Cashing Out: Week of October 9th – 15th 2011 in Online Marketing News

EBay announces X.commerce and Facebook partnership

EBay representatives took the stage at its new developer conference Innovate on October 12 to announce both a new platform and a new partnership.

The company’s CEO John Donahoe took the opportunity to formally introduce X.commerce. Powered by eBay, PayPal, Magento, and GSI commerce, among others, eBay hopes the new platform will “bridge online and offline commerce,” according to GigaOm.

What is most important about X.commerce, says TechCrunch, is that it “truly caters to developers. In the past, eBay developers have been divided in the marketplace, PayPal etc., but now developers have all those technologies in one place.”

EBay’s second announcement focused on the company’s new partnership with Facebook, in which eBay will integrate Facebook’s Open Graph into its existing global commerce platforms. Developers will also be able to build apps that allow users to share about products they’ve bought or that they recommend, as well as products they want.

This ought to personalize and build on the social aspect of online shopping, though, as TechCrunch points out, Facebook as an eCommerce platform hasn’t yet caught on the way many expected it to.

“It seems that consumers aren’t particularly jazzed about doing their shopping on Facebook,” TechCrunch’s Rip Empson writes.

Still, Matthew Mengerink, X.commerce’s General Manager of Commerce, believes this type of sharing will help make online shopping look and feel more like offline shopping, where friends shop together, discuss and recommend products.

“What we’re encouraging developers to think about is to try out the more ‘pre-shopping’ social experience,” TechCrunch quoted him as saying.

RIM apologizes for badly-timed outage

This week, Blackberry users on five continents experienced the longest service outage in the device’s 12-year history.

The outage, which began in Europe on October 9 with a “core switch failure within RIM’s infrastructure,” resulted in a data backlog that quickly spread to Africa, the Middle-East, Latin America and North America.

On October 12, RIM said that service levels were improving, though they admitted there were “still some delays and service levels may still vary amongst customers.” And a formal apology from RIM founder and co-CEO Mike Lazaridis finally came October 13. In a video statement, he offered the following:

“I apologize for the service outages this week. We’ve let many of you down […] You expect better from us, and I expect better from us […] For those of you affected, I know this is very frustrating. We’re doing everything in our power to restore regular service levels, and we’re working tirelessly to restore your trust in us.”

As AdAge noted, it’s terrible timing for RIM. The company’s global smartphone market share dropped to 12 percent in this year’s second quarter. It had been at 19 percent last year in the same period. Its stock and earnings are down and the sales of its new tablet have been less than stellar, to say the least.

“It remains to be seen if RIM’s crisis response will be enough to keep its shrinking customer base,” said AdAge, which compared the company’s brand perception in the UK, Germany and the US:

“So far, Blackberry has suffered significant declines in brand perception in the UK […] In Germany, declines were less pronounced with only a slight drop in perception. Blackberry brand perception in the US has remained flat by YouGov’s measure because the outage didn’t affect North America until Wednesday. Meanwhile, iPhone brand perception is soaring in all three markets.”

Connecticut pushes for online sales tax

The battle over online sales taxes continues between Connecticut officials and retailers like Amazon and Overstock.com, Bloomberg reported October 9.

Connecticut’s Internet Sales Tax legislation was implemented in May. And though Amazon cut ties with its affiliates there in June (and arguably no longer has a physical presence in the state), Connecticut officials are pressuring the online retailer to pay the taxes it owes for the one-month period before its Connecticut affiliate program was closed.

Further, the state wants to continue collecting on the tax, even after retailers have severed ties with their Connecticut affiliates.

Overstock’s position in Connecticut is similar to Amazon’s. Since ending their affiliate program in the state, they claim the tax legislation no longer applies to them, and the company is willing to take the issue to court if need be.

Responding to a letter from the Department of Revenue Services demanding compliance with the new sales tax, Overstock’s general counsel Mark Griffin said the company could “promise a very healthy and robust legal challenge.”

“By severing those ties, we effectively severed any sort of obligation […] We don’t have boots on the ground in Connecticut,” Griffin said.

According to Bloomberg, Connecticut is “estimated to be losing $152 million a year from uncollected sales taxes from Internet retailers that don’t currently collect the tax.” And, as TechFlash notes, the pressure state officials are putting on such retailers has a lot to do with the state’s $3.3 billion deficit. Connecticut stands to collect as much as $9.4 million if internet retailers begin complying with the legislation.

Netflix dumps Qwikster, promises no further price change

Oh, Netflix.

The company’s decision in July to change the price of bundled streaming and DVD-by-mail service met with no end of complaint. And, as for its recent decision to provide DVDs through Qwikster, which meant customers would have to use two separate websites (one for streaming and one for DVD rental), well, that was generally disapproved of as well.

Post price-hike, and after spinning off its DVD rental service to Qwikster, the streaming company has announced yet another change. And considering the response Netflix has received for its two most recent changes, it’s no surprise the company is saying this one isn’t a change at all.

In an October 10 company blog post, Netflix CEO Reed Hastings announced that Netflix would be abandoning Qwikster and that users could now go back to getting their DVDs at Netflix.com:

“It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs. This means no change: one website, one account, one password…in other words, no Qwikster.”

But that’s not all. Following the first announcement in some time that’s likely to please its users, Netflix also promised to address another change that’s made them largely unhappy. “While the July price change was necessary,” Hastings wrote, “we are now done with price changes.”

The new decision won’t change all the negative response to the poor decisions Netflix has made in recent months, but as the Wall Street Journal (WSJ) points out, at least the company can move on now, and perhaps get a fresh start. “So that’s it,” the WSJ wrote, “Until the next Netflix kerfuffle, the company and those subscribers who didn’t jump can put aside that unhappy episode like a bad dream.”

Greystripe’s Ad Boosters help interaction, social presence

Mobile ad network Greystripe introduced two new types of ad units October 12 that they say will encourage interaction and make ads more social. They’re calling them Ad Boosters.

The first type of Ad Booster is market-specific, with features designed for particular industries. So, while a restaurant’s booster bundle may include menu display and store locater, the entertainment booster can display a trailer and reviews, and will connect to Facebook. All of these features can be customized.

Meanwhile, the second type of Ad Booster is based around social integration, allowing access to all the supported social networks, including Facebook, Twitter, YouTube, and Google+, with one click.

Ad Boosters will also insert an additional 300 x 100 brand image above the ad itself “to drive additional brand awareness.”

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