What’s next for marketplace growth? 100 retail leaders weigh in
Written by
Annie Laukaitis
Key Highlights
Marketplaces are driving revenue growth and becoming a bigger part of brands’ overall strategies.
Brands are balancing marketplace growth with DTC rather than treating the two as competing channels.
Inventory coordination and data integration are among the biggest challenges brands face as they expand across marketplaces.
Marketplace success requires more than getting products listed, with operations and data playing a critical role behind the scenes.
Brands are investing across customer service, advertising, pricing, analytics, inventory management, and cross-platform integration to strengthen their marketplace strategies.
For shoppers, buying from a marketplace can be as simple as finding a product and clicking “buy.” But behind every listing is a team working to keep inventory accurate, product data up to date, pricing competitive, and orders moving. And, often across multiple channels at once.
As marketplaces become a bigger part of the ecommerce mix, that balancing act is only getting more complex.
In the new Mastering the Marketplace in Retail and Ecommerce report from eTail Insights, sponsored by Feedonomics, 100 senior retail and ecommerce leaders share how their organizations are approaching marketplace growth, the challenges they’re working to solve, and where they’re investing next.
The findings reveal an interesting divide. While 85% of respondents say their marketplace strategies are at least somewhat effective at driving revenue, only 15% have a comprehensive strategy in place to address their biggest marketplace challenges.
In other words, marketplaces are working. But as brands look to grow their presence, the question is shifting from simply where to sell to how to manage that growth effectively.
Let’s take a closer look at what retail leaders had to say about where marketplace strategies stand today and what’s coming next.
Marketplaces are becoming a bigger part of the growth strategy
For many brands, marketplaces are no longer just another place to sell. They’re becoming a bigger part of the overall growth strategy. In fact, 81% of leaders surveyed expect marketplace sales to become more important to their organizations over the next 12 months.
But that doesn’t mean brands are choosing marketplaces over their direct-to-consumer (DTC) channels. More than half (51%) say they place roughly equal emphasis on DTC and marketplace sales.
The opportunity lies in understanding the role each channel plays. Marketplace practitioners interviewed for the report described marketplaces as a way to reach and acquire customers where they already shop, while direct channels can give brands more control over the experience and more opportunities to build long-term customer relationships.
As marketplaces take on a larger role, brands have an opportunity to think more intentionally about where they fit within the broader channel mix and how they can complement direct channels.
Marketplace growth is putting operations to the test
The more places a brand sells, the more moving pieces its teams have to keep in sync. And according to the report, some of the biggest marketplace challenges aren’t happening on the digital shelf. They’re happening behind the scenes.
Coordinating inventory across multiple platforms is the top challenge for 40% of respondents, followed by integrating marketplace data with internal systems at 33%.
Consider what that can look like in practice. A marketplace may promise a customer next-day delivery, but the brand still needs to know where that product is available and how to allocate inventory to fulfill the order. At the same time, marketplace data needs to stay synchronized with internal systems. When it doesn’t, discrepancies can show up across inventory, pricing, orders, and customer data.
Those challenges become even more important as brands try to improve product visibility and understand whether marketplace growth is actually profitable. The report explores where leaders stand across each of these areas and where gaps still remain.
As marketplace strategies mature, simply getting products listed isn’t enough. Brands also need the operations and data infrastructure to support what happens after those products go live.
Brands are investing in what comes next
The challenges are clear, but brands aren’t standing still. Many are already thinking about what they need to improve as marketplaces take on a bigger role in their growth strategies.
In fact, 67% of respondents say they’re developing strategies to address their biggest marketplace challenges, even if they haven’t implemented them yet.
Where are they focusing their attention? The report points to investments across the marketplace experience, from customer service and advertising to pricing, analytics, inventory management, and cross-platform integration.
There’s no single lever for marketplace success. As brands look ahead, the opportunity is to build a more connected strategy that helps them manage what happens across channels while still delivering the experiences customers expect.
The final word
Marketplace opportunities are growing, but so are the demands of managing them. As brands expand their marketplace strategies, they need to think beyond where they sell and consider how inventory, data, visibility, profitability, and customer experience work together.
Mastering the Marketplace in Retail and Ecommerce takes a deeper look at how 100 retail and ecommerce leaders are navigating these priorities, what’s working today, and where they see opportunities to improve marketplace performance.
