Online marketplaces in Europe

Conforama provides 1.5 million active offers on the marketplace, which recorded an average of 4.4 million visitors per month in 2018. Sellers don’t pay a monthly fee; commission depends on product category and is due on the selling price of a product, plus a shipping fee

Ecommerce vs. marketplace: How and when to choose each?

Online marketplaces in Europe

Online marketplaces in Europe

In Europe, the most popular online marketplaces are Amazon and eBay. But of course, there are a lot more interesting platforms for retailers looking to sell their products to local customers. On this page you will find more information about the most popular marketplaces in Europe.

Online marketplaces are here to stay. An increasing amount of small and medium-sized retailers join these platforms, to better reach their target audience (and eventually get sold to one of many Amazon seller acquisition companies). It’s thanks to the retailers who preceded them, that marketplaces have become a more popular destination for other sellers. Many consumers even don’t do a Google search for a product, they just go their favorite online marketplace and start their quest there.

Fnac Darty

Darty, acquired by Fnac in 2016, is an electrical retail company from France. It launched its own online marketplace in 2014, selling products from themselves and from third party vendors. Fnac Darty Marketplace has 36 million active customers and is leader in high-tech, appliances and home products. The monthly subscription price is €39.99, plus a commission rate on the sales. Sellers can register on Darty and/or on Fnac.

La Redoute, founded in 1837 in France, is a retailer of apparel and home decor items. The online shop welcomes over 7 million visitors each month and operates in 26 countries across the globe. La Redoute has over 450 sellers connected to its marketplace, who pay 49 euros per month, plus a commission on sales (varying from 8 to 20 percent).

Ecommerce vs marketplace: from the basics

First things first: both business models consist of online stores. The main difference is that one (ecommerce) supports only a single seller, the owner of the store, and the other (marketplace) enables multiple sellers to offer products through the same storefront – there are both the store owner and third-party sellers operating under the hood. For the final customer, there is no practical difference in the shopping process: it is the same and happens on the same website, in a seamless way.

But while this difference may be irrelevant to the final consumer shopping experience, for business owners is the actual the opposite – choosing between one or another implies on huge impacts on the operation.

What an ecommerce operation looks like

In a regular ecommerce operation, the business owner sells its own inventory and takes care of each part of the operation, from the purchase until its fulfillment and everything on the backstage – storage, processing payments, logistics and taxes to quote a few. To summarize, in an ecommerce operation the owner is responsible for guaranteeing that everything’s running as it should and that the order gets to the final customer. In this case, the site owner is the one and only seller.

What is a marketplace operation

A marketplace is an extension (or evolution) of an ecommerce platform that allows third parties to sell through it, which means that besides the actual owner other sellers can also display and sell their products.

For retailers, becoming a marketplace is a way to increase the product assortment without the extra work of storing, managing and fulfilling them. In a marketplace, sellers take care of their own operations – the commerce website works as a sales channel for them to announce their products and services in order to reach more customers.

Why become a marketplace?

It is a win-win operation. For the owner, a marketplace operation is a way to expand the business to different markets and segments and generate incremental revenue with little investment and risk, given that the seller is responsible for its own sales and orders. For third-parties, selling on marketplaces is a way to add an extra sales channel to display its products and to make them available in trustworthy and well-known websites. Also, therefore, to reach a number of potential customers that they wouldn’t by themselves.

Choosing between ecommerce and marketplace

We can answer this question to two different personas: retailers who already operate their own ecommerce and question whether or not to turn it into a marketplace; and people looking forward to having an online business and are not sure which model is the best. Below, we’ll focus on the first persona.

1. Increasing product assortment

As a retailer, once you become a marketplace you can establish new partnerships and welcome sellers that have a different product assortment, from new, local brands to different product categories and so on. This means that you get to increase product assortment with no risk or high investment, but just by allowing new sellers on your platform.

2. Total control over the operation

If a concern of yours is whether becoming a marketplace leaves you with less control than in an ecommerce operation, there’s no need to worry. As the owner, you have total control of who can become a seller on the platform, what products can be sold and, if needed, you can also put in place the desired selling rules.

All that with no extra work. With VTEX’s native marketplace, you can automate supplier management and product approval, while partners have a self-service portal available to manage its own products, as well as track their sales and orders.

3. Gathering consumer insights

By having sellers from different markets that sell different products and brands, you get to know a whole new consumer habit and gather insights that can inform the next steps of your business to better serve customers’ needs.

4. Building loyalty and reaching new customers

If consumers can find all sorts of products, brands and different price ranges in your platform, why should they shop anywhere else? As a marketplace, you offer the convenience people are looking for and become the go-to place for shopping by selling everything they need and giving them options to choose from.

Sources:

https://ecommercenews.eu/online-marketplaces/
https://vtex.com/en/blog/strategy/ecommerce-vs-marketplace/

Cassie

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