Three months, three highlights, three minutes. Every week at eManaged, we compile a list of the top marketplace news stories as part of our Friday newsletter. At the end of every quarter, we round-up the headline story, key marketplace moves and essential Amazon goings-on. Here’s your marketplace round-up for April-June 2024.
Headline Story
Tesco’s online marketplace is back. Six years after shelving its previous online marketplace, Tesco Direct, the UK’s largest supermarket has launched Tesco Marketplace. Designed to be ‘a one-stop shop for everything customers need,’ Tesco Marketplace currently offers ‘thousands of products from third-party partners’ across home & garden, baby and pet care, and toys.
Following in the footsteps of other UK retail stalwarts-cum-marketplaces like Debenhams and The Range, Tesco will look to capitalise on its brand name and 27% share of the UK grocery market to drive sales. It has adopted a hybrid marketplace model selling its own products alongside branded goods from the likes of Charles Bentley and Tefal, but will only fulfil orders for its own products. Third-party sellers are responsible for dispatching goods bought via Tesco Marketplace and also deal with any delivery issues, returns or customer complaints.
While the number of current sellers and product categories is small compared to larger marketplace rivals, Tesco has a trump card for sellers. According to retail analyst Jonathan De Mello in Thisismoney, “sellers have access to a wealth of data Tesco can provide - they will know what's selling and what to provide more of, where the margins are, and how to look at promotions.”
For advice on getting started on Tesco Marketplace, get in touch with eManaged.
Marketplace Moves
Online marketplaces are surging in popularity across Europe. In Italy, marketplace turnover increased 55% with €14.5 billion of sales. In Germany, marketplaces accounted for over half of all online sales last year generating €47 billion of sales (55% were bought via smartphone).
In addition, German marketplace Otto announced plans to expand its marketplace offering in Europe, but also to increase its monthly seller fees from €39.99 to €99.99. TikTok marketplace is due to go live in continental Europe with the company inviting a select bunch of sellers to ‘beta-test’ in Germany, France, Italy, and Spain.
Meanwhile, the AI train continues full steam ahead. eBay has launched new AI-powered fashion features, including a ‘shop the look’ fashion app based on customers’ shopping history and a clothing recommendations feature called eBay Explore based on customer preferences. Given Ali Express’ latest Consumer Insight Report found that fashion has the highest online spend among UK shoppers, expect more AI fashion-related features to roll-out this year.
Amazon Analysis
In May, Amazon launched in South Africa: its 22nd market, but first in sub-Saharan Africa.
Amazon also launched a new raft of fees and features over the past quarter. After a transition period in April, Amazon introduced its low-inventory fee for sellers who do not consistently keep enough inventory. But after a backlash, Amazon changed the terms of its new higher charge for processing FBA returns. Now, the higher return rates will be linked to product category, size and shipping weight, and the charge will be postponed until January 2025.
Amazon also made it easier to bulk add products at the same time and analyse customer service performance in Seller Central, while also introducing new AI tech to spot damaged products pre-shipping. Meanwhile, the era of drone delivery buzzed a bit closer with Amazon receiving approval for drone drops in more US states (Texas, California and Arizona are now expected to see drone delivery this year).
Looking ahead: Q3 2024
Prime Day is on the horizon. On 16-17 July, Amazon’s biggest marketplace sales event of the year will see more than 200 million Prime members in 25 countries access exclusive offers. Last year’s Prime Day on July 11 was the single largest sales day in Amazon’s history - will that be surpassed this year?
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