YCD News—It seems that it has been a long time since I heard any sellers mention Wish, and there is a vague illusion that this former top stream has disappeared from the cross-border circle.
Not so, recently Wish announced its return to the French market. Shortly before that, it also officially announced the appointment of a new CEO, a big to regain the market’s doings. But is it a day-to-day struggle or is everything far from final?
Wish pays €3 million fine to return to the French market
Wish’s parent company Context LogicInc. recently announced that the French regulator DGCCRF (Directorate General for Competition Policy, Consumer Affairs and Fraud Control) has lifted the delisting measure on Wish and allowed it to re-enter the French app store and search engine system.
This means that French users will once again be able to download and update Wish apps from Google Play, as well as being able to navigate to the site directly from Google Search, the French search engine Qwant. In addition, within the next few days, the Wish app will also be relaunched on the Apple system App Store.
Wish has spent a torturous, long 15 months in France from the time the ban was issued to the time it was lifted.
In November 2021, the French government ordered the major search engines and app stores to take down Wish because the platform had ignored consumer protection regulations and was selling unsafe and counterfeit products in violation of the law, and instead of recalling the offending products after receiving warnings from the DGCCRF, it had re-sold them under a different name.
At that time, French Economy Minister Bruno Le Maire forced various platforms to take down Wish, including Google and Apple, saying that if Wish was not removed, legal action would be taken against these companies.
After its IPO in 2020, Wish’s growth started to hit a slippery slope, and the ban came into effect to add insult to injury for Wish. In the wake of this, Wish lost a European market, search traffic, platform sales are in decline.
For 15 months, Wish’s parent company, ContextLogic, tried to overturn the DGCCRF’s decision to take it down, but to no avail. It wasn’t until March of this year that Wish settled with DGCCRF by paying a €3 million fine to DGCCRF (Wish’s founder and CEO was fined €250,000) and instituting a recall process for banned items.
A French government official said that DGCCRF’s decision to allow Wish to return to the French market was made “after more than a year of discussions with Wish, involving the commitments it had made.
Europe is already one of Wish’s headquartered markets, and this return to the French market will bring its business map back intotact, which should be good news for Wish today, after last year’s disastrous results.
Revenue plunges in several Wish business segments in 2022
Like other e-commerce giants, Wish was hit by a chill in the market last year.
In February, Wish’s parent company ContextLogic announced its financial results for the fourth quarter and full year of 2022.
In 2022, Wish’s platform revenue was $571 million, a huge 73% decline year-over-year, while Wish’s net loss continued to grow over the past full year, reaching $384 million, compared to $361 million in 2021.
Among Wish’s several major business modules, core marketplace, Product Boost, three-party marketplace, and logistics revenue all underperformed year-over-year in 2021. Among them, core marketplace revenue fell 81%, ProductBoost fell 72%, three-party marketplace revenue fell 80%, and logistics revenue fell 59%.
At its peak, Wish’s monthly active users could reach more than 100 million, but in recent years the platform’s user churn has been increasing, with only 24 million monthly active users left in 2022 and the number of active buyers plummeting from 64 million in 2020 to 13 million in 2022. Both are down by more than 60% year-over-year in 2021 and by nearly 80% year-over-year in 2020.
In the fourth quarter of 2022 alone, Wish’s core marketplace, Product Boost, and logistics revenue declined 74%, 64%, and 37%, respectively, year-over-year; the single-quarter net loss reached $110 million.
However, it is worth noting that Wish’s traditionally criticized logistics and return problems seem to have improved.
In Wish’s Q4 2022 data, for example, the on-time arrival rate (OTD) of products on Wish reached 89%; the product refund rate dropped 36% year-over-year, and the order cancellation rate dropped 58% year-over-year.
In the past, uneven merchandise and low delivery times on the Wish platform made for a poor user experience, which in turn led to a sharp decline in user size and the number of active buyers. While user churn remained very high last year, Wish is making more changes to retain users.
Joe Yan, Wish’s CEO, said, “Despite a variable and challenging macroeconomic environment, 2022 has been a productive year for Wish. While the transformation is still in its early stages, great progress has been made in each of the foundational pillars of the business. There is still much work to be done to get back on the path to profitable and sustainable growth in 2023.”
Wish has failed to turn a profit from 2017 to 2022, with a change in ownership that has seen no improvement. Previous interim CEO Joe Yan is now the official CEO of Wish and a member of the company’s board of directors, and the task he carries is clearly daunting.
Can Wish break the logjam with a third CEO at the helm?
In November last year, Vijay Talwar, Wish’s second CEO, announced his departure after less than a year in office. At that time, Joe Yan became the interim successor and became the third CEO of Wish in 2022.
Joe Yan, Wish’s new chief executive, has an extensive resume, as he was an operating partner at venture capital firm GGV Capital when he took over the reins, but has previously worked for a number of international technology giants, including Alibaba Group Holding, Alphabet Inc. and Amazon.
At that time, Wish announced that Joe Yan was an interim successor and that ContextLogic’s board of directors had hired a headhunter to find a permanent CEO, but many industry insiders believed that he would eventually become the official CEO and that the so-called “interim” was only an inspection period given by the board.
In February of last year, Wish announced that Vijay Talwar had replaced founder and former CEO Piotr Szulczewski as its second CEO, responsible for leading the strategic execution of Wish’s transformation plan to bring Wish back to market through fun features, technological innovation and operational excellence to improve the user and merchant experience.
During Vijay Talwa’s tenure, Wish’s NPS (word-of-mouth) doubled. But for reasons unknown, Vijay Talwa left after only seven months in the job.
Although Vijay Talwa was not able to save the company from losses, he did achieve a lot during his reign. As the new head of the company, Joe Yan still has a lot of urgent tasks at the helm of Wish.
Joe Yan said that the first priority is to ensure the stability of the team and the business. In addition, to let team members know the company’s long-term development direction and short-term business focus, reasonable allocation and use of resources at hand, in the business can achieve short-term breakthroughs and long-term development.
Internally there are internal problems, and externally we are facing a fierce market competition.
In the early days, Wish took the low-price route to do a flourishing, but logistics and quality problems frequently, sellers and buyers lost, and now want to regain the market has been difficult.
Last year, Temu, also known as “Wish 2.0”, landed in the U.S., repeatedly topping the download charts and gaining a lot of attention, but in half a year, it has now expanded its market to Canada, New Zealand, Australia and the United Kingdom, and will expand to more markets in the future.
In terms of platform-based e-commerce, Amazon, eBay, Selling and other e-commerce giants are also increasingly fierce fight. Nowadays, social commerce is also growing, and social media giants such as TikTok are also gaining a lot of attention in the field of e-commerce.
In the increasingly fierce situation, can Joe Yan lead Wish to stand out and return to the top?