Online marketplaces aren’t just for global players like Amazon or eBay. More and more often we see retailers who decide to set up their own marketplaces and accelerate their sales. Let’s investigate 10 examples of retail brands that successfully launched a marketplace.
Why do retailers add marketplaces to their businesses?
Online marketplaces are sales channels where many different sellers provide their products or services to buyers. Marketplaces may also sell their own products, but this is not required.
There are many reasons why retailers might decide to launch a marketplace. What reasons stand behind clients’ decisions? Based on our experience, I will try to cite the most common ones.
Top reasons why retailers launch marketplaces
- Strong base of loyal customers
Marketplaces are powerful sales channels. It is no wonder that companies want to develop and introduce new solutions to their business, especially when it comes to companies with a bunch of loyal customers. With a base of ready-to-buy customers, a channel like an online marketplace offers a huge opportunity. It is a ready-made solution.
- Increasing number of products
Launching an online marketplace is associated with an increase in the range of products. Consequently, an increase in the product base will result in a more extensive choice for customers. Products can be the same type as the products of the company that creates a marketplace or they may be completely different. For instance, TIM offers electrical and electrotechnical equipment, meanwhile Amazon offers products from multiple categories. This solution allows marketplaces to grow their offer rapidly.
- Marketplace revenue
Everyone who runs a market wants to generate revenue. Starting an online marketplace requires choosing the best business model. First of all, it is necessary to choose a strategy. One of the most popular models is to charge a commission from each transaction. You can also choose between a membership fee, which is a recurring fee to access the marketplace, or listing fee, for newly added products. There is also a subscription model, featured listings and ads, and more. Marketplaces employ various business models so it’s up to you to choose the best one.
Examples of companies that added a marketplace
Based on clients who work using Mirakl software, we selected and described some of the most interesting cases.
Best Buy Canada
Best Buy is a multinational consumer electronics retailer with over 112.8M monthly visits, which is an impressive result. Why did Best Buy decide to launch a marketplace in Canada? First of all, they have a large audience. That was my first point among “The most important reasons retailers launch a market.” The company wanted to adapt and be more relevant to customers. The aim of launching an online marketplace and adding new products to the base is to increase the product range. Every retailer wants customers to buy in his store. By offering a wide range of products from multiple providers, we have a better chance that the customer will find what he is looking for, and as a result, keep coming back. More products on your marketplace can help you develop new categories that you have not even thought of adding before. By releasing an online marketplace, Best Buy Canada made a significant and profitable move.
“With a marketplace, Best Buy Canada brings immense value to Canadian shoppers, who are underserved online and often must rely on international e-commerce sites to purchase goods, leading to inflated prices and longer shipping times. By increasing our online selection, we provide the convenience of an omni-channel experience to Canadian shoppers and help them embrace eCommerce by finding the products they are looking for directly from a retailer operating in Canada.”Thierry Hay-Sabourin, Senior Vice President, eCommerce, Best Buy Canada
The Carrefour Spain Marketplace has been operating for over a year. As a result of 19.7M monthly visits and successful launches in France and Poland, the company decided to add another online marketplace to their business. The marketplace will also soon be available in Brazil. The main goal of introducing the marketplace was to connect all Carrefour hypermarkets. Not only within one country. This practice significantly increased the number of products.
Christian Lacroix is a French fashion house offering luxury products inspired by the baroque era. Why did that luxury brand launch an online marketplace? The company wanted to sell all of its available products on the market. Integration of all products from partners around the world required creating one platform. The creation of a marketplace has become the perfect solution for this French company. In addition to merging all companies offering products of this brand, the implementation of the marketplace allowed them to deal with distribution and delivery.
“Christian Lacroix is an iconic brand – one that’s renowned for having revolutionised the world of fashion. Our e-commerce platform has brought us into the digital age, with an innovative model allowing us to establish direct contact with our customers and provide them with a unique experience, accessible from anywhere in the world. This model benefits both our brand and our partners.”Nicolas Topiol, CEO
Conforama is a network of stores dealing in the retail sale of home furnishings. The primary purpose of launching an online marketplace by Conforma was expanding the product range with new styles. As one of the first home equipment marketplaces, Conforma offers its customers the latest products and trends. Since 2016, Conforama has been offering its clients a wide range of products from the best trading partners.
Conrad Electronic marketplace is slightly different than other ones. The company launched a marketplace for B2B, which is the first B2B technology and electronics market in Germany. As one of the largest suppliers in the field of electronics, Conrad wanted to offer business customers even more professional service in one place. As a result, the company increased its product range by more than three million products, as well as the number of customers.
As the first eCommerce Italian company, ePrice wanted to add an online marketplace as soon as possible. The main goal was to increase the variety of products and growth in the European market. The company promote the local Italian industry. The launch of the marketplace has resulted in a doubling of the product range only half a year after implementation.
Galeries Lafayette is an exclusive French department store chain. The introduction of the online marketplace was the next company step after the reconstruction of the website and migration to the SAP Hybris eCommerce platform. Galeries Lafayette wanted the whole process of introducing the marketplace to happen without compromising the quality of services provided. The goal of Galeries Lafayette Marketplace was to centralize the offer of many sellers. This new implementation resulted in the expansion of the product range with new categories and an increase in online sales.
Presenting an online marketplace to their customers, Go Sport turned to a new selling level. In addition to its collections, the GO Sport marketplace offers customers a greater selection of products. The main challenge was to maintain the quality of services but also photos and descriptions at the same level. As a result, the company managed to achieve its goals. Around 70% of the catalog was updated after a few months.
Phone House is a Spanish retail specialist in telephony and communications. Why does a telecommunication company need a marketplace? The company decided to go further with its business. The launch of the online market has expanded the Phone House offer and expanded its customer base. For retailers, Phone House Marketplace offers the ability to generate new business lines and open up new markets in nine European countries.
Walmart Mexico marketplace is a new thing. Walmart Mexico also known as Walmex, is an American supermarket chain. Why has Walmart Mexico launched a marketplace? There were two reasons for this decision. Firstly, creating one site for customers with multiple product categories. Secondly, offering companies the ability to scale their business. Each of these points translated into an increase in Walmart sales.
The main reasons behind a company’s decision to implement a marketplace include a base of loyal customers, a desire to expand the product range, and increasing market revenues. Having a marketplace not only means benefits for the implementer, but also benefits for sellers using this solution. One of them is a ready-to-use sales tool and a customer base guaranteed by the platform provider – but more about the advantages for retailers another time.
Published September 30, 2019