Leveraging Marketplace Momentum: How To Capitalize On New Growth Opportunities Without Risking Your Brand Identity

Consumers are swarming to marketplaces in droves: 97% of U.S. consumers who shop online do so on marketplaces, according to research from comScore. The breadth and depth of products offered at competitive prices is likely what initially captures consumer attention. However, it’s marketplaces’ extensive focus on providing seamless fulfillment and personalized shopping experiences that keep shoppers coming back for more, according to Tyler Higgins, a Director in the retail practice of global consultancy AArete.

“The freedom to browse, assortment of goods, and ease of transaction have driven the growth of online marketplaces,” Higgins said. “Consumers have gravitated to having control of their shopping experience and selection, and online marketplaces have given consumers that freedom.”

As a result, Amazon, Alibaba, Jet.com and other marketplaces have acquired a large and growing share of the e-Commerce pie. In 2017, marketplace sales accounted for 41% of all online sales — a significant rise from a mere 17% in 2008 — according to Euromonitor. Over the next five years, the impact of marketplaces will become even more significant, according to Forrester: the research firm projects that online marketplaces will account for 67% of global e-Commerce sales by 2022.

The value of selling through third-party marketplaces is clear: brands can get their products in front of millions of shoppers around the world who visit these e-Commerce destinations regularly. Brand awareness rises and sales jump. However, there are specific limitations to marketplace partnerships that brands must know before they make the dive.

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