🌀 Zalando vs Shein Impact 🆚

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Welcome to MarketMaze, the #1 newsletter for staying on top of the latest in Marketplace and E-commerce. Get all the insights you need in just five minutes!

🌀This week’s maze:

1. The Big Story 🧠
Zalando vs Shein Impact 🆚

2. Data 📊
China vs US, 3P vs 1P 🤼

3. News on Ecommerce ecosystem 📖
🗞🇺🇸 PayPal raises merchant fees starting Jan. 13
🗞🇬🇧 UK sellers halt EU sales due to new rules
📣🇪🇺 Meta fined €251M over 2018 data breach
📣🇺🇸 Google unveils AI to navigate the web for users
🦄🇮🇱 Justt raises $30M for AI chargeback growth
🦄🇺🇸 HubSpot to Acquire Frame AI for Growth

+ over 15 other hot news from the last week you need to know 🔥

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🎁 A Small Gift and Warm Wishes
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Oxford Economics reveals Zalando’s €9.5B GDP impact and 113K jobs in Europe, vastly surpassing Shein’s €1.1B GDP and 6K jobs (analyzed already by us here). With just 30% more revenue in Europe, Zalando achieves 9x GDP and 19x employment impact by prioritizing local supply chains.

🌍 Zalando’s Economic Lead Over Shein

Zalando outperforms Shein in Europe, driving a €9.5B GDP impact—9x Shein’s €1.1B—despite just 30% more revenue. Oxford Economics reports that Zalando supports 113K jobs, 19x more than Shein’s 6K, thanks to its local supply chain and stronger economic integration.

📈 How Zalando Creates Value

Oxford Economics shows 60% of Zalando’s €9.5B GDP impact comes from its supply chain. Induced effects from wage spending add 25%, while 15% is direct impact. The 113K jobs are mainly indirect, emphasizing Zalando’s supplier-driven economic influence in Europe.

💼 Europe-Focused Procurement Strategy

Zalando spent €8.4B on procurement in 2023, with 57% on merchandise like clothing and 43% on logistics and IT. Germany and the Netherlands benefited most. This localized focus strengthens European industries, contrasting with Shein’s limited procurement impact.

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Chinese brands surpass US sellers on Amazon, with 24.7K making $1M+ annually. 3P brands also grow 2x faster than 1P brands. Data from Scott Needham and SmartScout (1, 2) reveals the shifting dynamics in Amazon’s third-party marketplace.

📊 Chinese Sellers Outperform US Brands

Chinese third-party brands are leading Amazon, with 24.7K sellers earning $1M+ annually versus 15.1K US sellers. Data from Scott Needham and SmartScout shows Chinese sellers excel with newer ASINs (1.7 vs. 4.2 years), lower prices ($26.8 vs. $28.8), and minimal ad spend (56% of US levels).

🚀 3P Brands Double 1P Growth Rate

Third-party brands grow twice as fast as first-party brands, at 8% vs. 4% annually. 3P brands focus on new products (2.8 vs. 3.9 years ASIN age) and spend 246% more on sponsored video ads.

🇺🇸 PayPal raises merchant fees starting Jan. 13. PayPal will raise fees for U.S. merchants using its services like BNPL and advanced card payments. The BNPL fee jumps to 4.99% + $0.49 per transaction. The changes start Jan. 13, 2024, under CEO Alex Chriss's focus on profitability.

🇩🇪 Decathlon Germany unveils a digital revamp. Decathlon Germany has upgraded its platform with faster speeds, rentals, used goods, and services like coaching. Customers can mix rentals, purchases, and bookings into one cart. A step towards a seamless, sport-focused future.

🇪🇺 MediaMarkt expands marketplace to 3 countries. MediaMarkt's online marketplace revenue doubled in 2023-24. The retailer is now expanding to Belgium, Poland, and Turkey. Ceconomy aims for $800M in marketplace GMV by 2026, driving growth with new sellers, products, and services.

🇺🇸 Google unveils AI to navigate the web for users. Google's DeepMind launched Project Mariner, an AI agent that performs actions like humans online. Tested with Gemini tech, it navigates websites, shops, and manages forms. Though limited, it hints at a web-use revolution. Released to testers on Dec. 11, 2024.

🇪🇺 Google ends test, critiques EU's DMA enforcement. Google stops a hotel-search test after EU's DMA concerns, claiming traffic fell 10% for hotels. The EU is investigating Google’s compliance with DMA rules, with potential fines of 10% of global revenue looming. Stakes remain high for all.

🇺🇸 Instagram to Surpass 50% of Meta's US Ad Revenue. By 2025, Instagram will generate over 50% of Meta's US ad revenue, driven by Reels and potential gains from a TikTok ban. Feed and Stories dominate now, but Reels is growing fast, expected to claim 9.6% in 2025.

🇦🇺 Loop acquires Wonderment to enhance operations. Loop acquires Wonderment to integrate real-time tracking, AI tools, and seamless returns, benefiting 6,000 Shopify brands. CEO Hannah Bravo aims to enhance transparency, boost retention, and streamline commerce operations. Deal announced Dec 10, 2024.

🇮🇱 Justt raises $30M for AI chargeback growth. Justt raised $30M in Series C, hitting $100M funding. Revenue doubled in 2024, and new funds aim at global expansion and enhancing AI tech for chargebacks. CEO Ofir Tahor targets profitability by 2027, tackling $54.5B in merchant chargebacks.

🇺🇸 HubSpot to Acquire Frame AI for Growth. HubSpot is acquiring Frame AI, an AI-powered platform, to unify structured and unstructured data. This move will enhance customer insights, optimize strategies, and improve its AI tools. CEO Yamini Rangan calls it a key step for smarter business growth.

🇺🇸 Cart.com boosts logistics with OceanX acquisition. Cart.com acquires OceanX from Guthy-Renker, gaining 600K sq ft, 200 staff, and key beauty clients. It now operates 17 centers with nearly 10M sq ft, driving better supply chain control for iconic brands like Smileactives and Westmore Beauty.

🇺🇸 Parafin raises $100M to expand finance tools. Parafin raises $100M in Series C funding to scale financial tools for small businesses. CEO Sahill Poddar highlights growth with partners like Walmart. The company projects profitability in six months with 4x growth since Series B.

🇻🇳 OnPoint acquires CREA, expands in e-commerce. OnPoint acquired CREA on Dec 18, combining forces to dominate Southeast Asia’s e-commerce. Together, they serve 250+ brands, employing 1,600+ staff, and aim to lead the $370B market projected by 2030.

That’s all. See you next time in the 🌀Maze!