retail news in context, analysis with attitude

•  From the Wall Street Journal this morning:

"Amazon.com Inc. founder Jeff Bezos and Chief Executive Andy Jassy can’t avoid testifying in an investigation related to the company’s Prime membership program, the Federal Trade Commission said late Wednesday.

"Amazon last month asked the FTC to cancel subpoenas issued to Messrs. Bezos and Jassy, arguing that they aren’t steeped in the details of Prime’s sign-up and cancellation processes, which is the investigation’s focus. The FTC’s staff began the probe in March 2021, examining whether the company deceived customers into signing up for Prime and didn’t provide a simple way to cancel the program’s recurring charges, according to the order issued Wednesday.

"Amazon must largely comply with a June investigative demand that sought information about other Amazon subscription programs, the FTC order said. Amazon had pushed back against that request, saying it was too burdensome and expansive."



•  TechCrunch reports on Temu, a Chinese shopping app that "has quickly gained momentum for its first international endeavor in the U.S."

Temu was developed by Pinduoduo, described as "the Chinese e-commerce giant known for offering hard-to-believe deals."  The app "briefly claimed the top spot of Android shopping apps in the U.S. in mid-September before dipping to No. 15 this week, according to app analytics platform Data.ai. The rankings indicate new downloads, so it’s hard to gauge the app’s user retention and activeness.

"At a glance, Temu doesn’t look much different from other e-commerce platforms exporting affordable goods from China, whether it’s Amazon, Alibaba’s AliExpress, or Wish. Its landing page features a dazzling collection of competitively priced products, from a $2.77 blouse to a $1.39 soap holder."

But what really could give it an advantage is "its extensive connections with factories in China. Founded in 2015, Pinduoduo quickly grew to challenge the dominance of Alibaba, which started out more than a decade before it. The company’s meteoric rise has been credited to a clever strategy of connecting manufacturers directly to consumers, which allows it to trim middlemen costs and eventually price products a lot more competitively than others relying on layers of distributors."

Which is not to say it won't face challenges.  Temu, TechCrunch writes "has been repeatedly slammed for its opaque supply chain practices and accused of infringing on intellectual property. In 2019, the U.S. added Pinduoduo to its notorious blacklist over suspected counterfeits, though the company has pledged to crack down on counterfeits."



•  The Wall Street Journal reports that "Meta Platforms Inc. is planning to cut expenses by at least 10% in the coming months, in part through staff reductions, as the social-media giant confronts stalling growth and increased competition, according to people familiar with the company’s plans.

"The Menlo Park, Calif., company has begun quietly nudging out a significant number of staffers by reorganizing departments and giving affected employees a limited window to apply for other roles within the company, according to current and former managers familiar with the matter, in a move that achieves staffing cuts while forestalling the mass issuance of pink slips.

"The reductions are expected to be a prelude to deeper cuts, according to people informed of the company’s plans. While some savings will come from cuts to overhead and consulting budgets, the people said, much of it is expected to come from reduced employment."