Home » Latest News » E-commerce & AI News Flash Collection (Apr 14): Amazon’s Soaring Electronics Sales, TikTok Innovates with Virtual Influencers

E-commerce & AI News Flash Collection (Apr 14): Amazon’s Soaring Electronics Sales, TikTok Innovates with Virtual Influencers

virtual influencer in the future

US

Amazon: A Forecast of Robust Electronics Sales

Momentum Commerce predicts a 14.6% growth in Amazon’s U.S. electronics sales for 2024, totaling $57 billion. Electronics are slightly behind the overall platform growth of 19.9% but show a strong upward trend with a 25% increase in search volume in February. Peak sales in this category are expected in May, reaching a 21.8% growth rate. The fourth quarter, bolstered by Prime Big Deal Days and Turkey 5 promotions, is anticipated to generate $17.6 billion in revenue from electronics, capturing 31% of the annual forecast.

Amazon: Combating Fraudulent Returns

Amazon continues to face significant losses due to fraudulent return schemes. An Amazon warehouse worker was arrested for marking orders as returned without actual returns, facilitated by a bribe of $3,500. Fraudulent returns are alarmingly common, with organizations leveraging Amazon’s liberal return policies to exploit the system, causing a $101 billion loss to U.S. retailers in 2023 alone. The Federal Trade Commission has taken legal action against Amazon for such malpractices, emphasizing the growing seriousness of return fraud.

TikTok Shop: Capturing the US Market

Since its launch in September 2023, TikTok Shop has attracted over 11% of U.S. households. The platform dominated 68.1% of the social commerce goods market by February 2024. Customer loyalty is high, with 81.3% of the sales contributed by returning customers. The platform particularly appeals to Gen Z, who are 3.2 times more likely to shop on TikTok compared to other demographics, highlighting its success in engaging a younger audience.

TikTok: Pioneering with AI-Driven Virtual Influencers

TikTok is developing virtual influencers to enhance brand promotions and live commerce. These AI-generated personas can stream 24/7, significantly boosting sales through continuous engagement. Despite their success in China, it remains to be seen if Western audiences will embrace this novel concept. The tech, still under development, allows advertisers to script videos and tailor influencer appearances to fit brand needs.

Nike’s Direct Sales Strategy Adjustment

Nike’s CEO, John Donahoe, acknowledged the company’s shift towards direct-to-consumer sales had unintentionally marginalized important wholesale partnerships with retailers like Macy’s and DSW. This strategic pivot aimed to enhance profit margins and gather richer customer data through direct engagements on Nike’s platforms. However, the approach led to reduced presence in external retail outlets, impacting overall brand reach and market coverage. Recognizing the misstep, Nike is now realigning its strategy to reinvest in these traditional channels, aiming to strike a balance that leverages both direct sales and wholesale partnerships to maximize market penetration and customer access.

Globe

Amazon Canada: Managing Overstock Through Automatic Removal

Starting April 13, 2024, Amazon Canada announced a new policy to ensure adequate warehouse space by automatically removing excess inventory stored for over 365 days. This measure helps sellers avoid additional fees associated with overaged inventory and improve inventory performance metrics. Sellers can manage their settings under Automated fulfillable inventory settings; if they need their inventory returned, they must provide a valid return address or the goods will be donated, recycled, or removed. Once set, these removal settings cannot be canceled, and sellers with unadjusted settings will be notified of impending automatic removals via email and the Seller Central dashboard.

Netherlands: Significant Growth in E-commerce

By January 1, 2024, the Netherlands boasted over 100,000 active online stores, doubling in the last decade, with small and medium sellers growing by 252%. The Dutch Statistics Office reports that online stores outnumbered physical stores at the start of 2023, marking a significant milestone. E-commerce sales in the Netherlands reached 34.7 billion euros in 2023, a 3% increase from the previous year, with online purchases totaling 365 million transactions. Cross-border online spending was robust, particularly with 25% directed towards German online stores and substantial shopping from Chinese online stores in categories like home living and fashion accessories.

China’s E-commerce Expansion in South Korea

Chinese e-commerce platforms like AliExpress and Temu have seen their sales in South Korea surge by over 130% in the last six months. A comparison of payment data from October last year to March this year by Korean credit card provider BC Card shows a 138% increase in total payment volume and a 130.6% rise in transaction counts from Chinese platforms. Despite lower average order values compared to Korean platforms, the gap is closing, with low-cost items under $22 making up 78% of sales. Gender demographics show a notable increase in female shoppers from 30.6% to 35.3%, highlighting changing consumer dynamics in the region.

Otto’s Marketplace Expansion

European e-commerce giant Otto reported a dip in revenue but an increase in trading volume, credited to sales through its marketplace partners, which now account for one-third of its total income. To combat revenue losses and invigorate its market presence, Otto announced plans to open its marketplace to more sellers across Europe. Starting next year, this expansion will include not just German but all European Union marketplace participants. This strategy is intended to diversify the products offered on its platform and enhance consumer choice, fostering a more competitive marketplace environment.

BowFlex: Navigating Bankruptcy Amidst Economic Headwinds

BowFlex has filed for Chapter 11 bankruptcy despite significant sales, such as its adjustable dumbbells still ranking high on Amazon’s Best Sellers list. The company cites post-pandemic market conditions and macroeconomic challenges as key factors. BowFlex’s sales plummeted by 24.8% in the first nine months of 2023, demonstrating the volatile nature of the fitness equipment market.

AI

Innovative AI Traffic Management in Florida

Florida has recently approved the deployment of an advanced AI-driven traffic management system developed by the Tel Aviv-based company NoTraffic. This system employs AI algorithms, sensors, and cameras to optimize traffic lights and reduce congestion. The technology, which has been patented in the U.S., adapts to real-time road conditions, promising to enhance traffic flow and reduce transit times significantly. Already in use in over 24 states and parts of Canada, NoTraffic’s system represents a major step forward in smart city infrastructure and urban planning.

Mali’s AI Initiative for Cultural Preservation

In an effort to preserve its cultural heritage, Mali is turning to artificial intelligence to digitize and catalogue vast arrays of historical artifacts and documents. This project, led by the government initiative RobotsMali, involves using AI to translate and transcribe ancient texts and oral traditions into Bambara, Mali’s most spoken language, and other local dialects. The initiative not only aims to safeguard these cultural treasures from physical decay but also to make them more accessible to the global academic community and the general public, ensuring that Mali’s historical and cultural narratives are not lost to time.

Generative AI Transforming Recruitment Practices

With the advent of generative AI technologies, many companies are revolutionizing their hiring processes. AI is now being employed to automate and refine job postings, screen resumes, and even conduct preliminary interviews. This technology enables human resources departments to handle large volumes of applications more efficiently, identify the most promising candidates more quickly, and customize recruitment approaches to better meet organizational needs. These advancements are helping companies reduce the time and cost associated with hiring, while also improving the quality of candidates progressing through the recruitment pipeline.

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