The ChannelX European Marketplace 2023 report gives us great insight into the current positioning of marketplaces within the broader consumer market. We’ve summarized our key takeaways.
Acquiring web traffic for an individual web store is becoming a huge marketing challenge. Paid advertising CPCs are at an all-time high, organic social media and SEO are more competitive than ever, and PR opportunities are harder to come by with dwindling resources in print media. This may sound doom and gloom, but far from signifying the end of eCommerce, these challenges are merely a reflection of the ever-evolving consumer environment. Expanding channel coverage to include marketplaces is quickly becoming a necessity for eCommerce brands.
85% of European web traffic goes to online marketplaces. With web store traffic hard to come by, these statistics can be frustrating for SME brands and sellers. Love them or hate them, marketplaces are a dominant presence in the modern consumer experience. With 35% of all online purchases being made on a marketplace, brands continuing to push against marketplaces as a perceived threat risk missing access to a new tranche of customers.
Marketplaces that offer a broad range of categorized products are considered generalist marketplaces. Giants Amazon and eBay are prime examples of marketplaces offering a huge variety of brands and breadth of products. Although not category-specific, brands specializing in electricals, fashion, and leisure tend to do best on these types of marketplaces.
In recent years, category-specific marketplaces have become more common. These marketplaces have gained popularity as many high-street brands launch their own retailer marketplaces, providing a more relevant buying experience. Stores such as B&Q, Decathlon, and Very launched specialized marketplaces relevant to their product categories. The marketplace landscape is continually evolving to accommodate the increasing number of options available.
eBay is currently ranked the third-leading marketplace in Europe. Once ranked second only to Amazon, it was recently overtaken by Polish marketplace Allegro in relation to sales. Despite this, eBay is still the leading pure marketplace in the world. Pure marketplaces connect buyers and sellers to facilitate purchases but do not handle any inventory goods. As a marketplace pioneer, eBay works with a flexible strategy, enabling the platform to evolve with consumer trends.
In 2022, the Financial Times labeled OnBuy the fastest-growing eCommerce business in Europe. Similarly to eBay, OnBuy is characterized as a pure marketplace, even pledging to never sell its own goods on the marketplace. As a relatively new marketplace, OnBuy has been able to rise quickly by offering the best deals to both sellers and buyers. Currently, the marketplace’s best-performing category is fashion and accessories, making up 44% of their sales.
Amazon is the leading eCommerce marketplace and hosts more than 10 million sellers. Unlike eBay and OnBuy, Amazon is a mixed marketplace. In addition to listing the products of sellers, they have used their brand awareness and trust to launch their own-brand products and ranges.
Reflecting the wider eCommerce marketplace trends, ‘fashion apparel and accessories’ is the leading category on Amazon. 35% of the European Top1000 retailers based in the UK sell on Amazon.
Generalist marketplaces (sometimes referred to as horizontal marketplaces) have dominated eCommerce in past years, and their relevance in the eCommerce landscape is unlikely to dwindle. However, the forecast is firmly focused on specialized marketplaces. These vertical marketplaces offer a relevant, convenient, and specialist range of products based on the niche needs of the consumer.
Read the full ChannelX European Marketplaces 2023 Report.
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