paid memberships 

Although all offer free shipping and discounts, Amazon Prime and Walmart+ have far more traction than Bed Bath & Beyond’s loyalty programs membership. More than a quarter of Top 1000 online retailers offer free loyalty programs while less than one in 10 have paid memberships.

Digital marketing:

What to do when Google won’t take ads for your products 

That’s the problem e-bike retailers face now that Google has strengthened enforcement of a rule that bars ads for virtually all electric bikes sold in the U.S. Retailers can risk Google suspending their account, advertise on other channels or find work-arounds to a policy the e-bike industry finds puzzling.

The cord cutters: Retailers move to appeal to consumers on streaming devices 

As consumers cut the cord and stream entertainment, retailers are taking advantage of lower costs to reach an ever-expanding audience through CTV.

Beyond the buzz: TikTok’s trajectory prompts retailers to reassess how it reaches younger consumers 

TikTok gains eight new users every second. However, ad spend share allocated to TikTok grows at a much slower rate — but that is changing. To reach younger consumers, digital marketers need to assess whether to proactively invest in TikTok while costs are low or risk rushing to catch up as more retailers look toward the future on a platform with 1 billion global active users each month.

Increased digital marketing regulations create clever tactics 

Cannabis regulations created a prime opportunity for resourceful, privacy-compliant data collection and application.

Omnichannel shopping:

Stores aren’t going away, but their role keeps evolving 

Retail chains and born-on-the-web brands find their way to adopting an omnichannel business model.

Smaller store-based omnichannel retailers prep for holiday season 

Brick-and-mortar stores take advantage of both their physical locations and online sales to meet customers on whichever channel they prefer.

Payments and fraud:

Buy-now-pay-later options catch on with online retailers and shoppers 

The installment payment option is here to stay, but consumers want choices. Retailers are seeing increases in average order value, conversion rates and sales when they offer their customers’ preferred buy now, pay later system as a payment option at checkout.

Apple debuts a deferred payment service and iPhone updates to developers 

The new payment feature, called Apple Pay Later, is a highly anticipated addition to the Wallet app. It is part of an expansion into the financial world that also includes bringing more infrastructure in-house.

Inside the battle against ecommerce fraud 

Ecommerce fraud has gotten hard to detect and stop. More than half of fraud attempts against ecommerce retailers are now deemed “sophisticated,” meaning professional criminals used state-of-the-art methods aimed at circumventing anti-fraud systems.

Retail response to war in Ukraine:

Russian ecommerce slows in wake of invasion, as retail industry looks to help Ukraine 

Digital sales in Russia have dropped dramatically in the wake of global sanctions, and Wall Street is warning of tough times ahead for Putin’s Russia. Meanwhile, ecommerce merchants are raising money for besieged Ukraine.

Toy retailers respond to Ukraine war; LEGO becomes a symbol of resistance 

A poster of a lego block painted in blue and yellow, a child singing “Let it Go,” boycotts by PLAYMOBIL and others are playing a role in fundraising for Ukraine and boosting morale in the wake of Russia’s invasion.

Retailer spotlights:

Patagonia demonstrates how digitization helps both the environment and the bottom line 

Patagonia reduced landfill waste by 170,000 pounds over the course of a single season just by changing its garment paper hang tag process. The retailer urges other retailers to use technology to reduce single-use materials.

Perry Ellis launches buy online, pick up anywhere 

The apparel merchant is allowing shoppers to pick up their online orders at third-party physical locations, such as Walgreens, Dollar General and FedEx. The rollout is part of a larger omnichannel and delivery push. Perry Ellis plans to launch buy online, pick up in store and same-day delivery before the holidays. 

Furniture retailer Floyd launches resale program for returns 

Floyd’s Full Cycle program allows shoppers to purchase returned or imperfect products for a discount. 25% of Full Cycle shoppers come back and purchase a full-price Floyd product.

A shift to fundraising guides communication approach for Double Good 

The COVID-19 pandemic accelerated the company’s transformation from a popcorn retailer to a virtual fundraising company. Now, most of its revenue comes from its virtual fundraising, said Anton German, chief technology officer and chief product officer.

Selling on marketplaces:

Managing products across multiple marketplaces isn’t easy, merchants say 

Given the various approaches that marketplaces take to product pages, sellers must dedicate resources to managing SKUs and listings across multiple marketplaces.

Macy’s officially launches its marketplace

Macy’s joins a growing list of top retailers that operate a marketplace alongside their ecommerce site. The retailer says its online marketplace will boost their product assortment, add incremental revenue at a ‘low incremental cost.’

Marketing on Amazon is all about keywords and presentation

Retailers find different ways to stand out among competitors when selling on marketplaces.

There is more than one way to manage customer data 

In an increasingly competitive ecommerce landscape, DTC retailers are figuring out how to reach new customers by linking up with larger merchants like Walmart or selling on marketplaces like Amazon — without losing too much control. The key is to take a step back and assess before diving into new ventures or technologies.

Supply chains, sustainability and fulfillment:

The costs and rewards of sustainable fulfillment 

Customers are increasingly aware of how their shopping habits affect the environment — and they’re holding retailers accountable. Online retailers including Taylor Stitch, Carter’s, REN Clean Skincare and Sabai Furniture give examples of how they implemented changes to consider sustainability by cutting back on what ends up in landfills, while maintaining profitability.

Making a 3PL relationship work 

Retailers seeking to outsource their fulfillment operations must understand their own needs and carefully select a firm they can trust to meet them.

US retailers unload a glut of slow-moving inventory in Q2 

Discounting hurt online retailers’ bottom lines and caused many to scale back their sales and earnings projections for the rest of 2022.

Rethinking resale as a giftable option 

Consumers are increasingly more comfortable buying secondhand merchandise for themselves. When it comes to gift giving, however, shoppers are reluctant to give used products as gifts — for now. That’s beginning to change as young shoppers are embracing resale as a giftable option for the holidays.

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The post Editors’ picks: Our favorite stories about online retailers in 2022 appeared first on Digital Commerce 360.

According to the report, retailers can expect 17.9% of the merchandise purchased this holiday season will be returned. That comes to nearly $171 billion in returned goods. The expected rate of holiday returns is more than a full percentage point higher than the 16.5% average return rate throughout the year.

For the first time since online data has been captured as part of the survey in 2019, online return rates are consistent with the overall return rate, the report said.

What’s more, online return rates dropped to 16.5% in 2022 from 20.8% in 2021.

Fraud and returns

For every $100 in returned merchandise accepted, retailers lose $10.40 to return fraud.

Of the approximately $212 billion in returned online purchases, $22.8 billion (10.7%) will be deemed fraudulent, the report said. Return fraud takes many forms, including the return of items after a single use (typically high-priced apparel.)

That’s roughly in line with the expected fraud rates from physical store purchases. Of the more than $3.66 trillion in expected in-store sales, $603 billion will be returned, the report said. Approximately $62.1 billion of those returns, or 10.3%, are expected to be fraudulent.

“The holidays typically include a spike in retail activity, but higher return rates can also impact profitability,” said Steve Prebble, CEO of Appriss Retail. “Retailers must look for ways to individualize the returns process through data-driven insights. This will minimize the risk of accepting fraudulent returns while enhancing the customer experience for loyal shoppers.”

The report is based on a survey of 70 retailers conducted by NRF and online fraud prevention vendor Appriss Retail from Sept. 19-Oct. 14.

Experts expected the drop in returns

The reports conclusion seems to coincide with what retailers and industry experts expected.

“We are expecting that our returns will stay proportional to our sales,” said Joshua Rich, digital fulfillment team leader at furniture retailer Freedom Australia. Rich said his team has put considerable effort into reducing returns by ensuring shoppers are happy with their purchase. “Decreasing returns is almost exclusively done prior to purchase. This can be things like making sure that product descriptions are correct, the quality is not inferior, colors match photos online, customers are happy with the service they have received. All in all, setting our customers’ expectations and meeting/exceeding them is crucial.”

A week before the report was released, Nicola Kinsella, senior vice president of global marketing at Fluent Commerce, said she expected the rate of holiday returns in 2022 to be roughly equal to that of 2021. Fluent Commerce sells order management and fulfillment services to retailers.

“I’d say it’s going to be very similar and for a couple of reasons. One is people are spreading out their purchases because retailers and brands are spreading out discounts. They’re starting their promotions early,” she said. “Because of that, people have had a bit more time to think about things and maybe returned something already that they might not have returned until a bit later.”

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JD Logistics agreed to pay about 9 billion yuan ($1.42 billion) for Deppon Holdco, an investment vehicle that holds about 66.5% in Shanghai-listed Deppon Logistics, according to a statement to the Hong Kong stock exchange on Sunday. As part of the deal, JD Logistics will launch a mandatory general offer for all of Deppon shares at 13.15 yuan ($2.07) a piece, a 3.9% premium to the latest closing price, as required under Chinese rules.

The purchase price was determined by factors including Deppon’s earnings, its stock market performance and that of its peers, as well as the long-term strategic benefits of the transaction, according to the statement. JD Logistics plans to finance the acquisition with its own funds and financing.

Chinese companies including JD.com have been investing heavily in warehouses and logistics infrastructure as the coronavirus pandemic accelerated the shift to ecommerce. Last year, the tech giant’s infrastructure management unit JD Property agreed to buy a controlling stake in China Logistics Property Holdings Co. in a deal valuing the firm at about HK$16.4 billion ($2.1 billion).

Deppon offers an integrated logistics services including less-than-truckload transportation, full truckload transport, delivery services and warehousing management, according to the statement. As of June of 2021, it counted more than 30,000 service stations across China, 143 transfer centers with more than 1.8 million square meters, and more than 15,000 vehicles.

Google to buy cybersecurity firm Mandiant for $5.4 Billion

Google agreed to acquire cybersecurity company Mandiant Inc. for $5.4 billion, its second-biggest deal ever. Owner Alphabet Inc. is No. 82 in the 2021 Digital Commerce 360 Top 1000.

With Mandiant, Google gets more tools to protect its cloud clients by responding quickly to online threats. The company is working to recruit and support cloud customers amid stiff competition from Microsoft Corp. (No. 95) and Amazon.com Inc. (No. 1). Following the close of the deal, Mandiant will be part of Google’s cloud business.

The cloud business could help Google diversify beyond advertising, which comprises the bulk of its revenue and profit. Under CEO Thomas Kurian, who took over in 2019, Google Cloud has sought myriad ways to expand. It’s working to make the service more reliable and revamping its partnerships to engineer bespoke projects for more clients.

Google is snapping up Mandiant amid a flurry of deal-making in cybersecurity, as global anxiety continues over the potential ripple effects in cyberspace from Russia’s invasion of Ukraine. Mandiant has frequently detailed nation-state hacking activity — including cyber-espionage from Russia and China — as part of its threat intelligence offerings.

Amazon Aggregator Yaba raises $85 million

Southern European Amazon aggregator Yaba is snapping up more Amazon-native brands with a fresh $85 million in funding. Venture capital firm Crossbeam Venture Partners and credit fund Tikehau Capital led the round.

Since launch in 2020, Yaba has acquired 12 Amazon brands and generated $20 million in revenue across its brands during 2021. Yaba will use the funding for additional staff and acquire as many as 15 more companies by the end of 2022.

Yaba is looking to expand in a variety of verticals, including existing categories like beauty and baby care, as well as new verticals like outdoor equipment and lighting.

The post JD Logistics buys 66.5% of China’s Deppon for $1.4 billion appeared first on Digital Commerce 360.