Flowers Gifts | Digital Commerce 360 https://www.digitalcommerce360.com/topic/flowers-gifts/ Your source for ecommerce news, analysis and research Thu, 09 Nov 2023 18:03:59 +0000 en-US hourly 1 https://wordpress.org/?v=6.3.2 https://www.digitalcommerce360.com/wp-content/uploads/2022/10/cropped-2022-DC360-favicon-d-32x32.png Flowers Gifts | Digital Commerce 360 https://www.digitalcommerce360.com/topic/flowers-gifts/ 32 32 Retail blogs can deliver sales but only with a strategic plan https://www.digitalcommerce360.com/2023/11/02/retail-blogs-can-deliver-sales-but-only-with-a-strategic-plan/ Thu, 02 Nov 2023 14:03:41 +0000 https://www.digitalcommerce360.com/?p=1311407 Blog content is a key digital marketing tool for online bridal merchant Azazie.   The bridesmaid dress retailer revamped its blog in Q2 2023 with a strategy, plan and one goal in mind: to have Azazie.com show up higher in search engine results, says marketing manager Keily Hernandez.  Azazie has had a blog on its site […]

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Blog content is a key digital marketing tool for online bridal merchant Azazie.  

The bridesmaid dress retailer revamped its blog in Q2 2023 with a strategy, plan and one goal in mind: to have Azazie.com show up higher in search engine results, says marketing manager Keily Hernandez. 

Azazie has had a blog on its site since 2019, with search engine optimization as one of its goals as well as using it to promote giveaways and promotions without significant financial investment. But SEO wasn’t the primary focus, and the merchant didn’t have a team dedicated to managing it. As a result, Azazie did not rank highly in search results for its targeted keywords, Hernandez says. 

Now, Azazie updates the blog one to two times a week. Each month, Azazie picks a keyword to focus on, such as “bridesmaid” or “bridal gown,” and focuses all its marketing content, including social media posts, influencer content, content across the website and its blog, on that keyword.  

“We have everything point back to us as the leader of that keyword,” Hernandez says.  

I would think and I would hope that every company and every brand in every industry has a blog. It’s kind of like the low-hanging fruit of organic content.
Keily Hernandez

This focused and integrated effort has led to a 24% increase in sales revenue attributed to organic search (which includes blog content) from April until September 2023, compared with that same period in 2022, Hernandez says. And the content is resonating with shoppers, as sales from shoppers who viewed Azazie’s blog content increased 50% from January through September 2023, compared with the year-ago period.  

Azazie is among the roughly half or so retailers that offer a blog or editorial content on their site, according to Gartner data. A Gartner analysis of 300 U.S. retailers (75 luxury retailers, 105 multi-brand retailers and 120 monobrands) in March 2023 finds that 47% of retailers have a blog or editorial content on their site, such as articles related to the products they sell, content about that category’s trends, company history or policies.  

Merchants cite several reasons why investing in editorial content can help their bottom lines, including more traffic from search engines, higher conversion rates and low return rates. But execution is key, as retailers will not see any return on their investments if they are not thoughtful and thorough with their strategies. And investments can be significant, as merchants may have to invest in internal employees to generate the content or hire outside agencies. 

Only 6% of online shoppers say blog content is an important feature for a well-designed and functional online shopping experience, according to a Digital Commerce 360 and Bizrate Insights survey of 999 online shoppers in October 2023. But shoppers put a higher value on similar content, which retailers could publish on a blog, such as how-to guides, at 19%, and an About Us page, at 12%. 

Data from research firm Forrester Research Inc. also finds that only a small subset of consumers consult a blog before a purchase. 3% of U.S. online adults who purchased clothing or footwear (online or in person), and 5% who purchased furniture or home improvement products in the past six months visited the retailer’s blog in the past month, according to data fielded between November 2022-March 2023. 

Yet, only 17% of shoppers say online retailers have met or exceeded their expectations with providing detailed product information such as origin story, history, business policies and sustainability. And only 12% said online retailers have met or exceeded their expectations with additional content such as how-to guides and blogs.  

Retail blogs boost SEO value, organic search traffic

While shoppers may not rely on blog content to make a purchase, retailers and analysts still believe it can be an important component in the online shopping journey. In fact, shoppers may not realize that a blog post was how they landed on that retailer’s site to begin with. If brands write their blogs and editorial content with search engine optimization in mind, it can have a large impact on bringing in organic traffic, says Brad Jashinsky, director analyst at Gartner 

And organic traffic is important for Azazie. The wedding apparel retailer says about 10% of its site traffic and sales come from organic search, which includes shoppers finding its site from the blog articles. 

“I would think and I would hope that every company and every brand in every industry has a blog,” Hernandez says. “It’s kind of like the low-hanging fruit of organic content.” 

Chip Malt, CEO and co-founder of cookware brand Made In, says that roughly 25% of its site traffic comes from organic search, which includes shoppers who come to Made In’s robust blog. On average per month, its blog receives 2 million page views, and each reader views about six pages in the blog, Malt says. This shows good engagement, Malt says. On average, this is about 20% of the site’s overall page views, he says.  

What’s more, when Made In sends content-focused emails, the click-through rates are three times higher than its selling-focused emails, Malt says. Similarly, its content-focused ads on Google produce click-through rates at four to 10 times higher than selling-focused ads, he says. 

Education through content has been a part of cookware brand Made In’s strategy since Day 1, Malt says. Made In launched a blog six months prior to launching products on its cookware site and the fourth employee the brand hired was a part-time content contributor, he says.  

“Education is a part of the brand’s story,” Malt says.  

Made In sells high-end cookware that’s designed for cooking enthusiasts and is popular among professional chefs. For example, its 10-inch blue carbon steel frying pan is $109, and the brand’s average order value is $330, according to Digital Commerce 360 estimates. The blog helps to explain the value of its cookware.  

Today, the brand has 10 full-time employees on its content team, it publishes roughly 50 blogs per month and the blog ranks for 56,000 keywords within Google Search, Malt says. About 50% of these keywords are in the top 20 search terms on Google, with 25% of those on the first page of search results, he says.  

One of the top navigation tabs on MadeinCookware.com is “Learn,” where the brand publishes its founding story, recipes, care for its products and cooking techniques. As Made In has expanded its product lines to include bakeware and wine glasses, it also has added content to support these products as well.  

“If we are offering this line of cookware, we also want to keep up the pace of content. …. It’s something we wanted to do for our community,” Malt says.  

Retail blog content connects to shoppers post-purchase 

This large breadth of content distinguishes the brand from its competitors, such as All-Clad, Malt says. 

“Long term, we believe if you are shown All-Clad or Made In, and you walk out the door and you are on your own, and you went with Made In, you have all this helpful content behind you. And that makes the consumer go with us overall, because they see us as a value-add,” Malt says.  

All-Clad has a blog on its site with recipes and other product content. All-Clad did not provide a comment as of press time.  

Top online floral merchant 1-800-Flowers.com Inc. also invests in editorial content as a way to engage with shoppers, says chief marketing officer Jason John 

It operates six blogs across its 17 brands, which include a variety of giftable products such as cookies and chocolates as well as flowers. The goal is to deepen the relationship with shoppers, so they don’t just view the e-retailer’s ecommerce sites as shopping destinations, John says. It updates each blog multiple times per month.  

“It takes us beyond one transaction and helps solidify us as a part of the customer relationship,” John says.   

1800Flowers.com addresses themes within each brand’s product assortment and customer base to appeal to shoppers. For example, topics that have resonated with consumers are about how to write sympathy cards, including pet sympathy cards, for its 1800Flowers.com blog, and articles about hosting holiday dinners for its food and gifting brand HarryandDavid.com.  

Results from retail blogs 

Web visits to its blog have increased 70% year over year, John says. Even more telling is that shoppers who view a brand’s blog content convert at a 3%-5% higher rate than shoppers who don’t. This speaks to the quality of its blogs, John says.  

“You need a North Star with content,” John says. “A lot of companies, you can tell they are putting out content to put out content, and they are putting out content for a commerce outcome. We don’t believe there is authenticity in that type of content.”  

While conversion metrics are a clear performance indicator, Made In says privacy regulations can make it difficult to track a direct conversion to a blog post, because many shoppers don’t accept cookies and may visit the site several times before deciding to make a purchase. The path to purchase becomes more muddled especially with products that are high-ticket and more considered, like Made In’s relatively pricey skillets and knife sets. Instead, Malt describes its investment in content as a “brand tax that we absorb,” meaning a cost of doing business for higher-end products.   

Besides increasing site traffic, results from investing in a blog shows up in other ways, Malt says, such as aiding in the customer journey, helping its customer service team and low return rates. If shoppers are more informed about the products they buy from reading the blog, they are more likely to purchase the right product for their needs and not return it. He points to its stainless-steel products, which have a less than 2% return rate, without sharing more. 

Roughly a third of the visits to Made In’s blog come from shoppers already on the website, and the rest from outside the site, such as search results, emails and ads. If Made In was only doing the blog for SEO purposes or completely focused on that as the goal, Malt would expect 99% of the traffic to come from outside sources. But that’s not Made In’s primary goal.  

The fact that a third is internal traffic shows that the content is providing value to shoppers as they consider the brand’s products. Instead of having an article only live in the blog section, Made In peppers relevant content throughout the site to aid in the shopper journey, Malt says. For example, on the search results page, it may surface a post about the difference between nonstick and stainless-steel cookware.  

“We believe content should be intertwined in the customer journey and are happy to have internal traffic get there,” Malt says. 

Using blog content in multiple ways is smart, Gartner’s Jashinsky says.  

“If you are going the extra mile to make great content, you need to make sure it’s discoverable, across social, across search, and product pages and search pages,” Jashinsky says.  

How retailers know what to feature in blog content

Made In surveys its shoppers via email and uses that feedback to inform its content strategy. Based on 20,000 comments, Made In determined it needed more blogs about how to care for its products post-purchase, and now publishes such articles regularly.  

“The nice part of being a direct brand is that people tell you exactly what they think,” Malt says. 

Made In’s editorial team plans the focus of its blog posts for each month. Each of the brand’s departments, such as its product, customer service and marketing teams, give input on their teams’ current priorities. For example, the product team may say that it is launching a bird beak’s paring knife that month and request at least two articles featuring the product. The customer service team might say it’s had an influx of shoppers calling in about how to season their carbon skillet and propose a video blog and step-by-step instructions on how to do this.  

“Customer service acts as a very direct line to our actual customer. So our customer service team has direct input into the content calendar,” Malt says. 

The customer service team’s input gets particularly high priority when planning the blog’s editorial calendar, as the articles they suggest can help them assist customers much faster, Malt says. For example, with the “how to season the carbon skillet?” question, instead of taking 10 minutes to write out tailored instructions for each shopper, agents can direct shoppers to a video or blog that addresses their need.  

“It’s an efficiency play,” Malt says. While Malt doesn’t have a direct KPI figure to tie to its retail blog, he knows speeding up solving customer service issues keeps agents and shoppers satisfied.  

Azazie also taps its customer service team for input on what it should include in its blogs.  

“If they have a question about a trend, we can respond and create a content strategy to that, that tying into what’s trending, and what we are also offering,” Hernandez says. 

For example, a common question shoppers call in about is sizing for a bridesmaid dress while pregnant. Azazie has a blog that provides examples and tips on this topic, but it was first published in 2016. So, the content team refreshed the blog with examples of Azazie’s current maternity dresses and relevant links to its products. The customer service team refers to this blog while helping shoppers and directs shoppers to read it.   

Customer service acts as a very direct line to our actual customer. So our customer service team has direct input into the content calendar.
Chip Malt

Azazie also looks to any interactions it’s gotten on social media and trends in the bridal industry to inform its content strategy.  

The blog is under the purview of its digital marketing team, and Azazie also employs an SEO consultant to help determine its content and execution. Overall, the blogs that gain the most traffic and lead to the most sales are the ones that are integrated into its overall marketing strategy and are tied to press releases and influencers, she says.  

“It’s a lot of moving pieces and work, in order to put a campaign behind a keyword, but those are the most successful, the ones with a content strategy,” Hernandez says.  

Involving multiple departments in content creation will serve retailers well, Gartner’s Jashinsky says. Retailers would also be wise to track which types of content shoppers click on, and use that information to personalize product recommendations and for ad targeting. This is a way to gather first-party data directly from the consumer, which is especially valuable now that cookies that track shopper behavior across the web are increasingly being phased out, and can greatly benefit retailers in the long term, he says.  

If retailers do decide to make a focused effort on improving SEO through blog content or guided selling tools like a quiz to match shoppers with suitable products, they should expect it could take a year or two to see results, not months, Jashinsky says.  

“We always tell clients, this is not something you can get up and running in a week or month,” Jashinsky says. “This takes many months to get up and running, and takes a year or two to start to see significant payout. So you really need to make sure you have a long-term strategy and you are ensuring you reallocate this content as many places as possible to make sure that investment pays off.” 

For something like a quiz that guides shoppers through a series of questions and links to relevant product pages, retailers should expect to pay thousands to tens of thousands of dollars to a vendor to build it, Jashinsky says. But to do an editorial program at scale — which may take a team of writers to publish content daily and collaborate with different teams, plus the technology to plug into personalization software — that could take hundreds of thousands of dollars to millions, he says. 

For Made In, these marketing costs show up as the salaries for 10 employees dedicated to digital content instead of spending these dollars on ads. Similarly, the cost of the blog for Azazie shows up in its marketing staff resources. 1-800-Flowers also has an editorial staff that “fluctuates” depending on the time of year, John says without revealing more. 

Retailers that do strategically invest in content often see an increase in traffic from organic search, and small increases in basket size and conversion rates for shoppers that engage with this content, Jashinsky says. This, of course, varies by how well the content strategy is executed and product category.  

“Whether you are selling online or in-store, it is a pretty cost-effective way to increase SEO and increase conversion rates, and typically almost every retailer is already creating content and already has a lot of these pieces in other parts of ecosystem,” he says.  

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6 ways retailers are using generative AI right now https://www.digitalcommerce360.com/2023/10/17/6-ways-retailers-are-using-generative-ai-right-now/ Tue, 17 Oct 2023 17:29:43 +0000 https://www.digitalcommerce360.com/?p=1308657 When the Digital Commerce 360 editors embarked on the October edition of Strategy Insights, we knew we wanted to focus on generative AI, but we weren’t sure how much we’d find. The OpenAI consortium released its generative AI bot ChatGPT for public use during Q4 2022, and it quickly became the hottest topic around. Months […]

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When the Digital Commerce 360 editors embarked on the October edition of Strategy Insights, we knew we wanted to focus on generative AI, but we weren’t sure how much we’d find.

The OpenAI consortium released its generative AI bot ChatGPT for public use during Q4 2022, and it quickly became the hottest topic around. Months later, everyone in the online retail industry is still buzzing about generative AI, but how many businesses are actually using the technology today? And how many would want to talk to us about it?

Turns out, quite a few.

While many merchants we talked to are still just piloting and exploring how best to use the burgeoning technology, many brands have live generative AI programs up today. This Strategy Insights, “6 ways retailers are using AI right now and how generative AI will change ecommerce,” showcases examples of many large retail brands (and a few smaller ones) and how they are using generative AI right now.

Below is just a sampling of examples you’ll find in the rest of this report. Download the entire Strategy Insights here.

1.) Stitch Fix taps generative AI to write  ad headlines and product descriptions

Apparel retailer Stitch Fix uses generative AI to write headlines for Facebook and Instagram ads. In the past, it would take about two weeks to develop a creative campaign and draft copy. But now, human copywriters can evaluate a headline created by the generative AI system in less than one minute — and they approve the machine-created content 77% of the time, Stitch Fix says.

2.) Babylist uses generative AI to write email subject lines

Baby products marketplace and registry says its marketers are expected to use generative AI to help create ideas, content and copy, says Lee Anne Grant, chief growth officer. Babylist finds that ChatGPT-generated subject lines increased open rates for marketing email in half of their tests. It concluded that ChatGPT is a “great resource for when the team needs subject line inspiration or help writing one,” Grant says.

3.) J’evar uses generative AI to create product models

Online-only jewelry merchant J’evar has its product designers use generative AI to speed up how it creates custom jewelry pieces. Instead of going through dozens of product mockups over the course of weeks, genAI can help its designers produce product samples in minutes, says J’evar founder and CEO Amish Shah.

4.) Newegg uses generative AI to summarize customer reviews

Online electronics retailer Newegg built a generative AI tool in house that creates one product summary for a product based on all of the published customer reviews. This review is published at the top of all the reviews. Reviews are an important feature for Newegg, as 20% of Newegg.com shoppers read reviews, and these shoppers spend 40% more money on the site than non-review reading shoppers, says Andrew Choi, director of brand and website experience for Newegg.

5.) UrbanStems creates images with genAI

Online flower merchant UrbanStems is using generative AI in multiple ways, including having it create images of potential products it wants to sell. For example, the brand can tell its generative AI software to create an image of a 10-stem red and white arrangement of peonies in a glass vase and white background — and send that image to its merchandising team to create the product in real life. This helps the brand quickly experiment with new designs, without having to purchase flowers and conduct a photo shoot just for a design mock up, says Katie Hudson, content director for UrbanStems.

6.) EBay enables its marketplace sellers to use genAI to write product descriptions

Marketplace giant eBay built a tool based on Open AI’s ChatGPT that creates a product description based on data sellers provide about a product’s category, condition, color, brand and more. Roughly 20% of sellers shown the generative AI tool use it, and of those, 90% accept at least part of the description, says Xiaodi Zhang, vice president of seller experience at eBay.  

Download the free Digital Commerce 360 October Strategy Insights, “6 ways retailers are using AI right now and how generative AI will change ecommerce” here.

—April Berthene, Editor, Strategy Insights

Additional reporting from Digital Commerce 360 editors Don Davis, Gretchen Salois and Abbas Haleem.

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Why digital marketers should not fear generative AI  https://www.digitalcommerce360.com/2023/09/25/why-digital-marketers-should-not-fear-generative-ai/ Mon, 25 Sep 2023 13:02:59 +0000 https://www.digitalcommerce360.com/?p=1309541 Babylist marketers are expected to use generative AI to assist their campaigns. Babylist, an online marketplace and baby registry aggregator, treats generative AI as a “co-pilot,” and not necessarily a time-saving tool, says Lee Anne Grant, chief growth officer. “It’s a tool to help generate ideas, content and copy,” she says. “In some ways, using […]

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Babylist marketers are expected to use generative AI to assist their campaigns.

Babylist, an online marketplace and baby registry aggregator, treats generative AI as a “co-pilot,” and not necessarily a time-saving tool, says Lee Anne Grant, chief growth officer.

Lee Anne Grant, chief growth officer, Babylist

Lee Anne Grant, chief growth officer, Babylist

“It’s a tool to help generate ideas, content and copy,” she says. “In some ways, using it is taking us more time.”
This is because Babylist’s creative team uses the technology to inspire rather than outright write complete blog posts or other marketing content. Marketers ask AI questions and then think about how the results can help them create.

“We had an all-hands meeting [in early 2023] with the goal to approach the technology in an educational development way,” Grant says. “You’re not only allowed to use it for your job, but you’re also expected to.”

More retailers are likely to follow suit as the technology continues to advance and retailers learn how to wield it. 56% of U.S. marketing or advertising decision-makers already use generative AI in their marketing efforts, according to consulting firm Forrester Research Inc.’s June 2023 business-to-consumer marketing survey of 154 executives. These large language models, chatbots and image generator vendors include ChatGPT, DALL-E, Stable Diffusion and Midjourney.

Digital marketers are learning that the more they test, the more the technology learns. This affordable tool can help — but not replace — marketers. Babylist uses ChatGPT to test copy for newsletter and marketing email campaigns. Online florist UrbanStems uses generative AI to write blog posts, and it creates images for social media marketing creative. And men’s footwear brand Koio uses AI-generated copy for brainstorming email and ad ideas. The costs are low, and retailers like UrbanStems are mindful that if they aren’t using it, their competition certainly is.

Retailers must consider the potential upsides — and pain points — when using generative AI

Digital marketers are using generative AI to draft ideas and examples for emails, SEO and other marketing materials. While the potential benefits are vast, there are also concerns, says Jay Pattisall, vice president, principal analyst at Forrester.

Marketers must consider how brands, retailers and agencies are using the technology, Pattisall says. Copyright law does not protect AI-generated art, for example.

But the potential for how brands can use AI is exciting, he says. Advertising agencies are building platforms for their clients as part of their own proprietary technology. Retailers are building in-house, too, he adds.

“But at this stage, it’s more practical to buy because there are more options available on the marketplace. That may change in the future,” he says.

Babylist tests ChatGPT-generated email campaigns

Babylist uses ChatGPT to test newsletter marketing email campaigns. In 2023, Bed Bath & Beyond Inc., owner of major baby products retail chain Buy Buy Baby, filed for bankruptcy. Babylist saw this as an opportunity to acquire Buy Buy Baby’s customers.

Babylist ran a test for an email marketing campaign on April 29 with ChatGPT for its two newsletter audiences. It sent out one test to 10% of its “pregnant” newsletter recipients (about 59,000 subscribers out of 589,000 on the total list) and 10% of its “parent” newsletter recipients (222,000 recipients of 2.32 million).  Half of each group received one email written by a Babylist editor and the other written by ChatGPT.

The results? For the pregnant group, the editor’s email won with a 2.9% higher open rate compared with the generative AI’s version.

  • The Babylist editor’s subject line: “buybuy BABY Bankruptcy & Your Registry: What to Know.”
  • The ChatGPT’s subject line: “What the buybuy BABY Bankruptcy Means for Parents.”

For the parent group, ChatGPT gained a slight edge over the human editor with a 0.37% higher open rate.

  • The Babylist editor’s subject line: “buybuy BABY Bankruptcy & More Parent News.”
  • The ChatGPT’s subject line: “What the buybuy BABY Bankruptcy Means for Parents.”

Babylist found that ChatGPT-generated subject lines increased open rates in half of their tests. It concluded that ChatGPT is a “great resource for when the team needs subject line inspiration or help writing one,” Grant says.

AI helps retailers brainstorm ideas

ChatGPT-generated content helps Babylist’s creative team create better content, Grant adds. The value is in the brainstorming.

“If a copywriter is feeling stuck on a new concept for TikTok video, they can ask ChatGPT to generate a bunch of ideas,” she says.

Using generative AI allows retailers to scale and personalize marketing based upon the brand’s approach, says Forrester’s Pattisall.

“Let the people be in charge of the creativity and let the machines help scale and volumize the marketing,” Pattisall says.

Retailers must consider copyright and liability issues

Babylist employees are instructed not to share proprietary or confidential information with ChatGPT or any other public generative AI platform, Grant says.

This is important because retailers must also take care about what materials they use to “train” the AI model, Pattisall says.

“If those inputs are using data points that are copyrighted material, then the model potentially is violating the copyright by using rights-protected materials,” he says.

One example of this is between visual media company Getty Images and Stability AI Inc. Getty Images accused Stability AI of using more than 12 million photos without permission or payment to use those images. The complaint, filed in February 2023, says that Stability AI unlawfully used Getty’s copyrighted images and text, including metadata, to train its AI text-to-image tool Stable Diffusion.

Metadata is the information used to summarize how and when the data was created as well as the source, type and owner of the data. Stable Diffusion is a text-to-image model that uses deep learning to generate high-quality images from written descriptions.

“All of Getty’s images are copyrighted images,” Pattisall says. “So the liability is a concern for marketers.”

UrbanStems jumps onto generative AI to keep up with competitors

Competition prompted online flower retailer UrbanStems to focus on generative AI, says Katie Hudson, content director. In early 2023, the retailer was already using generative AI to create notes to accompany its flowers. Hudson says she noticed competitors doing the same — and she read about it in the media.

Katie Hudson, brand marketing and content, UrbanStems

Katie Hudson, brand marketing and content, UrbanStems

UrbanStems decided to look into how it could use the technology beyond brand awareness, Hudson says.

Mother’s Day is UrbanStem’s busiest holiday. It accounts for 15% of the retailer’s total annual revenue. For Mother’s Day 2023, the retailer used ChatGPT to write a blog about the 10 best brunch spots for Mother’s Day in Washington, D.C.

UrbanStems marketers wrote the introduction, AI wrote the rest of it, and the article appeared in the retailer’s blog section on its website.

“During May, which includes Mother’s Day, we saw this local post drive 5% of our organic blog traffic. It was in our top 10 performing posts for the month,” Hudson says.

Blogs are not intended to drive conversion, but rather, improve organic search results, she says.

“Our blog had our highest ever non-brand search traffic during Mother’s Day,” Hudson says.

This could be attributed to the brunch blog, among other marketing efforts, she says. Over the two weeks leading up to Mother’s Day, UrbanStems’ organic search’s conversion rate increased 17%, she says.

UrbanStems Mother's Day blog post

UrbanStems used AI to write a top 10 best brunch spots for Mother’s Day in Washington D.C. in April 2023. The post increased organic blog traffic 5% in May. It was in the top 10 performing blog posts of the month.

UrbanStems has not drafted enough generated-AI posts on its blog to truly compare performance, Hudson says. Part of the reason is because it typically takes several months for its blogs to gain traffic and views in search engines like Google, she says.

Digital marketers use AI to automate content creation tasks

Not only did this ChatGPT-post drive traffic to its site, but it saved its marketers time as they did not have to manually research brunch places.

The retailer is drafting at least one AI-generated blog post a week to test how the posts perform, Hudson says. UrbanStems marketers use templates to help guide the AI. Marketers can use saved templates and copy and paste information like name insert and word count requirements, she says.

“We don’t have to do everything from scratch,” Hudson says.

What’s left is copyediting.

“I find where it’s saving us time is truly the structure of the blog. It builds it out. We give it all the key questions you might want answered and it will give us some interesting facts. We then go in and tweak as needed,” Hudson says. “Instead of a blog post taking a couple of hours, it will take 20 minutes.”

AI results need human assistance

The AI results aren’t perfect, as sometimes the AI will make up descriptions for products it does not know, or it will not write in the tone UrbanStems’ brand voice, Hudson says.

“We asked ChatGPT to write about a bouquet with a certain kind of flower and the description was way off. It didn’t know our products at all,” Hudson says, without revealing more. “It was kind of guessing. So, we had to go back and do tweaks.”

UrbanStems is feeding ChatGPT its own product descriptions. This will help it better understand the tone of the “brand’s voice” as it learns, Hudson says.

“We’re still working on having AI understand our brand voice. AI tends to create cheesy writing [for descriptions],” she says.

So for now, UrbanStems is still writing its own product descriptions.

“We are using AI to draft all our SEO content, some of our blog content, and all our meta descriptions and title tags for SEO purposes,” she says.

Retailers use AI to generate marketing content

Babylist also uses generative AI for search engine optimization. The online marketplace uses Frase, a generative AI content writing software vendor.

Typically, marketers log into Google Webmaster Tools to search what to use for SEO, Babylist’s Grant says. Now, Frase generates frequently asked questions keywords that Babylist should use to make sure an article they’re writing is SEO-optimized, she says.

“That frees up our editors to take the time to write an article and create better quality content,” Grant says, without revealing more.

Forrester’s Pattisall says generative AI will allow retailers to send more relevant communication. Marketers can uncover new ways to grow and acquire new customers. They can also use the technology to keep existing customers at a cost that does not exponentially increase year after year, he says.

“[Retailers] can maintain their business margins,” he says “They can provide the type of marketing services that they’re good at in a way that doesn’t break the bank. [The technology] allows them to be profitable,” he says.

Generative AI produces images for social media

Another way marketers can use generative AI is to create images. UrbanStems uses AI software program Midjourney that creates images from text prompts. Marketers ask it to create an image of a 10-stem red and white arrangement of peonies, in a glass vase on a white background.

Hudson says the results were encouraging.

“While it still looked like AI — not quite like a true image — it was a great starting off point,” Hudson says. “I sent that off to the merchandising team and they were able to use that image for vendors to use as a reference. That’s a huge value to us.”

AI-generated images allow UrbanStems to experiment and create new bouquet designs quickly. They do not have to buy the flowers and conduct a photo shoot to mock up new designs, she says.

Hudson says the retailer uses the standard tier of Midjourney, which means it has limits on how many images it can have the AI create in a month. Businesses can also pay more to have the AI generate images in seconds or create images in 10 minutes for cheaper.  A basic plan can cost $10 a month to $120 per month for a mega plan.

 

AI generated peonies

UrbanStems uses Midjourney to create images of flower arrangements to use as product mock ups to share with vendors.

Using generative AI to generate social media images

During the summer of 2023, UrbanStems ran a test via social media to see if it could gain consumers insights using AI generated images.
The test used products UrbanStems already sells, but the goal was to see if it could gain insights before actually creating new products.

The retailer launched “This or That” polls using Instagram Stories, where viewers could vote on which bouquet they preferred. The stories were live for 24 hours. UrbanStems paired similar bouquets together that have similar price points and color schemes.

The retailer’s average interaction rate for Instagram stories is 20% of its 233,000 followers view the story.

The poll’s results reflected real-life sales, Hudson says. The winning bouquets had higher
online sales compared with the bouquets with fewer votes, she says. The bouquets Sol vs. Neon Lights polled from July 12-13, 2023, with Neon Lights as the clear favorite with 79% of the vote compared to Sol’s 21%.

Sol vs neon lights UrbanStems

In UrbanStem’s Summer 2023 summer poll “This or That,” in its Instagram Stories, The Sol received 21% vs. The Neon Lights (79%).

These results give Hudson confidence that the brand could do a poll like this with AI-generated images so UrbanStems will know what shoppers’ preferences are before going to market with those products.

What’s more, it’s insights like these that Hudson believes will lead to further investment from its management team in Midjourney and generative AI applications in general.

“I feel confident I could get our company on board investing in [higher-cost plans],” Hudson says. “It will take some of the heavy lifting off our junior marketers that no longer have to be in the weeds looking up SEO terms, for example. We want our employees to grow in their role and not be bogged down.”

Marketers test and learn from AI

Another way retailers are using AI is to help alleviate the workload for junior marketers. Some retailers like men’s footwear brand Koio are just getting started using generative AI.

For about six months, Koio has used ChatGPT for email subject lines, says Joe Anhalt, vice president, marketing, growth.

“It’s one of the first places we go for inspiration,” Anhalt says. “It might take a few times and we have to make tweaks on our own, but the prompts are showing us results.”

The shoe retailer uses the AI-generated copy for performance ads on Facebook and Instagram, he says, without revealing more. The brand uses software vendor Zenlytic with generative AI tool Zoe. Zoe answers questions and generates reports about how marketing campaigns and specific promotions are performing.

While Koio hasn’t tracked how AI is performing compared with human marketers, the tool has saved it considerable time, he says.

“The larger win for us has been not needing a full-time employee to produce some of these tasks,” Anhalt says.

AI has helped marketers free up time to do other tasks, Anhalt says. However, there is a learning curve for junior marketers, he says. The retailer typically pairs a junior marketer with a copywriter until they are confident the junior marketers can use ChatGPT or a similar tool to craft emails, banner ads and other site content, he says.

What does it cost to use AI?

Overall, Babylist, UrbanStems and Koio said the cost to use generative AI technology is affordable. For certain applications, ChatGPT is free and services like Midjourney and Frase charge “reasonable” rates, according to UrbanStems and Babylist.

It’s not about the cost, Forrester’s Pattisall says. “Retailers’ knee-jerk reaction tends to be, ‘how much money is this,’ or ‘how much money will this save us?’” Those are the wrong questions, he says. “The better way to think about this is how effective it’s going to be.”

Generative AI continues to evolve at an accelerated rate. As marketers learn how to use it, the technology itself improves. It’s an idea generator if nothing else, Babylist’s Grant says.

“An editor might ask ChatGPT to come up with 40 ideas for an Instagram post,” Grant says. “30 out of 40 of those ideas might be bad — but you end up with a gem of an idea from all the wacky weirdness.”

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Earnings recap: What you missed from Lululemon, Land’s End and more https://www.digitalcommerce360.com/2023/09/01/ecommerce-earnings-this-week-lululemon-chewy-best-buy/ Fri, 01 Sep 2023 15:47:53 +0000 https://www.digitalcommerce360.com/?p=1308570 This week, more retailers in Digital Commerce 360’s Top 1000 list of leading ecommerce retailers in North America reported ecommerce earnings results for the most recent fiscal quarter. Here’s the ecommerce earnings summary you need to know from this week. Read more ecommerce earnings coverage here. Academy Sports & Outdoors Inc. (No. 136) Academy Sports […]

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This week, more retailers in Digital Commerce 360’s Top 1000 list of leading ecommerce retailers in North America reported ecommerce earnings results for the most recent fiscal quarter. Here’s the ecommerce earnings summary you need to know from this week. Read more ecommerce earnings coverage here.

Academy Sports & Outdoors Inc. (No. 136)

Academy Sports and Outdoors reported net sales declined 6.2% in the second quarter ended July 29, 2023. The retailer did not share specific information on online sales, but it says it is working to expand omnichannel capabilities.

Best Buy Co. Inc. (No. 7)

Best Buy reported ecommerce earnings this week. Online sales declined 7.1% in the second quarter ended July 29, 2023. 

Online sales made up 31.0% of total revenue, staying flat with the previous year. Total domestic revenue also declined 7.1% to $8.89 billion. The decline can largely be attributed to a 6.3% decline in comparable sales. Read more here.

Big Lots (No. 252)

Big Lots reported net sales declined 15.4% to $1.14 billion in the second quarter ended July 29, 2023.

“Our results for Q2 illustrate that we remain in a very challenging environment, in which our core lower-income customer remains under significant pressure and has limited capacity for higher-ticket discretionary purchases,” CEO Bruce Thorn said in a written statement.

Big Lots did not share specific online sales data. The retailer said it focused on creating a “curated experience, better site navigation and eliminating friction” for online customers in the quarter. 

Chewy Inc. (No. 13)

Chewy reported net sales grew 14.3% to $2.78 billion in the second quarter ended July 30, 2023. Autoship orders remained significant at the online pet retailer, accounting for 76% of net sales and growing faster than overall sales.

Chewy Health also grew to penetration among 20% of Chewy customers. Consumers required more “nudging” to spend than in previous quarters, the retailer said, but non-discretionary categories like food and health remain strong. 

Chico’s FAS Inc. (No. 108)

Chico’s reported net sales declined 3.0% to $545 million in the second quarter ended July 20, 2023. Online sales made up 41% of net sales, which was flat with Q1 of 2023.

“For all three brands, full-priced sales remained healthy, we attracted new customers, and we gained market share,” CEO Molly Langenstein said in a written statement. Chico’s improved website experience and grew online conversion rates, the retailer said. 

Five Below (No. 580)

Five Below reported net sales grew 13.5% to $759.0 million in the second quarter ended July 29, 2023. The discount retailer said online sales remain a “low single digit” portion of the total business.

“With every seasonal change, we get it up online first and it helps us prepare and set up the stores,” CEO Joel Anderson told investors about the value of digital sales for Five Below. 

Dollar General Corp. (No. 753)

Dollar General reported net sales grew 3.9% to $9.8 billion in the second quarter ended Aug. 4, 2023. Same-store sales declined 0.1%, and operating profit declined 24.2% to $693.2 million.

Customer traffic declined, while average transaction amount grew. Dollar General didn’t share specific online sales data, but it said online active monthly users grew 20%.

Joann Inc. (No. 307)

Joann reported online sales grew 3.0% in the second quarter ended July 29, 2023. Online sales accounted for 12.1% of revenue in the quarter.

Meanwhile, net sales declined 2.1% to $453.8 million, and comparable sales declined 2.0%. Online sales outpaced in-store sales growth due to expanded online offerings, technology improvements and increased traffic to Joann’s website and mobile app. 

Land’s End Inc. (No. 79)

Land’s End reported global ecommerce sales declined 8.7% to $218.7 million in the second quarter ended July 28, 2023. U.S. ecommerce sales decreased 3.6% over the same period due to promotions and discount pricing. Net revenue declined 7.9% to $323.3 million.

The retailer also described efforts to incorporate AI into the business. Land’s End recently launched an app for merchants and designers using ChatGPT to “analyze our customer data to identify gaps in our assortment to improve buying decisions,” it said.

Lululemon Athletica Inc. (No. 27)

Lululemon reported online comparable sales grew 17% in the second quarter ended July 30, 2023. In-store comparable sales grew 9%, and total revenue grew 18%.

Lululemon online sales made up 40% of total revenue, at $894 million. Online traffic also grew 20% in the quarter, Lululemon said.

Signet Jewelers Ltd. (No. 60)

Signet Jewelers reported total sales declined 1.9% to $1.8 billion in the second quarter ended July 30, 2023. That’s up 29% over Q2 of 2020, the retailer said.

Same-store sales, including brick-and-mortar and ecommerce sales, declined 8.2%. The retailer did not share specific online sales figures for its online-only brands James Allen and Blue Nile. Signet says it expects consumers to delay more spending than usual to Black Friday because of inflationary pressures.

Vera Bradley Retail Stores LLC (No. 276)

Vera Bradley reported net revenue declined “modestly” to $128.2 million in the second quarter ended July 29, 2023. The Vera Bradley brand’s revenue declined 1.2% in the period, primarily due to store closures. Pura Vida brand sales declined 3.6% due to a decline in wholesale customers, the retailer said. Vera Bradley plans to implement a “strong focus on driving ecommerce growth,” after online sales moderately declined in the quarter, it said without revealing more.

Victoria’s Secret & Co. (No. 52)

Victoria’s Secret reported total sales declined 6% in the second quarter ended July 29, 2023. The sales environment was “particularly challenging” for the digital intimates market in North America, the retailer said in a statement.

Traffic and average basket size declined both in stores and online during the quarter. Conversion rates and average unit retail are below where they were a year ago, but they remain elevated over 2019 levels, the retailer said.

1-800-Flowers.com Inc. (No. 47)

1-800-Flowers reported total revenue declined 17.9% to $398.8 million in the fourth quarter ended July 2, 2023. Net loss for the quarter equaled $22.5 million. Like many other retailers, 1-800-Flowers cited the impact of decreasing consumer spending on non-essential goods.

As consumers were challenged by ongoing inflationary pressures, escalating interest rates and higher credit card debt, they reduced their discretionary spending,” William Shea, chief financial officer, told investors.

Lower-priced products saw the largest decline, Shea said.

So what does it mean?

  • This week’s ecommerce earnings show that consumers remain reluctant to spend on non-essential goods. Discount retailers like Dollar General and Five Below are reaping the rewards of these pressures on consumers.
  • Not every discount retailer automatically benefits from consumers trading down, though. Big Lots shows that simply having low prices isn’t enough to win in 2023.

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Europe ecommerce sales and growth by category https://www.digitalcommerce360.com/article/europe-ecommerce-sales-by-category/ Fri, 14 Jul 2023 18:31:57 +0000 https://www.digitalcommerce360.com/?post_type=article&p=1048413 The European ecommerce landscape Each year, the Digital Commerce 360 research team analyzes and ranks the leading ecommerce companies headquartered in Europe in our Europe Database. These leading 500 European companies include some of the world’s most iconic brands such as LVMH, which owns: Louis Vuitton Tiffany & Co. Dior Fendi Tag Heuer Bulgari Givenchi […]

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29 takeaways from ranking the largest online retailers by category https://www.digitalcommerce360.com/2023/06/15/takeaways-largest-online-retailers-top-1000-category/ Thu, 15 Jun 2023 16:41:33 +0000 https://www.digitalcommerce360.com/?p=1046726 U.S. ecommerce sales grew 7.7% in 2022, but the Top 1000 online retailers only grew 5.1% — a big change from the double-digit growth they have seen in previous years. This month’s analysis consists of looking at the Top 5 leaders in each Top 1000 category and by merchant type, getting a sneak peek of […]

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Online prices were down 2.3% in May, Adobe found https://www.digitalcommerce360.com/2023/06/13/online-prices-were-down-2-3-in-may-adobe-found/ Tue, 13 Jun 2023 17:42:14 +0000 https://www.digitalcommerce360.com/?p=1046694 Online prices fell at the fastest rate in 36 months in May, according to Adobe’s Digital Price Index. Prices were down 2.3% year over year, and 1.2% compared with April 2023. Adobe produced the report based on 100 million SKUs across 18 retail categories including groceries, personal care, and appliances. Biggest declines 11 of the […]

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Online prices fell at the fastest rate in 36 months in May, according to Adobe’s Digital Price Index. Prices were down 2.3% year over year, and 1.2% compared with April 2023.

Adobe produced the report based on 100 million SKUs across 18 retail categories including groceries, personal care, and appliances.

Biggest declines

11 of the 18 categories Adobe monitored showed year-over-year price declines in May. They were driven by decreases in discretionary categories, Adobe said. The largest year-over-year price decrease was for the flower and gift category. Prices declined 27.8%. The category continued the trend from April, when it also showed the largest decrease.

Computers and electronics also decreased significantly, down 16.45% and 12.04%, respectively, year over year. 

Appliance prices dropped 7.9% year over year, and 2.4% month over month. This was the largest drop in the category pricing since Adobe first began tracking in 2014. Appliance prices decreased for the eighth month in a row, Adobe found.

Home and garden prices also decreased 6.3% over last May, when prices were up 2.5% over May 2021, per Adobe. 

Grocery prices increased again

Online grocery prices rose 8.2% year over year and 0.3% month over month in May, Adobe found. Though prices keep going up, Adobe noted that the rate of increase has slowed for eight consecutive months. Online grocery prices were up 9.3% year over year in April, 10.3% in March, and 11.4% in February. Growth peaked in September 2022 at 14.3% year over year.

Ecommerce splits from other retail

Adobe says it uses the same general methodology that the Bureau of Labor Statistics uses to track prices in the Consumer Price Index (CPI). In May 2023, online prices fell 23% while the CPI grew 4%. That’s on track with recent months, with Adobe and BLS findings diverging. In April 2023, ecommerce prices declined 1.8% year over year and the CPI was 4.9%. In March 2023, ecommerce prices decreased 1.7% per Adobe, while the CPI grew 5%

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Online prices were down nearly 2% in April https://www.digitalcommerce360.com/2023/05/09/adobe-online-prices-were-down-nearly-2-in-april/ Tue, 09 May 2023 20:27:30 +0000 https://www.digitalcommerce360.com/?p=1044307 Ecommerce prices decreased for the eighth consecutive month in April, per Adobe’s Digital Price Index. Online prices overall were down 1.8% year over year, and down 0.7% compared with March. Adobe produced the report based on 100 million SKUs across 18 retail categories including groceries, personal care, and appliances. The biggest price declines 11 of the […]

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Ecommerce prices decreased for the eighth consecutive month in April, per Adobe’s Digital Price Index. Online prices overall were down 1.8% year over year, and down 0.7% compared with March.

Adobe produced the report based on 100 million SKUs across 18 retail categories including groceries, personal care, and appliances.

The biggest price declines

11 of the 18 categories monitored by Adobe recorded lower prices in April 2023 than in the previous April. The largest year-over-year decline was flowers and gifts, with prices down 27%.

Electronics and computers saw significant declines in April, Adobe found. Electronics decreased 11.6% year over year, and computers decreased 15.4% over the same period. Both saw slight increases month over month of 0.5% and 1.9%, respectively.

The appliance category also drove the price decline, Adobe said, with prices down 7.1% year over. That was the largest annual decline for the category since Adobe started tracking them in 2014. Appliances prices were down 2.1% month over month, marking the seventh month of price drops following 29 consecutive months of price increases beginning in May 2020.

Sporting goods, toys, and home and garden were all also down year over year. Sporting goods marked a 12th consecutive month of year-over-year price declines. Before that, prices increased for 28 months beginning in January 2020. Prices peaked in September 2020 as consumers invested in home exercise equipment during the pandemic.

Grocery price increases slowed

Online grocery prices increased 9.3% year over year in April, more than every category except pet products (11.32%). Though prices were up, the growth rate decreased for seven consecutive months. Online grocery prices increased 10.3% year over year in March, and 11.4% in February. Growth peaked in September 2022 at 14.3% year over year.

Grocery ecommerce sales grew 10.8% in 2022 over 2021, according to a previous Adobe report. With prices steadily increasing, more consumers turned to buy-now-pay-later services to purchase groceries, with usage up 40% in 2022.

“The rise of buy-now-pay-later usage for groceries tells us that consumers are likely making bigger purchases online to take advantage of special promotions and stock up on staples, thus managing living expenses in more flexible ways,” Adobe Digital Insights lead analyst Vivek Pandya said in a March press release.

Ecommerce prices diverge from overall retail

Adobe says it uses the same general methodology that the Bureau of Labor Statistics uses to track prices in the Consumer Price Index (CPI). The agency hasn’t released its April numbers yet, but in recent months the CPI has diverged from Adobe’s Digital Price Index. In March 2023, ecommerce prices decreased 1.7% per Adobe, while the CPI grew 5%. In February, Adobe recorded a 1.4% decrease, and the CPI grew 6%. Both measured year-over-year price changes. 

Ecommerce prices have largely risen more slowly than retail prices as a whole, or even decreased. Online groceries are an exception to this, and generally move in step with the CPI, Adobe says.

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Consumers will spend nearly $30 more per person this Mother’s Day https://www.digitalcommerce360.com/2023/05/04/consumers-will-spend-nearly-30-more-per-person-this-mothers-day/ Thu, 04 May 2023 12:47:33 +0000 https://www.digitalcommerce360.com/?p=1043776 Americans are projected to spend more than ever for Mother’s Day in 2023, according to new data from the National Retail Federation (NRF). NRF surveyed 8,164 consumers in April 2023 on their plans for the May holiday. The organization predicts consumers will spend $35.7 billion for Mother’s Day 2023, nearly $4 billion more than the […]

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Americans are projected to spend more than ever for Mother’s Day in 2023, according to new data from the National Retail Federation (NRF).

NRF surveyed 8,164 consumers in April 2023 on their plans for the May holiday. The organization predicts consumers will spend $35.7 billion for Mother’s Day 2023, nearly $4 billion more than the previous record of $31.7 billion in 2022. 

Consumers plan to spend $274.02, up from the 2022 record of $245.76 per person, an increase of $28.26. Consumers between ages 35 and 44 are projected to spend the most, at an average of $382.26 per person.

Fewer customers plan to shop online for Mother’s Day 2023

84% of survey respondents told NRF they plan to celebrate Mother’s Day this year. Just over one-third, 34%, said they will shop online for gifts. That’s down slightly from 36% in 2022, and on par with online shopping levels in 2021. It peaked in 2020 with 42% of consumers planning to shop online during the height of the pandemic.

Online shopping is tied for the single most popular venue projected for Mother’s Day shopping in 2023. 34% of consumers also said they plan to shop at department stores, up from 30% in 2022 and 28% in 2021. 

“While most consumers shopped online last year for the perfect Mother’s Day gift, we are seeing just as many people turn to department stores as a shopping destination this year,” said Phil Rist, Prosper Insights executive vice president of strategy.

Another 30% of survey respondents said they will purchase gifts from a specialty store like a greeting card shop, florist, or jewelry store. Respondents also mentioned local small businesses (24%), discount stores (23%), and specialty clothing stores (13%). Just 3% of consumers said they would purchase gifts through catalogs.

Traditional gifts remain popular

Most of the consumers planning to celebrate Mother’s Day told NRF they will purchase classic gifts for the holiday. Flowers and greeting cards are the most popular gifts. Nearly three-quarters of consumers (74%) said they plan to gift each item.

Mother’s Day remains a major holiday for flower retailers. Online flower retailer UrbanStems previously told Digital Commerce 360 that the week of Mother’s Day has 10 times as many sales as a typical week, and double the sales of Valentine’s Day. Urban Stems ranks No. 900 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest North American online retailers by web sales. Online flower retailers are popular, with a penetration rate of 87.6% in the category compared to the Top 1000 as a whole, according to Digital Commerce 360 data. The three-year CAGR for flower retailers in the Top 1000 is 22.2%, above the total Top 1000 CAGR of 20.7%.

60% plan to engage in a special outing like dinner or brunch. Gifting is up in all categories NRF tracks over 2022, including flowers, clothing, and gift cards, except for greeting cards.

Consumers will spend the most on jewelry, projected at $7.8 billion. 44% of consumers plan to gift jewelry, spending $59.90 per household. Jewelry also has a higher CAGR than average, at 23.6% according to Digital Commerce 360 data. Daniel’s Jewelers previously told Digital Commerce 360 that Mother’s Day accounts for 25% of its sales.

Outings like meals at restaurants have the next highest spending, projected at $43.29 per household to total $5.6 billion. 

Electronics are the least common gift category for 2023 tracked by NRF, with 25% of consumers planning to gift them. That’s up from 22% in 2022, and 20% in 2021. Electronics are the third-highest spending category, at $30.69 per household for $4 billion total.

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Etsy posts 13.4% drop in net income in first quarter https://www.digitalcommerce360.com/2023/05/03/etsy-posts-13-4-drop-in-net-income-in-first-quarter/ Wed, 03 May 2023 22:11:54 +0000 https://www.digitalcommerce360.com/?p=1043874 Etsy Inc. reported net income of $74.5 million in the first quarter of 2023, a drop of 13.4% from the $86.1 million a year earlier. The marketplace cited inflationary pressures on consumer discretionary spending for the decline. Etsy operates an online marketplace for handmade items. Artisans and merchants sell a variety of clothing, photos, jewelry, […]

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Etsy Inc. reported net income of $74.5 million in the first quarter of 2023, a drop of 13.4% from the $86.1 million a year earlier. The marketplace cited inflationary pressures on consumer discretionary spending for the decline.

Etsy operates an online marketplace for handmade items. Artisans and merchants sell a variety of clothing, photos, jewelry, toys and more on the site. Based in Brooklyn, New York, Etsy went public in 2015.

Etsy also owns fashion resale marketplace Depop, musical instrument marketplace Reverb, and Brazil-based handmade goods marketplace Elo7.

A key metric at Etsy is what the company calls consolidated gross merchandise sales, which measures the dollar value of items sold in all Etsy marketplaces including Depop, Reverb and Elo7. In the first quarter, consolidated GMS was $3.1 billion, down 4.6% year over year.

At the core Etsy marketplace, GMS in Q1 was $2.7 billion, down 4.7% from a year earlier.

On a more positive note, the Etsy marketplace grew active buyers by 1% year over year to 89.9 million, the first time this metric has grown on a year-over-year basis since the fourth quarter of 2021. The marketplace acquired 7 million new buyers, reactivated 21% more buyers than during the prior year period, and retained active buyers at levels above pre-pandemic rates on a trailing 12-month basis.

“While we remain cautious on the broader macroeconomic climate, we are pleased to see positive trends in our first-quarter 2023 buyer data, particularly the return to year-over-year growth in the Etsy marketplace’s active buyer base,” Rachel Glaser, chief financial officer, said in a written statement.

Etsy is No. 17 in the 2023 Digital Commerce 360 Global Online Marketplaces database. It is No. 6 among U.S.-based marketplaces.

For the fiscal first quarter ended March 31, 2023, Etsy reported:

  • A 13.4% drop in net income to $74.5 million.
  • Consolidated revenue of $640.9 million, a 10.6% increase from a year earlier.
  • A 3.8% increase in the number of active sellers.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports.

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