Marketplaces are forecast to witness 40% of all e-commerce revenue by 2020 and so they’re likely to become the front line in the battle for brands and retailers looking to internationalise their offering. The lack of complexity around accessing marketplaces, combined with the fact that they offer a capex-light solution means that they’re also a great way to collect data and understand consumers across an array of countries. When it comes to the UK these factors become doubly important when Brexit is taken into consideration, as businesses increasingly focus their attention on cross-border sales to stabilise and grow.
As a key component of a cross-border strategy marketplace are the future of online retail. Gone are the days of regional online expansion through a sell managed website. Speed to market, low risk and financial scalability are critical to the success of online retailers and marketplaces offer all of these. They allow a national online retailer to explore new, untapped, markets and revenue streams with a speed that was unimaginable even 3 years ago.
If the branding is right, customers will desire the products and be driven to buy them, even if the brand’s webshop does not offer localised e-commerce services.
Generally speaking, marketplaces are the start of most consumers online purchase pathway. It’s where people go to analyse prices, compare products or read peer reviews. Marketplaces also have a social element to them, which leads them to having longer site durations. Consumers will often simply browse, as they would do at a conventional mall, but from the convenience of their laptop, tablet or mobile device. As a proposition, it’s difficult to compete with that.
There is clearly a paradigm shift taking place as more retailers turn away from traditional brick and mortar retail and turn to marketplaces. We see that cross-border trade is the future of e-commerce with marketplaces being the cornerstone piece to that industry.
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