Shopify has new tools for B2B sales, Twitter and in-person payments.
With tools that made it easy for entrepreneurs to set up online stores and sell consumer goods, Shopify became synonymous with the rise of the direct-to-consumer (DTC) model. The Ottawa, Canada-based company helped to normalize a setting for ecommerce marketplaces beyond Amazon, and created its own ecosystem that flipped the established model on its head in the process. Over the last decade, the brands that set up web-based shops were many, but a large number were powered by the Ottawa, Canada-based company's software and the DTC playbook it enabled.
Now, following a spike in digital adoption that included shopping during the pandemic, ecommerce generally and the DTC approach in particular are more established parts of how we shop. This has led a growing number of platforms to make space for commerce. In turn, DTC brands have more places than ever to meet potential customers. These startups are not only advertising on Facebook and directing customers to their websites. They’re also testing new marketing channels and social media shopping functionalities, expanding to physical stores, exploring web3 and more. What's more, the merchants that tapped Shopify to get started are now seeking tools to scale.
It’s in this context that Shopify on Wednesday rolled out Editions, a look at more than 100 recent product releases that expand the scope of what the company offers merchants. Some of the releases are freshly announced, while others were rolled out in recent months. Each is the reflection of an identification of specific places in a merchant’s process where software can play a role in solving a problem, product strategy about the best approach to address it and engineering that brings a solution to life.
Taken together, they make a bigger point about commerce and how it has evolved. Shopify said Editions points to a new era: Connect to Consumer (C2C).
So what will characterize the C2C era? Admittedly, Shopify didn’t share a treatise to define it. However, it's clear that each product release is part of the equation.
Given that, here’s a look at 10 Shopify product updates that reflect key themes shaping commerce. These are just some of the 100+ features Shopify detailed with the release of Editions, but they each point at a bigger shift taking place:
Shopify merchants are increasingly selling to other businesses, while others want the opportunity to do so, the company said. This is reflected in part through a rise in DTC businesses selling wholesale. To enable growth in this area, Shopify is debuting a new feature called B2B on Shopify. Initially available to Shopify Plus members, this will allow merchants to sell to businesses using the same platform where they sell to consumers. Shopify created a store experience that is designed to be optimized for businesses, with considerations such as bulk buying and flexibility in pricing for individual customers. It also partnered with ERP providers such as NetSuite, Brightpearl, and Acumatica to integrate data.
Social media is becoming more shoppable, as platforms integrate features to enable not just discovery of products, but also buying and selling. A new Shopify partnership with Twitter is growing the presence of stores on the bird app. Shopify has a new app allowing brands to create a sales channel through Twitter. This allows brands to showcase products on their Twitter profile through Twitter’s Shop Spotlight or Twitter Shops. The idea is that after a user discovers a brand's product on Twitter, the path to a purchase gets easier.
As they embrace a return to in-person activities and seek to create a venue to meet shoppers in-person, direct-to-consumer brands are adding physical retail channels. At the same time, they’re embracing digital tools to help reinvent the experience. Shopify itself is seeing this, as the company’s GMV for offline commerce grew 80% year-over-year in Q1 of 2022. A new Shopify release called Tap to Pay on iPhone allows for more seamless payments. Partnering with Stripe, Shopify created a payment tool for iPhone that doesn’t require additional hardware. This is initially rolling out for Shopify point-of-sale merchants, but the company pointed to potential for using it in other settings like farmers markets, pop-up shops and new stores.
Google has noted that searches for “in stock near me” are an increasing trend of online shopping behavior. It reflects a consumer mode where a shopping journey might start online and end at a store, or vice versa. Shopify has a new product enabling brands to sync local inventory. Available through Shopify’s Google channel, this allows brands to automatically notify customers when a product is available in store.
The rise of web3 will usher in an era where an exchange of currency for ownership extends to digital items, as well as physical ones. Non fungible tokens (NFTs) are one of the early constructs allowing brands to offer digital ownership. Rather than selling goods one-to-one, many brands see these as an opportunity to power loyalty by allowing NFT ownership to build communities and unlock rewards. A new release called Tokengated Commerce on Shopify allows merchants to give NFT holders access to perks and products. This gives shoppers the ability to connect their crypto wallets to a Shopify store. Then, they can use their NFTs to unlock experiences. There’s also collab opportunities, as brands can invite NFT holders of other brands to their storefront where a specific experience is being offered.
On the topic of loyalty, Shopify also put the early word out about a new product called Shop Cash that will provide rewards through the Shop app, and allow brands to boost their own presence, providing a promotion tool.
The trend toward headless commerce reflects a desire by brands to create experiences that are unique to them. Shopify previously released Hydrogen and Oxygen, a set of developer tools to create custom storefronts. Now, it is providing tools for the backend. Shopify Functions allows developers “to extend or replace Shopify’s backend logic with custom code,” Shopify said. An initial tool called Discounts is designed to enable the building of customized volume discounts or free gift with purchase offers.
Rising customer acquisition costs and privacy-oriented changes rolled out by Apple with iOS 14.5 are changing the landscape for brands in digital advertising. Where Facebook ads were once a primary source of scale, brands are now exploring other advertising venues, like TikTok and even offline billboards. However, Meta properties remain a part of the marketing mix, and brands are seeking new tools to succeed there in a post-App Tracking Transparency world. In response to this, Shopify rolled out Shopify Audiences last month to allow brands to leverage Shopify’s network to build high purchase intent audiences, and export them to other ad networks. Read a full breakdown here.
As the saying goes in international trade circles, a business is international once it stands up a website, with a digital presence enabling access to a brand from anywhere. Selling goods internationally requires a considered approach, however, as currencies, culture and regulations create unique selling environments. Shopify last year released Shopify Markets to enable global sales. This allows businesses to create customized storefronts for particular markets, sell in the language of a country and collect fees for selling across borders.
Influencers and creators rose as a force in ecommerce as Instagram and then TikTok became key channels. To provide tools for brands, Shopify in April acquired Dovetale, a platform which helps brands manage influencer campaigns. As they take a bigger role in connecting people and products across different platforms, creators are forging a bigger presence as entrepreneurs themselves, as well. To that end, Shopify released Linkpop, a link-in-bio tool that allows creators to promote their presence across multiple business lines and channels, and syncs with a product catalog.
As ecommerce becomes more normalized and shoppers move across online and offline channels, consumers will increasingly want items to be available where they are. At the same time, supply chain issues of the last two years made fulfillment and logistics a top concern for brands and customers alike. To give brands a way to provide peace of mind for consumers, Shopify is rolling out Shop Promise, a badge that provides a two-day delivery and “hassle free returns.” Shopify is also building out a fulfillment network to power merchants shipping and delivery behind the scenes. It acquired logistics platform Deliverr in May, and is looking to combine it with its own capabilities and previously acquired fulfillment tech company 6 River Systems. Check out our full analysis here.
Plus, check out the ecommerce software companies raising millions.
This week, Walmart takes a stake in a tech partner, Moët Hennessy brings on a Napa Valley legend and a group of ecommerce software companies are reporting big funding rounds.
Take a look at this week’s activity:
Walmart partnered with Symbotic in 2021 to bring more automation to its warehouses, and in May expanded its use of the company’s technology to all 42 of its regional distribution centers in the coming years.
This comes a few weeks after Symbotic made its public debut on the Nasdaq by merging with a SPAC that is affiliated with prominent investment firm Softbank.
Walmart has said Symbotics' technology plays a key role in its ongoing supply chain improvements. Specifically, Symbotic creates palletized loads of department-sorted inventory. This gets products onto shelves at its stores more quickly, and makes materials handling safer. It's part of a big upgrade to fulfillment and distribution center technology planned by Walmart in the coming years, as the company seeks to build out ecommerce operations to rival Amazon.
LVMH-owned Moët Hennessy is adding a fine wine legend to its luxury offerings.
The wine and spirits division acquired the Napa Valley wine collection of Joseph Phelps Vineyards. Known for the Bourdeaux-style blend Insignia, the winemaker was of the pioneers that made California a wine destination.
“Joseph Phelps has been to the Napa Valley what Nicolas Ruinart, Mrs. Clicquot, Joseph Krug and Claude Moët were to the Champagne region, and likewise we will continue to develop this new House in the respect of the founder’s heritage and vision,” said Philippe Schaus, chairman and chief executive officer of Moët Hennessy.
Henkel has completed the acquisition of the professional haircare business of Shiseido, the companies announced this week. This includes the brands Sublimic and Primience. With the deal, Shiseido will retain a 20% stake in the business.
Initially announced in February, the deal will help Henkel bolster its presence in Asia, the company said. Henkel also plans to set up a J-beauty innovation hub in Tokyo to develop new products for Asian consumers.
It adds to a portfolio that also includes hair color brand Schwarzkopf Professional, as well as Bonacure, Igora Royal and Authentic Beauty Concept. Henkel is planning to merge its beauty care and homecare divisions into a newly-created Henkel Consumer Brands unit next year.
DTC online fitness store Bodybuilding.com has a new partnership with digital marketing experts at Retail Ecommerce Ventures.
Founded in 1999, Bodybuilding.com specializes in dietary, sports, and bodybuilding supplements, offering private-label and third-party brands. It also has an app, and a loyalty community with over 15 million registered members.
For its part, Retail Commerce Ventures works with brands to build ecommerce capabilities, with a focus on helping legacy brands move from brick-and-mortar to digital storefronts. In the case of Bodybuilding.com, the goal is to expand its online presence. Founded by Tai Lopez and Alex Mehr, it has a portfolio that includes Pier 1, Radio Shack, Dressbarn, Ralph & Russo, Stein Mart, Franklin Mint, Modell's, MentorBox, FarmersCart, Linens 'n Things and more.
"This company's history is only in its first inning, and at a time when there's so much noise and confusion on the internet, Bodybuilding.com's trusted content, products, and community are more valuable than ever,” said Lopez of Bodybuilding.com, in a statement.
UK-based ecommerce app operator Shop Circle launched out of stealth mode last week with financing of $65 million.
The funding was led by NFX and QED. Investors, with participation from 645 Ventures, FirstMinute Capital and Triple Point Capital. Global law firm Orrick participated in a strategic advisory capacity.
Founded by Luca Cartechini and Gian Maria Gramondi in 2021, the company created a “one-stop shop” for Shopify merchants to find the best apps for their needs, without having to search through the 7,500 apps available on the platform. It says it is behind six apps with 40,000 downloads by merchants. The company’s business model includes options for app entrepreneurs to sell to Shop Circle, or join the company’s team and work alongside its teams to grow.
“With the funding, we are able to rapidly increase our portfolio of apps and support more direct-to-consumer brands in building experiences their customers will love,” said Cartechini, the company’s CEO, in a statement.
Nautical Commerce executives. (Courtesy photo)
Nautical Commerce, which helps brands, retailers and B2B businesses launch company-operated marketplaces, raised $30 million in a Series A round.
The funding was led by Drive Capital, with participation from existing investors Accomplice Ventures and Golden Ventures.
With leaders bringing experience from Apple, Visa, Top Hat and TouchBistro, Nautical offers a platform that allows companies to launch multi-vendor marketplaces in as little as 90 days.
With the funding, it is planning to add over 40 new team members this year.
“Ecommerce is becoming more distributed and single-vendor platforms were not built for this multi-vendor future. Ryan and his team built the only multi-vendor ecommerce platform and are serving a huge need in the market,” said Drive Capital’s Masha Khusid, in a statement. “We’re impressed by what Nautical has already accomplished and are proud to enable them to deliver on their mission to democratize marketplace technology.”
Promoted, which unifies search, feed, ads, and promotions for ecommerce marketplaces, raised $6 million in seed funding.
The round was led by Y Combinator, and included participation from Interlace Ventures, Vela Partners and angel investors including Michael Seibel, the managing director at Y Combinator.
Typically, teams at ecommerce marketplaces have separate teams for ads, merchandising, search, and recommendations. This leads the data to be siloed, as well. Promoted solves this by:
With the funding in hand, the company will continue to develop its streaming data infrastructure platform, and hire additional engineers.
“Promoted helps large marketplaces and ecommerce apps achieve profitability at scale and react in real-time to how ads, search, listings and promotions perform,” Seibel said. “Promoted’s tools optimize marketplaces -- leading to double digit conversion increases -- and are becoming an integral component of how marketplaces make money. We are excited to continue to work with the Promoted team, who have deep experience in adtech engineering."
The SleekFlow team. (Courtesy photo)
Hong Kong-based Social commerce platform SleekFlow said it raised $8 million in a Series A funding round.
The funding was led by leading tech investor Tiger Global Partners, with participation from Transcend Capital and AEF Greater Bay Area Fund, managed by Gobi Partners GBA.
The company makes an omnichannel social commerce platform that enables the processes behind the selling of products directly through social media channels. This includes features such as a system that generates payment links in chats. It also integrates with 2,500 tools and messaging channels, and helps businesses track and retain potential sales leads from both online and offline channels.
Following the funding round, the company plans to grow in Southeast Asia, where it currently has a presence, and expand to the UK and Europe. It also plans to invest in product development, with a focus on areas such as one-click checkout.