Here’s Why PayPal Should Acquire Pinterest

PayPal has denied published reports that it is interested in acquiring Pinterest. Nonetheless, if consummated, the transaction might be the first of many similar acquisitions as platforms seek vertical integration.

In this post, I’ll address why it makes sense for PayPal to buy Pinterest,  and why other ecommerce providers could get serious about vertical integration.

Image of a PayPal exterior sign in front of one of its office buildingsImage of a PayPal exterior sign in front of one of its office buildings

PayPal’s acquisition of Pinterest could add vertical integration heft.

Vertical Integration

China’s leading merchants have demonstrated that vertical integration in ecommerce works.

Social commerce in China combines content, chat, live streaming, sharing, and retail purchases. It obliterates the distinctions between social media networks and online stores (to paraphrase one of my articles).

Successful ecommerce-focused businesses in China are integrated, notwithstanding the government’s apparent machinations to break up or limit their influence. Those businesses have a social media network or content arm. They have a retail component or marketplace. They have payment processing and other financial tech services. They have fulfillment services. And they often have a device, such as a phone, or a device network.

Similar patterns exist with leading Western companies.

Amazon has Prime video, a content network. The company has a massive retail marketplace. It has fulfillment capabilities. It has Amazon Pay. And it has smart speakers and Kindle devices.

Apple, Google, Facebook, and Walmart also have some combination of these services or products. Other companies, including Shopify, could follow.

In this sense, PayPal purchasing Pinterest would put it in good company. It would provide key components of the vertical integration puzzle.

Creator Economy

PayPal might want to focus on a niche with a lot of room for growth and not yet dominated by one or two vertically integrated companies. That niche could be the creator economy.

Vloggers, bloggers, podcasters, chefs, coaches, consultants, independent musicians, and artists are among the long list of entrepreneurs collectively called creators. Often creators produce content for an audience on platforms such as YouTube, Instagram, TikTok, or Pinterest. They develop large followings of adoring fans, and then those creators seek ways to monetize that relationship.

The creator economy is reportedly worth about $100 billion, but it has the potential to grow. The opportunity to service creators is, for some, a tech industry gold rush.

Pinterest recently changed its interface to encourage creators. If the combination of PayPal and Pinterest allowed the latter to succeed as a TikTok for adults, the parent could be well-positioned for growth.

Payment Processing

One of PayPal’s core businesses, payment processing, faces numerous challenges.

Direct rivals. Bloody competition in the payments processing industry could make it difficult for pure processors to grow or even survive. Providers include PayPal, Helcim, Square, Stripe, Authorize.net, and hundreds of others.

New entrants. Many companies are entering the payment processing industry in one way or another — Amazon Pay, Google Pay, Apple Pay, Walmart Pay, Shopify Pay, and so on. Vertically integrated businesses understand that payment processing is not a discrete function but a feature of some other service. While these integrated companies could make deals with pure-play payment processors in the near term, they could just as easily develop the capabilities themselves.

Substitutions. Stablecoin and central bank digital currencies might sound like science fiction, but they could marginalize credit card and bank-issued debit card ecommerce purchases. Stablecoin and CBDCs would have much lower processing fees than payment cards, offer relatively better fraud protection, and open new markets. In both cases, stablecoin and CBDC, payment processors would be unnecessary.

Dissatisfied customers. Merchants and direct-to-consumer brands pay more than $100 billion annually in payment processing fees. All sellers seek ways to reduce those fees in my experience — I have never met a merchant that liked its payment processer. Most would abandon the processor for a better and lower-cost alternative.

More to Come?

Any of these competitive forces could disrupt PayPal’s payment processing business. Its acquisition of Pinterest could secure its future. Look for other industry participants to seek vertical integration and growth.

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15 Popular Pinterest Accounts (for Marketing Inspiration)

Pinterest continues to develop its ecommerce tools and features. For consumers, the tools are handy when browsing turns to buying. For merchants, the platform can expose a brand and drive revenue.

High-traffic accounts on Pinterest use influencers and brands to engage followers and drive monthly views. Here is a list of 15 of the most popular. There are curated topical style boards, product tags to shop, rich pins with product information, video pins, and more.

Oh Joy

Screen capture of the Oh Joy Pinterest pageScreen capture of the Oh Joy Pinterest page

Oh Joy

Oh Joy is an L.A.-based lifestyle brand and design company by Joy Cho. Oh Joy creates licensed products for home decor, kids, pets, and furniture collections with Target, Urban Outfitters, Keds, Petco, Band-Aid, and more. Popular Pinterest boards include Hair, Recipes, and For the Home. 15.2 million followers, 4 million monthly views.

Poppytalk

Screen capture of the Poppytalk Pinterest pageScreen capture of the Poppytalk Pinterest page

Poppytalk

Poppytalk is a design blog and creative studio founded by Jan Halvarson and Earl Einarson. It covers design elements, do-it-yourself projects, entertaining and recipe creations, art and photography, interior design, architecture, and more. Popytalk has partnered with Target, Martha Stewart Living, Tiffany and Co., and Proctor & Gamble. Popular boards include At the Lake, DIY and Tutorials, and Entertaining + Fun. 10.5 million followers, 9 million monthly views.

Tasty

Screen capture of the Tasty Pinterest pageScreen capture of the Tasty Pinterest page

Tasty

Tasty, from Buzzfeed, is a network for quick food videos and recipes. Tasty was originally a Buzzfeed Facebook page that featured short, comfort-food videos. Its Pinterest boards include food genres and meal hacks, such as Breakfast & Brunch, Desserts, Seafood Dinners, and Tasty Happy Hour. 10.4 million followers, 10 million monthly views.

Maryann Rizzo

Screen capture of the Maryann Rizzo Pinterest pageScreen capture of the Maryann Rizzo Pinterest page

Maryann Rizzo

Maryann Rizzo is an interior designer whose Tumblr blog, called “Curated Style,” contains inspirational images to design, decorate, craft, cook, garden, entertain, dress, and travel in style. Popular Pinterest boards include EVERYTHING and …and then some. 9 million followers, 760,200 monthly views.

Mamas Uncut

Screen capture of the Mamas Uncut Pinterest pageScreen capture of the Mamas Uncut Pinterest page

Mamas Uncut

Mamas Uncut is a site by Bekka Palmer for moms, with boards on parenting news and hacks, lifestyle-related content (e.g., tattoos), beauty and hair, celebrities, humor, and more. Popular boards include Baby, Lifestyle and Inspiration, and Mamauncut Inspiration. 8.5 million followers, 10 million monthly views.

Cathie Hong Interiors

Screen capture of the Cathie Hong Interiors Pinterest pageScreen capture of the Cathie Hong Interiors Pinterest page

Cathie Hong Interiors

Cathie Hong Interiors is an interior design firm in San Francisco. Its inspirational boards pin content on interior and outdoor design, tile and materials, stores and displays, packaging and branding, general inspiration, as well as the studio’s own work. The Dining Inspiration board has over 3 million followers. 7.9 million followers, 20,100 monthly views.

Jane Wang

Screen capture of the Jane Wang Pinterest pageScreen capture of the Jane Wang Pinterest page

Jane Wang

Jane Wang is the mother of Pinterest co-founder Ben Silbermann. With over 56,000 pins, Jane Wang’s boards demonstrate that popular inspirational content can cover a wide range of topics, from Wood to Madagascar to Will it blend? 7.7 million followers.

HonestlyWTF

Screen capture of the HonestlyWTF Pinterest pageScreen capture of the HonestlyWTF Pinterest page

HonestlyWTF

HonestlyWTF, curated by Erica Chan Coffman, features anything extraordinary. It features boards on interior design, style, art, shoes, jewelry, typography, photography, weddings, ceramics, architecture, and travel. Popular boards include DIY and Home Sweet Home. 7.1 million followers, 10 million monthly views.

Bonnie Tsang

Screen capture of the Bonnie Tsang Pinterest pageScreen capture of the Bonnie Tsang Pinterest page

Bonnie Tsang

Bonnie Tsang is a visual artist. Her boards feature inspirational and stylish images on architecture, fashion, colors, stripes, minimalism, and food. Popular boards include Living Spaces and Workspace. 7 million followers, 61,000 monthly views.

Evelyn

Screen capture of the Evelyn Pinterest pageScreen capture of the Evelyn Pinterest page

Evelyn

Evelyn has a wide range of topics across nearly 200 boards, including Passport to Western Europe, Nature’s WIndows, and America the Beautiful, Traveling the USA. 6.8 million followers.

Pejper

Screen capture of the Pejper Pinterest pageScreen capture of the Pejper Pinterest page

Pejper

Pejper is a Swedish lifestyle blog that focuses on the environment, with Pinterest boards that include Work ROOMS and Green Living – Houseplants. Its Lovely Living board has over 3 million followers. 6.8 million followers, 33,200 monthly views.

Harper’s Bazaar

Screen capture of the Harper’s Bazaar Pinterest pageScreen capture of the Harper’s Bazaar Pinterest page

Harper’s Bazaar

Harper’s Bazaar pins items from its magazine, including tagged content to shop at its online store. Popular boards include Street Style and Beauty & Hair. 6.4 million followers, 10 million monthly views.

Trey Ratcliff

Screen capture of the Trey Ratcliff Pinterest pageScreen capture of the Trey Ratcliff Pinterest page

Trey Ratcliff

Trey Ratcliff is the artist behind the daily travel blog StuckInCustoms.com. His Pinterest boards collect travel images. The My Favorite Travel Photos board has over 6 million followers. 6.4 million followers, 808,500 monthly views.

Style Me Pretty

Screen capture of the Style Me Pretty Pinterest pageScreen capture of the Style Me Pretty Pinterest page

Style Me Pretty

Style Me Pretty is a wedding site containing inspirational images and products to shop. Popular boards include Bridal Hair & Hairstyles and Wedding Cakes. 6.3 million followers, 10 million monthly views.

Nordstrom

Screen capture of the Nordstrom Pinterest pageScreen capture of the Nordstrom Pinterest page

Nordstrom

Nordstrom pins and curates images on women’s fashion, men’s style, handbags, shoes, home decor, and more. Followers can also shop tagged images. Popular boards include Women’s Clothing, Home, and Beauty. 5.2 million followers, 10 million monthly views.

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5 Things Online Businesses Can Do Today to Increase Conversion Rate

Opinions expressed by Entrepreneur contributors are their own.

The average conversion rate for a website is 4.31%, though this figure varies by industry, of course. Ecommerce sites, for example, average a 2.9% conversion rate, while B2B SaaS websites average a 5% conversion rate. Such a variety of figures makes answering the seemingly simply question, “What’s a good rate?” more challenging.

Let’s say your site runs at a 1% rate; that means that for every 100 visitors to the site, you can expect one customer. If the traffic goes up to 1,000 visitors, you can expect ten, and so on. This conversion rate could be good or bad, depending on industry standards, but the fundamental principle must be getting more out of present traffic. You’ll likely spend 10 to 15% of revenue on — with the sole purpose of getting the best leads for your team — so increasing that conversion rate is vital. 

But how?

1. Establish trust with social proof

Most customers don’t want to be the first to try out a new product, and having a beautiful website with compelling copy won’t take you far without customer testimonials. Recent surveys show that an average customer reads ten online reviews before making a purchase, and that 94% of such customers are likely to patronize a with positive reviews. Hence, including “social proof” is key. You can start by adding logos of companies you work with or have worked with before, along with their accounts of your merits, if that’s possible. If you don’t work with companies, including testimonials and reviews from customers. The goal is to put minds at ease, both before and after purchasing from you. 

2. Communicate and simplify your unique value proposition

Too often, businesses try to entice by promising more than they can fulfill. The fact is that everyone can’t be your customer, so communicating exactly what you offer to prospects will differentiate you from others they might be considering. This unique value proposition is something prospects should understand once they land on your website, and without the need to scroll. It should, with simple words, address their current problems and provide solutions. An additional tip is to focus more on the benefits your product offers rather than its features. This way, visitors can easily picture how your product will solve their problem. 

Related: How to Develop a Winning Value Proposition (Infographic)

3. Remove friction in a customer’s journey

One of the best ways to increase conversion rate is by making every part of a customer’s journey seamless. Hurdles like multiple CTAs, long sign-up forms and frequent pop-ups contribute to reducing the rate. For example, let’s discuss the impact of long sign-up forms. Hewlett Packard recently reported a 186% increase in email opt-ins after it trimmed form fields, and Neil Patel, co-founder of Neil Patel Digital, saw a 26% increase in conversions simply by removing the “Revenue” field from one form on his site. While considering the best form length, keep in mind that a Hubspot survey showed the average length is five fields long — a good figure to shoot for to produce the highest conversion rates. So, if customers at the moment have to fill out 11 fields before buying your product, cut it down to five at most.

Other methods of reducing user friction include removing distracting ads and pop-ups, speeding up website load time and reducing the website’s cumulative layout shift.

Related: Video: How to Increase the Conversion Rate on Your Ads

4. Encourage small commitments

Taking a cue from the average conversion rates across industries, it’s clear that a massive percentage of customers are not buying products immediately after they see them. For the most part, they are interested in buying, but are simply not ready to decide… yet. Encouraging small commitments that provide benefits influences this buying decision. Instead of using a “Place Order” link, consider changing it to “Talk to an Expert” — this way, you’re positioning your business as one that helps customers make informed decisions. 

5. Conduct A/B testing

There’s no one fix-all when it comes to increasing conversion rates. Some methods will work for you, others won’t, but you can only know the difference when you A/B test your website. Assess it first by running a heatmap tool like CrazyEgg, HotJar or Smartlook to help you see what parts are most active and which aren’t. Then, you can quickly pinpoint what sections, links or pages you need to optimize for better conversions. 

More broadly, once you make changes to any part of your website — whether layout, color gradients, CTA, copy, headlines, etc. — test it with your audience and compare results. This way, you can make better decisions that will have a positive impact.

Related: 5 Game-Changing Ecommerce Trends in 2022

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Conversion Lessons from the Luggage Industry

Broad economic trends impact conversions. A prime example is the luggage and travel-accessories market, which experienced a 60% decline in 2020.

The pandemic had drastic effects on both production and sales, challenging online merchants to find unique ways to entice consumers to purchase items they might not put to immediate use. The mid-range luggage market, which focuses on value instead of price, teaches us a great deal about today’s savvy consumers.

Led primarily by independent, direct-to-consumer manufacturers, successful mid-priced luggage and travel-bag sites are setting the pace for conversion practices.

Here’s why.

Selling to Savvy Consumers

Emphasis on value. Showcasing what makes a product more durable and long-lasting than lower-priced competitors is critical. Using text, photos, and videos to highlight reinforced stitching, no-catch zippers, and sustainable design justifies higher price points.

Informative images that show the product from many angles, inside and out. Consumers want to know exactly what they’re buying. Using product images to educate shoppers about look and functionality is crucial. Any time visual content (reinforced by text somewhere on the page) can answer a question, you’ve increased the chance of a conversion.

The Away store provides 10 or more images for its products, giving a 360-degree view. Then, it breaks out the most important features into large, detailed photos and videos.

Product page: Away luggage on displayProduct page: Away luggage on display

Away highlights product design and functionality.

Another benefit of quality images is conveying a product’s design and aesthetics. This can get people talking about a product, even if they have no intention of buying it.

Real-life solutions. “How much can it hold?” is one of the most frequently asked questions about any suitcase or bag. Dimensions aren’t sufficient, and neither is the number of travel days. Images and videos showing various packing scenarios keep shoppers engaged and more apt to convert.

Solving both everyday and unique dilemmas can also boost the purchase of products as gifts. For example, Brevite designed its Jumper backpack for cameras. However, it can organize many items, including crafting supplies, toys, and food containers.

Images of Brevite backpacks being used different waysImages of Brevite backpacks being used different ways

Showcase products being used in different ways. Brevite designed its Jumper backpack for cameras. But it can organize many items beyond photography goods.

When possible, incorporate short explainer videos. These help customers visualize how they could use the product. Brevite’s 41-second “Daily Packing” video shows how much the backpack holds without overstuffing.

Let customers do the talking. Customer reviews, especially on video, are big conversion boosters. They can point out a product’s unique features and explain alternate uses. For example, some Brevite customers have touted the company’s camera backpack as an ideal diaper bag.

Reviews also convey customer loyalty and trust, a huge conversion factor. By encouraging customers to share their stories, merchants can build massive audiences.

Easy purchasing. Many top travel gear merchants offer flexible payment options, including installments. With price points of $100 to $400, being able to pay over four months helps close more sales. Many buy-now, pay-later providers immediately remit the total purchase price (less fees) to sellers, who carry no collection risk if customers fail to pay.

Remember, too, that shoppers are likely on smartphones. Streamline the checkout process and never ask for unnecessary info.

Live chat. Shoppers want answers fast. On-site chat provides instant help. Email and phone support, while useful, takes longer, increasing the risk of shoppers moving on to a competitor. And offering real-time assistance at the point of sale guides buyers to close.

Opportunities

You are likely missing out on revenue-generating opportunities no matter what you sell. Studying unrelated industries can expose innovative ways to attract more customers. Start with the luggage industry. It proves there’s room for growth amid debilitating circumstances.

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Why Purpose-Driven Marketplaces Are the Antidote to Amazon

Opinions expressed by Entrepreneur contributors are their own.

As the child of a nomadic entrepreneur, I moved around a lot. I’ve been to 45 of the 50 U.S. states and lived in eight. It wasn’t until my early 30s, however, that I made my way to Oregon and the “maker city” of Portland. The culture was like nothing I’d experienced. Walking down the neighborhood streets, free of chain stores, it dawned on me how rare it was to be in a community where local, small businesses thrive. 

In the early days of the crisis, the world digitized. We learned, worked, exercised and shopped online. In what many thought would be a temporary shift, the visibility and convenience factor of ecommerce giants like Amazon has endangered our small . A survey by the Institute for Local Self-Reliance reveals three-quarters of independent retailers see Amazon’s dominance as a major threat to their survival. It is. 

From 2007 to 2017, while Amazon secured its ascent, the number of small retailers fell by 65,000. About 40 percent of the nation’s small apparel, toy and sporting goods makers disappeared, along with about one-third of small book publishers. 

It doesn’t have to be this way. Values-based marketplaces are emerging to promote local, small businesses on a global scale. These online hubs enable consumers to find products based on what matters to them most. They are the digital equivalent to knowing the maker down the street, and they might just be the antidote to Amazon’s war on small business — that is, if consumers buy in.

Related: The Future of Online Shopping Is ‘Buy Now, Pay Later’

Behind the curtain of Amazon’s “benevolent monopoly”

In Dave Eggers’ new satire The Every he paints a dystopian future where a fictional search engine company buys an ecommerce giant. The corporate juggernaut algorithmically controls access to everything from housing to food to jobs, however, its abuse of power is disguised under what Eggers calls “benevolent market mastery.” 

In the non-fiction world, the real Amazon invests a lot in PR efforts to portray itself as a community player that has “a mutually beneficial relationship” with small businesses. Yet only 11 percent of companies selling on its site describe their experience as successful.

From cornering the online market and blocking small businesses from having relationships with their customers to selling goods below cost to dominate market share, Amazon’s benevolent optics are stained with unscrupulous practices. 

I’m not suggesting ecommerce giants such as Amazon don’t have a place in the market. If a customer lives far away from a major city and can’t buy bandaids or key medical supplies, they should be able to get their commodities online. However, when these massive global corporations promote a destructive cycle of production, consumption and convenience at all costs, we have to stop and ask ourselves: What will our retail world look like 10 years from now?

Related: 5 Online Shopping Trends to Watch This Holiday Season

Convenience is killing our retail biodiversity

Last year, as I was setting up my Portland home, I needed a dresser and conveniently purchased it on Wayfair. The next day as I was driving around my new neighborhood, I realized there was a local furniture store five minutes away with great stock. It wasn’t from a lack of desire that I hadn’t stopped there before, it was a lack of awareness. 

The lack of awareness for small businesses through online search is an internet-wide problem. Ads and SEO-savvy corporations dominate both paid and organic search creating an unlevel playing field for local shops. Only two percent of brands own the first page of search results on Google and it’s only getting worse. 

Values-based marketplaces can change this. As consumers become more aware of where to go shopping based on their values, they can consciously choose to bypass tech giants such as Amazon. This is how we can build a more sustainable and diverse small business economy. 

When you buy from a small business in your neighborhood, that money circulates back into the local economy supporting local job growth and paying for community infrastructures such as public schools and hospitals. When you buy from Amazon, 30 percent of your money goes back to Amazon. Think about that. Was it your intention to fund Bezos’s space race? 

Thankfully, more people are realizing the power of their buying habits and use them to shape the future they want to see. In 2020, Gen Z and Millenials spent $3 trillion shopping from businesses that reflected their values. 82 percent said they’d spend more to support local businesses post-pandemic. 

Eggers’s dystopian vision of an America ruled by corporate dictatorship is a cautionary tale of what can happen if we don’t realize the real cost of our spending decisions. I’d argue that we’re standing on the edge of that cliff. 

Still, I am optimistic in our ability to make different, better choices. In the past year, we’ve seen people come together to change laws systematically designed to suppress entire populations. I believe we can all learn to shop our values. It’s time we embrace our power as consumers, one click at a time.

Related: 14 Tips for Safe Online Shopping

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Do you want to export? eBay launches its second round of support for Mexican SMEs
This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.

Opinions expressed by Entrepreneur contributors are their own.

Do you want to export? eBay launches its second round of support for Mexican SMEs

Depositphotos.com

If you are the owner of a small or medium-sized business, eBay will

The sanitary measures necessary to stop the coronavirus pandemic made small and medium businesses face major adversities. Faced with this situation, eBay launches the second round of My business 24/7 on eBay , a platform where companies can sell online to everyone.

Need for digital commerce

The closure of non-essential businesses has caused different companies to significantly reduce their income. Faced with this situation, many businesses chose to promote their e-commerce practices, since this became their main source of income during the first months of the health crisis.

Not wanting to dabble in ecommerce is simply refusing the future of sales. That is why eBay Mexico has entered the scene by developing My business 24/7 on eBay where small and medium-sized businesses can use e-commerce as a vital tool to increase their sales.

What is My business 24/7 on eBay?

My business 24/7 on eBay a platform that allows SMEs to have their own online sales channel through eBay, with unique benefits and the possibility of exporting their products to different parts of the world in the most fluid way possible.

The advantages that include when joining this program are:

  • Business development program: Businesses that have more than 100 products to export will be able to apply for the program through this form and after receiving confirmation, they will receive eBay support for the entire process.
  • Free eBay Premium Store or Super Store – eBay will provide the store subscription level that best meets the needs of the requesting business. This store will have no cost for the first three months and they will be able to publish between 1,000 and 10,000 ads.
  • Personal manager for the development of their business: Businesses will have access to a personal manager who will work hand in hand to support them to export on eBay in the most efficient way.
  • Training program: eBay will provide you with a special training program to learn about all the platform’s features and learn about the details of each of the sales steps. From creating your account and uploading your inventory, to communicating with your buyers.
  • Higher sale limits: Increase in the limit of ads that are entitled to run, at no additional cost to allow faster growth.

Depositphotos.com

Requirements to participate

All businesses that are interested in being part of “My business 24/7 on eBay” must fill out theform found here until December 31, 2021. Once completed, the application will be evaluated by a group of experts from eBay to approve or deny it, depending on the experience the company has in selling online.

A couple of examples of the requirements that will help businesses have a better chance of being selected for the program are:

  • Have more than 100 products in its catalog to export to other markets.
  • Have experience selling online, either through your own website or in other marketplaces.

Once the company is selected, it must commit to developing a business plan together with eBay in a period of six months to one year.

Even if your company is not selected to participate in My Business 24/7 on eBay, this does not exempt them from uploading their products to the marketplaces. on eBay and increase your income through that platform.

Results of the first round and investment for the second

In the first round of My Business 24/7 on eBay launched in April last year, more than 800 businesses from the aforementioned countries applied for the program. So far, more than 50% of the 800 companies that applied have been approved to begin their induction process so that they could begin to receive the unique benefits that the program offers.

Most applicants sell clothing, shoes, and accessories, but also office supplies, auto parts, and home and garden items. Thanks to these businesses that were pioneers in this program, we can say that Latin American SMEs are ready to start selling through online commerce to the whole world.

The second round of support contemplates an investment of 5 million pesos and will seek to support even more SMEs to exponentially increase their market and income.

“This second round of support for Mexican businesses seeks to create economic opportunities for them, especially for those who have faced difficulties due to the pandemic and are looking for alternatives to accelerate and expand their online sales,” said Ilya Kretov, general manager of emerging markets global eBay.

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Why Amazon is Poised to Further Command the Ecommerce Space

Opinions expressed by Entrepreneur contributors are their own.

In 2020 alone, U.S. online ecommerce grew by an astonishing 32.4%, totaling $791.7 billion in online consumer spending. Part of the resulting effect is that online stores are increasingly grabbing sales from physical locations, as consumers are expected to spend more than $1 trillion through digital retail channels in 2022. Additionally, older consumers who never used to engage in ecommerce are now going online for their needs, particularly as they apply to health concerns. And even after commerce returns to a semi-post-pandemic normal, these people are likely to keep shopping online.

Amazon is poised to own the lion’s share of these ecommerce gains. It simply dominates the online space, with Digital Commerce 360 estimating the company represented more than a third of all ecommerce spending in 2020. The reasons for this are many, but include gained trust of shoppers thanks to an “A-to-Z guarantee”, that its refund and return policies are standard-bearers, and the one- to two-day shipping available for Prime members. In a 2019 Feedvisor survey among U.S. shoppers, 89% said they are more likely to buy from Amazon than other ecommerce websites.

Related: How to Start a Multimillion-Dollar Amazon With Less Than $2,000

Interestingly, it’s actually third-party sellers that stand to gain the most from Amazon’s continued rise. The company is, in part, a platform for third-party brand owners to sell their products — essentially the world’s largest shopping mall. Amazon gets a cut, but most of the money shoppers spend on the platform goes to third-party sellers, which range from massive name brands to those owned and operated by relative unknowns. According to Statista, third-party sellers are Amazon’s single greatest revenue generator for all its retail sales. It’s incentivized to help such brand owners make money, since that’s a win-win-win: The seller wins with a sale, Amazon wins via referral fees for facilitating the sale and the shopper wins for getting the best product for the best value.

Another future-bankable asset for the Seattle-headquartered giant is that when shoppers trust Amazon, that faith transfers to the often consumer-unknown branded products it sells (and that shoppers can also lean on Amazon reviews to help further validate product choices). In 2020, a survey published by Statista asked U.S. consumers, “How often do you use Amazon to discover new products or brands?” Over half of respondents said they use the site “sometimes” to do just that. An additional 23.6% said they use Amazon “frequently” to discover new products or brands. That means hundreds of millions of shoppers are open to and buy from new brands there, so vast potential is there.

Related: Why You Should Start (or Buy) a Fulfillment by Amazon Business in 2021

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Gas Station Coffee Spurs Golden Ratio Founder

Solving a personal hardship may be the most common motivator for starting a business. Felipe Correa launched Goodspread when he couldn’t find suitable remedies for his eczema. Shreya Patel founded Hyve to address her need for toxic-free household cleaning goods.

Clark Nowlin’s hardship was acidity in coffee. He told me, “I used to be a full-time touring musician, playing in rock bands, drinking rural gas station coffee or Starbucks. It wrecked my stomach. It was because of coffee’s acidity.”

Golden Ratio Coffee is Nowlin’s solution. It’s a producer of low-acid coffee. He founded the business last year in Austin, Texas, and it now sells direct-to-consumer in all 50 states.

He and I recently discussed the company’s launch, raising money, growth plans, and more.

Embedded below is our entire audio conversation. The ensuing transcript is edited for length and clarity.

Eric Bandholz: Golden ratio. That’s a photograph thing.

Clark Nowlin: Yes. We did not make up the golden ratio. We just apply it to our products. We want to be the golden ratio between you, your morning, and your caffeine. Listeners should search Google for “golden ratio.” It’s a beautiful natural aesthetic, the number is 1.610803, repeating.

If you plot it, it makes a beautiful spiral. It’s a natural phenomenon. We are grateful that golden ratio, the phrase, was available for us to name the company.

Bandholz: You make Golden Ratio Coffee. It’s a lightly roasted coffee in tea bags. It doesn’t have the same acidity as traditional coffee, but it’s not weak, either. Walk me through how you came up with the brand and the process.

Nowlin: It helped that we could start with a naturally beautiful aesthetic. Most people that know about the golden ratio are architects or photographers. We are grateful to have started with a blank canvas to create our brand around. Our packaging uses variations of different circles. It was inspired by what the golden ratio already is.

Our brand was born out of a desire to help people feel good. I had trouble drinking regular coffee. I used to be a full-time touring musician, playing in rock bands, drinking rural gas station coffee, or Starbucks. It wrecked my stomach. I had to stop drinking coffee altogether. It was because of coffee’s acidity.

I then discovered a popular, low-roast coffee in the Pacific Northwest. It didn’t hurt my stomach. But outside of Seattle, no one had heard of it. So that was my call to entrepreneurship.

I started the brand to give folks access to low-roast coffee because it solved a big problem for me, and I thought it would help others, too.

Bandholz: When I lived in Spokane, Washington, my business partner told me about the brand you mentioned. She called it white coffee. That was 2011, 2012. You’ve greatly expanded that market. Why use tea bags versus traditional ground coffee?

Nowlin: We asked ourselves, “Do we just sell ground beans, cans of coffee, or wholesale to coffee shops?” We found the tea bag format interesting. Initially we cold brewed it, and the tea bags were amazing for that because you don’t need additional equipment — just need water and time.

So that’s why we picked the tea bag, for ease of use. We also had accessed focus groups for feedback. One of our investors, Noah Kagan, who lives here in Austin, told us, “You can come to our office and give our employees free coffee. We’ll give feedback.”

Some folks thought our coffee tasted like tea. So we needed to know if it was coffee for tea people or tea for coffee people.

We learned that from a packaging perspective, it didn’t matter. People associated us with tea. So if we put it in a format that was more like tea, the adoption would be easier. When we presented it as ground coffee, one in six people in the focus groups said, “I hate this!”

We put the same product in a tea bag, and zero out of 100 people hated it.

So we align more with consumers’ subconscious expectations by using tea bags. I also learned that people brew coffee in a hundred different ways — Chemex coffee makers, french press, drip machine, you name it.

We made it very simple with the tea bag. However, we’re launching our ground coffee bags in November. We’ll see how that goes. We’ve had roughly 11,000 people opt-in to receive it. We might find out in six months that the whole tea bag thing was just a waste of time.

Bandholz: So you’ve been in business for about a year. You sell direct-to-consumer and advertise on Facebook.

Nowlin: Yes.

Bandholz: What is the long-term vision? Will you stay direct-to-consumer or expand into other channels?

Nowlin: We definitely have the vision to be in multiple channels. In 10 years I could see us in every type of channel, even a ready-to-drink version.

But at the beginning, we’re focusing on that one thing. We’re selling in all 50 states now. We could make a can or sell ground beans or whole beans. We could venture into pour-over stuff. Before you know, we’d have a lot of SKUs. We’re not big enough to justify that much product and operational muscle.

Bandholz: You’re wise beyond your years. Beardbrand made all of the mistakes you’ve just described. We were trying to do everything for everyone. We had European fulfillment, for example. The deeper penetration you can get with limited SKUs, the better.

Nowlin: For sure. But it’s easy to fall into an entrepreneurial trap of making a bunch of new stuff. It’s fun to make stuff. But you launch 10 things at once, and you’re surely not going to have any meaningful marketing penetration if you’re constrained by resources, which we are.

Bandholz: Let’s go back to your early days, attracting investors.

Nowlin: When it comes to raising capital, investors want to provide gasoline money to take your car to the next location. That’s not very useful if you do not have direction.

I didn’t want to take outside money until I felt confident we could deliver it back in multiples to the investors who gave it to us. Also, I had taken a lot of risks by starting the business without any outside money.

I was fortunate I had a financial runway from my last job. When that ended, I took all my chips and put them in this business. So I drained my savings to get all the products developed and put the core team together. I could then present it to an investor and say, “This is real. It’s going to be in tens of thousands of homes in the next year.”

That helped us raise capital because investors could see the impact happening quickly. The speed at which we could bring in money was due to having already spent a lot of money. I had taken the risk. I’m still our company’s largest investor.

Bandholz: So you had the brand built and the products researched and developed.

Nowlin: That’s right. We hadn’t sold anything yet, but we had set up the supply chain and developed the products, including early prototypes.

We needed investors to meet the minimum order quantities at our supplier. I could not do that on my 401(k) budget. Fortunately, investors responded.

Bandholz: How did you find them?

Nowlin: Austin is a very entrepreneurial community. Several of our initial investors were successful business people I’d known for 3, 5 years. It was angel investing.

It’s better to bring in money when you’re not held to the numbers. You get people excited about the vision. Otherwise, you’re accountable for actual revenue growth. So the timing is important. Wait too long, and if you don’t have great numbers, it’s much harder to raise capital.

We brought in some investors out of necessity before we had customers. Fortunately, the numbers were good after the launch — roughly 40% month-over-month growth. That helped us bring in more money. We’re now 15 months in and haven’t needed more capital.

Bandholz: Walk me through your growth strategy. Doing it on Facebook for the past year has been difficult.

Nowlin: The lesson for us is to sell more expensive products. It doesn’t matter what you’re selling. The cost per acquisition on Facebook is likely $50 or more. Back in 2017, $8 CPAs on Facebook were common, but not today.

Our average order value is about $30. So it doesn’t work to pay $50 to get a customer who pays you $30.

The good news for us is we have a healthy reorder rate. It’s kept our business alive. One in five customers that come from Facebook ads reorder. So that’s how we can afford the $50 CPA or $75 or even $100. The lifetime value of those customers is hundreds of dollars, not $30.

Also, we’ve started our foodservice business. There are several coffee shops in Austin that sell Golden Ratio Coffee. That’s an exciting way to get people exposed to our brand without paying Facebook $50 to try it.

We have a corporate gifting program as well. We have several companies who buy for customers and employees. It helps that our tea bags are easy to mail — just put one in a regular envelope.

Bandholz: Where can people learn more about you and support your company?

Nowlin: DrinkGoldenratio.com is our website. The company is also on Instagram. I’m on LinkedIn and Instagram.

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WhatsApp Business launches the new 'Collections' feature to organize your products and make shopping easier. See how it works.
This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.

WhatsApp Business has excellent news for entrepreneurs and consumers who use the platform. The messaging app has just launched the new ‘Collections’ feature to make shopping easier.

Cortesía WhatsApp Business

WhatsApp Business ‘Collections’ will help sellers better organize their products, while buyers will save themselves from browsing through huge listings to find what they want.

Until now, users had to review the entire product catalog and then choose their favorites, add them to the shopping cart and pay, all from WhatsApp chats.

Companies and entrepreneurs can upload a maximum of 500 products or services to the catalog, and now they can create lists of products by category . This feature makes searching easier and improves the customer experience , while optimizing the sales process .

“People can now view a business’s products directly in their business profile, and today we are rolling out collections of catalogs for small businesses around the world. Collections allow businesses to organize the items in their catalogs by category, so that customers no longer have to scroll through long lists of items to find what they are looking for , ”the company said in a statement.

“For example, a restaurant can create collections with starters, main courses and desserts; A clothing store can add collections for men’s clothing, women’s clothing, shirts, pants, and more. Once people choose what to buy, they can add it to their cart and send the order to the company, ”they explain.

The new feature will come to WhatsApp Business users at the best of times, as they prepare for the end of the year sales season.

“We want WhatsApp to be the best way for people to buy goods and services, and for businesses to connect with their customers, so we are facilitating the way users see a company’s offer on WhatsApp, just in time for the Christmas season , they point out from the platform owned by Facebook.

If you haven’t yet considered using WhatsApp Business for your business, you should. A recent study by Ipsos , 27% of people in Mexico who use WhatsApp have used it to buy or search for products more frequently since the start of COVID-19.

If you have a business and want to master the ‘Collections’ function of WhatsApp Business , here is the tutorial to learn everything you need:

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4 Simple, Proven Ways to Improve Your Customers' Ecommerce Experience

Opinions expressed by Entrepreneur contributors are their own.

These days, customers can access your from anywhere in the world. While smart devices and ecommerce have leveled the playing field like never before, the fact remains that the vast majority of people who visit your site aren’t going to make a purchase.

In fact, research from Growcode shows ecommerce conversion rates ranging from 3.79% in the arts and crafts niche to a mere 0.99% for baby and child products. While you’ll never convert every customer, implementing some proven tactics that improve the ecommerce experience will go a long way in helping you surge ahead of industry benchmarks.

1. Start with your online layout

Ecommerce founders should think of their website as a digital version of a traditional brick and mortar store. There is a big difference between entering a store where everything is clearly laid out and organized in a logical manner, as opposed to a store where it’s impossible to find what you’re looking for.

The same is true of your website. Intuitive navigation should make it easy for visitors to find your products. A fixed top menu bar with a limited number of navigation options serves as a good starting point. If your website sells several product categories, these should generally be part of a drop-down menu. A robust search system with several categories and filters can also make it easier to find products.

Quality web design will ultimately guide customers to where you want them to go. Pair an intuitive layout with plenty of white space and you’ll have a very user-friendly site.

Related: Building an Ecommerce Website: 8 Technical Aspects You Need to Know

2. Up your packaging game

No ecommerce customer wants to receive a damaged shipment. Because of this, ecommerce retailers would be wise to invest in custom packaging features to protect items while in transit. Cardboard, pulp, foam or plastic inserts keep items in place and offer protection from bumps and jolts.

Personalized packaging can even make the act of opening the box a brand experience. From the box itself to cards with special discount codes, you can create excitement from the moment an order shows up on a customer’s doorstep. The popularity of unboxing videos can even create new opportunities for social media growth.

Packaging can have a direct impact on your company’s sales. In a case study from Packlane, Father Time Bread saw a 20% revenue increase and 25% growth in its subscriber base after introducing a custom-designed box with inserts that protected the bread while in transit. Reducing shipping complaints improved the and ultimately increased sales as well.

3. Create an in-person experience with product pages

The product page is where customers will make their initial purchasing decision. Since they can’t see or touch the product physically, it is important that you create as robust and tangible of an experience as possible through the product page.

High quality pictures are an obvious must-have. In addition to showcasing the item from different angles, it can also be helpful to include at least one picture showing it in use. Good lighting will make the product more visually appealing. Similarly, some websites even include videos or 360 degree visualizations to provide a more robust learning experience.

Your product description can also go a long way by showcasing the brand’s personality while highlighting benefits and features. Keep it short and sweet, only focusing on necessary details. Give customers the ability to leave reviews for individual products as well — according to Qualtrics, 93% of customers will read reviews before buying.

4. Streamline checkout

While the product page can convince someone to buy, your checkout process must be easy to use in order to close the sale. According to Baymard Institute, the average shopping cart abandonment rate is 69.80%, with top problems being expensive extra costs, a site wanting users to create an account, or a process that was too long or complicated.

The fewer clicks customers need to make to finalize their purchase, the better. While there’s nothing inherently wrong with giving customers the option to create an account, guest checkout should always be an option. Limit forms to information that is absolutely necessary to complete the order — such as a shipping address and payment information. Allow for additional payment options besides credit cards (such as digital wallets) so you can better meet the needs of today’s customers.

Trying to bombard your customer with more ads and product suggestions when they’re trying to go through checkout will only slow them down and make them more likely to click away. Be transparent regarding shipping options and fees early in the process so they don’t abandon their cart at the last minute.

Related: 4 Top Tips to Optimize Your Online Checkout

On the surface level, the aforementioned tips seem stunningly easy. Yet ecommerce brands fail to implement many of these practices. Whether a shopper has trouble navigating your website or can’t get ahold of customer service, such setbacks create very real roadblocks that keep you from growing your customer base.

By taking a little extra time to fine-tune the ecommerce experience, you can have confidence in your ability to delight your customers — and get them to buy from you again in the future.

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