Successfully develop internationally with marketplaces - FOR BRANDS & RETAILERS
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W H I T E PA P E R
FOR BRANDS & RETAILERS
Successfully develop
internationally
with marketplaces
04 CONTENTS CONTENTS 05
I. General information 06 III. Integrate into marketplaces easily 72
on marketplaces
A. How to distribute your product catalogue 74
A. What is a marketplace? 07 B. Content optimisation 76
B. Marketplaces’ business model 10 C. Order management 80
C. Why sell on marketplaces? A few perspectives 13 D. Avoid having your marketplace account suspended 82
D. Selling on marketplaces: making the right decisions 20 E. The essential steps to carry out before launching 84
E. What’s new? The rise of m-commerce, new players 28 on a marketplace
and other trends F. Sales tools for marketplaces 86
II. Boost your international sales 34 Conclusion 88
with marketplaces
Lengow / Wunderman Thompson 90
A. European e-commerce potential and specificities 36
B. Some of the most popular marketplaces around the world 52
Sources 92
C. Enter markets around the world thanks to marketplaces 66
D. Challenges to anticipate 68
CONTENTS CONTENTS
1
06 07
A
I. General information on marketplaces
General
information What is a
marketplace?
on marketplaces A marketplace is an online virtual Marketplaces have a very wide
space where retailers and consumers client base, ranging from individuals
IN THIS CHAPTER come together to buy and sell goods to professionals, whether it be
and services. distributors, wholesalers, brands or
manufacturers.
A. What is a marketplace? Amazon, eBay and Alibaba are just
some examples of this type of sales The marketplace takes control of the
B. Marketplaces’ business model. 10 outlet, and millions of retailers and technical and marketing elements,
even private individuals sell on which removes differences between
C. Why sell on marketplaces? A few perspectives. 13 marketplaces to benefit from their retailers on the site, putting them all
features and audience. on a level playing field.
D. Selling on marketplaces: making the right decisions. 20
E. What’s new? The rise of m-commerce, new players 28
and other trends.08 09
The foundations PAYMENT Keeping up with competitors’ prices is one of the biggest Communication between shoppers and retailers, whether
of marketplaces
When dealing with sales, the issue of financial transactions challenges for brands and retailers, as your pricing strategy that takes place before purchasing or after (SAV), is an
I. General information on marketplaces
I. General information on marketplaces
is sensitive for the operator. As a third party trusted seller, will directly affect your financial performance. integral part of the sales cycle. If you sell on marketplaces,
marketplaces have to provide a secure environment and you normally don’t get access to clients’ email addresses,
take care of bank transactions and subsequent verification It’s necessary to get a structured pricing strategy, by so tools are a great alternative to help you get in touch with
THE TYPE OF MARKETPLACE checks. When a product is sent, the marketplace will clear monitoring competition constantly and centralising your consumers.
The marketplace environment is very varied and enables all the payment for the retailer, taking a slice of commission. marketplaces management to get
types of retailers to sell in a particular zone to a particular a clear view. On Rakuten for example, retailers are in charge of their own
audience. Operators can use payment systems like Paypal, Stripe, marketing strategy. They can create their own advertising
Hipay or even develop their own payment system like COMMUNICATION TOOLS campaigns and promotions in just a few hours, choose their
There are B2B, B2C and C2C marketplaces, where people Amazon did with Amazon Payment, or Tmall with Alipay. AND SALES CYCLE MANAGEMENT own delivery fees, and buy keywords so their brand appears
exchange physical goods, intangible goods, and services. Ideally, marketplaces want consumers to buy as many TOOLS when someone searches with a keyword2.
products as possible in one go from different retailers using There is no doubt that marketplaces are full of potential, but
With so many different marketplaces, it is important to one simple payment process. they are also very competitive, and there is a chance that you LEGAL FRAMEWORK
distinguish between generalist and vertical marketplaces. will be competing alongside another retailer with the same When using marketplaces, retailers have to be able to
The former include industry giants such as Amazon, eBay THE CATALOGUE target audience, selling the same product as you. Therefore, it communicate their Terms and Conditions of Sale and legal
and cDiscount, which offer a range of products from a For a standard catalogue, the marketplace operator has to can be very difficult for retailers to stand out from the crowd. notices. The retailer has to provide consumers with all
variety of sectors. The latter include Galeries Lafayette, define: Marketplaces provide a range of solutions to help retailers deal the pre-contractual information that they are entitled to.
Zalando and ePrice, which display products from a particular with this problem, and improve the visibility of their products Section 7.1.a of the Consumer Protection (Distance Selling)
universe (fashion, beauty, electronics, etc.). ̷ Which products are authorised and online stores. Depending on the solution, they are set Regulations Act, passed in 2000, states that retailers must
On eBay for example, product restrictions are pretty much up either by retailers themselves, or using teams from the provide contact details, full price (including tax), delivery
Marketplaces can also employ a hybrid model, whereby nonexistent; there are many categories. However, on other marketplace in the question. costs and information regarding payment and delivery prior
the operator is also a retailer on its own marketplace (e.g. marketplaces (often hybrid ones), like Otto or Galeries to a sale.
Amazon), or they can be a pure-player, where the operator Lafayette, operators define exactly which products can be The first solution, which is free, improves natural referencing by
acts purely as an intermediary (e.g. eBay). sold, with precise categories. They retain entire control of optimising the content distributed on marketplaces: product The terms and conditions for setting up an e-boutique, and
your catalogue. page titles, descriptions and keywords. accountability of each party should be set out within the
TRAFFIC Terms and Conditions. These days, e-commerce is highly
The appeal of this support depends on the volume and ̷ Offer visibility Certain marketplaces also have extra features, at an added reglemented, and marketplaces now have stringent legal
quality of the visits that it generates. The more visitors they On Amazon, you can display different offers in the cost, which let retailers promote their products or online shop requirements. Numerous seals of approval and certifications
have, the higher the sales potential. Marketplaces are an product information. However, on eBay, if you search for and subsequently become more visible to internet users. An exist for retailers to provide all the necessary guarantees to
efficient sales channel because they increase visibility and a product, the different offers will appear on different example of these added solutions is product promotions, reassure shoppers3.
generate traffic thanks to their reputation. pages. whereby retailers can improve their position in the results
pages. Retailers can usually buy advertising space on
For example, Amazon (30.7 million monthly unique visitors ̷ Pricing rules marketplaces, which can be used to display offers.
in France) and Fnac.com (13.9 million monthly unique visitors You may have the best products and promotions, but if
in France) demonstrate the capability of marketplaces to you are not competitive on pricing, you’ll have a hard time A retailer can push their most performing products,
attract internet users1. making progress. You must continually and automatically or products that are relevant for a certain period, or
adjust your products prices if you don’t want shoppers to conversely, push their least performing products as sales
choose your competitor’s listing over yours. items to offload stock.10 11
B
I. General information on marketplaces
I. General information on marketplaces
Marketplaces’
business model
It is important to know SALES COMMISSION PROFESSIONAL
the business model of The classic pricing model, sales SUBSCRIPTION
a marketplace, so you commission, is the most popular Certain marketplaces have a monthly
can understand their option for marketplaces. When a sale subscription for retailers, which has
pricing and payment takes place on a marketplace, the supplementary advantages, including
methods. operator will take a commission fee. improved visibility in search results.
For example, Rakuten gives the
For example, Amazon has retailers a chance to sign up to a
commission rates from 7% for fixed monthly subscription ranging
large appliances to 15% for cultural from €39 to €499, with a gradually
products. Marketplaces usually have decreasing commission rate
a summary table which sets out their according to the subscription5.
commision rates according to each
product category4. ADVERTISING
Marketplaces generate heavy traffic The classic pricing model,
and another way they make money
is through selling advertising space, sales commission, is the most popular
such as banners, partner brands, and
product ads. option for marketplaces12 13
C
I. General information on marketplaces
I. General information on marketplaces
Why sell on
marketplaces?
A few perspectives
Why sell on marketplaces?
The answer to this question is
actually very simple: because
consumers spend time on them. Consumers who know which product they want browse
before making a buying decision. They compare product
£80.00 variants, price, ratings, reviews and service levels. You must
make sure your product is in the consumer’s short list of
considered products.
You must be present on platforms where your consumers
are spending their time. Consumers are on marketplaces. Once a consumer has decided, they buy the product that
Marketplaces deliver the best experience for buying most fits their needs. Of course, that can be done on the
products and services. Marketplaces offer convenience. marketplace itself, but also via another channel. It could
Consumers know that they can find what they need on even be a purchase in a brick and mortar store. Sometimes
marketplaces. There’s no reason to go anywhere else. people want to touch and see the product before they buy
it. So, you sell your product on marketplaces not only for
Consumers do three main activities on marketplaces: the marketplace sales, but also to increase the chance of
hunt for deals, browse or buy. Shoppers that are lacking conversion at any other touchpoint with the consumer.
inspiration browse for deals and price promotions. The Deals Therefore, marketplaces shouldn’t only be considered as a
page is one of the most visited pages on Amazon. sales channel, but also as a marketing channel.14
I. General information on marketplaces FOCUS ON BRANDS FOCUS ON BRANDS 15
I. General information on marketplaces
The D2C Brands must
ensure they
model
CHALLENGES TO
Consumers actively use Amazon, ANTICIPATE
are a source
eBay and other marketplaces to Before embarking on the D2C model,
search for the products they’re particularly on marketplaces, brands
looking to buy. Resellers on these must bear in mind what work this
of truth
Depending on the type of marketplaces always find a way to represents and be prepared. When
business you’re in, there could fulfil this demand if the brands don’t selling D2C, brands must be ready
be other reasons to start selling directly deal with it. to manage all marketing, sales,
on marketplaces. For brand customer support and logistics.
manufacturers it’s a way to directly Unless brands are willing to accept Selling D2C and on marketplaces
interact with your consumers. You that these sellers and marketplaces requires more time and resources,
can bypass the whole traditional define their e-commerce strategy, which could mean you will be In addition, the presence of all the from different angles, videos, etc.
supply chain via marketplaces and they must establish a plan to sell their required to outsource your operations major marketplaces complicates Brands must ensure they are a source
get more control on your pricing. products directly on these platforms. It or hire more staff. things for brands, as each of truth, in other words, information
You can reach consumers directly, is simply no longer an option to ignore marketplace is different and requires is accurate and content is consistent
and get feedback in the form of marketplaces and the D2C model. Several brands have thrown a specialized approach to achieve and on all contact points and pages
questions, ratings and reviews. themselves head-first into the D2C the best performance. Marketplaces’ which present their products.
sales model without first developing requirements are often even higher Finally, brands must pay specific
You learn what your customers find a real action plan. They generally than those of consumers. Sellers attention to economics, on
You learn how
important and how they experience realize a little later that they missed must comply if they want to be marketplaces in particular. We have
your products and services, and in turn critical steps in the process. This haste able to continue selling on these the tendency to think you just need
your customers
improve products and services across can lead to poor customer feedback, platforms. Brands need to take care to connect to a marketplace and pay
channels thanks to these learnings. inaccurate sales forecasts or other to present products and promotions the commission on sales to achieve
Thanks to their growing success, costly consequences. well to their online customer, and success. But that’s not quite true —
experience
marketplaces have become essential should be careful as to how this being profitable on a marketplace
in the world of retail. Some brands information appears to consumers can take time and require some
are no longer able to sell on Amazon who search on multiple websites. investment. Selling on marketplaces
your products
Vendor, which no longer wishes to requires a well planned long term
buy their stock, and must turn to the Consumers only buy online if they strategy and real expertise.
and services
Amazon Seller model. have seen a certain amount of
detailed product information: ratings
and reviews, ingredients, details of
the product’s origin, multiple photos16 17
REASONS TO GET STARTED
Marketplaces are a great showcase for your brand image:
Marketplaces
I. General information on marketplaces
I. General information on marketplaces
Internet users trust marketplaces and will purchase your
products on these renowned sites with less hesitation than
are a great showcase
on your own online site, especially if it is their first time
coming across your brand. SEO is also a major argument.
Marketplaces have a strong strike force, so you will have a
for your brand image
better chance of being found on search engines. In addition,
their marketing budgets and expertise (acquisition, etc.)
are both very high, allowing them to capture a very large
audience.
Sell a wider range of products:
If Amazon, eBay and other marketplaces only offer a If brands do not proactively manage their online presence, D2C e-commerce sales can be very profitable:
part of your product range, selling as a third-party can other sellers will inevitably follow competition to sell their Almost all brands now claim that their own sales are
be a great way to build up more references online. If this products, meaning they will play around with the prices, significantly more profitable than wholesale transactions (via
is a challenge you face, you may choose to continue the therefore having a negative impact on your brand’s image. In distributors). There are some exceptions, but categories such
wholesale relationship on certain products and open a seller response, many brands are taking steps to take back control of as clothing and electronics are the most lucrative in D2C sales.
account for items that the marketplace does not sell (hybrid their activity by creating their own third-party vendor account As brands invest more and more in their supply chain and
model). This can be an effective method to increase your on the marketplaces. This means they can take control of their the number of consumers integrating brand sites into their
D2C activity while maintaining a steady flow of revenue products, placement of their products and the management of purchasing processes increases, many brands are discovering
through first-party sales (the marketplace is then a classic their collections and prices. that they do not need so many retailers in order to make
distributor) on these marketplaces. known or sell their products.
Through D2C, brands build a direct connection with their
Take back control: Some brands are facing battles with customers. Moreover, even before the launch of a product, An increasing number of brands are turning to D2C by
third-party merchants who don’t present their products these customers are often involved in the choice of the selling on marketplaces. In addition to unlocking a wealth
correctly or respect their prices. For others, counterfeiting is product’s branding. Customers then become a community of consumer and product data, this model allows brands
a real problem on marketplaces. If you are facing these kinds of product ambassadors. In addition, brands that sell D2C to better control the customer experience, product prices,
of challenges, there are no better means of regaining control receive an invaluable asset: data on their customers. This distribution channels, etc. There is a huge revenue potential
than to be present on marketplaces yourself. is a huge strength because major brands have difficulty for brands that want to invest in D2C. After taking the
assessing customer satisfaction on a given product. D2C time to ensure a successful launch on a marketplace, many
brands know this very quickly and can, therefore, faster brands are surprised to see how easy it is to expand to
adapt products to consumer demand. other channels. Many D2C marketplaces sellers have
experienced very strong year-on-year growth after
increasing their presence on marketplaces.
FOCUS ON BRANDS FOCUS ON BRANDS18 19
For distributors and retailers, development of voice commerce,
I. General information on marketplaces
I. General information on marketplaces
marketplaces offer both an social commerce, video commerce,
opportunity and a threat. As etc. Selling on marketplaces now
marketplaces allow brand builds an organizational foundation
manufacturers to go direct-to- that helps implement new channels
consumer, distributors and retailers a lot more efficiently. It supports a
are forced to rethink their added scalable business.
value in the supply chain and develop
new strategies. One way is to show Marketplaces bring down borders.
they’re way better capable of It’s relatively easy to go cross-border
operating marketplaces than brand and reach millions of new potential
manufacturers and so decreasing customers with marketplaces. You
the need and emergency for them don’t have to set up your own e-shop
to go direct-to-consumer with in the local language, logistical
marketplaces. Another way is to infrastructure is already there, and
create their own brand and build that you don’t have to start building an
brand using marketplaces. audience from scratch. Marketplaces
provide a great environment to test
In general, selling on marketplaces new products and markets.
also has a few other advantages that
might be worth considering. However, the most important
argument is that consumers are on
Selling on marketplaces trains skills marketplaces, and therefore you
all organisations need to develop. must be there too. Do you really
The number of sales and marketing have a good reason not to sell on
channels will vastly increase in marketplaces?
the coming decade with the
It’s relatively easy to go cross-border
and reach millions of new potential
customers with marketplaces.20 21
D
1 4
I. General information on marketplaces
I. General information on marketplaces
HAVING NO
3
PLAN AND
OBJECTIVES
INCONSISTENCY
WRONG
Selling on
Many organizations CROSS
start without having
any strategy. They
PRODUCT CHANNELS
open an account, ASSORTMENT
marketplaces:
any other online or offline
randomly list products In larger organizations
channel. You’ll cannibalize
and start bumping into The common approach different channels are
your business. You have
obstructions. Think about is to instantly list the managed by different
to understand that the
making the right
the why and the how first. complete product departments. The result
customer journey is fluid
assortment on a is inconsistency in quality
2
and consumers go from
marketplace. However, of product content,
one channel to another
many of your products branding and pricing.
decisions
for inspiration, browsing
may not be suitable Pricing is an especially
or purchasing. To give an
for marketplaces. peculiar topic. If your
NO ALIGNMENT Marketplaces may also marketplace prices differ
idea of the consequences
it may have: we’ve seen
be specialized in certain too much from pricing
WITHIN THE that Amazon disables
categories, not allowing on your other channels,
listings because another
ORGANIZATION all of your products, or you’re doing it wrong.
retailer ran promotions
Being successful when selling on marketplaces means your products don’t stand You can’t have your
on the same product
more than just uploading a product feed. This is where many We often see ‘the one a chance against the pricing too high or too
and the promoted price
organisations go wrong: they underestimate the dedication man show’. Somebody competition. Carefully low in comparison with
was too distant from the
required. In practice we see a lot of recipes for failure. within the organization choose the product prices in your stores or
listed price on Amazon.
Here’s a few common mistakes. ‘handles’ marketplaces. assortment you are listing
As well as the sales you
But many different on a marketplace. Do so
miss on Amazon, this can
capabilities come from the helicopter view
be especially painful if the
together on the platform. of all your online and
product is part of one of
Marketplaces need to be offline channels: balance
your campaigns.
centralized within the your channels.
organization to guarantee
success.22
I. General information on marketplaces 23
I. General information on marketplaces
1 Select
2 Select
3 Create an
So, how do you do it well? Of This helps you to make the
marketplace products account
course, by not making the mistakes right choices in other areas, like
listed above. It all starts with your marketplace and product selection. It
objectives. Why are you selling on also helps you to define and measure
5
marketplaces? success.
̷ To increase reach: broad
mainstream assortment
The second step is to build a plan. A
lot of different elements come into
6 Optimize Set up
4 Create
play. You need to know how you are content logistics listings
̷ To increase brand going to manage product content,
awareness: limited prices and orders. You need a plan on
selection of the seasonal how to handle customer questions,
collection negative reviews, returns, etc. You
7 8 9
need a plan around automation, legal
̷ To get access to new and financial impact and processes.
customer segments:
specific product category Once you have a clear view, you Start Collect Run
can start building your marketplace selling reviews campaigns
̷ To sell extra stock: slow practice. You construct a team
sellers or out-of-season combining marketing, sales, logistics,
products IT, customer service, finance and
legal. That team is responsible for the
12 11 10
marketplace success.
That team starts executing. By
Select a new Add
following the 12-step plan, they start Evaluate
small and then scale up. marketplace products24 25
Example Example Example IMPACT ON PROFIT
I. General information on marketplaces
I. General information on marketplaces
1 2 3 CALCULATION IF PARAMETERS
STEP 1 CHANGE
Item value 100 50 50
As you can see the profit is clearly impacted by every change.
CHOOSE A MARKETPLACE Number of In these examples we first assume that we sell one item for
1.2 1.2 1.2 €100 on a marketplace. At the end we have a €22 profit. Then
items per order
TO START WITH another one for €50, here the profit is only €6. For the last one
Markdown 0% 0% 30% our brand decides to offer a 30% markdown but the return
Whilst in the UK, US, Germany and other markets, Amazon rates also slightly increases to 50%. In this case the order is not
stands tallest, there are numerous marketplaces across You should also look at which product categories are most Gross revenue €120 €60 €42 profitable anymore.
markets and regions to select from, such as Alibaba, eBay, La suited for the various marketplaces. For instance, one
VAT €-19 €-10 €-7
Redoute, Lazada, MercadoLibre and Allegro. marketplace may be good for fashion, the other for furniture,
and another for electronics. You can use this information to Net revenue €101 €50 €35
Consider also whether you want to sell directly to consumers find out which products from your catalogue are the most
(B2C) or to other organisations (B2B), as there are different relevant on a particular marketplace. COGS €-30 €-15 €-15 STEP 2
marketplaces for both models. In addition to the traditional
Gross margin
B2C marketplaces, Amazon also offers the B2B platform In addition, pay attention to the services offered by a €71 €35 €20 SELECT PRODUCTS
before returns
Amazon Business. In many B2B sectors there are already marketplace. For instance, would you rather leave the logistics
marketplaces you could join as a manufacturer or distributor. or customer service to the marketplace? One marketplace Return rate 40% 40% 50% Start with a small number of products — preferably unique
B2B marketplaces may be closer to your current way of may meet your requirements better than another. ones. Choose products with a slightly higher margin and a
working and therefore perhaps more accessible. As a Net revenue low return rate. Check whether there is a demand for the
€60 €30 €18
manufacturer, distributor or wholesaler you could consider Make sure that you look at the registration terms and after returns products that you want to offer and whether they stand out
selling on B2C marketplaces. However, starting with sales conditions. What are the KPIs? What data and reports can you enough compared to similar offers. Larger marketplaces,
will have more of an impact on your organisation as a whole, derive from the marketplace? What level of service, in terms Gross margin such as Amazon, have tools that can help with this. Another
€42 €21 €10
because B2C is very different from B2B. of delivery and response time, do you need to meet? What is after returns method is to read reviews. These will give you an insight on
the return policy? Success largely depends on whether you the demand and the features that consumers are looking for.
Fulfillment cost €-10 €-10 €-10
In addition, consider whether you want to embark on a are able to meet the requirements set by the marketplace.
retail or wholesale relationship with the marketplace. You should also read the small print. What charges are you Marketplace Choose products that more or less sell themselves, namely
Many B2C marketplaces offer both types, but others offer committing to? What commissions do you need to pay? provision (10- €-9 €-5 €-3 products that are easy to understand. This prevents you
only one or the other. Each type has its advantages and Transparency about marketplace profitability is key. 20%) from getting overwhelmed at the start with questions from
disadvantages. Look to see what suits you best and which consumers about the product, or by returns from customers
marketplaces are accessible for your organisation. Integrator who have misunderstood the product.
provision (0.5- €-1 €0 €0
1.5%)
Profit per
€22 €6 €-3
transaction26
I. General information on marketplaces 27
I. General information on marketplaces
STEP 3 STEP 7 STEP 10
CREATE AN ACCOUNT START SELLING Shopper 2019 survey6 told us EVALUATE
they check Amazon reviews when
Create an account on the relevant shelf’. Products on the wrong shelf Outsourcing logistics to a Activate your account and the shopping on other sites or in a retail You can implement improvements
marketplace. Then take a look at your in a physical store sell less because marketplace will improve the position products. Now you are live! It’s a store! Moreover, positive reviews on the basis of your reviews and
account. Which settings can you they are harder to find. A digital of your products in the search milestone, so celebrate it! But, it’s lead to a higher position in the what you and the organisation have
use? Do you need to take care of any marketplace works the same way. results. Obviously, it costs money to not the time to sit back and wait for search results. Monitor your reviews learned. You can improve the product
issues to get the account live? What outsource logistics, but you might orders. As we said earlier, it’s not and learn from them. Respond to content, optimise your delivery and
reports or dashboards are available Make sure that you have entered all get something extra in return. For something you can do overnight. negative reviews helpfully — don’t design your campaigns differently.
to help you? If you are a brand owner, the attributes correctly. Write content instance, customer queries and Success doesn’t just happen on its damage your reputation through There is always something you can
you should immediately register that is relevant to the consumer. returns may also be taken care of own. Now is the time for the real an undignified, published argument improve.
your brand with the marketplace, if Be sure to use high-quality images. on your behalf. There are different work to start! about a disputed order. Look at what
possible. This often allows you to gain Write a strong title, use effective options and implications in each you can improve based on your reviews STEP 11
control over things such as product bullet points, and insert the correct marketplace. Create a business STEP 8 in order to secure more orders.
content. keywords. Fill in as many fields as case. Bring in your colleagues from ADD PRODUCTS
possible. Consumers will not be able the logistics department. Make a COLLECT REVIEWS STEP 9
STEP 4 to see most of the fields that you fill choice and implement the required Once you have everything under
in, but they are crucial for the search processes to get your products to the When you start to make sales, the RUN CAMPAIGNS control, it is time to scale up and add
OPTIMISE CONTENT algorithm. fulfilment centre or to your customers next step is to actively collect reviews. new products. You can then keep
on time. When you have email addresses from Your products will not have much repeating the previous process. Keep
Optimise the content for your STEP 5 consumers, you can contact them traction at this point. They need experimenting, learning, improving
products. This is a discipline in its STEP 6 and ask for a review. Alternatively, to move up in the search results and optimising. Continue to add new
own right and is not the same as SET UP LOGISTICS you can place a flyer in the box to and they will probably have a low products, optimise processes, run
creating content for your own online CREATE LISTINGS prompt a review. Another option is to conversion rate. Also your brand campaigns and scale up.
store. After all, on a marketplace you Make a choice regarding your logistics. hire promoters and influencers who awareness can still be low. Each
are competing with other suppliers. Choose whether to do it yourself, Upload your product content. As can be rewarded (eg. financially or via marketplace has different types of STEP 12
Consider working with a partner deploy a fulfilment partner or use we’ve said, make sure that your the product itself) to write a review. promotions and advertisements. Look
who can create consumer-focused the marketplace fulfilment service. products are in the correct category. Be careful though, this is an area open at them carefully and think about SELECT A NEW
content for you. Although it may work out cheaper The category is a digital shelf and to abuse, we advise above all genuine which of these you can best deploy
to look after the logistics yourself, this is essential for consumers to find user reviews. As a guide, aim for a for your products or brand. Special MARKETPLACE
Place your products in the correct outsourcing it to a fulfilment partner your products. If not done correctly minimum of 15 reviews per product. deals or promotional prices work
category. This may seem rather means considerably less hassle. you’re going to lose customers. effectively for new products. The aim Once you mastered the process of
obvious, but it often goes wrong in Further optimise the product content Reviews play a crucial role when here is to gain your first sales and marketplace selling, you may wish
practice. The category is the ‘digital and make sure you have 100% of the consumers are deciding to make to collect reviews. Once a product to scale via new marketplaces. Start
fields filled out. a purchase. A whopping 64% of has sufficient (positive!) reviews, it is again with the first step!
online shoppers in our Future ready to use for advertising.28 29
E Interestingly, the m-commerce
revolution is even more prominent in
APPS
The classic pricing model, sales
big marketplaces (such as Amazon,
Cdiscount or even La Redoute) or on
I. General information on marketplaces
I. General information on marketplaces
emerging markets. This is a massive commission, is the most popular vertical marketplaces that only exist
rise from 58.9% in just 2017. While option for marketplaces. When a sale as applications (eg, Wish, Mallzee and
China is most responsible, by far, for takes place on a marketplace, the Wine Advisor).
this growth, figures from India and operator will take a commission fee.
other developing economies are not More and more it seems to be mobile According to a worldwide study led
What’s new?
worth scoffing at, either7. Therefore, applications fuelling m-commerce by Criteo, transactions are nearly 4x
marketplaces have had to evolve and growth. The main reason why apps more common on apps than mobile
invest in mobile to adapt to these perform better than websites is sites and the average basket cost is
practical evolutions as well as the personalization. The first half of higher9.
The rise of
new challenges of the market. These the year 2019 has seen that 62%
days, many have mobile-friendly of smartphone owners use mobile What’s more, when a retailer appears
websites or applications. Thus, if a apps mostly for purchases8. on a popular marketplace app, they
m-commerce,
retailer sells on these sites, they are benefit from increased traffic, whilst
also active on mobile devices, and It can be very profitable for retailers being closer to consumers in their
can benefit from the consequent to be active on marketplace apps, everyday lives.
opportunities and advantages. whether that be applications for
new players, and
other trends
As digitalization and e-commerce continue to evolve, new players
keep entering the field. One strong trend is the rise of m-commerce.
Worldwide, the share of m-commerce in all e-commerce is
expected to rise to 72.9% by 2021.30 31
EXAMPLES OF SHOPPING APPS
I. General information on marketplaces
I. General information on marketplaces
For marketplaces that exist only in application form (which There are two different possibilities for retailers:
tend to be specialised), retailers can benefit from a more
qualified audience. ̷ If retailers already distribute products on a given
marketplace, they will appear on the equivalent mobile
Lastly, one of the main challenges for retailers in an site or application. As marketplaces are mainly mobile- AliExpress is a leading Joom is a Russian Wish is making a name
increasingly fragmented purchasing environment is friendly, the retailer can still benefit from its audience online retail service marketplace and for itself in the US and
customer retention. Appearing on both computer and and a surplus of visibility on these new channels. based in China that is alongside Russia is also Europe. This marketplace
mobile-friendly sites along with the complementary app is a owned by the Alibaba one of the most popular has 90 million returning
great way to tackle this. ̷ The retailer can also choose to integrate onto other Group. It is active in 220 marketplace apps in users each month, 1
marketplaces that are only in application form. These countries and has 150 France. million sellers and 200
Although most sales come via traditional e-commerce, not types of marketplaces tend to be specialised, and show million users. million items.
m-commerce, mobile devices are present throughout the just how important m-commerce has become. Joom is also in the top
purchasing journey. According to Criteo, more than 50% of At least 92% of all orders 10 in Germany, Italy, Wish is in the top 5
all e-commerce is the result of a cross-device purchasing The retailer, small or large, will be able to benefit from the are placed using a Spain and the UK. It is most popular mobile
process. marketplace’s advancements and thus, indirectly, benefit mobile phone. AliExpress slowly starting to allow marketplace apps
from its investments. is already accessible for European sellers. in Germany, France,
Therefore, it is important to think about your mobile presence European sellers and Italy, Spain and the
and develop a cross-device strategy, because even if the As you can see, the world of marketplaces is bigger than is extremely popular in UK. Bargain hunters
final transaction is not made on a mobile device, the user will Amazon, eBay and Bol.com. There are dozens of different France (ranked 5th in the use Wish, and it’s a
probably use one during the process. marketplaces and new players continue to storm the market. mobile marketplace) and very attractive option
Each one has its own characteristics, dynamic, strength and ranked 3rd in both Italy if you can offer a really
A mobile strategy (i.e. being present on a mobile site and/or audience. They all offer new opportunities for reaching a new and Spain. competitive price for
app) lets retailers accompany mobile users in their everyday audience. Research the new marketplaces and determine to your products.
life, and gives them the potential to convert a customer at what extent they suit your marketplace strategy.
different stages of the purchasing process. Wish is developing many
activities in Europe to
increase its profile and
this is something you
can also benefit from.32
I. General information on marketplaces 33
I. General information on marketplaces
SOCIAL COMMERCE GOOGLE SHOPPING AMAZON EXPANDING MARKETPLACES CHINESE
Facebook is experimenting with Pinterest has also entered the mix ACTIONS TO OTHER FOCUSING ON A MANUFACTURERS
checkout features across its with its “Shopping” programme We know from the Future Shopper COUNTRIES THIRD PARTY (3P) BUILDING BRANDS
platforms including WhatsApp which enables visitors to purchase survey by Wunderman Thompson There are markets where Amazon MODEL ON AMAZON
and Instagram. WhatsApp gives products that are similar to the ones Commerce10 that more than half of has very low presence or penetration, Several marketplaces such as As marketplaces lower the threshold
brands and retailers the opportunity they are searching for and viewing. online consumers go to Amazon such as the Netherlands or Czech Amazon, Zalando and Bol.com have for brands to go direct-to-consumer,
to connect, converse and engage for product-related searches, Republic. This doesn’t suggest a tried stated that their strategic focus will it is logical to expect a lot of new
with consumers individually and to But Instagram and Pinterest are comprehensively overtaking Google and failed venture by the Seattle- be on the 3P model, namely the players entering the market.
inspire and guide them on a personal not the only ones. Twitter has at its own business! But Google based giant, but its focus to succeed ‘marketplace model’. Traditionally, Products are for a large proportion
level. This channel allows for hyper experimented with a checkout is fighting back and will become in major strategic markets first, these marketplaces have had a manufactured in China. These
personalization. Instagram enables feature, but failed. Snapchat has a marketplace. Google Shopping such as the US, UK and Germany. wholesale relationship with many manufacturers see what brands do:
you to inspire consumers on a bigger been experimenting with a limited Actions allow users to locate and Amazon will no doubt connect sellers (1st party relationship). The take their products, brand it, and sell
scale. It has added a checkout feature amount of influencers and TikTok is order products from third parties. with consumers beyond its high marketplace buys items and sells it to consumers via marketplaces.
which in principle means that it has working on checkout features too. Naturally, this fits seamlessly with penetration markets in time – and these to consumers under their own They started to believe that they
become a marketplace. Products can More and more social platforms are Google Home, so products can when it decides to make a move name. This is attractive for many could do it themselves... they
be singled out and ordered directly entering the field and each have their also be searched for, added to the into a new market, it is likely to be organisations due to the higher sales don’t need brands to bring their
from advertisements and influencers’ dynamics, consumer demographics shopping list and purchased using rapid! Amazon launched in the volumes. It offers greater certainty own manufactured products to
posts. Instagram has enormous and consumer mindset. Marketing speech. Google Shopping Actions Netherlands in March 2020. Amazon that items will be sold and certain consumers. And they’re right! We
potential as a sales channel. This and commerce melt together on only operates in the US and France also announced plans to open shop services, such as customer service see this happening on a large scale
is not only due to its 1 billion users these platforms which means that at the moment and has a limited in Poland in the near future. We and logistics are outsourced. Now nowadays. Chinese manufacturers
worldwide, but primarily because these departments within your number of sellers for now. Google expect Amazon to expand to the that the focus is shifting to the are succeeding. Almost half of all
72% of these users claim to have company have to work closer Shopping Actions allows consumers Scandinavian countries. This will also 3P model, it is becoming harder sellers on Amazon.com are Chinese11.
purchased something they saw on together. As more and more channels to search, browse and buy products affect other marketplaces, brands for parties to set up or maintain One example is Anker12, a branded
Instagram. Instagram is therefore will be part of your marketing or sales across different channels, for example and retailers. Amazon will follow the this wholesale relationship with a electronics manufacturer that’s
excellent at inspiring consumers, mix, and because they change shape Google Shopping and Google Home. trends in various aspects of customer marketplace. This is leading to sellers estimated to be Amazon.com’s 2nd
and even encouraging them to make over time, you frequently have to So Google has a multitrack plan experience and will keep innovating. being more or less forced to take top seller13. So on marketplaces,
a purchase. There are currently a balance them. For each channel you to compete with Amazon in the The consumer will get used to this sales to the consumer into their own you’re not only competing with local
limited number of brands affiliated have to reconsider which business commerce playing field. and take these expectations with hands but also to regain autonomy or continental players, but you’re
with Instagram, a number that is set purposes they serve and how to them when they shop elsewhere. and control. competing on a global scale.
to increase. optimize them as one of the cogs in
your total channel portfolio.2
34 35
Marketplaces will account for two-thirds of global B2C
II. Boost your international sales with marketplaces
e-commerce sales by 2023, up from 58% in 2018.
In the US, Amazon drove 48% of e-commerce growth in 2018,
which will rise to 56% by 2023 if the current trends continue.14
Boost your
international
sales with
marketplaces
IN THIS CHAPTER
A. European e-commerce potential and specificities. 36 1 CHINA 6 FRANCE
B. Some of the most popular marketplaces around the world. 52 2 UNITED STATES 7 SOUTH KOREA
C. Enter markets around the world thanks to marketplaces. 66 3 UNITED KINGDOM 8 CANADA
D. Challenges to anticipate. 68 4 JAPAN 9 RUSSIA
5 GERMANY 10 BRASIL36 37
A
II. Boost your international sales with marketplaces
II. Boost your international sales with marketplaces
INTERNET
European
PENETRATION IN
EUROPE
In Europe, the internet penetration
EUROPEAN is at 82.5%, with Northern and SHARE OF EUROPEAN
e-commerce
E-COMMERCE Western Europe being the regions CONSUMERS WHO
GROWS BY 13% with the highest internet penetration SHOPPED ONLINE
As indicated, European B2C (respectively 93.3% and 92.3%). We The percentage of online shoppers
potential and
e-commerce turnover is expected can still see big differences between shows striking disparities, from 88
to reach €621 billion this year. If this European countries. to 22%. The UK with 87% is trailing
estimate comes true, e-commerce Switzerland (88%). Germany (82%)
in Europe will have grown by more For example, Iceland has an internet is ahead of France (76%) and Spain
specificities
than 13%. penetration of 99%, while in Ukraine (62%). Some states have not yet
just 64% of the population has access passed the 50% mark, such as Italy
Counting €363 billion, Western to the internet. (47%) and Portugal (49%), but
Europe - Germany, Belgium, France, especially the Eastern European
Ireland, Luxembourg, the Netherlands Counting €363 billion, Western countries, with Ukraine in last place,
3
and the UK - has the largest share Europe - Germany, Belgium, France, which counts only 22% of e-shoppers.
of the European market (66%). This Ireland, Luxembourg, the Netherlands
is followed by Southern Europe - and the UK - has the largest share
rd Croatia, Cyprus, Greece, Italy, Malta, of the European market (66%). This
Portugal, Spain and Turkey with is followed by Southern Europe -
€78 billion (14%), and Northern Croatia, Cyprus, Greece, Italy, Malta,
Europe - Denmark, Estonia, Finland, Portugal, Spain and Turkey with
50 COUNTRIES + 800 MILLION BIGGEST + 500 MILLION + 300 MILLION Iceland, Latvia, Lithuania, Norway and €78 billion (14%), and Northern
INHABITANTS E-COMMERCE INTERNET ONLINE Sweden with €49 billion (9%). Europe - Denmark, Estonia, Finland,
REGION IN THE USERS SHOPPERS Iceland, Latvia, Lithuania, Norway and
WORLD Sweden with €49 billion (9%).38 39
AVERAGE ONLINE
SHOPPER SPENDING
II. Boost your international sales with marketplaces
II. Boost your international sales with marketplaces
IN EUROPE
Although in Western Europe, the SOME COUNTRIES’
highest share of the continent’s SPECIFICITIES Europe is still a group of distinct national
e-commerce turnover is generated, The main obstacles to online Michelle Beeson, the author of a
Northern Europe is the region with shopping remain payment security Forrester report on the European markets, rather than one unique market.
the highest spending per online issues and logistics. Delivery e-commerce market, explains in a
shopper: 2,046 euros per year. The conditions and delivery times or blog that currently “Europe is still a Countries still operate differently in terms
average online shopper spending in the management of returns in case group of distinct national markets,
the whole of Europe was 1,346 euros of dissatisfaction are also among rather than one unique market. of administration, payment structures,
last year and is forecasted to grow to the main concerns of European Countries still operate differently in
1,464 euros by the end of 2019. consumers. terms of administration, payment marketing and even in terms of consumer
structures, marketing and even in
CROSS-BORDER However, to respond to this, sellers terms of consumer tastes, which tastes, which can vary hugely from one
SHOPPING will have to be attentive to the can vary hugely from one country to
The online cross-border market in customs in each country. While most another.” country to another.
Europe represented a turnover of Europeans prefer to be delivered to
95 billion euros in 2018, with 55% of their homes, the distribution points As a result, marketplaces hold a lot
it generated by EU retailers and the are in the lead in Norway or Ukraine of potential for retailers that want
remaining 45% coming from retailers and equally-ranked with the home to start selling in Europe. This sales
that are located outside the European delivery in France. channel simplifies cross-border
Union. This corresponds to a cross- selling, as it deals with each market’s
border share of total online sales in As for transactions, the survey reveals special features and tends to have a
Europe of 22.8%. a real disparity in the payment great client base. In many countries OUTLOOK FOR Contrary to the situation in France, where nine marketplaces
methods used by Europeans. While such as the UK and Germany, MAIN EUROPEAN feature in the top 15 most popular e-commerce sites, retailers
In Western Europe, the UK and in France, Ireland and Denmark credit Amazon and eBay are clearly the MARKETPLACES that want to start selling on marketplaces in the UK or Germany
Germany are the two most attractive cards are the preferred payment leaders in these markets, however have to use eBay and Amazon, as these two giants dominate
buying destinations for online buyers method (nearly 80% of Europeans merchants wishing to enter the the two markets.
around the world. In 2018, more than use credit cards), this is not the case European market must consider
a quarter of English online retailers’ everywhere: 22% in the Netherlands, that in other countries, such as
orders were made from abroad. 46% in Belgium and only 12% in France, the Netherlands or Poland, The European marketplaces
In Germany, over half of all online Germany. Some Europeans prefer other marketplaces are strongly market is not uniform. In order
retailers were selling products to at solutions such as PayPal or bank challenging Amazon (for example to sell efficiently and effectively
least two foreign countries. transfers. Mobile payment scores the Cdiscount in France, Bol.com in the in each country, retailers have
highest in Northern Europe, 51% in Netherlands, or Allegro in Poland). to take the specifics of each
Lithuania and 48% in Estonia, while country into account.
cash on delivery is still very used in
Eastern European countries. 15 - 1840
II. Boost your international sales with marketplaces 41
II. Boost your international sales with marketplaces
United TOTAL POPULATION INTERNET PENETRATION ONLINE SHOPPERS
Kingdom 66.5M 96% 54.8 M
Top e-commerce
market in Europe
E-COMMERCE SALES M-COMMERCE SALES ANNUAL E-COMMERCE
GROWTH RATE
€196 B €56 B 14%
By 2024, UK shoppers will spend 73% of the products purchased
50% more than they do now on online come from domestic online
online marketplaces, new research stores. Of the remaining 27%, 16%
suggests. of the goods purchased online are MAIN MARKETPLACES
purchased outside the EU and 11%
General merchandisers Amazon are ordered from an EU country.
and eBay dominate the online The foreign markets from which
marketplaces market and are UK consumers order most products
forecast to account for over 90% online from are the US, Germany and
of spend in 2019. France.19 - 2242
II. Boost your international sales with marketplaces 43
II. Boost your international sales with marketplaces
TOTAL POPULATION INTERNET PENETRATION ONLINE SHOPPERS
Germany 82.8 M 89% 57 M
2nd largest e-commerce
market in Europe
E-COMMERCE SALES M-COMMERCE SALES ANNUAL E-COMMERCE
GROWTH RATE
€94 B €49.6 B 11%
Highest returns rate in Europe. The EU is the most significant
Credit cards are not the preferred source of cross-border purchases
payment method; Germans prefer to (products shipped into Germany
use solutions like PayPal, SEPA Direct from other countries). China and
Debit, Sofort or Giropay. the US account for 44% and 32% MAIN MARKETPLACES
respectively.
Amazon accounts for an impressive
27% of all e-commerce sales. Online marketplaces were able
to increase their revenue by 9.7%
to 30.62 billion, making them the
largest distribution channel in
German e-commerce.23 - 3044
II. Boost your international sales with marketplaces 45
II. Boost your international sales with marketplaces
TOTAL POPULATION INTERNET PENETRATION ONLINE SHOPPERS
France 67 M 85% 39 M
3rd largest e-commerce
market in Europe
E-COMMERCE SALES M-COMMERCE SALES ANNUAL E-COMMERCE
GROWTH RATE
€92.6 B €20 B 13.4%
Delivery cost and time are key
determinants in France.
The marketplace industry is highly MAIN MARKETPLACES
developed, with countless vertical
structures to consider.3146 47
FOCUS ON MARKETPLACES MARKETPLACES ACCOUNT
IN FRANCE FOR 30% OF DIGITAL REVENUES
II. Boost your international sales with marketplaces
II. Boost your international sales with marketplaces
France is one of the most dynamic e-commerce markets in The French e-commerce market has a special feature: IN FRANCE
the world (6th). With an internet penetration rate of 85%, marketplaces are very popular. Out of the top 15 most visited The share of marketplaces has increased from 15% of the total The marketplace phenomenon is experiencing a meteoric
France is one of the European e-commerce market leaders, e-commerce websites in France, nine are marketplaces, most sales volume of the main merchant sites in France in 2013 to rise. On Amazon, the marketplace model accounts for 69% of
with a market value of €92 billion in 2018, set to exceed of which are vertical and local.32 30% in 2018 and should reach 33% in 2021. The marketplace total sales volume in France. More broadly, for all the major
€100 billion in 2019. is therefore an effective sales channel, but above all one with e+commerce brands in France, the share of the marketplace
a future. has risen from 21% in 2015 to 35% in 2018.33
Average unique visitors Monthly France coverage Average unique visitors
Rank Brands
per month (% population) per day
1 Amazon 30 781 000 49.1 % 5 188 000
2 Cdiscount 20 145 000 32.2 % 2 158 000
3 Booking.com 15 413 000 24.6 % 1 393 000
4 Fnac 13 972 000 22.3 % 1 035 000
5 Veepee 13 702 000 21.9 % 2 648 000
6 OUI.sncf 13 419 000 21.4 % 1 263 000
7 Carrefour 12 377 000 19.8 % 1 144 000
8 E.Leclerc 11 955 000 19.1 % 1 155 000
9 Vinted 10 855 000 17.3 % 2 512 000
10 Leroy Merlin 10 678 000 17 % 741 000
11 Groupon 10 538 000 16.8 % 1 242 000
12 eBay 10 368 000 16.5 % 1 099 000
13 Airbnb 9 937 000 15.9 % 1 059 000
14 Wish 9 858 000 15.7 % 1 181 000
15 Darty 9 824 000 14.1 % 512 00048
II. Boost your international sales with marketplaces 49
II. Boost your international sales with marketplaces
TOTAL POPULATION INTERNET PENETRATION ONLINE SHOPPERS
Spain 47 M 92% 27 M
Biggest e-commerce
market in Southern
Europe
E-COMMERCE SALES M-COMMERCE SALES ANNUAL E-COMMERCE
GROWTH RATE
€28 B €16 B 17%
AliExpress is particularly used
in the country.
When targeting the country, online
retailers have the chance to access MAIN MARKETPLACES
other markets like Portugal (lots of
Portuguese buy online from Spanish
sites) and South America.34 - 3550
II. Boost your international sales with marketplaces 51
II. Boost your international sales with marketplaces
TOTAL POPULATION INTERNET PENETRATION ONLINE SHOPPERS
Italy 60 M 92% 23 M
Second largest
e-commerce market
in Southern Europe
E-COMMERCE SALES M-COMMERCE SALES ANNUAL E-COMMERCE
GROWTH RATE
€27.4 B €11 B 18%
Italy has one of the highest rates of
mobile penetration in Europe.
Free delivery is a key factor which
determines whether someone MAIN MARKETPLACES
completes a purchase.
Online payment is still not universally
accepted by Italians, most of whom
prefer to pay in cash. 36 - 3752 53
B ACCORDING TO ECOMMERCE EUROPE, AMONG THE TOP
II. Boost your international sales with marketplaces
II. Boost your international sales with marketplaces
CROSS-BORDER EUROPEAN MARKETPLACES, WE CAN FIND:
Company Country Sector
Germany Fashion - Jewelry - Baby
The most popular United Kingdom Mass merchant
marketplaces United Kingdom Fashion - Jewelry - Baby
around the world United Kingdom
France
Fashion - Jewelry - Baby
Mass merchant
Estimates state that marketplaces will represent 66% of global
The Netherlands Home - Garden - DIY
e-commerce sales38. 72% of marketplace sales came through
third-party sellers in 2018. eBay, Mercado Libre, Pinduoduo, and
Amazon have the most third-party sellers, reaching 7.5 million, France Consumer electronics
4 million, 3.6 million, and 2.5 million, respectively, in 201839.
France Fashion - Jewelry - Baby
Denmark Mass merchant
Spain Personnal careYou can also read
