In a few years, the main e-commerce sites have turned into marketplaces, expanding their offerings to attract more customers.
Today they occupy the first places in the ranking of the most efficient e-commerce sites. In France, according to Fevad, The 15 Best Ecommerce Sites Have a Marketplace.
And this model is not the prerogative of pure players and non-food: in 2020, Carrefour opened the first marketplace for grocery products, riding the local wave that has also spawned specialized marketplaces For real Where Food.
With the pandemic and stores closing, enthusiasm for marketplaces has increased.
The e-commerce boom is fully benefiting marketplaces, whose sales have grown twice as fast in 2020 compared to the previous year.
Of course, if marketplaces are so successful, it’s because they meet a consumer need: to simplify and speed up their selection process by avoiding having to go through multiple websites.
All of these signals promise a new Eldorado for brands that haven’t launched yet and are looking for a niche market they could create to become a new one ManoManowhich became a unicorn by doubling its sales in 2020.
But the promise of the “one-stop shop” doesn’t stop with the large selection. In order to be successful with a marketplace model, you need to find a delicate balance between the requirements of the different actors.
here are the 4 main rules consider…
#1 – Use the model and avoid its pitfalls
The observed success of the marketplace model proves its many benefits, but it is important to measure the risks of converting your e-commerce site into a marketplace.
Indeed, the success of a marketplace is based on the subtle balance of promises kept for the 3 stakeholders: the brand, the sellers and the consumers.
In this tripartite relationship, the role of existing site is essential.
Its brand awareness, its established clientele, its visibility add value to the sellers.
Its product selection and the experience it offers bring value to its customers.
Therefore, the expansion of the offer promises for the brand to attract new customers, the opportunity to test market trends and increase revenues.
However, for the marketplace to attract sellers, it must anticipate the obstacles they may encounter: Competition for visibility, need for profitability, dependence on the market, etc.. And set up optimal supplier experience management.
For the consumer, increasing the selection is not enough, the search experience is essential and also becomes more complex with the expansion of the offer.
The marketplace must not lose sight of its role as a retailer, must know how to adapt its merchandising, but also remain demanding in the selection of its sales offer.
Without addressing these risks, brand management costs can increase, performance can decline, and the promise of higher income can be lost.
#2 – How do you meet customer expectations?
A pandemic that has shaken consumption habits, market participants enforcing their standards, and new generations with different sensibilities becoming consumers: the world is changing very quickly and with it customer expectations.
It is important to pay attention to this and consider a few key elements to ensure the success of a marketplace.
Many consumers, and especially the younger generations, have now become accustomed to starting their product search on the leading marketplaces, most notably Amazon. A habit acquired thanks to the extensive offer, fast deliveries and impeccable product returns.
However, customer experience at the time of choice on these platforms can be a limit…or an opportunity!
Because this new generation, the generation of “now”, does not wait.
Immediate loading of your pages and research is therefore essential, as is the relevance of the first products displayed.
These items must correspond to the customer’s desire to buy, which is why they came to the marketplace despite an often gigantic number of references and categories. The risk is losing the visitor…
Personalization therefore seems to be the key to customer satisfaction, but we should not fall into the traps it sets for us… Because if it is not relevant, it risks misleading the customer.
For a marketplace, the sheer volume of products and categories makes it impossible to handcraft personalization rules for the entire journey.
AI technologies make it possible to respond to this problem, thanks to mechanisms for customizing the shopping journey based on the behavior of each customer.
#3 – The Marketplace: primarily an e-commerce site
Becoming a marketplace shouldn’t mean turning into a collection platform, a big bazaar with no identity.
It is important to become a marketplace in order to remain above all an (e-)retailer! The basics of trading therefore need to be strengthened.
The abundance of offers is an opportunity for the consumer, but one that can very quickly get stuck Messy middlea state in which he finds it difficult to sort all the information and makes the purchase process impossible.
Product selection must remain qualitative, personalized customer reception, individual product recommendations and the customer must be guided to the product they want to buy on your e-commerce site.
Fighting the obstacles of online shopping also keeps you a merchant.
Assure every customer of the supplier’s reputation, be transparent about delivery costs and most importantly, a smooth and pleasant online shop experience!
But also trade secure its marginsand in the context of a marketplace, the exercise can become difficult.
The margins achieved by a marketplace are average 3 times less than that of a traditional e-commerce activity.
This margin depends on the commission rate charged on sales, on average 10%.
It is therefore important to ensure the attractiveness of the marketplace for everyone involved, but above all to maintain your own sales so as not to reduce income.
Finally, the marketplace a treasure trove of very valuable data.
It is important to collect, recover and use this data, both to deepen your customer knowledge, to guide your strategic axes, but above all to improve your customers’ experience during their buying journey…
#4 – Customer experience is key
Marketplaces are growing in popularity, and at the same time, the temples of hyperconsumption are no longer appealing.
Almost half of Amazon’s Gen Z customers feel guilty after placing an order.
Therefore, there is an opportunity for more virtuous marketplacesmore specialized and whose merchandising is based on local experience.
Local is also one of the trends in e-commerce as consumers are sensitive to the fate of local suppliers and their carbon footprint.
It is therefore important to keep this in mind when choosing suppliers for your marketplace.
Other notable developments need to be kept in mind for a successful marketplace such as: the growing influence of social media on retention and conversions, the growth ofuse of voice whether with voice assistants or smartphones, or the need for customers to havea solid omnichannel experience.
In addition, the main problem in a marketplace remains the easy access to the offer.
With ever-increasing choice, most consumers turn to search engines to find their products: navigation becomes almost impossible when choices are vast.
The search engine can offer a precise selection of desired products in just a few words.
But for this search to be successful, it is necessary to immediately offer the right products in every customer context, no matter how precise their search is.
As part of a marketplace Relying on artificial intelligence technologies for e-commerce is inevitable.
They make it possible to process the impressive volume of the catalog and to analyze the weak signals coming from the behavior of your customers in order to better understand their desires and offer them adequate products…