In what could be the biggest security breach in history, Ebay may have lost personal data for 233 million accounts. Long story short – hackers got access to employees’ corporate network credentials, probably by phishing. They than accessed and extracted user data saved on Ebay databases, including addresses, date of birth, usernames, emails and passwords, which Ebay officials mentioned were encrypted. There is yet no report of hackers stealing credit card info from PayPal (an Ebay subsidiary).
Ebay was “quick” to notify its users on the breach – it only took them three months to discover and communicate what could now be the largest cyber-attack on an American company.
Is there more to this security breach and others?
One can only notice the similarities between this breach and the one that previously put Target CEO out of job. In the previous biggest cyber-attack on an American company, Target lost personal data for more than 110 million of its customers, some of which included credit card info.
In the aftermath the company was heavily investigated by law enforcement as well as the secret service. The company hired a new CIO following the security breach, Bob DeRhodes, a former security analyst for the US Department of Homeland Security, US Department of Justice and the US Secretary of Defense.
The fact that Target customers’ credit card info later showed up on Russian underground forums, as well as involvement from national security specialists, points to something closer to cyber warfare than your everyday phishing.
There will be others
The shady practices employed by the NSA to gather intel have probably left the Internet a less secure place. If it weren’t for Heartbleed, a vulnerability the agency has allegedly kept secret, or other backdoors, tracked and harnessed in the interest of “national security” – probably Ebay wouldn’t report losing more than 200 million accounts today.
Now I’m not saying that some groups left american tech companies with heavy security gaps. And I’m not saying that some former agent / analyst of theirs is halfway across the globe in a country known for its history of espionage and overall unfriendliness toward US. But probably someone should say it.
Ecommerce startups need flexible, easy to set up and cheap solutions when it comes to software. A few companies provide such solutions and probably the best known is Magento, which can accommodate a wide array of startups.
However, Magento does have some issues and when it comes to small ecommerce companies, it might not be the best choice. Issues ranging from bloated code, unreliable support when it comes to finding the right development team make it hard for small companies to implement it. As you’ll see below there is one contender to Magento’s reign that you should definitely check out if you’re planning on starting an ecommerce company.
That contender is PrestaShop, a flexible and easy to setup open source application.
A brief history of PrestaShop
The company that now develops the product was founded in 2007 by Igor Schlumberger and Bruno Lévêque. The duo thought they could bring a better open source solution to the market and they did just that. Bruno, having a background in both tech and business, developed the first version of PrestaShop, which was downloaded 1000 times in the first month. Now PrestaShop runs on more than 185 000 stores world wide and has more than 600 000 registered contributors.
As Bruno Lévêque, founder and company CEO was unavailable at the time for a statement regarding the company vision, I’ll just go ahead and assume that they’re planning on increasing the install base and further develop the application. As they’re pushing forward with the new version, it’s becoming obvious that the two main opensource applications that small and medium companies will be able to chose from in the future will be Magento and PrestaShop. So it’s probably a good thing to know a thing or two about the upcoming champion.
PrestaShop’s Business Model
When deciding what platform to run your store on it’s important to think about the company developing it. How is it organized, why does it exist and of course – what’s the business model? What keeps the company afloat? That way you can know whether it’s here to stay or not.
Fortunately – PrestaShop is developed by a growing company, with offices throughout the world and a very interesting business model: they give out the application as open source but they charge for special modules and themes in the … aham … PrestaShop shop.
The company also charges for support and training services, which might come in handy when the online store or the development team evolves. If you’re more into online documentation – there are plenty resources out there, starting with the Developer Guide.
PrestaShop Version 1.6 has a great back-office design
Well – enough with the talk about the company – let’s get busy reviewing the new PrestaShop v 1.6. I’ll just stick to the back-office but you can have a look at the default responsive frontend theme.
What’s really outstanding about the PrestaShop’s new back-office is that it’s designed for humans. It’s uncluttered (looking at you, Magento), it’s responsive (great for quick use both on the Desktop and mobile devices) and the team managed to arrange the dashboard elements in a way you can quickly access what you need.
The top most used reports (such as sales, orders, cart value and others) are displayed on the dashboard and users can quickly check, refresh or change settings for them.
It’s not just the dashboard – all back-office sections are redesigned to provide quick access to data, in a beautiful interface:
With the new version users can get access to PrestaShop’s best features without any hassle. My two favorites are:
the customers area – there’s a great benefit in having all customer data in one place. With the new version you can get all kinds of info on the targeted customer – previous purchases, groups he’s in, internal memos about the customer, vouchers and more. Back-office operators can thus have access to a birds-eye view on the customer interactions;
the stock management – a great feature in PrestaShop is the fact you can also use it as a starting point for inventory and supply chain management. It’s light interface does the job when keeping track of inventory, inventory movement, stats and supplier orders.
PrestaShop is probably a very good choice for small and medium companies that look for open-source solutions. With the new version you’ll have an uncluttered view of your ecommerce operations and you’ll be free to upgrade your system with the help of a growing contributors community.
Twitter keeps getting closer to social commerce. The social network just announced a partnership with Amazon where users can add products to their Amazon cart with a tweet.
The process is fairly simple. Amazon customers who are also Twitter users can add products by following three simple steps:
Connect their Amazon and Twitter account
Watch for tweets containing an Amazon link
Reply to above mentioned tweets and adding “#AmazonCart”
After users follow through these steps products are automatically added to their Amazon Cart and they can buy later. If Twitter users didn’t connect the accounts or the service is not yet available in their area, they get an automated message from @MyAmazon guiding them to a specific Amazon web page describing the service:
Most avid users – the Amazon affiliates
After quickly connecting my accounts I was expecting to see a public stream of Amazon shoppers announcing their purchases.
Not even close. Right now most of those tweeting the hashtag are Amazon Affiliates asking their followers to reply to tweets containing their affiliate links.
Apparently this is somewhat of a feature, as Julie Law, Amazon spokeswoman states: “We have a significant number of customers who use Twitter, and a significant number of affiliates who use Twitter, too.“
Twitter is serious about eCommerce
The #AmazonCart partnership is probably just a first step for the two companies. Amazon is interested in social commerce and as Facebook is probably harder to steer, Twitter seems the right choice.
Twitter on the other hand, showed interest in developing ecommerce abilities by hiring ex Ticketmaster CEO Nathan Hubbard. Moreover, this year information was leaked about a potential partnership with Fancy.com and mobile payments company Stripe, involving a three way solution allowing Twitter to leverage potential customers.
Last year american retailer Target was the victim of a security breach. The hack compromised personal data for over 110 million customers. What is now known to be one of the biggest security breach in corporate history has not left the company unscathed.
On December 13th, 2013, Target executives meet with the US Justice Department. The reason: discussing a hack that exposed credit and debit card data for over 40 million customers. On December 18th security analyst Brian Krebs breaks the news. The Secret Service is involved and Target gets investigated.
On Dec. 27, 2013 word’s out that PIN numbers for the stolen cards were accessed. Target acknowledges PIN’s were accessed but says they were not decrypted. Meanwhile Russian forums get flooded with millions of credit cards.
And then it gets worse: Target declares an additional 70 million customers were affected by the security breach. The company reveals poor Holiday sales. Lays off 475 employees and reports costs associated with the data loss topping $200 million.
The breach left Target in a disastrous situation as profits dropped 46% in the last quarter (-$440 million), compared to the year before.
First the CIO, now the CEO
After the blast, some heads were sure to fall. First was CIO Beth Jacob, the obvious … target. To show it means business, the company brought Bob DeRodes on board, as new CIO and executive VP. DeRodes, 63, started on May 5th and now oversees the adoption of secure technology, with the help of $100 million worth of tech investments.
The new CIO is a tech security veteran, his previous endeavors including being a senior IT advisor for some organizations you might have heard of: the US Department of Homeland Security, US Department of Justice and the US Secretary of Defense.
But that was not enough. Chairman, President and CEO Gregg Steinhafel announced his resignation. The breach left both Steinhafel and the company in a vulnerable position.
The company announced the parts have reached a settlement that will probably allow the ex-CEO to walk out with over $11.7 million salary and incentive pay. Not bad for a CEO leaving a company that lost $941 million in its Canadian 2013 expansion, is under heavy fire from Amazon and Walmart and was just exposed to the biggest card robbery in history.
But than again, the man did work for Target for the past 35 years.
In 1972 an young man, then 22, would join his father in their family owned small tailor shop. After graduating from Waseda University he tried his hand at selling kitchenware in a Jusco supermarket but that didn’t really worked out. So after one year in the kitchenware sales business he was back to the family shop.
It took him 13 years of hard work and one day, in 1985, he opened the first unisex clothing store in Hiroshima City. The brand our young man built would soon become a global multi-billion company and in 2014 – the fastest growing online retailer in the US.
The brand you will see towering at number one in the fastest growing online retailers in the United States is proof that the Internet is indeed a leveled play field. As many economists, investors and analysts showed – the Internet is clearing the way for a border-less economy.
InternetRetailer’s top retailers list clearly shows the fastest growing retailers are a special breed of companies. From foreign investors to Google, from mom-and-pop stores turned fast growing retailers – these companies show that we’re living extraordinary times for a ever-evolving breed of new retailers. Their growth and many others’ amount to a 16.9% growth in ecommerce sales in the US. That’s one big number but it gets even bigger when you have a look at the growth rate for the five fastest growing online retailers.
No.5: Google Play – Growth rate – 162%
Google’s entertainment ecommerce business has been growing rapidly with the extended adoption of Android based mobile devices. In terms of android app sales is second only to the largest online retailer in the world, Amazon, but it seems the gap is closing fast.
The company is now one of the biggest digital goods retailer online, selling anything from music to movies, apps and games. It is also heavily pushing Android – powered mobile devices such as those manufactured by Samsung or HTC and the much praised Chromebooks.
Google Play, originally named Android Market, was launched on 22 October 2008, as an Android alternative to Apple’s App Store.
In July 2013 Google Play listed more than 1 million apps available and over 50 billion downloads since launch. The number is growing fast and it has already surpassed the App Store in terms of submitted applications and downloads. With gamers worldwide switching from PC and gaming consoles to hand-held devices, the app sales market becomes more and more attractive, thus the increased growth rate.
Google Play Sales Figures
Here are some key take-away figures to get a glimpse into Google Play’s sales:
estimated $1.3 billion in revenue in 2013
75% of all downloaded mobile apps run Android
top 200 grossing apps are cashing in on $12 million /day
No.4: Alex and Ani – Growth rate – 250%
Alex and Ani was founded in 2004 by Carmen Rafaelian. The company designs, manufactures and sells its own line of bangles, earrings, necklaces and rings.
A factory originally built by Rafaelian’s father in 1966 was home for the first manufacturing operations. Now Alex and Ani has 40 brick and mortar stores and an online store that reported a 250% increase in YoY sales.
The one thing that sets the company apart from its competition is its focus on a virtuous company ethos. Alex and Ani, originally named after its founder’s two daughters, takes pride in designing and manufacturing long-lasting, beautifully designed, hand-made jewelry. The products are somehow filled with positive energy, using carefully designed symbols that “carry their own energy and are accompanied by thoughtfully crafted and meticulously researched meaning“. Buyers are of course empowered by the jewels, which “reflect the unique qualities of the individual“. All materials and manufacturing is “Made in America With Love”. And positive energy.
I don’t know about the esoteric power of its products but the company is definately ahead of its game when it comes to customer experience. Besides adopting a multichannel approach to product sales, Alex and Ani adopted a mobile checkout process in store. The company partnered with Mobiquity to create a mPOS (mobile Point of Sale) solution that lets store associates handle payments and answer customer questions independent of fixed POS. The hardware solution is part iPod and part mobile payments processor. Each Alex and Ani store now comes equipped with up to 25 such devices. As a result store associates (or Bangles Bartenders) can bond with customers and quickly answer their needs.
Alex and Ani Sales Figures
Alex and Ani opened their first retail store in 2009. Sales that year were $2.9 million
In 2012 sales had reached $79.8 million, showing a staggering 3 years growth of 3569%
In 2013 sales reached $230 million
No.3: NoMoreRack.com – Growth rate – 250%
NoMoreRack.com was founded in 2010 by Deepak Agarval, now CEO. The company sells women, men, home, electronics, kids, and lifestyle products, through a combination of daily deals and flash sales.
Although the company has had a successful increase in sales, possibly due to it small pricing and short-term sales policy, the customer service still needs work. The Better Business Bureau lists no less than 2590 closed complaints in the last 3 years, most (1335) in the last 12 months. Customers complained about product and service, as well as delivery issues. The company seems to be improving its customer service and is willing to resolve ongoing complaints.
Be that as it may, the old saying “sales cure everything” may hold true, as NoMoreRack’s 250% increase in sales shows. But just in case – the company has a pool of cash to help it get through rough times, thanks to series A investment by asian G-Market ($12 million, 2012) and series B investment lead by Oak Investments ($40 million, 2013).
NoMoreRack Sales Figures
$325 million in 2013 sales
$78 million sold Nov 1, 2013 through Dec 2, 2013 (Cyber monday). Yes, that is one month.
No. 2: TheRealReal.com – Growth Rate – 297%
Although it may not be number one on the list, The RealReal is probably the most interesting business model on it. It is a mix between luxury sales, flash sales and consignment sales. The company was founded in 2011 by Julie Wainwright and is now the top online resale outlet for luxury goods. Flash sales cover a wide array of luxury products, ranging from clothing to jewelry to art and beyond.
Previously to being the founder of The RealReal, Julie Wainwright, 57, served as a CEO to high profile consumer dot com ventures such as Pets.com and Reel.com, as well as a board member for the San Francisco Art Institute, Baker and Taylor and more. She was named among the top 50 Most Influential Business women in the Bay Area.
As impressive as that sounds, it may be possible The RealReal is her greatest achievement yet. Companies such as Reel.com or Pets.com folded at times she held top management positions, most likely due to the dot com crash. She outlined the challenges and mistakes that lead to these failures in her book “ReBoot: My Five Life-Changing Mistakes and How I Have Moved On“.
The RealReal Business Model
Consignors sell their goods through TheRealReal and get up to 70% the end price. The company curates the product listing and authenticates all products with the help of professional gemologists, art experts, horology consultants and authentication experts.
Because all sales happen during a 72 hrs time-span customers can upgrade to a 24 hrs advance to sales, by purchasing a “First Look” subscription for 5$/month. Right now only 0.6% of all members have upgraded to the First Look subscription, but founder Julie Wainwright is optimistic about the future.
The company considers itself as holding the “top products from Ebay and the bottom of Sotheby’s and Christie’s”. Unlike Ebay, consignors earn 60% of the sale price and can work their way up to 70%, with repeated sales. The RealReal thus built a gamification system that encourages sellers to repeatedly use the platform.
The RealReal Sales and Membership Figures
Over 750 000 members
Over 1.5 million visits per month
2012 Sales: $15.1 million
2013 YOY growth in sales: 297%
No. 1: Uniqlo – Growth Rate – 341 %
Remember the young man we were talking at the beginning of this post? The one that opened a store in Hiroshima City in 1985 and went on to become the leader of one of the largest retail chains in the world? His name is Tadashi Yanai, the wealthiest man in Japan ($17.6 billion in 2014) and the founder of Uniqlo, now the fastest growing online retailer in the United States.
It stands as a sign of the times that a brand founded in Hiroshima went on to become the leader in a redefining area of retail, in the largest economy in the world, almost 30 years since its birth date.
In may 1985, Unique Clothing Warehouse was opened as a unisex casual wear store in Fukuro Machi, Hiroshima. It later on changed its name to Uniqlo, a contraction of “unique clothing” and became increasingly popular as it opened store after store in an effort to extend its retail reach.
Uniqlo, now a wholly owned subsidiary of Fast Retailing, is a contender to global casual wear behemoths GAP, H&M, Limited Brands (best known for Victoria’s Secret brand) and Zara (a brand owned by the Inditex Group). Its first urban store opened in the fashionable Harajuku district in november 1998. It was quickly followed by approximately 780 stores in Japan and later throughout the world.
The company entered the chinese market in 2002 and the US market in 2005. Since its debut in America, Uniqlo continuously opened stores and plans to open up to 200 locations by 2020, with a sales target of $10 billion. Right now the total store count is 18, way behind its presence in Japan (790 stores) and China (260 stores). Still not bad considering the fact that many american retailers are actually closing stores.
Uniqlo plans to become the biggest company in its market, by growing at a 20% rate until 2020, when it expects to report $61.2 billion in revenue. The company’s track record so far shows that is possible.