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Australia's online grocery market to grow to $4.2b by 2023?

According to figures released by the IGD today, Australia’s online grocery market is predicted to grow to $4.2 billion by 2023. Over the next five years, Australia will grow at a 15.3% CAGR, taking market share from 2.1% to 3.7%. IGD also predicts that ten leading global online grocery markets will experience combined growth of $227 billion, at an annual rate of 20% in that time frame. It's important to remember that these statistics are forecasts, and we have no visibility of the methodology used to generate them. Stanislav Lem once said that anybody in the forecasting business who in 1990 didn’t predict the Internet should change profession (this means 100% of people).

Apple CEO calls for stricter data privacy laws in the US

The Wall Street Journal reported that Apple's CEO Tim Cook issued the tech giant’s strongest call yet for US-wide data-protection regulation, saying individuals’ personal information has been “weaponised.” Mr. Cook’s call came in a sharply worded speech before a privacy conference organised by the European Union. Mr. Cook told the audience of EU privacy regulators that the US should enact a comprehensive federal privacy law that follows their GDPR example. “Our own information—from every day to the deeply personal—is being weaponised against us with military efficiency,” Mr. Cook said. His statement comes off the back of recent data breach scandals involving Facebook and Google. Given the critical importance of the Digital Path to Purchase for modern retailing, cybersecurity and the protection of customer details has become an essential focus for the industry.

French Connection in sale talks

The Retail Gazette in the UK reported that French Connection has begun discussions with four potential bidders regarding a sale. The developments come two weeks after the British fashion retailer revealed it had started looking for a buyer, with founder Stephen Marks ready to sell his 42% stake in the business he began in 1969. The size of Marks’ stake means that any sale would trigger a takeover offer for the whole group. Shares in French Connection rose 45% on the back of the news on October 8, and 10% again on October 19 after the retailer said in a stock market statement that sales conversations were underway.    

Amazon's stock falls 9% despite standout Q3 earnings

Business Insider reported that Amazon's stock fell 9%, as disappointing revenue, guidance seems to have outweighed standout Q3 earnings. Yesterday, Amazon declared third-quarter earnings that were more than US$2 a share better than analysts had forecast. However, the company’s revenue for the period was lower than expected, and it offered a disappointing revenue forecast for the fourth quarter. Yet again, Amazon’s cloud business gave it a big boost. AWS’s revenue jumped 46% from the year-ago period to US$6.7 billion. The division’s operating profit, meanwhile, grew 77% over the same time period to US$2.1 billion, accounting for more than a third of Amazon’s total net profit for the period. And the company continued to see success in advertising. Its “other” revenue, which largely comprises advertising sales, jumped 122% to US$2.5 billion.

JB Hi-Fi reaffirms $7.1b sales guidance

The AFR reported that JB Hi-Fi appears to be defying the downturn in discretionary spending, reporting stronger same-store sales growth in its Australian and New Zealand electronics stores in the lead up to Christmas. At the annual meeting in Melbourne on Thursday, where the retailer narrowly avoided a first strike against its remuneration report, the retailer's CEO said total sales at JB Hi-Fi stores in Australia rose 5.3% and comparable sales grew 3.4% for the three months ending September. This was a significant acceleration from July, when same-store sales rose just 0.3%. Analysts say trading conditions for discretionary retailers have deteriorated over the last few months – pointing to subdued same-store sales at Nick Scali, PAS Group and Michael Hill and slower growth at Super Retail Group – as low wages growth, rising utility costs and political instability take a toll on household spending.

Alceon now one of the largest fashion retail groups in AU

Ragtrader reported that Alceon Group’s private equity business has acquired the Pumpkin Patch childrenswear business, adding to its already extensive portfolio of retail brands, including Noni B, Ezibuy, SurfStitch and Cheap as Chips. The business was acquired in March 2017 by its current owner, Catch Group Pty Ltd, from the company’s receivers. Alceon's executive director said the group hopes to revive the brand. Pumpkin Patch will initially be re-launched in New Zealand through EziBuy and will feature in EziBuy’s online and physical stores, planned for the end of October. A full re-launch of Pumpkin Patch into the Australian and New Zealand markets is planned for July 2019. Alceon also plans eventually to launch stand-alone Pumpkin Patch stores.  

The value of Click & Collect

Recent research conducted by US automation company Bell and Howell looked into the value of Click & Collect for retailers, we've picked out a few of the most interesting findings from the report. In terms of enhancing customer experience, 76% of consumers say that pickup efficiency influences their purchasing decision, while 79% say overall experience influences where and how often they buy. The data shows that consumers expect their orders to be ready for pickup in 24 hours or less, with 53% demanding two hours or less! More than one notification method (email, text message, phone call, etc.) also matters. Additionally, 58% of shoppers make impulse purchases when retrieving an order, and 53% of consumers buy additional items when returning items in-store. For a retailer's bottom line, there is an 85% reduction in shipping costs when orders are shipped to store, e.g. Walmart reduced their shipping costs from about US$5, down to circa US$0.75 per order shipped.

ASX battle looms between Catch Group and Kogan

The AFR reported about the looming ASX rivalry between online retailers Catch Group and Should Catch Group Holdings float as planned in coming weeks, fund managers reckon there promises to be fireworks. Both retailers were frontrunners in the online space Down Under, Catch set out with a deal of the day type offering, while focused on selling electronics and white label products. But the rivalry has stepped up recently with Catch's "marketplace" strategy, which targets apparel and homewares, putting it up against It'll be interesting to see whether Catch gets away. The choppy equity markets are proving hard for newcomers, although there remains plenty of contenders lining up for a shot at the ASX-boards.  

Big brands flock to Google Shopping Actions

Retail Dive reported that Google added Best Buy, Sephora and Nike to the list of retailers that now sell directly through Google's Shopping Actions service, a unified shopping cart capability integrating Google Assistant, Google Express and the internet giant's search capabilities. Shopping Actions enables shoppers using Google search and Assistant capabilities to buy products on Google Express without having to go to the retailer or brand website after the initial product discovery. While this sounds great, it's worth noting that it goes against the Digital Path to Purchase funnel - the focus is on ordering and not true experience, which means that the sale becomes transactional rather than a part of nurturing lifetime engagement.

US food supply jolt

The Wall Street Journal reported that more than a dozen companies have recalled millions of pounds of potentially contaminated food in recent days in a new challenge for food producers facing heightened scrutiny of the US food supply. This is one in a series of similar events as food companies grapple with costly recalls and an increase in multistate outbreaks of foodborne illness this year, due to advances in pathogen detection and new regulations that require US farmers and food processors to do more to prevent foodborne illness.    

Woolies staff approve new enterprise agreement

The AFR reported that Woolworths supermarket staff have overwhelmingly approved the company's new enterprise agreement, which restores full penalty rates for the first time in decades. The new deal increases weekend and evening rates to the award minimum. Under the agreement, casual loading will rise from 20% to 25%. The four-year arrangement is expected to significantly increase labour costs for the retail giant as, unlike previous agreements, it does not trade away penalty rates for higher base rates.