Analysis: Why 44% of retailers are launching marketplaces

These are just some of the findings from an in-depth off-the-record survey of 60 retailers conducted by Retail Week as part of our report A marketplace mindset, produced in association with Mirakl.

With IMRG forecasting online sales growth will slow to single digits for the first time this year, the pressure is on retailers to boost new customer acquisition – and increasing assortment by taking on third-party brands could be a way to do this.

However, while the 44% of retailers that say they operate their own marketplace or are planning to launch one may seem like a compelling figure, it is unclear whether retailers truly understand what being a marketplace operator means.

Many retailers work with third-party brands on a dropship basis, whereby they buy stock upfront to sell via their own websites, with the brand then taking care of warehousing and fulfilment.

“A true marketplace model means a retailer does not buy any stock upfront, but rather hosts third-party brands and earns commission on the products sold via its website”

However, a true marketplace model means a retailer does not buy any stock upfront, but rather hosts third-party brands and earns commission on the products sold via its website.

Similar to the dropship model, the third-party brand then takes care of warehousing and fulfilment.

This misunderstanding may have artificially inflated the 44% statistic.

However, while the findings of this report underline the confusion among retailers around marketplaces, the research also underscores the high level of interest in the marketplace operating model.

This report lifts the lid on what becoming a marketplace operator really involves and reveals how making the investment could help retailers better compete in a market dominated by third-party marketplaces such as Amazon and eBay.