A Year in E-Commerce: What’s Hot in the Southeast

Based in Atlanta salt box, a co-warehousing startup, rolls into the holiday season with a $35 million Series B from Cox Enterprises and California-based Pendulum. The funding caps a busy year for Saltbox, which has more than doubled its storage space to help small businesses navigate e-commerce logistics.

The two companies, co-founder Tyler Scrivens told Hypopotamus: “understand how difficult it is to invest in and build complex companies with long maturity horizons, as is the case with Saltbox.”

This guidance and funding will be critical as Saltbox looks to continue its growth in an ever-changing e-commerce landscape. Having weathered the pandemic, supply chain bottlenecks, high shipping costs and hiring shortages, brands are now facing dwindling consumer confidence and high inflation.

It was also a favorite topic of Hyppotamus readers this year. Some of our most-read articles of 2022 included the launch of e-commerce brand D2C PCKL, exempt returns‘ Seed round and a look behind the scenes salt box‘s new physical location.

It’s been a year of development for eCommerce and the general RetailTech space. So we wanted to take a look back at what happened throughout 2022 and how startups from the Southeast have changed to fit the moment. Some key trends surrounding what drives innovation in the industry:

Ecommerce trends that caught our eye

Community building is the focus

The local brands we spoke to echoed a common refrain: Inflation has certainly impacted business earnings in recent months. But it’s not all doom and gloom.

Just talk to me John Roman at BattlBox, a monthly subscription box service launched in 2015 for lovers of survival and outdoor gear. Beyond just shipping products, Roman says BattlBox has recently focused on creating a community and additional curated content for its members.

“Consumer behavior is evolving. Consumers want to identify with and feel connected to the brands they shop from. Most brands fail at that,” Roman told Hyppotamus. “I think smaller e-commerce companies that have failed (or are not working to build a community and a brand) will feel the brunt of this recession. Increased advertising costs make it even more difficult for these smaller companies to get the attention they need for their product.”

This focus on customer retention was critical as brands like BattlBox attempted to manage the external pressures of price inflation and general economic uncertainty.

“2022 was a challenge. Maintaining the momentum from such a strong 2021 has not been an easy task. We had to increase our prices this year due to inflation, which we didn’t want. Fortunately, our customers understood and supported the change,” added Roman.

Some brands turned to new technologies to build a community.

Richard (Ronin) Rivera (Ronin The Collector, as he’s known in the industry) helps enterprise brands break into the NFT space with Atlanta-based startup GigLabs and its unique product platform gigantic.

For Rivera, it’s important to “help brands really understand the technology and how to implement it into their current business strategy.”

It’s been particularly strong for fashion and sports brands, Rivera said.

“It’s about opening up the lines of communication with their customers and consumers in a new way,” he told Hypopotamus.

There is still room for more players

With giants like Amazon, Shopify, and Etsy, it can feel like you can buy almost anything online. But the shopping experience isn’t always the best for consumers or smaller retailers, leaving the door open for innovation on both the consumer and brand sides of the equation.

Nicole RufukuCEO and co-founder of Goji shopsaw an opportunity for a new type of platform in the e-commerce market when she became a mother.

When I needed to buy something for my daughter, Google just sent me reading an endless list of listicals and other blog posts. There are just too many products to choose from at this point, and older tools like Google search aren’t that useful when you need to buy something that requires some thought and research. Therefore, Goji solves what we call the “infinite shelf” problem. Shoppers want to be more thoughtful and aware when purchasing products, but they don’t have the time to do their own research. That’s where Goji comes in – we get to know you and then put products together for you,” Rufuku told Hypopotamus.

Goji Shop acts as a shopping recommendation platform for busy parents who want to find the best items for their babies. It’s a “personalized curation layer” for e-commerce, Rufuku explained.

The platform also helps brands navigate the ever-changing e-commerce landscape.

“Brands and retailers are facing headwinds from Apple’s privacy updates, which make ad targeting and optimization more difficult,” she added. “That means they need a new way to find new customers, and we believe the next wave in marketing will be focused on personalized and human-powered curation. Influencers will continue to benefit, but so will platforms like Goji that focus on human-powered curation.”

Other startups are also making their way to transform the way we shop. in atlanta, hi-hat started as a marketplace and search engine to find black owned businesses and joins a growing list of specialized e-commerce websites.

Other brands are adopting the circular economy model as they operate at scale. One such startup is Rent-a-onesiea convenient and affordable platform that stops parents from wasting money on outgrowing baby clothes.

“I think we are at such a critical time [in ecommerce]. Parents are overwhelmed. There’s so much to do, they’re constrained by the cost of inflation… and consumers are changing their mindset about sustainability. But big retailers really need to rethink the traditional way of doing business, so I think we’re really well-prepared to fit well in this space.” Lauren Gregory said Hypopotamus. “We’re helping retailers transform the way they interact with their customers and how they use their inventory.”

Where eCommerce is going next

What’s next for ecommerce innovation is an open question. As recession fears surface, energy costs rise, and businesses operate in an uncertain inflationary environment, brands focused on fulfillment and automation could have an advantage. Several investors in this space told us that they are focused on the automation and AI part of the industry while also looking at startups focused on shipping and delivery innovation.

In terms of brand engagement, GigLabs’ Rivera also has a prediction. He reckons that in 2023, more brands will need to find innovative ways to increase “loyalty, rewards, and customer retention and acquisition.” That could put start-ups from the Southeast in a unique growth position as the region has become a hub for marketing technology (MarTech), media, supply chain, logistics and consumer brands.

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