As a Senior Marketing Manager at Amazon UK, I saw firsthand the scale and speed at which UK companies can grow overseas by selling on an established marketplace.
Online marketplaces have been at the centre of the explosive growth in e-commerce around the globe in the last 10 years. It has been predicted that by 2020 they will account for 40% of the global retail market, and already in key e-commerce markets such as China, 90% of all online purchases are made via an e-marketplace.
The marketplace model, as pioneered and exemplified by Amazon, offers numerous benefits to potential exporters:
- Low Cost: Marketplaces give companies the opportunity to surface products in new markets on a low-cost, commission-based sales model.
- Low risk: The low upfront cost means businesses can accurately assess, and even build demand before investing in expensive, fully-localised international websites, or building international operational capacity.
- Customer acquisition: Marketplaces offer a cost-effective channel for acquiring new customers in markets where you have low brand awareness and would find it difficult to drive traffic to a branded site.
- Discoverability: Marketplaces like Amazon are a major competitor to Google, and many shopping journeys begin with a search in a marketplace as opposed to a search engine. To be found, having a presence on a marketplace is an integral part of even the best-known brands’ strategies.
- Agile export strategy: Marketplaces allow companies to make incremental investments in their exports. They can start fulfilling orders from the UK, before progressing to use local shipping and warehousing when demand and volume justify the expense.
- Customer Experience: Marketplaces cater to local payment preferences, offer competitive delivery options and provide comprehensive customer service, all of which can help brands establish trust and credibility in new markets.
Simply put, brands who fail to recognise marketplaces as part of their international expansion strategy risk losing out. Marketplaces dominate the online retail landscape in countries like China, with hundreds of millions of Chinese consumers flocking to these marketplaces because they trust that the products available will be high quality, authentic branded goods.
Marketplaces provide a future-proof export opportunity that matches supply to demand and allows companies to take a data-driven, low-risk and agile approach to their international growth.
Find out how Three Sixty Interactive can help you identify, connect with and launch your products on the marketplaces that best fit your goals and have the greatest demand for your products.