Alvaro Verdoy 14 December 2018

Categories B2B, B2C, Content, Customer Experience, Ecommerce, Strategy & Operations, Technology

Marketplace magic! 5 keys to success

There has been a lot of talk recently about the prominence of Marketplaces and how they have been instrumental to ensure success for manufacturers, brands and retailers in selling their products via e-commerce. However getting onto specific Marketplaces such as Amazon or EBay is the easy part, maintaining your brand, raising your profile and selling is still the biggest challenge. Here are 5 key tips to consider to bring success to your marketplace entry.

1. What is a marketplace.

First get to understand where you are placed. A marketplace is a 3^rd party site or application that enables shopping. It doesn’t hold any inventory but facilitates transactions. Often it works like an online concession model where commissions are charged or it may have an open API available to provide extra automation and extra logistical and digital efficiencies.  Most of us know the common marketplaces such as Amazon or EBay but there are over 450 global marketplaces, some on specific verticals, so before deciding, it is best to check what could be best for you.

2. Where do your products and company fit

A marketplace fits between the well-known and understood constructs of E-commerce and Wholesale, depending on the market in which you are working. It is a break with tradition from the normal way of trading, particularly for the retail market in e-commerce where a brand or manufacturer would often go through a distributor who would sell to retailer then onto the customer. In marketplaces, brands and manufacturers can go straight to the customer which elicits more control over the product offering and collects more data. However as it does not fit as a normal channel it often lacks ownership.  There are implications, either from competition who use keywords and digital marketing from the marketplace for e-commerce or from Resellers who may want to utilise the channel for their own benefit. It is then important to know how you are sell your products and how your products are seen and take care in the marketplace listings. The appeal of marketplaces is that they give brands and manufacturers the opportunity to start from scratch.

3. The value in using a PIM solution

Marketplaces are data hungry. Any company that is growing will reach a point where a PIM is integral to maintain that growth. Any company may start out using excel to cover their main product updates but with growth comes complexity and as it becomes important to be data centric so the need for product information to be centralised and accurate. Having a PIM solution set-up to maintain product information becomes an essential tool to ensure the marketplaces can serve the customer experience best on every marketplace.

PIM is also of great value to balance the differing objectives of retailer and the brand. Generally speaking the Retailer is looking to shift product at high volume at high velocity. It is a numbers game and is more about getting everything listed rather than looking at high quality descriptions. Brands are too looking to grow sales but they will want to put more care and quality in the listings, descriptions, images etc.

If the brand is using a reseller to sell their goods onto a marketplace catalogue there is often a problem concerning how much quality care that has been taken on placing a brand’s product on the marketplace. The buyer of course is unaware of who has created the product description, nor do they care, but it may have a negative effect on whether they buy. Brands therefore need to take control of the image they are placing on marketplaces. This is where a good PIM solution comes in providing accuracy and enriched product information to maintain the best possible experience for the buyer.

Also in the next decade, it is likely that in certain sectors (food industry, manufacturing) there will be a new way of handling complex data through internationally recognised schemas for product records. PIM will be ideal to handle such a data rich environment, providing clean, robust, accurate and well formatted product information to manage and scale catalogues.

When listing on Amazon, remember Amazon has a strong policing policy for reviews. In order to get the best reviews, product descriptions need to be appealing to increase buyer experience and potential to purchase.

4. Define a clear strategy for successful marketplace entry

 

1. Define your objectives

It may be a simplistic notion but the most successful and common sense way of approaching marketplace entry is to define your objectives. Time and again companies miss this important stage of their marketplace entry planning, but it will provide focus. It is not always the case that a ‘Premium brand’ will have a premium route to market. Likewise a ‘Clearance brand’ will not always assume a discount focus based on high volume/mass sales.

However generally speaking, premium brands are more likely to want to have more care and attention over their product descriptions, display and listings. They will more often want to appear on hand-picked marketplaces and provide human translations, where necessary. Clearance brands on the other hand will look for scalability and efficiency to get products listed quickly with a focus on discounts, volume and basic information via automated translations.

 

2. Look for opportunities to match the focus

 Where? – For example, testing new markets and brand awareness will depend upon your focus, either          domestic or international markets.  

What assets do you already have? What data do you already have ..and from what markets?

What languages do your customers support?

If you are looking at exciting new opportunities what is the cost to set them up?

What is the product / pricing parity across countries/ distributors/resellers?

What is the logistics set-up for shipments, returns handling, IT and importantly what internal resource can be used?

Review the operational set-up . What is the best fit? International/Local company/ Marketplace fulfilment?

5. Comparison with Amazon FBA

For companies that are just starting, or trying new products or territories, Amazon FBA could be the right direction for your products.

You sell it, they ship it. Amazon has one of the most advanced fulfilment networks in the world. With Fulfilment by Amazon (FBA), you store your products in Amazon's centres, and they pick, pack, ship, and provide customer service for these products. FBA can help you scale your business and reach more customers. However there is a price to pay.

You will need to review your own international fulfilment criteria and what internal/external resources fits best. In terms of marketing spend also, what gives the biggest returns.

You may want to work with different companies in a different market or territory. In addition you will need to check what your returns rates and costs are for that territory, is it affordable?

If you are entering a new market or territory what are the costs compared to Amazon FBA.

        6) Optimisation on marketplaces such as Amazon

Amazon is the largest global marketplace, however to help get the successful optimised listing on Amazon for your products you will need to keep attention to:

1. Look for the right categories in which you are listed
2. Adjust your title length of your listing according to your market- title length works differently from US to UK
3. Make sure your product title has balance to include hi res images, USPs,
4. Description- use of bullet points, concise, impactful paragraphs
5. Use of discounts
6. Optimise keywords and search item terms
7. Brands need to take ownership and responsibility for the control and quality of the listings.

In conclusion, to place your products on a marketplace is a major consideration yet, with the right preparation and plan can be very successful for your revenues. Major marketplaces such as Amazon provide a full 3^rd party service (FBA) to enable companies to manage their operations without the hassles of a set-up and the major costs attributed to it or the necessary data you will need to collect to analyse for success. It is well known, for instance, that using a marketplace will reduce your returns rate as they have already operational experience in a particular market, territory or sector. 

Companies will also need to take care of their product descriptions to maximise the buyer experience across all the marketplaces they are using and this is where a PIM becomes essential to maintain accurate, well formatted product information.