Amazon ad's costly mistake, increasing cross-border shopping, global ecom revenue hitting $6 trillion | D2C Digest

Weekly D2C News

Hey there, great people of the D2C community who are building fantastic things! This is your host Berkay writing. 

Take a 5-minute break and dive into D2C Digest for a quick overview of what’s happening in the D2C market worldwide!

😬 Amazon showed expensive ads for items that weren't even available for purchase

A small business owner got hit with a massive headache when he discovered that Amazon was still pushing ads for his products in California, even though he couldn't sell them there due to strict local laws, a Bloomberg article revealed.

The seller stopped selling in California due to strict energy rules, but Amazon's ad system didn't get the memo, and it kept showing his ads there.

Even when he told Amazon about the mix-up, the platform kept charging him big bucks —somewhere between $200,000 and $300,000— for ads aimed at people he couldn't sell to. This fiasco left him and his team of 80 in Virginia, who build custom computers, making zero profit for three whole months.

Amazon acknowledged the mistake and offered a $15,000 refund, a fraction of the seller's claimed losses.

This isn't the first time Amazon's been in hot water over its ad system. Contrary to Google Ads, Amazon Ads lack geo-targeting, focusing on product matches over shipping feasibility. And their ad system has faced criticism for irrelevant ads and brand favoritism before.

How do your Amazon ads perform?

Ouch!

📈 54% of consumers expect to increase cross-border shopping

A recent report by Airwallex revealed that more than half of the global consumers, around 54%, are looking to increase their shopping from abroad in the next six to twelve months, but they're calling for a smoother and more transparent online payment process to make it a reality.

Despite economic uncertainties and a slowdown in global growth, consumer spending is predicted to continue its upward trajectory, with expectations for the global cross-border e-commerce market to hit USD 7.9 trillion by 2030. For international sellers to succeed in this burgeoning market, addressing customer pain points and enhancing the overall shopping experience is crucial.

Trust plays a pivotal role in encouraging consumers to shop internationally, with 61% finding international merchants trustworthy and 65% feeling secure about their personal and financial information when purchasing from abroad.

Shipping costs and clear policies, alongside quick refund processes, are major considerations for consumers when choosing to buy from overseas sellers. Interestingly, a significant motivator for cross-border shopping is the pursuit of a wider variety of products, better quality, and lower prices, largely influenced by the global reach of social media.

💪 Global ecommerce revenue exceeded $6 trillion, accounting for 20% of overall retail sales

In a significant milestone for digital commerce, global retail ecommerce sales are set to make up over a fifth—20.1%—of total retail sales this year, hitting an impressive $6.334 trillion, according to recent forecasts.

However, this rapid expansion is expected to moderate somewhat over the coming years.

Insights from the Worldwide Retail Ecommerce Forecast 2024 report by Emarketer suggest a gradual slowdown in ecommerce growth worldwide. Among the regions analyzed, Latin America leads the pack with an impressive 15.8% growth rate expected this year. Meanwhile, Western Europe is on the other end of the spectrum, with the slowest growth rate projected at 6.4%.

If you’re up for more reading, check these out:

1. eCommerce marketplaces crack down on fakes to boost consumer trust

Since trust is a big deal for customers deciding where to shop online, digital sellers are getting serious about weeding out counterfeit goods.

Today, a lot of shopping happens online or has some kind of online option. This means if you're running an online shop or a physical store, you've got to get how this online shift changes what shoppers expect and how loyal they are.

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