To paint a better picture of the current landscape and identify growing trends within the industry, we pored through an array of reputable advertising studies.
Three years after purchasing Zettle, PayPal is launching PayPal Zettle in the U.S. This small business-focused mobile-payments system is already operating in PayPal’s overseas markets and has been beta-tested in the States during the past three months. Zettle, a Swedish company, cost PayPal $2.2 billion in 2018. Its card reader/e-commerce tool was designed to help small businesses integrate their sales and back-office operations better. According to Jim Magats, PayPal’s Senior Vice President, “One key advantage that Zettle offers small businesses is the ability to seamlessly transact with consumers wherever they are—in brick-and-mortar stores or online.” PayPal Zettle will allow small businesses to accept a range of payments through Zettle’s card reader and benefit from Paypal’s suite of payment and commerce solutions. The integration brings help in managing sales, inventory, payments, and reporting, all from one place. It also creates a real-time ledger of transactions and inventory levels that’s very easy to check. “That back-office reconciliation, when the online and physical world are brought together, means merchants won’t miss a sale or fail to satisfy a customer,” Magats said. With Zettle also comes PayPal’s partner network. Users can effortlessly link their accounts with PayPal’s e-commerce, accounting, and point of sale partners, such as Lightspeed, SalesVu, QuickBooks Online, or BigCommerce. PayPal also promises integrations with more partners in the future. It’s these integrations that have proven to be the biggest reason for Zettle’s success overseas. Small businesses appreciate the opportunity to use Zettle for transactions without signing up for an unwanted bundle of services or having to replace their existing online bookkeeping services or e-commerce platforms completely. “What we hear is they love the interoperability,” Magats added. Starting from June 30, small businesses can purchase their first card reader for $29 and additional readers for $79. The transaction rate for card processing stands at 2.29% + 0.09 cents at launch.
An increasing number of Chinese consumers and e-commerce sites are boycotting well-known international retailers such as Nike and H&M. The move came as a response to various Western brands and retailers issuing statements condemning the alleged use of Uyghur forced labor in the Xinjiang province. Last week, regular consumers, celebrities, and Chinese state media outlets called for a boycott of multiple international outlets that have previously issued statements accusing China of human rights abuses. In 2020, these outlets responded to growing calls by the general public and human rights groups to react to human rights abuse allegations. Now, Chinese e-commerce sites are massively removing products sold by these producers from their stores. Chinese celebrities have also cut ties with said brands, and over 32 million people used the ‘I support Xinjiang cotton’ hashtag on the social media platform Weibo. One of the hardest-hit companies by this boycott was H&M. The company reported a loss of $122 million in the December-February period. Nike and Adidas also experienced losses, with the Chinese company Anta, often called the ‘Nike of China’, stepping in to fill the vacuum left by the boycott of these brands. The reason why clothing retailers are even involved in the question of the alleged abuse of this Muslim ethnic minority group is the Australian Strategic Policy Institute’s report that states that 82 international and Chinese companies have ties to the Xinjiang province, which represents a crucial link in the global cotton supply chain. As a result, retailers such as H&M, Nike, Victoria’s Secret, Zara, and others felt the need (or were pressured by the public) to condemn the alleged practice of Uyghur forced labor, with some companies even completely cutting ties with the region and its cotton supply. The Chinese government strongly denies these allegations. However, the reaction of the Chinese public came several months after the retailers mentioned above issued their statements. This late reaction could be due to the fact that said statements weren’t translated nor widely circulating in the Chinese public space until last week. Another explanation could be the new sanctions imposed on Chinese officials last week by the US and its allies. Even before the Chinese boycott started, some companies have quietly redacted or removed their statements condemning human rights abuses. The reasons are obvious - China is a vast and lucrative market, and most global retailers do not wish to risk losing access to such a significant source of revenue. This story is another escalation in the increasingly hostile relationship between the US and China, with lines between politics and the private sector becoming more and more blurred.
Disney announced that a fifth of its brick-and-mortar stores would close by the end of the year in the rapid shift toward eCommerce caused by the pandemic.First on the shutdown list of 60 stores are North American locations, all scheduled to close either on or before March 24, 2021. Disney is currently closing several stores in Arizona, California, and Texas, among others.These changes are part of a bigger plan for eCommerce development. European stores might be hit next, but the media giant has yet to announce which of its 300 stores will go under in the future.In 2020, eCommerce retail sales jumped by 32.4%, signaling the move away from conventional shopping. These are grim news for those fans who consider the stores an essential part of the Disney experience. However, they can look forward to an overhaul of Disney’s online store in the near future. Disney has promised significant improvements to its e-shop, with more adult apparel collections, streetwear, premium home products, and collectibles. Considering that Disney stores are usually focused on creating a magical experience for kids, this improvement will undoubtedly cater to a much wider audience. Disney’s partnership with Target for more than 50 locations with Disney pop-up shops within the retail giant’s megastores is also in danger. On the plus side, more than 600 Disney Parks stores, third-party retailers, lifestyle, and outlet locations will remain unaffected by these closures. To say goodbye to a fifth of its shops, Disney is currently running a 30%-off storewide sale, with discount coupons for shopping at the online store. On a much happier note, after keeping its gates closed for a year, Disneyland has finally been cleared to reopen in April. The Walt Disney World Resort in Florida has been open since June 2020, but strict state regulations have kept its California counterpart closed until now. Both are and will be operating under the necessary safety measures due to the pandemic. Backed by these announcements, Disney stocks are also flying high, increasing by 6.33% within one day. The latest Disney animated feature, “Raya and the Last Dragon,” taking a whopping $8.6 million on its opening weekend certainly played a significant part in this increase.
Import-based retail forecasts for 2021 look promising: The expected slowdown in retail sales after the holidays was missing in 2021, and the National Retail Federation is predicting record retail sales this year. Imports are continuously growing, with retailers preparing to meet the demand as the country reopens. The Covid-19 pandemic turned shopping into a predominantly online experience, which was bad news for brick-and-mortar stores, but good news for retail overall. The initial prognosis was grim, with over 8,300 US stores closed in 2020 and 400 stores announced to close in 2021. Another 10,000 physical retailers are predicted to go belly up by the end of 2021. However, the import reports and estimates from the NRF’s Global Port Tracker tell a different story. The first month of 2021 was the busiest January since 2002 in terms of retail imports. Furthermore, February and March forecasts anticipate increases by a quarter and nearly a half of 2020 imports, respectively. To boot, Chinese New Year last year didn’t bring the usual Asian factory closure during the holidays, either. Instead, ships arriving at US ports struggled with an unexpected backlog of unloaded goods. All in all, the reports from the NRF are very encouraging. Ben Hackett, the founder of the consulting firm helping the NRF establish these predictions, places his faith in vaccine rollout. Vaccinations are already helping the dwindling retail stores, with customers going back to purchasing non-essential products, such as apparel, from physical locations. While this is encouraging, it could also go sideways: Vaccinations could shift spending trends back from hard goods to services. “The successful distribution of vaccines will help ensure that the economic recovery will likely be strong and sustainable,” Hackett said on the topic. Still, all signs indicate that the retail industry will recover. Where that recovery will go is anyone’s guess, however, as major changes are apparently imminent, with initial steps already taken by some big names.