In digital commerce the marketplace model has grown faster than the traditional model over the past five years. It accounted for 41% of digital commerce sales in 2017, up from 17% in 2008. It is expected to continue to growing faster than the traditional model. This report explores why this growth is happening and what it means for the retail industry.
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In digital commerce the marketplace model has grown faster than the traditional model. It accounted for 41% of digital commerce sales in 2017, up from 17% in 2008.
There are “pure” marketplaces that only connect third-party merchants with shoppers, but there are “hybrid” models where a marketplace is combined with a traditional model. Some hybrids have a physical presence.
The largest marketplaces have built out a full ecosystem of products and services for both their customers and third-party merchants. Some examples include payments, logistics, entertainment, and financial services.
The expectation is that the marketplace model will continue to outpace the traditional model. As a result, retailers need to have a strategy when it comes to marketplaces, or risk irrelevancy.
The hybrid model benefits from the selection and low prices of a marketplace and the influence a traditional model can have. Adding a store improves the customer experience for logistics. As a result, this model is likely where more marketplaces are headed.