In this post we share some information on the global marketplace and fast-growing company known as Fruugo.
We’ve spent a lot of time on this blog talking about marketplaces, especially international marketplaces, as the UK continues to recover from the Brexit hiccup and looks to re-build its cross-border credentials. It seems appropriate that we should talk about Fruugo, then, which advertises itself as a global marketplace. As you’ll see though, it’s a different kind of global marketplace.
Let’s open up with some fast facts on Fruugo:
Fruugo doesn’t have a product catalogue like Amazon, for example. Every listing is separate, like on eBay. What this means – as we’re for ever talking about in this blog – is that your data quality is very important. Because Fruugo takes care of the localisation, your buyers in the countries where you’re present will always see products in their domestic language and currency and with all the local payment methods.
Another area where Fruugo is different is in its marketing. 100% of the marketing costs are Fruugo’s; there are no advertising or product optimisation costs for sellers. 97% of Fruugo’s traffic is through paid search, which is a direct effect of spending more than £1m per month on Google Shopping. Fruugo specialises in ‘long tail’ search, where it drives better value by virtue of the cheaper long tail clicks.
And when Fruugo talks about being a global marketplace, it means it, since a staggering 85% of all sales are cross border – a buyer in one country buying from a seller in another. Compare this with the global cross-border average of 23% and you can understand the claim. The top 6 countries for Fruugo in 2020 were Great Britain, Switzerland, Sweden, the Netherlands, the US and Australia.
One integration to Fruugo means you can sell in over 40 countries. What’s more, there are no set-up or monthly fees (see below for how the commission model works), making it easier for you to think big – think global – safe in the knowledge that Fruugo will get the localisation and marketing right.
You have to be in the market to benefit from the regional spikes in demand. Fruugo shared a story with us from Black Friday 2020 involving a surge in Germany for an English product that benefitted a Spanish seller the most. What this illustrates to potential Fruugo sellers is that local domestic surges can really drive sales, but you can only capitalise if your products are available in market, and listing on Fruugo’s 46 country sites is the ideal vehicle for that.
Against the backdrop of 2020, where all marketplaces fared astonishingly well, it’s no surprise that Fruugo’s positioning has resulted in major growth. In February of this year Fruugo placed 286th in the FT 1000 fastest growing companies across all sectors. It was also the UK’s second fastest growing ecommerce site, and to qualify for this growth index the FT audited companies whose annual revenues need to be at a certain entry point for 3 consecutive years and maintained.
Finally, how Fruugo makes its money. It charges commission to you, the seller, amounting to 15% of the basket value excluding VAT, plus a fund processing fee of 2.35% of the transaction value. So, for example, if an item sells for £60 including shipping, VAT, Fruugo takes a total of £10.69 including VAT before passing £49.31 including VAT to you.
In our next Fruugo post in the not too distant future we’ll share more information to help you decide whether it’s the marketplace for you and talk about how to start selling – and selling well – on Fruugo. In the meantime, if you’d like to discuss adding Fruugo to your marketplace portfolio without layering on extra time, effort and processes of your own, you can get in touch with us here.