Monthly Marketplace Article Roundup: September 2018

By: Charles Costa | September 27, 2018 | Marketplaces

As marketplaces across the globe continue to gain traction, many industry leaders are experiencing growing pains—things like payment processing, expanding to global markets, and battling against innovations of the competition. Let’s explore these topics in this month’s marketplace article roundup:

1. Why Online Marketplaces Still Struggle to Make Digital Payments to Gig Workers, PYMNTS

Today, almost a third of the global workforce participates in the gig economy in some capacity. In fact, 53% of gig workers don’t hold full-time jobs, and as many as 58% don’t want them. Although these workers turn to the gig economy as their primary source of income, 85% of gig workers also say that they would perform more gig tasks if they were paid faster.

Marketplace operators need to recognize that as they’re facilitating transactions between buyers and sellers, they can use technology to rapidly pay sellers, while collecting money from buyers separately.

Ultimately when it comes to payment processing, marketplace operators need to ensure that they provide sellers with multiple payment options so they can choose the option that works best with them, as opposed to being locked into a single method.

2. Amazon Dominates International Marketplace Reach, Retail Dive

E-commerce is predicted to grow to 13% of global retail sales by 2020. In 2017, 40% of all digital commerce sales went through a business embracing the marketplace model, compared to 23% in 2013. Those figures in mind, it makes sense that Amazon is now looking to capture a piece of the market by expanding into new regions.

Despite its status as a global leader, Amazon reported a $3 billion loss in its international business last year. Turning those numbers around isn’t going to be easy, especially considering how Walmart, MercadoLibre, and eBay, and numerous other businesses in the industry have established holds on commerce in the regions Amazon is targeting.

3. eBay Begins Intermediating Payments on Its U.S. Marketplace, eSellerCafe

In its efforts to optimize for sellers, eBay recently announced that it will start managing payments within its platform. Rather than sending payments through PayPal, buyers will instead complete their purchases without leaving eBay. In fact, PayPal will no longer be used for distributing payments either. Instead, eBay will make deposits to seller bank accounts.

Is this a mistake or a strategic move that will improve performance down the road? We would go as far as saying that it’s the former because eBay is in essence taking away flexibility from sellers. Although direct deposit is a convenience for many, bank accounts aren’t accessible to all sellers across the globe, making PayPal an essential part of transacting online.

4. Amazon Takes Swipe at Etsy, Lures Small Business Sellers with Storefronts, Multichannel Merchant

In an effort to expand its third-party offerings, and compete against marketplaces such as Etsy, Amazon recently announced its Storefronts functionality that enables shoppers to view more than 1 million items that are provided by 20,000 small-to-medium sized businesses across the U.S.

Considering how 38% of consumers first shop on Amazon when they consider purchasing goods, this arrangement only makes sense because they’ll leverage entirely new audiences. In order to effectively compete against Amazon, marketplace operators need to focus on being more than a place to purchase goods.

They need to become go-to destinations for buyers and sellers. This can be done in a variety of ways, one of which is leveraging intelligent messaging, which means enabling individualized/personalized experiences with the brand/seller on the marketplace. The benefit of these solutions is that it helps them stand apart from the competition.

 

To learn more about how the marketplace business model can help improve your profitability, check out The Kahuna Blog. Simply click the button below!

 

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Author: Charles Costa

Charles Costa is a content marketing manager who specializes in helping companies grow, one word at a time. Prior to Kahuna, Charles worked with brands such as Airbnb, Iron Mountain, and IBM on their content marketing efforts.

Charles' work has been featured in the Huffington Post, and he also was a contributor to the developer publication, Sitepoint.

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