Tag Archive: commerce


india1

Amazon is known for pouring the revenue it generates back into its business. Now, it’s ready to give a chunk away.

The Seattle-based retailer today announced a corporate philanthropy program called AmazonSmile, which allows Amazon shoppers to direct 0.5 percent of their purchase totals at the e-commerce giant toward a charitable organization of their choice. Amazon will then donate the money on behalf of its customers.

At launch, “basically every physical product is eligible” for the program, according to AmazonSmile general manager Ian McAllister.

But there are exceptions. Digital-media products such as Kindle e-books won’t be eligible for the program, although that could change, McAllister said. Purchases made through Amazon’s subscribe-and-save subscription program are also ineligible.

There will be no cap on donation amount.

The program will only be available to shoppers who visit Amazon via a special Web address – smile.amazon.com – instead of the normal Amazon.com homepage.

When customers enter through the new gateway, they will be prompted to select from one of a handful of featured charitable organizations, or to search a database of nearly a million 501(c)(3) organizations if they are looking to support a cause that isn’t featured. That breadth of choice pretty much matches up with the Amazon brand.

The shopping experience the customers encounter on the AmazonSmile landing page will otherwise be identical to the regular Amazon.com site – same selection, same prices – with the exception that eligible products will be marked as such on product detail pages, the company said.

An Amazon spokesperson said the company will market the program on Amazon.com, via email, and on its social network accounts.

A rep for Charity:Water, one of the organizations Amazon touts in its press release, said it will not do paid advertising of its own to promote AmazonSmile, but will publicize it to its social network followers.

Corporate charitable giving is nothing new, of course, and can take on varied forms. Google’s charitable initiatives include grants, free product handouts and an overall pledge of one percent of its profits toward its charitable organizations.

Last year, Walmart said it gave $1 billion in cash and in-kind contributions to U.S. organizations.

And Salesforce is known for donations and discounts to nonprofits of its customer-relationship-management software.

But the sheer size of Amazon’s customer base, the ease with which donations are made once someone becomes aware of the program and the charity choice given to shoppers make for a unique program. For those who end up making a routine out of shopping through smile.amazon.com, there will likely be the feeling that you’re doing good while shopping, which has the potential to be another powerful differentiator to set Amazon apart.

“At their scale, there’s potential to truly test whether &#8216cause’ affects buying decisions,” said Jeff Smith, chief innovation officer at Matter Unlimited, a boutique creative agency focused on social-responsibility campaigns. “It would be fascinating to really connect the dots.”

A side benefit of corporate-giving initiatives like this one are the tax deductions – and Amazon’s case is no different. The company, not Amazon shoppers, will receive the tax benefits for the donations. Donations will be made through an entity called AmazonSmile Foundation and will come out of Amazon’s pockets, not from any of its marketplace sellers.

McAllister, AmazonSmile’s GM, said tax benefits did not guide the decision to launch AmazonSmile. Nor did focus groups or customer surveys.

“We thought our customers would love it,” he said of the reason for the initiative.

When I asked a spokesperson whether Amazon cares about what Wall Street and its shareholders will think about a company that doesn’t frequently turn a profit creating such a charitable initiative, the response was similar.

“We think our customers will love it,” he said.

Quote: Full Circle

In 10 years I think we’ll look back and say we can’t believe we lived in a world with enormous transaction fees and all these security risks. That we couldn’t digitally send money to anyone anywhere in the world.

- Brightcove co-founder and former CEO Jeremy Allaire, on Circle, his bitcoin payment platform for merchants

Jimmy Pitaro

Jimmy Pitaro

Earlier today, Disney said what is likely not much of a shock to anyone – that it was handing over the reins of its interactive division to one of its two co-presidents, Jimmy Pitaro.

That means John Pleasants, who was the other co-president and was located in Silicon Valley, is leaving the kingdom, merging the games and media units under one leader in Los Angeles. Pleasants, as happens in these kinds of things, will be a strategic consultant to Disney Interactive.

The reorganization of the unit comes three years after Pitaro, a former Yahoo media exec, and Pleasants, who came to Disney via its acquisition of Playdom, were paired. Disney Interactive recently reported its second quarterly profit of $16 million on sales of $396 million, in what has been an uphill effort over the past decade for the entertainment giant.

Under the regime of former CEO Michael Eisner – many digital moons ago and which I covered since I am so dang old – Disney bought search engine Infoseek and tried to create a portal called Go.com. That failed, and was one of many efforts to define the media company’s Web goals. More recently, in 2008, Disney gathered most of its Internet properties under Steve Wadsworth.

Then came the pairing of Pitaro and Pleasants. And now, just Pitaro.

Disney said it “will move forward with a singular strategy for driving revenue and advertising across key platforms and franchises,” such as Disney Infinity – a big Pleasants project – and Club Penguin.

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Two months ago, when LivingSocial unveiled its marketplace of longer-term deals and a new category dedicated to coupon codes, I said it was getting “harder and harder to decipher how LivingSocial is setting itself apart” in light of the similarities between those products and ones from Groupon and RetailMeNot.

Turns out LivingSocial is not the only player in the category looking at other deals companies for a little product inspiration.

Today, Groupon announced the launch of its “Freebies” category, which is essentially a database of coupons much like the one LivingSocial recently launched – which was much like the one Austin-based RetailMeNot rode to a stock price increase of 50 percent in the four months since it priced its IPO at $21 a share. Groupon’s new coupon portal includes discount codes for large brands such as Adidas, Puma and American Eagle instead of the small businesses that are the target customer of its local deals business.

Putting aside the imitation play, what is it about the online coupon business that has LivingSocial, Groupon (and some Wall Street analysts) salivating? For one, profit margins, since a large chunk of customers find the deals through organic search results. Also, profit margins!

In a research note this morning, Sterne Agee analyst Arvind Bhatia called out RetailMeNot’s “90%+ gross margins” as one reason why the category is so attractive. He also pointed to Groupon’s existing customer base as well as its tech platform as possible advantages it has over the competition.

“If we assume that GRPN could achieve over time 1% to 2% market share of the overall coupon business (on line and off line) and generate margins similar to Retailmenot … this could result in incremental EBITDA of more than $100M,” he wrote. “If this business were to be afforded an [enterprise value] to EBITDA multiple of 15x, it would equate to incremental enterprise value of more than $1.5B or more than $2.00 per share.”

Let the search engine optimization wars begin.

netsuite-logo

Netsuite, the cloud-based business software company, just announced its quarterly earnings for the period ended June 30, and they reflect why the company’s shares have been one of the best performers on the New York Stock Exchange this year.

On a non-GAAP basis, Netsuite reported per-share earnings of five cents on sales of $101 million. That was better than what analysts had expected: Two cents per share on sales of $100.6 million. Sales rose 35 percent from the year-ago period.

Recurring revenue, a key metric for cloud software companies that sell their software on a subscription basis, grew 39 percent. Sales through resellers – or “channel partners,” in industry parlance – grew 70 percent.

“If there was any question that mission-critical business applications were moving to NetSuite, this quarter should provide the answer,” CEO Zach Nelson said in a statement. Just today, the company said that Hailo, the company behind the taxi-hailing app, had become a customer.

Always quick to point out where his main rival is tripping up, Nelson compared NetSuite’s results to those of the German business software giant SAP, which fell by about 7 percent year on year in its most recent quarter.

Amazon said in a message on its homepage on Monday that it was running a one-day, 15-percent-off sale for its new line of Kindles to celebrate the Federal Aviation Administration’s recent reversal of a longtime policy that banned airplane passengers from using electronic devices during takeoff and landing. Nick Bilton, the New York Times journalist who had pushed for the change, received a shout-out from Jeff Bezos in the prepared remarks for Amazon’s third-quarter earnings report.

beth_ferreira_fab_feature

Fab chief operating officer Beth Ferreira will be leaving the e-commerce startup, sources told AllThingsD.

This will be the second major departure in as many weeks at Fab. Co-founder Bradford Shellhammer recently said he was stepping away from day-to-day operations.

Before Fab hired Ferreira two years ago, she spent three years as an operations exec at Etsy. She is widely respected in e-commerce operations circles and her hiring was seen by many in the industry as a sign that Fab was as serious about the back-end operations of the business as it was about the front-end experience for shoppers.

(Update: Fab spokeswoman Deborah Roth issued a statement on upcoming personnel changes, but didn’t confirm Ferreira’s exit.

“With regards to the rumors, it is accurate that Fab is undergoing management changes as we realign the business to execute on our 2014-2017 plan,” she wrote. “There will be a number of management changes involved as we streamline the organization and move to a category P&L based structure. As not all of the organizational changes are final yet, we are withholding comment on any specific individuals until later this week.”)

In recent months, Fab has shed at least 37 percent of its staff – or 250 employees – as it decided it could not build a giant, profitable business around short-term flash sales in the categories it has chosen. Instead, it is trying to build an e-commerce store with a more traditional model of carrying inventory and making products available for sale for long periods of time.

That business-model transition will include a more narrow focus on product categories. Roth previously told AllThingsD that Fab would eliminate vintage, food and pets categories from its product focus.

In the aftermath of those layoffs, CEO Jason Goldberg and CTO Nishith Shah decided to forfeit their salaries for 2014.

(Photo courtesy of Fab.com)

no-dice

In its lackluster second-quarter report today, at the very bottom of its press release, Zynga made a very important strategic announcement, saying that it would not pursue real-money gaming in the U.S.

It added that it would continue to evaluate its tests of such gaming products in the United Kingdom, where betting is legal. U.S. online gaming, in comparison, requires Zynga and others to jump a series of long-term and difficult hurdles.

While some investors had been counting on the potentially lucrative online business to be a potential growth area for the troubled San Francisco online social gaming company, management said it has decided to focus on fixing its core business instead.

Said Zynga in a statement:

“Zynga believes its biggest opportunity is to focus on free to play social games. While the Company continues to evaluate its real money gaming products in the United Kingdom test, Zynga is making the focused choice not to pursue a license for real money gaming in the United States. Zynga will continue to evaluate all of its priorities against the growing market opportunity in free, social gaming, including social casino offerings.”

No surprise, given this surprise, Zynga’s stock is off 14 percent so far in after-hours trading.

gettyamazon380

JOE KLAMAR/AFP/GettyImages

First quick look at Amazon’s earnings numbers, and it’s a miss.

The online retail giant posted a loss, at an EPS of minus two cents on revenue of $15.7 billion.

Though Amazon’s net sales rose 22 percent compared to the year-ago quarter, it’s a disappointing miss against analysts’ expectations that the company would post earnings per share of four cents to six cents on $15.74 billion in revenue.

“This past quarter, our top 10 selling items worldwide were all digital products – Kindles, Kindle Fire HDs, accessories and digital content,” CEO Jeff Bezos said in a canned statement. (Of course, with no actual sales numbers on the amount of Kindle products sold – as always.)

Not a ton of color in this release as to why Amazon missed, nor are there any notes on AmazonFresh, the company’s experimental grocery delivery service. Hopefully, CFO Tom Szkutak will address these points on the conference call with analysts coming up shortly.

Shares of Amazon were trading off around two percent on the news, at around $297 per share.

A lot of companies aspire to have a mobile strategy, and then there are companies, like Trulia, that already have the beginnings of one.

peteflint trulia

Pete Flint, CEO of the San Francisco-based online real estate company, told AllThingsD that traffic from mobile had increased 120 percent in the fourth quarter year over year. “Mobile is an enormous opportunity for us,” he said. “At some point in the future, we expect it to generate a majority of our revenue.”

Today, the company’s stock hit a new high, closing at $29 a share, following yesterday’s release of its fourth-quarter results.

In that quarter, the company lost $1.6 million, or six cents a share, on revenue of $20.6 million. Excluding some items, Trulia would have lost three cents. Analysts were expecting the company to lose two cents a share on revenue of $19.1 million.

Flint said the average revenue per advertiser grew in the fourth quarter because of mobile and an overall increase in prices. Trulia agents are buying ads on its apps separate from the Web because that is where they are seeing the best results — and because of that, Trulia is charging more for mobile. ”Consumers are absolutely out-and-about using the apps to browse and to connect with an agent to purchase a property,” he said.

One data point backing this up is that in 82 of the top 100 U.S. cities, he said, there are more leads being sent via mobile devices to real estate professionals than through the website.

In September, Trulia went public, pricing its shares at $17 apiece to raise roughly $85 million. Flint said in hindsight, mobile was also a big factor in the success of the offering.

“As we look back, investor concern last year was for companies to execute on mobile and to have a proven track record, and we are uniquely positioned to execute on mobile,” he said.

Trulia’s closest competitor, Zillow, reported its fourth-quarter results today, and also credited mobile for some of its growth. The Seattle-based company, which makes money from charging real-estate agents subscription fees and from advertising, said in December that more than half of its visits occurred on mobile devices, with that traffic spiking to 60 percent on weekends.

Zillow reported a profit of $500,000, or two cents a share, on revenue of $34.3 million. Analysts were expecting the company to break even on revenue of $31.5 million. The company’s stock surged in after-hours trading, jumping 7 percent, or $2.88 a share, to close at $41.85.

The market values Zillow at roughly $1.3 billion, about double Trulia’s current market cap.

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