Ecom Influence

TL;DR

• Amazon crushes earnings (so did facebook) on the back of advertisers

• Amazon rolls out multiple seller images to listings (be careful)

• Honeypot gets the big exit for $380MM

• Boomers love TEMU

• True Classic seeks $1B valuation on ONLY $19MM EBITDA

Stock Prices

Quick Hits

Amazon Rolls out Prime Video Ads - First Netflix, now Amazon. Is any space safe from ads?

GDPR For All - Google issuing suspension threats for non-compliant GDPR consent banners. Make sure your sites are compliant.

AI Everywhere - Etsy rolls out an AI Gift Mode, much like Walmart, Google, Amazon and Others.

Boomer Boomer - Turns out Boomers love TEMU. Who doesn’t like a deal?

Temu Opens Up to US Sellers - Will you hop on the bandwagon?

Listing of the Week

What we like:

We love something that is difficult and niche, and it doesn’t get much more so than electrical components for trailers and boats. Your average Chinese seller or American with a few thousand bucks is not going anywhere near this. I expect that’s why we have outsized margins of 25%.

We also love that the brand has “has curated a distinctive range of proprietary products through manufacturing agreements for specific lines”

Finally, 70% of traffic & 95% of sales are organic through a well ranked blog. Having a blog that can drive traffic is a super power in the D2C world and there’s no reason that you can’t use it to also create a category leader on amazon (on which they have a minimal presense).

I would bet you could see a 20%+ sales uplift from simply getting their products onto amazon.

Caution - RV’s boomed during COVID. Make sure you aren’t overpaying for a residual COVID bump.

Thread of the Week

Interesting valuation and revenue numbers from Fan Bi.

Atlanta-based feminine care brand Honey Pot acquired for $380M

It’s not all dark on the M&A front for Ecom and D2C brands. Honey Pot (founded in 2012), the feminine care brand, was purchased by Compass Diversified for $380MM ALL CASH with revenue of $121MM and $29MM in EBITDA. 13x EBITDA is quite a payday for D2C these days.

From Marketplace Pulse, Amazon Aggregators raised over $16B in capital (mostly debt) and then pretty much lit it on fire. There is only a handful of aggregators still standing and most are limping along and trying to cash flow enough to pay their debt.

Amazon - Images from multiple selling partners to be displayed on product pages

Starting Jan 31, product pages “may” display images from multiple sellers.

This seems like a recipe for absolute disaster when it comes to policing product pages and preventing bad actors, but we will see how amazon rolls out the new policy.

Previously, product detail pages displayed images from one selling partner. To remove an incorrect image, contact Selling Partner Support.

Amazon Earnings

Amazon Earnings

Amazon earned $1/share on sales of $170 billion for the quarter. Advertising was the fastest growing segment with revenue rose 27% year over year to $14.7B (thanks 3rd Party Sellers). With $70B in e-commerce revenue and $20B in ads, that implies a HEFTY advertising cost to sellers. That ratio has increase every year it’s been disclosed, standing at over 20% in Q4.

Amazon also bragged about it’s continued Chinese seller efforts, “expanded tools and resources for Amazon sellers in China, including announcing an Innovation Center dedicated to sellers, introducing Supply Chain by Amazon for sellers in China, and establishing five regional global selling centers, all with the goal to expand opportunities for sellers to help them grow their businesses.”

As Bezos famously said, “Your margin is my opportunity.” Unfortunately that. margin is no longer his retail competitors and instead his platform sellers.

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