Hello, and happy Wednesday!
This is issue no. 18 of the Nebulab newsletter, your favorite bi-weekly reflection about retail, DTC, and eCommerce technology.
If you’ve been following e-commerce news lately and your head is spinning, you should know it’s not you—it’s them. The stack of press releases keeps growing by the day. So, just like we spent the last newsletter talking about Shopify’s SMB-vs-enterprise strategy, we’re spending today’s newsletter looking at the broader e-commerce technology landscape.
Here’s the thing: there was a simpler time in this industry when everyone stayed in their lane. Shopify used to be an e-commerce platform for SMBs, Amazon used to be a marketplace, and social networks used to be ad-serving machines. And for a long time, the pie was growing quickly enough for everyone to be content with this single-threaded strategy.
It’s hard to pinpoint exactly when this changed: post-pandemic headwinds definitely played a part, but we also believe it has to do with the eCommerce industry maturing and brand operators demanding more sophisticated capabilities of their vendors.
This combination led service providers to pursue a different, more aggressive strategy. This usually means one of two things:
Launching new products for existing customers, helping them succeed, and growing their top line through transaction or service fees.
Using their existing products as a wedge to grow into a new market segment that offers incremental or more predictable revenue.
This isn't just about revenue, either: data has always been gold and is even more valuable with the AI renaissance. The more pieces of the consumer experience you own, the more data you can gather. That data can be used for performance and operational improvements, allowing you to command a greater market share.
We’re seeing more and more of these plays unfolding lately: TikTok and Facebook want to become e-commerce platforms, Amazon wants to win Shopify customers with Buy with Prime, Shopify wants to move upmarket with Commerce Components… Everyone’s simultaneously imposing their products on the market and letting the market pull new products out of them.
Time will tell which of these strategies will stand the test of time: honestly, we don't really see Facebook becoming the new Shopify any time soon.
Still, for all the headwinds this industry has experienced, it's an exciting time to be in e-commerce. The constant launches coupled with a pretty fervent M&A landscape mean that the cream is rising to the top, equipping operators with even more, even better tools to succeed—in most cases, at least.
Outsights
Power moves
Today's outsights cover some of the major launches, partnerships, and other notable shenanigans in ecom-tech.
By the way, is “ecom-tech” a word, or did we just make it a word? 🤷♂️
Leaked document reveals Amazon cowing to Shopify over Buy with Prime negotiations. Shopify’s lukewarm behavior toward Amazon wasn’t really surprising, given that Shopify is slowly turning into a marketplace for their SMB segment and the rocky history of this partnership. What is interesting is how badly Amazon wanted to make this deal happen. Interesting times!
Facebook, Instagram, TikTok want on-platform commerce. A few months ago, we wrote about how the death of third-party data would either lead to more interoperability or force social networks to own the entire purchase flow. This isn’t the direction we were hoping for, but it’s a direction nonetheless. It’s up to brands now to respond however they see fit.
Shopify’s new tools are encroaching upon the business of existing vendors. For all their enterprise troubles, Shopify is still working pretty hard to make SMBs succeed by bringing more functionality in-house. In the past, they’ve done this at a more foundational level—such as with their Subscription APIs—that would play nice with their existing apps ecosystem. This time around, they’ve gone all in, which inevitably means taking business away from their app developers.
New article
5 Principles for Doing Great Work with Your eCommerce Agency
The way we structure engagements at Nebulab is different from most agencies, and constantly earns us the trust and love of our clients.
Today, we're sharing all our secrets with the world.
If you're an eCommerce brand working with an agency, or have an internal digital product team, check out our latest article: through practical tips and best practices, you'll learn how to collaborate with designers and engineers to achieve unmatched productivity and business impact.
That’s it for today!
If you have any questions, comments, or a training regimen to win the rat race, you can share it with us at [email protected].
See you in two weeks! 👋
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