A marketplace is a powerful ecommerce channel for any retailer, bringing together buyers and sellers under that retailer's brand - and customers clearly favor this new shopping channel.
In a recent report from Amazon, 64 percent of shoppers start a search on a marketplace, while 66 percent consider buying from online marketplaces according to a new study from Pitney Bowes. Amazon Marketplace (which accounts for more than 50 percent of Amazon's business) is the most famous example of an online marketplace, but many retailers are now offering them as a potentially rewarding way of expanding their offering and ensuring shoppers stay on their website.
After a retailer has made the decision to launch its own marketplace, one of the first things to consider is which brands should be included; should they offer more products of a similar style or feature a wider selection of items? Once that decision has been made, the next step is determining the best way to on-board those brands.
When it comes to the qualities a retailer should look for in sellers for their marketplace, the first question to ask is whether that seller already has an ecommerce site. If so, that means it is already used to engaging directly with customers. If not, a retailer must assess the seller's ability to manage logistics, product cataloging, customer invoicing and after-sales service. In an online marketplace, it is also important for a retailer to maintain consistency with its identity and strategy. A retailer's brand image is critical to maintaining customer comfort and loyalty, and a seller that contradicts that identity is likely not a good fit. A marketplace seller can usually offer different types of products compared to what the retailer usually sells, but it must be complementary.
Once a retailer has selected the sellers that will operate on its marketplace, it needs to get them ready to sell - this is known as the on-boarding process. A retailer must provide its sellers with the right tools and sufficient training so that they feel autonomous on the platform. Retailers shouldn't field regular questions from its sellers, but instead aim for them to be as self-sufficient as possible.
Selling in a marketplace means overseeing all aspects of customer communication and logistics, so a seller must have a real B2C strategy, including marketing, the ability to drive promotions, and dynamic and flexible pricing across the product range. In addition, the seller's catalog must be well displayed on the platform with SEO-friendly titles and strong images. For example, if selling apparel merchandise, customers would mostly search for the product by brand, so a seller should include the brand name at the beginning of the title in order to get picked up in searches.
Once the seller is on-board, a retailer can and should provide help in the initial weeks to help ensure a successful start for both the seller and the overall marketplace. This should include a marketing push for the marketplace with a prominent position on the retailer's homepage, as well as marketing support for the sellers that include logos for their pages, newsletter content and more. Promoting a marketplace - both overall and on the individual seller's page - requires extensive marketing, just as any business would need.
A marketplace can be a powerful ecommerce channel for any retailer, offering the chance to improve customer service and increase product range without the hassle of inventory. For every successful marketplace launch, there have been just as many which simply haven't worked for the retailer, their customers or the sellers on the marketplace. The key to a successful online marketplace lies in the initial on-boarding process - get that right, and any retailer can be on the path to true marketplace success.