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The news: Checkout provider Bold Commerce and fintech company PayPal announced an integration that will allow brands and retailers to adopt both companies’ services together. PayPal said it’s a move to expand in the headless commerce market, which describes solutions that allow merchants to operate stores without a front-end layer.
How will it work? The companies described the integration this way:
Brands and retailers can use Bold Commerce’s headless checkout suite with the PayPal Commerce platform.
This brings together payments and checkout in a “single pre-integrated solution.”
Merchants can launch sales beyond their own website by integrating checkout in places like blogs, social, and QR codes on packaging.
Through a single service, brands and retailers can accept payment options including PayPal, Venmo and PayPal Pay Later solutions, as well as credit and debit cards.
Key quote from PayPal VP and Global Head of Channel Partnership David Bruce: “Payment choice and flexibility have always been a critical part of a successful commerce experience – but it’s only one part of the equation. Retailers today need to also offer a tailored checkout experience to help drive increased conversion. It’s a powerful combination for a composable checkout to plug into any tech stack.
What it means for ecommerce: The partnership highlights several key trends playing out in the market today:
Headless commerce: In a past generation, retailers built monolithic ecommerce systems with a host of interconnected parts. The cloud and API-driven architecture is ushering in a new paradigm where brands and retailers can separate out different components, and select what best fits their needs. The market is moving toward this, especially in the enterprise segment that long required custom-built systems for scale and category needs. The entrance of PayPal signals that longtime ecommerce platforms are building for this shift. Meanwhile, Bold Commerce itself has 9,000 brands and retailers on its platform, including Vera Bradley, Staples Canada, Pepsi, and Mars. This follows a move by Shopify to launch composable product suite Commerce Components with a focus on checkout earlier in January.
Checkout anywhere: Content brought commerce to platforms beyond ecommerce stores, enabling ads on social platforms and brand placement in posts. More recently, more of that content has become shoppable, allowing users to browse and start a purchase right within a piece of media. A solution like the Bold Commerce and PayPal integration takes another step, embedding the ability to finish a purchase by checking out right inside that content. It shows how ecommerce is becoming more embedded in the experience of the internet, as opposed to existing on specific stores and marketplaces.Fighting cart abandonment: The ability to check out through media is enticing to ecommerce leaders because they want to reduce the touchpoints and time between a person showing interest in an item and completing a sale. Bold Commerce found over half (53%) of consumers abandon checkout before making a buy. This is a long-standing issue, but signals that perhaps there is another technical step being taken. It’s one thing to make checkout easier; It’s another to bring it directly to the point of discovery.
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Campbell Soup Company CEO Mark Clouse offered thoughts on messaging amid inflationary shifts in consumer behavior.
After months of elevated inflation and interest rate hikes that have the potential to cool demand, consumers are showing more signs of shifting behavior.
It’s showing up in retail sales data, but there’s also evidence in the observations of the brands responsible for grocery store staples.
The latest example came this week from Campbell Soup Company. CEO Mark Clouse told analysts that the consumer continues to be “resilient” despite continued price increases on food, but found that “consumers are beginning to feel that pressure” as time goes on.
This shows up in the categories they are buying. Overall, Clouse said Campbell sees a shift toward shelf-stable items, and away from more expensive prepared foods.
There is also change in when they make purchases. People are buying more at the beginning of the month. That’s because they are stretching paychecks as long as possible.
These shifts change how the company is communicating with consumers.
Clouse said the changes in behavior are an opportunity to “focus on value within our messaging without necessarily having to chase pricing all the way down.”
“No question that it's important that we protect affordability and that we make that relevant in the categories that we're in," Clouse said. "But I also think there's a lot of ways to frame value in different ways, right?”
A meal cooked with condensed soup may be cheaper than picking up a frozen item or ordering out. Consumers just need a reminder. Even within Campbell’s own portfolio, the company can elevate brands that have more value now, even if they may not always get the limelight.
The open question is whether the shift in behavior will begin to show up in the results of the companies that have raised prices. Campbell’s overall net sales grew 5% for the quarter ended April 30, while gross profit margins held steady around 30%. But the category-level results were more uneven. U.S. soup sales declined 11%, though the company said that was owed to comparisons with the quarter when supply chains reopened a year ago and expressed confidence that the category is seeing a longer-term resurgence as more people cook at home following the pandemic. Snacks, which includes Goldfish and Pepperidge Farm, were up 12% And while net sales increased overall, the amount of products people are buying is declining. Volumes were down 7%.
These are trends happening across the grocery store. Campbell is continuing to compete. It is leading with iconic brands, and a host of different ways to consume them. It is following that up with innovation that makes the products stand out. Then, it is driving home messaging that shows consumers how to fit the products into their lives, and even their tightening spending plans.
Campbell Soup is more than 150 years old, and has seen plenty of difficult economic environments. It is also a different business today, and will continue to evolve. At the end of the day, continued execution is what’s required.
“If it's good food, people are going to buy it, especially if it's a great value,” Clouse said.