Merchant Innovation

UPS Backs Direct-To-Consumer eCommerce Tech Startup

To stay competitive in the ever-changing world of eCommerce logistics, major players in the shipping industry understand its about gaining an edge in niche markets.

The direct-to-consumer market for manufacturers is one of those, and it’s one UPS may soon have a hand in.

Ally Commerce, an eCommerce technology startup, announced yesterday (Oct. 1) that it has received Series B funding from UPS’ Strategic Enterprise Fund, which is the company’s investment arm. The recent funding brings the company’s total to $8.4 million.

“UPS invested because the technology that Ally Commerce has developed has the potential to significantly impact eCommerce results for customers in several markets,” said Alan Gershenhorn, UPS executive vice president and chief commercial officer. “The UPS Strategic Enterprise Fund continues to invest in innovative companies that are evolving business models and creating new technologies and revenue streams.”

In its release about the funding round, Ally Commerce also shared how its services help advance the mission of the direct-to-consumer market and shared some key stats about how it’s growing.

“Ally Commerce has built a turnkey solution that handles all aspects of an eCommerce operation and delivers significantly better results to brand manufacturers that are selling direct-to-consumer online,” said Jason Rubottom, CEO of Ally Commerce. “The percentage of manufacturers selling direct is growing at 71 percent a year.”

Ally Commerce, which was started by UniqueSquared founders Richard Scalesse and Paul D’arrigo — has also experienced immense growth, according to the company, as it has been growing over the past two years as a result of its investments in technology and eCommerce solutions for brands. Because half of the brand manufacturers in the U.S. outsource their eCommerce business, Ally Commerce steps in to be the partner in the process — ensuring it provides that “digital storefront” to create an end-to-end solution that links the manufacturer right to the consumer.

According to a stat provided by The Wall Street Journal, the direct-to-consumer online sales market is becoming a rapidly growing sales source for brand manufacturers. In fact, it rings in at 34 percent of total sales, according to a Forrester survey.

“This is consumer-driven,” former eBay executive Rubottom told WSJ about the industry growth. “You want to go to one spot, and you know you’ll find it there.”

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