Shopify has suffered a data breach that has compromised customer names, physical mailing address, and the details of orders from approximately 200 sellers. Shopify informed Canada's privacy commissioner of the breach and claims that it was not due to any infrastructure or technical errors but instead the malicious act of two "rogue" employees.
More:
- The two employees who stole the data were from the customer support team.
- Both employees have since been fired. The company said that their access to Shopify's system had been blocked, and evidence against them has been turned over to the FBI and other investigators.
- Shopify sent a notice to sellers whose customers' data was compromised to inform them of the breach. Shopify won't estimate how many customers had data stolen. But one merchant, who was compromised, told TechCrunch they held 1.3 million customer records, and over 4,900 were accessed during the breach.
The Bigger Picture:
While large-scale data breaches provide more significant risks, Shopify's internal breach follows a similar event in August at Instacart. As data protection laws continue to become more stringent, companies will likely become required to screen hires and limit data available to employees.
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Companies including Spotify, Epic Games, and Match Group have formed a nonprofit coalition to push for App Store changes. The coalition said that app marketplaces collect excessive revenue share on users' digital purchases and stifle competition by giving unfair advantages to their own products. The coalition added that it wasn’t formed as a result of Epic-owned "Fortnite" being banned from app stores.
Marketplace revenue share: (paid apps, digital subscriptions, and in-app purchases)
- Google Play Store – 30% (15% for subs after 12 months)
- Apple App Store – 30% (15% for subs after 12 months)
- Amazon Appstore – 30%
- Microsoft Store – 30% on games, Business and Education stores, and 15% otherwise
More:
- The association was formed to advocate for regulatory changes on how app stores are operated.
- Project Management software provider Basecamp joined as a founding member of the coalition. The company’s founders recently launched the email app Hey and voiced concerns over Apple’s revenue share from its subscription fees.
- Last week, Match Group’s CEO said in an interview that it's "unclear" on why Match Group and other similar digital services provide a revenue cut to Apple, while Uber, which connects two parties, is not subjected to the same rules.
- Last month, Apple and Google banned "Fortnite" from their app stores after the gaming company introduced a payment option to avoid the platforms' commission. Epic Games filed a lawsuit against Apple for banning the game and its game-developing platform Unreal Engine.
- A court ruling allowed Apple to ban "Fortnite" but ordered it to remove the ban on Unreal Engine, as it affected other game developers. Apple countersued Epic – a court hearing is scheduled for Sept. 28.
- Facebook and Microsoft also expressed concerns over Apple’s control of its App Store, following the roadblocks they faced to release their own games.
- In June, the EU launched an investigation against Apple for its App Store policies following complaints from Spotify and an e-book/audiobook distributor. The U.S. Justice Department and Federal Trade Commission have also launched investigations against Apple’s antitrust practices.
- Apple’s App Store generated revenue of $50b last year. Google’s Play Store generated revenue of $29b in the same period. As a standalone, the App Store would rank #66, and the Play Store would rank #108 in Fortune 500 companies.
This story first appeared in Inside Business. You can read the full issue here.
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Amazon launched multiple products in its hardware event yesterday, including a drone, smart speakers, and a gaming service. The company’s new cloud gaming service Luna is priced at $5.99 in its early access phase.
More:
- Amazon announced a new spherical Echo ($99), Echo Dot ($49.99), and an Echo Dot with a clock ($59.99). As of January 2020, Amazon had a market share of 53% in the smart speakers market, down from 61% in January 2019. Google’s market share increased from 23.9% to 31% in the same time period.
- The company launched Echo Show 10, a smart screen with a motorized base to automatically face the user as they move around a room. The company also added Netflix to the list of available streaming options in Echo 10.
- Amazon launched a controller for its cloud gaming service Luna, with an introductory price of $49.99. Luna is set to compete with other cloud gaming platforms, including Google’s Stadia, Microsoft’s xCloud, Apple’s Arcade, and Nvidia’s GeForce Now. Though Apple doesn’t allow Stadia and xCloud in its current form, Luna is available in Apple’s platforms as it was released as a Progressive Web App, which has a home screen icon and can be launched through a web browser. Apple doesn't take a revenue cut of 30% from the web apps.
- Always Home Cam, an autonomous security drone, will cost $249.99 and be available in 2021.
- The company also announced a new car camera and car alarm. An API will be made available next year to allow car manufacturers to connect their car camera to Ring’s platform.
This story first appeared in Inside Business. You can read the full issue here.
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Target announced that it is set to hire 130,000 workers for the upcoming holiday season. The company said that twice the number of workers would be needed for in-store pickup and curbside pickup services compared to the first half of this year.
More:
- During Q2 2020, Target's same-day services (pickup, and delivery through Shipt) grew by 273% YoY.
- The company hired 130,000 workers for last year's holiday season as well, up from 120,000 in 2018. It typically retains 40% of the seasonal employees as fulltime employees.
- Walmart hired 500,000 employees during the pandemic and is hiring 20,000 workers for the holiday season.
- Walmart, Target, Home Depot, Best Buy, Kohl's, Ulta, and Dick's Sporting Goods announced earlier that its stores would be closed on Thanksgiving day.
- Deloitte estimated that e-commerce holiday sales would grow by 25-30% YoY, and that overall holiday sales will grow by 1-1.5% this year.
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Costco reported revenue of $53.3b, up 12% from last year’s $47.4b. The company’s net income stood at $1.3b, up 30% YoY. The company’s e-commerce sales increased by 91% (and was 8% of Costco's overall revenue, up from 5% last year). Walmart reported a 97% increase in its e-commerce sales for its recent quarter.
Costco’s revenue, last five quarters:
- Q3 2020: $53.3b
- Q2 2020: $37.2b
- Q1 2020: $39b
- Q4 2019: $37b
- Q3 2019: $47.4b
More:
- For its financial year that ended Aug. 30, the company reported revenue of $166b and net income of $4b, up 9% YoY.
- Unlike Walmart, the company doesn’t offer curbside pickup. It offers same-day delivery under a partnership with Instacart. According to a recent survey by Incisiv, 80% of shoppers expect to do more in-store pickup and curbside pickup over the next six months, and 90% of shoppers prefer home delivery over a store visit.
A version of this story first appeared in Inside Business. You can read the full issue here.
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QUICK HITS
- Whitebox, an e-commerce startup that focuses on logistics, raised $18m in its series B round.
- French e-commerce company Mirakl, which helps online sellers launch and manage online stores, became a "unicorn" this week when it raised $300m at a $1.5b valuation.
- Global advertising spend on e-commerce marketing is expected to surge to $58.6b this year.
- Brands see 18.5% of e-commerce revenue from SMS marketing. See 6 top SMS campaigns here.*
*This is a sponsored link.
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Liam Gill is an experienced entrepreneur passionate about business strategy and law. In business, Liam is best known for founding Fumarii Technologies, a top 20 ranked cloud computing service (Yahoo Finance!). Academically, he is working towards a Canadian Masters of Law having completed a UK Law Degree and Masters of Management. He aims to support other entrepreneurs with free legal templates through Law4Startups.com and is happy to chat on Twitter or Linkedin. Reach out!
Nataraajan Arulolie is a Business Researcher at Inside and is keen on telling stories through data.
Michael Tant is a Business Researcher at Inside. He's passionate about economics, technology, crypto, and investing.
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Editor
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Jonathan Harris is a writer for Inside.com. Previously, he wrote for The Huffington Post, TakePart.com, and the YouTube channel What’s Trending.
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