By Jose Mallabo on Thursday, January 13, 2011
Not too long ago you could do an industry round up on ecommerce by looking through a straw. There were two major ecommerce players – Amazon and eBay – and brick and mortar retailers launching Web sites to compete with them and their own stores. Then came search marketing and online payments.
Looking back at what ecommerce became in 2010 requires a much bigger straw. Local shopping, social media, couponing, mobile commerce and private sales became more than words buzzing around ecommerce last year. They became a bigger part of the consumer experience and are quickly becoming core to the segment.
Through that lens, below is my 5-minute rewind on the most important happenings in ecommerce last year:
Twitter begins its promoted Tweets. Under the headline of “Twitter’s revenue model” this somewhat discrete promoted area on Twitter was a sign of a lot of things on the horizon – namely, the significance of Twitter as a channel with ~90 million Tweets a day and the plaid-like interlock between social, mobile and commerce. Twitter is intrinsically more portable than Facebook and spans the divide between professional and social networking more seamlessly (noted by the Twitter integration with both LinkedIn and Facebook) -- which puts it at the top of my rewind of 2010 happenings just a micron ahead of Facebook.
Facebook becomes number 1 visited site. Facebook passed Google as the most visited site in the U.S. That’s kind of a big deal. Marketers took notice and moved dollars into the social network. Facebook now accounts for about 1 in every 4 display ads in the U.S. (23.1% or a whopping 297 billion ad impressions). Shop.org noted the shift to social in a study that told us that almost 3 out of every 4 (72.5%) retailers invested in Facebook ahead of what turned out to be a strong holiday shopping season. Commerce meet Social. Social meet Commerce.
Google makes a $6 billion bid for Groupon. Whether it was wrong or right for Groupon to pass on the deal only time will tell. People with weaker constitutions (ahem, yours truly) than 30-year old Groupon CEO Andrew Mason may have taken the money and gladly been assimilated into the Google vortex. Groupon quickly went out and raised $950 million on its own after saying “thanks, but no thanks” to Google. Much of the banter since then has been about the failed deal. But the real news was that Google made the $6 billion bid in the first place. It validates that local shopping and couponing (with its roots in classified ads, Val-Paks and the Sunday paper) are alive and well in today’s Web 2.0 world, in the form of a Web 1.0 channel: email. Email is dead? Long live email!
The fore fathers of ecommerce didn’t sit idle in 2010. Ebay and Amazon were busy making their own moves and news to keep up with the shifting industry landscape and consumer behavior.
eBay 2.0. With Skype on its own, eBay Inc. pushed hard in 2010 to reinvent its Marketplaces business with a site refresh that makes it feel a lot more like a modern shopping site than an auction site. Woop! After years of operating separately, its Classifieds offerings were integrated into eBay.com giving shoppers another buying option. (Full disclosure: I used to work at eBay.) It acquired local in-store inventory search engine Milo.com in a move that recognizes the so-called “gray market” (people researching online but buying offline) is now part of the overall market. eBay Mobile was relaunched which showed traction by Cyber Monday and was integrated with newly acquired RedLaser to allow consumers to comparison shop.
Amazon is still the juggernaut. If I wrote this post every year for the past and next 10 years, it would probably be true. An estimated $32 billion in revenues. $80 billion in market cap. And a price/earnings multiple of over 70 (~3 times that of both Apple and Google). Like eBay, Amazon didn’t sit still last year. In July, Amazon re-launched its online clothing business to grab share of the growing online fashion segment and complement its 2009 purchase of Zappos. What most people remember of Amazon 2010 is the Diapers.com acquisition and investment in LivingSocial, when really the move of the year was the Kindle price drop.
The Kindle strategy was already one of the smartest distribution strategies I’ve ever seen executed by an Internet company. (iTunes, you say? Apple is a device company with a store that sells media. Amazon is an ecommerce company with a device as a channel.) No doubt the move was prompted by the challenge that the iPad and Nook posed, but dropping the Kindle price to give more people access to it was smart regardless of the competition. Early estimates suggest that Amazon sold 4 million Kindles in Q4 2010. That’s a lot of people with Amazon on their brains and in their hands – and part of the reason Amazon remains a juggernaut and strong foe to retailers and ecommerce companies alike.
My hope for 2011 is that I can order a case of wine using TweetDeck on my Android phone from Amazon.com and have it shipped to Pennsylvania – all while standing inside a liquor store price comparing. Fingers crossed.
Google rolls out quick action buttons for Gmail
The e-Dialog Marketing Blog
GSI Commerce Appoints Michael Kliger as Managing Director for Europe
GSI Commerce News
e-Dialog Insights — Consumer Loyalty Programs: Leveraging The Loyalty Lifecycle
The e-Dialog Marketing Blog
Today’s Scuttlebot: Apple’s Tax Plan and Virtual Biology
New York Times Bits
Florida says no to Amazon’s sales tax deal
Follow GSI companies on Twitter:
eBay companies on Twitter: