SUMOHeavy — Issue #41
What We’re Reading
Alibaba Group, the world’s largest e-commerce company, will soon strike the word “e-commerce” from its lexicon, says Alibaba Executive Chairman Jack Ma.
The problem, as Ma sees it, is that e-commerce, as distinct from traditional retailing, is rapidly becoming an outmoded concept as online and offline retailing become fully integrated.
Amazon to Expand Grocery Business With New Convenience Stores — www.wsj.com
Amazon.com is pushing deeper into the grocery business with plans for convenience stores and curbside pickup locations, aiming to compete more directly with Wal-Mart and other grocery discounters.
Amazon Teaming With VMware Is the Latest Sign the Cloud Has Won | WIRED — www.wired.com
VMware has treated Amazon’s cloud service as an existential threat for years. Now the two companies are teaming up.
Three Strategies To Win In China’s E-Commerce Market — www.forbes.com
Will Macy’s follow the footsteps of other American giants such as e-Bay, which failed miserably, or Amazon, which couldn’t gain much footing in China?
The new ShopBot bot on Messenger searches eBay for you — techcrunch.com
I don’t know who wants to shop via chatbot, but that hasn’t stopped a range of companies from launching their own virtual assistants dedicated to this task…
Upcoming eCommerce Events
The 10x eCommerce Event
February 10–12, 2017 | Orlando, Florida
CES (Consumer Electronics Show)
January 5–8, 2017 | Las Vegas, NV
February 27 — March 02, 2017 | Palm Springs, CA
The SUMO Heavy Job Board
Reach qualified eCommerce managers by listing your job openings on the SUMO Heavy Job Board. We’ll list your openings for free in our weekly newsletter and post your listings on Twitter.
Click here to get started.
Our Latest Obsession
The Fresno Drop
Before the era of ubiquitous credit cards, consumers would either put things on ‘tabs’ or a store ledger. For large purchases, consumers would need to take out consumer loans at the local bank.
The Diners Club Card was created in 1951, but was not widely circulated, and could only be used in specified establishments.
In 1958, Bank of America had an idea that would forever change the financial landscape. Bank of America wanted consumers to have a card that could be used everywhere, not just restaurants. They also wanted consumers to be able to pay them back whenever they could, not just in 60 days, like the Diners Club card.
They tried an experiment in Fresno, California. Fresno was selected because it was believed that not many people were paying attention to what was happening there, so if the experiment flopped, the media wouldn’t pay much mind.
Bank of America dropped 60,000 unsolicited pieces of mail to citizens of Fresno. Inside was a plastic card. With a $500 pre-approved credit limit.
Within 10 months, more than 1 million cards were mailed to surrounding cities in California. But once the cards were mass mailed, fraud and theft became rampant. People would go to mailboxes in the suburbs and steal the cards when they knew they were going to be dropped. Also, since the cards were pre-approved, dead people, children and dogs were getting cards.
By the second year, cardholders had racked up nearly $60 million in purchases. The experiment initially lost money due to fraud and bad customers, but within 10 years was making Bank of America about $13 million a year.
The Truth in Lending Act in 1968 ended the unsolicited mailings. BankAmericard later became Visa.
Today, over 70% of Americans have at least one credit card, and US credit card debt is around $900 billion.
SUMOHeavy Weekly is a digest of of SUMO blog content, plus eCommerce news, events and job listings.
Click here view previous issues and to subscribe.