Are marketplaces the saviour for (online) retail?
Since the immense success during the Corona pandemic of Amazon, Alibaba & Co, marketplaces have become an indispensable part of global e-commerce as well as the daily lives of all of us. Therefore, here is an attempt to bring a little clarity to the confusing situation:
Sales on online marketplaces are growing the strongest:
Basis: Sales incl. VAT, Excluding sales from private via OMP; * Including: Stationary, teleshopping & pharmacy mail order / Legend: Online marketplaces grew 20.2% to € 40.8 Billion in 2020 and account for 49% of total e-commerce sales.
Source: BEVH ANNUAL PRESS MEETING 2021 #bevhPK21
Marketplaces have been around for a few thousand years
If you take the actual word and its origin, marketplaces are “places where different traders set up a stall” and in this way the consumer can bundle and do his weekly shopping in one place, for example. It’s been that way, more or less, for a few thousand years of human history.
If we now transfer this view to the new world of online commerce, we find that there were probably now (as in the past) the most diverse manifestations. Be it that a ruler took excessive stall fees (which some today accuse e.g. Amazon & Co) or that the marketplace operator (in the past mostly state-affiliated bodies) did not allow one to sell there in the first place, e.g. because many citizens (customers) complained about poor quality or counterfeit products.
What is the goal of marketplaces?
In the past as well as today, the goal of a marketplace is to bring customers and traders/manufacturers together, so that it is cheaper for the seller to bring his goods to the consumer and the consumer has it easier to buy products of a certain “branch”. Whether it is grocery shopping at the weekly market, the procurement of textiles at a grocer’s market or, for example, the bundling of consumer electronics products at our customer’s site.
www.EURONICS.de
or around sporting goods at
www.INTERSPORT.de
.
In short, it’s about selling products efficiently (retailer/manufacturer) and shopping more conveniently (customer).
What are the different types of (online) marketplaces?
You could probably make a never-ending list of categories here. Different studies
(among others the study of our partner
ecom consutling
)
or also the article at
Wikipedia
give a small insight here.
Source: ecom consulting, Marketplace Study 2020
In our perception, when we advise clients, we focus on two types of marketplaces:
Industry or Product Category Marketplaces
These are marketplaces that pursue the goal of offering a full range of products within a sector (e.g. consumer electronics, fashion, etc.), such as Zalando, or for a specific product category (building materials trade), and of bringing this range efficiently to the customer for the manufacturer or retailer.
Target Group Marketplaces
The most famous target group marketplace in Europe is probably Amazon (target group human over 18 years), next to ebay or etsy. But there are also exciting approaches, e.g. from the “support-your-local-retailer” environment, such as the Merkando platform (target group people from my region) or also a marketplace for seniors.
There are no limits to the variety here. Ultimately, what distinguishes these marketplaces is that they want to satisfy the customer holistically and across product groups.
Framework Conditions and Rules for B2B Marketplaces
In addition, there are a variety of different frameworks, rules and requirements to sell on a marketplace. Just as the rules existed in the Middle Ages (memberships in guilds, local affiliation, levying of fees) they also exist in the (no longer brand new) world of online marketplaces:
General Conditions:
Rules:
What is my answer to the marketplace economy?
First of all, it is important that you are aware of what you want to do and that you are particularly good at it.
At my core, am I a product developer/manufacturer or a distributor?
Is my strength the service on site at the customer or the expert advice?
These are essential basic questions which, in our view, have a decisive influence on the answer.
To put it simply, the following basic assumptions can be derived from this for different companies:
Dealers
In the future, there must be a clear added value from the customer’s perspective that goes far beyond the mere “supply of products”. If this is the case, it makes sense to deal with your own “marketplace”, which offers products from partners additively. This leads to an offer with an even better assortment depth. At the same time, the targeted linking of large (industry) marketplaces as a sales multiplier should be considered.
Manufacturer
As a rule, it is advisable for manufacturers to display and actively market their products on all common marketplaces. The principle “where my customer is, my products must be” applies. In addition, a strong direct-to-consumer (D2C) strategy with a proprietary platform and enrichment of partner products and additive services for sustainable customer retention should be evaluated at a minimum.
Conclusion: Marketplaces have existed for as long as civilized mankind has existed and accordingly this principle is also transferred to the online world.
2021 - the year of the (B2B) marketplaces
We at NETFORMIC (like, by the way, Alexander Graf von
www.kassenzone.de
and CEO of
Spryker
) expect the ultimate breakthrough of digital marketplaces in 2021. Breakthrough? Yes that’s right, in the B2B world this one is yet to come. This opens up new opportunities to create specialized and customer-appreciation platforms in the shortest possible time, e.g. with the Marketplace solution from our partner Spryker to develop. Or even fast product range extensions by means of modern product and service integration efficiently with our partner
brickfox
and its portal solution.
Therefore, in the coming months we will address the topic of B2B marketplaces here on the blog, on our social media channels(LinkedIn, Facebook, Instagram), but also in new formats such as several discussion rounds with interesting discussion partners on Clubhouse!
