Steve Thomas - IT Consultant
After filing for Chapter 11 bankruptcy protection in April, online wholesale retailer Boxed has been acquired. U.S.-based regional distributor MSG Distributors, Inc. announced this morning its acquisition of Boxed.com and “other intellectual property portfolios and affiliates” in an all-cash transaction.
Deal terms were not disclosed, but it’s not likely a high-value deal for a company that had raised north of $318 million through its lifetime, according to data from Pitchbook.
MSG says it will continue to serve Boxed customers, vendors, and brands following the acquisition.
Founded in 2013, Boxed’s original premise was to offer consumers an online version of something like Costco or Sam’s Club, where they could buy in bulk — but without having to worry about annual membership fees or driving back and forth to the stores. Instead, the bulk items would ship to their doorstep.
In the years that followed, Boxed reportedly rejected a $400 million buyout offer from grocer Kroger in 2018, then later partnered with one of Asia’s largest retailers Aeon in 2021 for an expansion. At the time, Boxed had over 7 million registered users and reported it was close to profitability, it claimed.
In 2021, Boxed completed a reverse merger, acquiring Seven Oaks Acquisition, in order to begin trading on the NYSE under the ticker symbol BOXD in a $900 million SPAC deal. The transaction was expected to provide Boxed with about $334 million in net cash proceeds, including a $120 million private investment from investors such as Brigade Capital Management, Avanda Investment Management and Onex Credit, Reuters reported.
But it’s clear Boxed struggled to make the economics of online grocery work, and it wasn’t alone. Other food delivery services have shut down or announced layoffs, including in particular fast-delivery services like Food Rocket’s 2023 closure and Gopuff’s multiple rounds of cost-cutting, among others. In addition, various regional services like Peapod and Bay Area-based Zero Grocery, have either scaled back or closed over the past few years.
In January 2023, Pitchbook reported Boxed was in talks to be acquired for an undisclosed sum, but the deal fell through.
This April, Boxed announced it would sell its Spresso software-as-a-service business to its first lien secured lenders while winding down its remaining retail business, as part of the bankruptcy process. The company had been trying to raise more capital in the months prior to this announcement and looking for other exit possibilities, ultimately raising up to $20 million in January.
The Chapter 11 announcement followed the news that Boxed had held the majority of its cash deposits and other liquid assets the collapsed Silicon Valley Bank, which some correctly guessed might be the final nail in Boxed’s coffin.
Going forward, MSG’s plan for Boxed.com is to continue to deliver to customers the brands they loved from the retailer, while also providing access to a catalog of new items and brands in the grocery and home goods space.
U.S.-based MSG has distribution facilities across New York, Florida, Texas and California. Its portfolio includes natural food brands and sports nutrition, including PowerBar, NuGo, RxBar, Amazing Grass, R Bar Energy, Long Island Iced Tea, Mocu Health, Grenade, Protein Puck, Betty Lou’s, Cellucor, Almased, and others. It caters to gyms, natural health food stores, pharmacies, sports centers, delis, and other retail locations.
“This acquisition strengthens our inorganic growth strategy and diversifies our distribution models nationwide,” said Mark Gadayev, MSG’s President, in a statement. “The loyalty and trust that customers and brands have in Boxed is priceless, and we are committed to continue this model of offering bulk-sized products to customers at wholesale prices.”
Nationwide retailer Target is encouraging more consumers to use the convenience of its curbside order pick-up service with the addition of a new perk: Starbucks coffee. The company announced today that customers will be able to add a Starbucks beverage or food item to their Drive Up order — a feature that will be available at the more than 1,700 Target locations that have Starbucks Cafés by this October.
The addition of Starbucks to Drive Up orders — orders where customers can remain in their car instead of having to go inside the store for a pickup order — was first announced in February 2022. At the time, the retailer said it would begin “testing” the option alongside both Drive Up pickup orders and returns. The service was then expected as part of a planned expansion in the fall of 2022. Early testers included store employees before rolling out to Target customers in the company’s hometown of Minneapolis.
Though a bit of a belated public launch, the service will likely appeal to the Target shopper who often likes to combine their coffee run with browsing the store, when shopping. Now, they’ll be able to do the same when they’re too busy to head into the store and wait in line. Plus, the perk builds on the convenience Starbucks’ own customers have already come to expect in terms of order pickups, which have been available through the Starbucks app for years.
In Target’s case, however, the Starbucks orders will be added through Target’s mobile app instead. Here, customers will be able to place their Target orders for curbside pickup, then alert the store when they’re on their way. That real-time location sharing ties into the Starbucks ordering option so the store staff knows when to begin preparing the drink orders.
Target and Starbucks first partnered in 1999 and now have a Starbucks location inside the “vast majority” of the retailer’s over 1,999 U.S. stores.
The feature follows the recent addition of curbside returns, which allows shoppers to return items at no charge at nearly all Target stores.
“Our guests have long told us Drive Up is a game-changer, adding convenience to their daily life, especially when they’re short on time,” said Mark Schindele, Target’s chief stores officer, in an announcement of today’s news. “We’ve continued listening to our guests, who’ve told us overwhelmingly that Drive Up with Starbucks would bring even more ease and joy to every Target run. This one-of-a-kind service — available only at Target — is the latest example of how we’re innovating every day to meet the needs of our guests,” he added.
In Target’s most recent quarter, the company beat expectations on earnings and revenue, but saw only small growth in year-over-year sales, as customers gravitated more towards groceries and everyday essentials, as opposed to more discretionary items, while they watched their wallets. The company reported $25.32 billion in revenue and $2.05 earnings per share, above Wall St. forecasts of $25.29 billion and $1.76 EPS, respectively.
The addition of Starbucks to Drive Up orders could potentially lure more customers to choose Target for their everyday purchases over the competition, but it may not boost their spending or the types of purchases made in general.
Amazon today introduced a new feature that will allow consumers to be better informed about potential product safety alerts and recalls. Now, instead of having to seek out product recall information through third-party websites and other news sources, Amazon shoppers will be able to access a new “Your Recalls and Product Safety Alerts” page that will be linked on the top of their “Your orders” page and shared with customers via email.
When consumers click on the banner or the emailed link, they’ll be directed to a page where they can read more details about the potential safety hazards of products they’ve purchased and review their options — like refunds, returns, and repairs.
“With this new feature, we are able to directly reach 100% of customers who have bought a recalled product in our store and provide clear instructions on what to do next,” Amazon says in a blog post announcing the new feature.
While the feature is designed to address products Amazon sells, the retailer is also making the new system accessible to its third-party sellers. The company’s U.S.-based selling partners will be able to opt into Amazon’s Recalls Logistics Service (RLS). This will allow the sellers to notify customers who purchased the affected products, while Amazon can manage the process of issuing refunds on behalf of the selling partner as well as managing the return logistics.
However, the drawback here is that the system appears to be limited to U.S. sellers and on an opt-in basis. Many of Amazon’s marketplace sellers are overseas — and in regions that don’t have the same safety standards as in the U.S. This has resulted in unsafe products sold by third-party sellers making their way into U.S. consumers’ hands — including, for example, children’s toys, a 2019 investigation by CBS News found.
Of course, as one of the largest retail websites, Amazon will continue to face several product safety issues, due to the size of its catalog. More recently, its recalls have included things like portable chargers recalled for being a fire hazard, as well as issues stemming from its own brands, like the Amazon Basics Desk Chairs that were recalled due to the possibility that their legs would break, posing fall and injury hazards. It also sold cups with unsafe lead levels, and more.
In 2021, the U.S. Consumer Product Safety Commission (CPSC) even sued Amazon to force it to accept responsibility for recalling potentially hazardous products it sells. The complaint had cited such issues as “24,000 faulty carbon monoxide detectors that fail to alarm, numerous children’s sleepwear garments that are in violation of the flammable fabric safety standard risking burn injuries to children, and nearly 400,000 hair dryers sold without the required immersion protection devices that protect consumers against shock and electrocution.”
Prior to this, several U.S. senators had also written to Amazon to demand the recalls of hazardous products after a CNN investigation found that dozens of AmazonBasics electronics had melted, exploded, or burst into flames.
It has taken some time for Amazon to address the issues around recalls and safety concerns, following these complaints, but the company has historically monitored sources like the CPSC, as well as recalls.gov, National Highway Traffic Safety Administration (NHTSA), the U.S. Food and Drug Administration (FDA), and the U.S. Department of Agriculture (USDA) and then taken action — like removing sellers or putting warnings on product pages.
The new page is live now, and Amazon says it will proactively notify customers about recalls and safety alerts going forward.
Walmart+, the U.S. retailer’s Prime competitor, is introducing a new program designed to help those on government assistance take advantage of its membership benefits, like free shipping and delivery, gas discounts and access to streaming service Paramount+. The company announced this morning the launch of Walmart+ Assist, a way to purchase a Walmart+ membership at 50% off ($49 per year, or $6.47 per month) for those on government assistance.
Typically, a Walmart+ membership costs $98 per year or $12.95 per month, plus applicable taxes.
Those on the Assist membership will still be able to utilize the full range of Walmart+ features and perks, which include free shipping on Walmart.com purchases with no order minimum (excluding most Marketplace items), free grocery delivery with a $35 order minimum, free returns from home (no printing or repackaging required), savings of 10 cents per gallon at 14,000 locations (including Exxon, Mobil, Walmart and Murphy stations), a free Paramount+ subscription, ad-free video streaming with Pluto TV, mobile scan & go in-store for contact-free checkout, and other special offers and savings for members only, including early access to Black Friday deals.
To qualify, new and existing Walmart+ members must first visit Walmart.com/Plus/Assist to verify their eligibility through a third-party verification provider called SheerID. Customers will be taken to the SheerID website to fill out their eligibility form, then returned to the Walmart site or app to continue enrollment upon completion. They can then sign up for the Assist membership at the discounted rate.
Walmart’s discounted program comes several years after Amazon announced a similar program for Prime members.
In 2017, Amazon debuted a low-cost version of Prime for those on government assistance, also bringing the cost down by about half. Amazon’s program at launch supported those on a number of government assistance programs, including Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), and Women, Infants, and Children Nutrition Program (WIC). The full list now also includes Medicaid, SSI (Supplemental Security Income), Direct Express Prepaid Debit Card, TTANF (Tribal Temporary Assistance for Needy Families), NSLP (National School Lunch Program), LIHEAP (Low Income Home Energy Assistance Program), NAP (Puerto Rico’s Nutrition Assistance Program card –Tarjeta de la Familia).
Walmart+ Assist is similar in terms of its support, as its FAQ notes the eligible programs include SNAP, WIC, Medicaid, SSI, TANF, TTANF, NSLP and LIHEAP.
Walmart has worked to address the needs of those on government assistance in other ways prior to this launch, as it was one of the first retailers to participate in the USDA’s SNAP Online Purchase pilot in 2019. The company began the test by allowing customers to pay for their online grocery orders using their SNAP (Supplemental Nutrition Assistance Program) benefits — more casually known as food stamps. The program has since expanded to include support for using SNAP benefits for both order pickup and delivery.
Today, Walmart announced that with the addition of Alaska, it’s now the first retailer to accept SNAP benefits in all 50 U.S. states.
Amazon One, the retailer’s palm-scanning payment technology, is now gaining new functionality with the addition of age verification services. The company announced today that customers using Amazon One devices will be able to buy adult beverages — like beers at a sports event — just by hovering their palm over the Amazon One device. The first venue to support this feature will be Coors Field, home of the Colorado Rockies MLB team. The technology will roll out to additional venues in the months ahead, Amazon says.
First introduced in 2020, Amazon’s biometric payment technology works by creating a unique palm print for each customer, which Amazon associates with a credit card the customer inserts in the sign-up kiosk upon initial setup, or with a card the customer has configured online in advance. If the customer has an Amazon account, that is also associated with their Amazon One profile information. These palm print images are encrypted and stored in a secure area in the AWS cloud, built for Amazon One, with restricted employee access.
To use the system, customers hold their hand over a reader on the device that identifies multiple aspects of their palm, like lines, ridges, and vein patterns, to make the identification.
By combining customer biometrics with payment card information and Amazon accounts, Amazon has created a tool that could be used to serve highly personalized ads, offers, and recommendations over time, if the company chooses.
In a FAQ, however, Amazon claims it “does not use or sell customer information for advertising, marketing, or any other reasons.”
Amazon has argued that palm reading is a more private form of biometrics because you can’t determine someone’s identity just by looking at their palm images. However, the company isn’t just storing palm images — it’s creating a customer database that matches palm images with other information.
After initially becoming available at Amazon’s own retail locations, like Amazon Go stores and Whole Foods, the Amazon One system has since expanded to various sports stadiums, entertainment venues, convenience stores, and travel retailers like Hudson and CREWS at several U.S. airports, in addition to Panera Bread through a partnership announced in March.
To now make the system capable of identifying someone’s age, customers can opt to update their ID to the Amazon One website. To do so, customers will go to one.amazon.com, upload photos of both the front and back of their government-issued ID, like a driver’s license, then snap a selfie to verify it’s them. Amazon says it doesn’t store these IDs after verification, which is performed by an unnamed ISO 27001–certified identity verification provider — a certification that references an international security standard.
After their age is confirmed, Amazon One customers will be able to purchase their adult beverages without having to pull out their ID from their pocket — they can be ID’d and pay for the drinks with a scan of their palm. When verified, the bartender will see a “21+” message appear on the screen along with the customer’s selfie, which they can then use to match to the customer placing the order. The customer can then scan their palm again to pay for the purchase.
Retailers may appreciate this technology because it could make lines move quicker, upping their potential sales and revenue. But it’s worth remembering that Amazon has not entered this market without secondary goals in mind, beyond simply speeding up checkouts.
The technology has been the subject of privacy concerns since its debut, which already led one early adopter to abandon their plans to use the readers, after receiving pressure from consumer privacy and advocacy groups. Denver Arts and Venues had been planning to leverage Amazon One for ticketless entry at Red Rocks Amphitheater — a big win for Amazon — but it cut ties with the retailer after the publication of an open letter that suggested Amazon could share palmprint data with government agencies and that it could be stolen from the cloud by hackers.
A group of U.S. senators also pressed Amazon for more information about its plans with customer biometrics shortly after the technology’s launch. Plus, Amazon is facing a class action lawsuit over failure to provide proper notice under a NYC biometric surveillance law, related to the use of its Amazon One readers at Amazon Go stores.
Despite these concerns, Amazon is pressing forward with its Amazon One expansion efforts, having recently landed the Panera deal, for instance.
“We are excited to team up with Amazon One to launch their age verification feature at Coors Field,” said Alison Birdwell, president and CEO of Aramark Sports + Entertainment, a provider of food and beverage and retail locations in various North American sports venues, including Coors Field. “Consumer preferences are ever evolving and demand for faster service models continues to grow. Amazon One’s latest capability directly responds to those demands by delivering a new level of convenience to the age verification process, shortening the time it takes to make an alcohol purchase, and improving the overall guest experience at Coors Field,” she said, in a statement.
Amazon One with age verification is available now at Coors Field, Amazon says.
Amazon’s palm-scanning payment tech will now be able to verify ages, too by Sarah Perez originally published on TechCrunch
