Interviews, insight & analysis on digital media & marketing

How to grow more business on online marketplaces

by James Barlow, Regional Director UK&I at Akeneo

For many brands, marketplaces are an important channel and becoming even more so as they look for growth opportunities that are constrained at home, abroad. According to Forrester, globally, 47% of ecommerce sales were made through online marketplaces (dominated by Amazon) in 2020 and this is predicted to rise to 66% in 2022. In 2020, this business was worth $2 trillion and there were 53 marketplaces that could boast more than one million visits a month. Be STF reckons marketplaces be worth as much as $8.745 trillion by 2025.

Marketplaces are also important to brands during the all-important peak periods. According to Sensormatic’s Peak Trading 2022 B2C Shopper Sentiment Survey, of those shoppers buying online over Christmas 2022, more plan to use marketplaces than those who will buy direct from retail brands; two thirds (65%) said they planned to shop on online marketplaces, such as Amazon, over Christmas compared to 54% of UK shoppers who planned to buy direct from retailers’ websites during peak.

It is common to see inconsistencies in the way products are displayed between marketplaces and other channels, including product descriptions, images, availability and fulfilment. Marketplaces are part of an ecosystem of search and purchase channels. MyCustomer reported four years ago that 95% of customer journeys occur across multiple channels, and the sheer number of channels has only increased since then with the use of social channels for both search and ordering.

There are many reasons for these inconsistencies. One is that the marketplace business is run by a dedicated team that is rightly is concerned only about the performance of their particular channel. Another is that the interfaces, catalogues and general functionality are all built at different times, and not necessarily using the same tools, so integration is often partial or missing altogether. Integration is key to meeting the needs of the customer who thinks not in channels but in purchase outcomes.

Right now, this is costing retailers sales conversions, traffic and the chance of building loyalty, as customers have rightly come to expect to see the same details and offer whatever combination of channels they may be using as part of a single purchase.

Key to fixing the problem is a single product information and experience management system able to manage products across multiple marketplaces, and indeed any other channel and customer touchpoint to ensure not only consistency but ease of use, so that new products and deeper product data can be added quickly to take immediate advantage of market opportunities.

The process must start with an understanding of what shoppers want. Their experience of products will heavily affect the journey they take and the likelihood of them purchasing, remembering that ecommerce conversion rates run between 1% and 4%. Akeneo’s own research in its 2022 B2C Global Survey found that 2 out of 3 shoppers will abandon a purchase due to a bad product experience.

A good experience demands that the product is accurate, complete, images are matched to description and description matched to product, and this not just about rescuing a sale but growing sales by taking awa barriers to purchase and friction. And this is something highlighted in IDC’s recent “Product Experience Strategy Is the Essential First Step to Omni-Channel CX and Digital Commerce Domination” Spotlight Report which suggests brands can struggle to deliver on their CX goals because most internal metrics focus on how well teams react to customer friction points rather than on proactively preventing friction – such as accurate product information – from the start. This is even more important for categories such as food where consumers’ health, safety, and well-being are all concerned.  Product information may well be mandated in law so, aside from customer experience, cross-channel inconsistencies may be cause for action against the brand.

Product experience is about growing as well as holding onto sales. The Akeneo research shows that 45% of shoppers would pay more for products if the product experiences were good and product information was complete and of good quality, while 61% would pay up to 10% more for products that had better product data.

Marketplaces are not only growing but their shape is changing – they are acquiring more and more brands, and new hybrids are emerging from social media and tech. This is potentially a threat to brands with the risk that they lose control. Product experience is core to ensuring they maintain control and mange their own destiny in this changing environment, even to the extent of launching their own marketplaces, which we are starting to see more and more.

mistakes in how they present, promote and fulfil their products.

Opinion

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