The growth in new online marketplaces throughout the world is no surprise. Though Amazon, AliExpress, eBay and Etsy still dominate in most of the developed world markets, the explosion of new e-commerce sellers and shoppers alike has left plenty of room for new online marketplaces to grow and prosper.
It’s all part of an e-commerce trend we’ve noted before, in the platforming of the online buying experience as a means of extending market reach and eliminating the buying frictions that cause so many buyers to abandon their carts before completing a purchase.
Of the many new online marketplaces to watch in 2019, here are the five we think will have the most upward momentum in the UK and the US in the coming years.
New Online Marketplaces – United Kingdom
Given that American companies like Amazon and eBay enjoy a huge first-to-market advantage and early development of their assets in the UK, British e-commerce is still largely under their domination, in terms of total market share. However, three new players founded in the UK are showing significant recent growth.
Fruugo’s customer base already spans 23 different countries, and will automatically translate your product listings into 11 languages. These features have made Fruugo a popular choice for sellers looking to reach international markets.
Specifically, UK-based Fruugo is a great fit for retailers across most industries, with product categories that include clothing, home and garden, health and beauty, and consumer electronics.
There is no monthly fee or listing fee. Instead, it charges a flat 15% commission on each sale, as well as a 2.35% funds processing fee.
Some call it the British alternative to Amazon: Flubit is another great marketplace to consider if you sell in the UK.
You actually get 5X the exposure with this marketplace. By selling your products through Flubit, you will also get visibility on four other platforms; Go, Mirror Tech & Games, Personal Group and Mighty Deals. This is because all five marketplaces are operated by a single marketplace ecosystem, SKU Cloud.
There are no commissions or fees. Instead, you set a base price for your product and SKU Cloud’s algorithm controls the pricing, rather than charging a fixed % channel fee. Flubit’s claim (presumably based on this algorithm) is that they have over a million items cheaper than Amazon’s prices, every week.
The company’s value proposition is a low-pricing model for consumers. Flubit users canpaste the URL’s of products from sites such as Amazon and Argos, where they will then be offered a better price on Flubit. This strategy has significantly grown their active users base.
Another advantage: SKU Cloud apps are now integrated with Google to better rank and promote your top-selling products. With Google Shopping Actions poised to get even bigger next year, there’s huge potential to including Flubit among your preferred channels.
Since launching in 2016, OnBuy has become one of the fastest growing online marketplaces in the UK.
OnBuy’s product catalog covers almost every category: health & beauty and clothing, technology and collectibles, all the way to mechanical and car parts. OnBuy could be a great fit for almost any online business.
This marketplace offers some lucrative benefits for sellers.
- Immediate payments (funds are released to your PayPal account as soon as you dispatch an item),
- Risk-free selling for Standard sellers (OnBuy waives the monthly subscription fee if you don’t make £500 in any month), and
- Product promotion through Google Shopping, Bing Shopping and other external marketing channels at no extra charge
They also offer PayPal Seller Protection, which will cover you if you have any issues with eligible orders.
There are two tiers of account packages: Standard (£19 per month excluding VAT) and Partner (£39 per month excluding VAT).
Commission rates are relatively low, ranging from 5% for consumer electronics to a more common 9% fee.
PayPal payment fees of 1.9%-3.4% will also apply, as well as a small 20p transaction fee.
New Online Marketplaces – United States
Since its launch in July 2015, Jet.com has become one of the fastest-growing marketplaces in the US. As of 2019, it boasts more than 4 million customers and an estimated Gross Merchandise Volume of $24 billion by 2020. [UPDATE: In Q4 of 2019, Jet.com was purchased by Walmart, which then absorbed Jet’s entire online inventory system. Jet users are now redirected to Walmart’s site.]
Jet’s unique value proposition is its unusual pricing algorithm, which offers discounts to customers based on the number of items they buy and the seller’s location. Not only is this driving a larger spend per customer, but its repeat customer rate of 23% is, higher than that of either eBay or Amazon.
Regarding fees, there’s a rather complex commission structure.
You start with a base commission rate that ranges from 5-15%, depending on your product’s category. From there, the commission you pay is dependent on any commission adjustments made in the Rules Engine.
In order to sell on Jet.com, you will need to have the legal and physical capability to fulfill orders in the United States. So if you aren’t located in the US, you will need to have a fulfillment partner located there, as well as a valid US Business Tax ID.
Bonanza is considered a “seller-friendly” marketplace. Its markets include not only the United States and Canada, but also the United Kingdom, France, India, Germany, Mexico, and Spain.
They’re still small, with just 2.2 million active users, but they’re well-loved by sellers. In an independent survey by ECommerceBytes, more than 12,000 sellers were asked, “How likely are you to recommend (marketplace name) as a Selling venue to a friend or colleague?” From the available choices, Bonanza scored higher than Craigslist, Amazon, Ruby Lane, and Etsy.
There are no listing or membership fees on Bonanza, which charges a 3.5% commission on all sales.
Many sellers say they like the import integration with eBay and Amazon, where inventory is synced on a daily basis. Some also cite Bonanza’s excellent customer support.
As with OnBuy, Every listing is automatically sent to Google and Bing Shopping for ranking there, and you also can use their easy import features for eBay, Etsy, and Amazon product listings.
My mission at Shoppingfeed is explaining how to leverage e-commerce platforms and SaaS technology to e-merchants who just want to run their business and make more money.
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