eCommerce Growth; Bezos’ Testimony; eBay and Shopify 2Q Results

By Cleveland Admin

According to our interview with Michael Lagoni, Founder and CEO of Stackline, eCommerce growth has normalized around 60-70% year over year for the past several months. This is down from 80-90% growth in March and April, but is well above the 17% rate at which eCommerce was growing pre-pandemic. Stackline is expecting eCommerce year-over-year growth to hover around the 60-70% range for the remainder of the year. While maintaining this type of growth is uncertain, Michael recommended brands evaluate and actively manage the expanding number of digital platforms that are now much bigger than pre-pandemic levels as well as look at ways of expanding business internationally.

Bezos’ Congress Testimony:
As part of Jeff Bezos’ Congress testimony around antitrust practices, he emphasized Amazon competes in a global retail market that has room for many winners. Amazon accounts for less than 1% of the $25 trillion global retail market and less than 4% of retail in the US and competes with large retailers like Target, Kroger, and Walmart. The eTailer also faces competition from companies such as Shopify and Instacart, which enable traditionally physical retailers to put their full assortment online. Among US Government’s concerns with Amazon is the company’s unfair practices related to its third party sellers when launching private label products. While Bezos couldn’t guarantee that the internal policy prohibiting employees accessing data from independent sellers has never been violated, he emphasized that Amazon wants its third party sellers to succeed, as the marketplace sales now represent 60% of all physical product sales on Amazon and are growing faster than Amazon’s own retail operation. The company will report on its 2Q results this evening and we will get the latest insight on how 1P and 3P sales have been trending during the pandemic. 

Source: Jim Watson/AFP via Getty Images

eBay and Shopify 2Q Results:
eBay and Shopify reported their 2Q earnings this week. Both companies’ results were ahead of expectations, with eBay growing GMV 29% to $27.1 billion and Shopify increasing GMV 119% to $30.1 billion. Management at eBay and Shopify emphasized the shift to eCommerce due to COVID-19 has contributed to strong results during the second quarter, with eBay adding approximately 8 million new customers onto its platform, and Shopify growing new stores on the platform by 71% compared with the prior quarter.