The Marketplace Summit by Mirakl 2017

We’ve just finished two days discussing why marketplaces are capturing the lion’s share of consumer purchases online at the Marketplace Summit by Mirakl. Each year, attendance at our annual user conference doubles as Amazon continues to make every retailer & brand take notice of the marketplace model.

While European companies are aggressively pursuing increasing their product offer & profit margin with their marketplaces, American companies are surprisingly behind. Why? Top retail analyst & influencer Sucharita Mulpuru kicked our event off by sharing the myriad of distractions faced by retailers today.

Sucharita says: Ignore the hype; don’t focus on trends like AR/VR, wearables, and IoT that won’t impact you near term

 Sucharita’s talk explored the myriad of choices facing retailers today as they search for growth. Those options include building experiences for virtual & augmented reality apps and wearable tech, and offering faster delivery via drones and driverless cars. The reality is most retailers are still trying to get mobile right, and are stuck trying to implement personalization initiatives while they lack enough meaningful data.

The bottom line: Marketplaces offer the near-term benefits companies need to survive. The fast increase product offers & site traffic give marketers and merchandisers the ability to capture more customers and revenue. The hyped solutions may offer slightly better conversion with existing customers, but will more likely waste critical R&D dollars on experiences consumers aren’t ready for.

Best Buy Canada carefully piloted their Marketplace to gain buy-in and test products

Sucharita’s panel with Thierry Hay-Sabourin, SVP eCommerce at Best Buy Canada, and Antoine Brouwer, Managing Director at Nextail / Blokker, opened up the discussion around how to get the quick wins with your Marketplace.

A key theme Thierry and Antoine discussed is that while marketplace projects are extremely high impact, they do require organizational change alongside the technical transformation. Establishing the quick wins by starting with very focused new category expansion – as Best Buy Canada has done – paves the way to getting the organization aligned around the model. Now that the success from marketplace product sales is clear, Best Buy plans to significantly increase the number of marketplace products in 2017.

Marketplaces provide a strong competitive response to - you guessed it - Marketplaces

While Amazon’s hit to US-based businesses was fairly immediate, and hard for those retailers to quickly respond to, retailers in other countries have seen threat and are quickly mobilizing to launch their own marketplaces. Across a myriad of panels we heard companies discuss how the marketplace is a weapon to accelerate their offer before Amazon grows in their markets, a sentiment echoed by Carlos Honorato Comandari from Ripley – one of the top three retailers in South America. Alibaba shipped 16 million products to Chile in 2016, and the population is only 17 million. To not just keep their strong foothold, but grow and protect against a rising threat from Amazon, Ripley launched their marketplace with Mirakl in December 2016.

Product expansion through marketplaces isn’t just for non-core categories

The initial wave of assortment expansion has been focused around non-core categories. And it was for two reasons:

1)    It allowed companies a low cost way to research demand for new categories without having to buy, store, or ship those products… or build up critical product expertise.

2)    It eased people into the model (particularly merchandisers, product managers, and category owners) who were afraid of marketplace products cannibalizing sales in their core categories.

2016 appeared to be a turning point for our customers who are now moving into core category expansion – such as Best Buy Canada now offering unlocked mobile devices via the marketplace, and soon in stores. This is a great showcase of the omni-channel impact marketplaces offer, and what we mean when at Mirakl we say we help our customers offer more, learn more, and sell more. It’s easy to put new products online, so you can quickly learn if there’s demand (Customers want unlocked cell phones!) and you can use that data to sell more online and in-store.

2017 is the year B2B marketplaces take off

This year almost half of our attendees were from B2B companies who are already working with Mirakl, or about to. They’re in a race to transform their digital presence and add more value for themselves, their brand partners, and business customers. IPH gave a great showcase of how the marketplace allows their local network brands to enable e-Business for their customers, creating more business for IPH, a net new capability for their brands, which allows easy online transactions for business customers. It’s a true win-win-win.

Forrester recently cited over 80% of B2B buyers have made work purchases on Amazon, which showcases the threat to the value chain of manufacturers -> distributors -> business consumers. Mirakl partnered with Roland Berger and Webhelp to produce a study on B2B marketplace adoption in response to this threat. Olivier de Panafieu, Partner at Roland Berger, showcased the findings in front of a packed room. To learn more about the four strategies driving B2B marketplace adoption, download the study.

Customers such as Groupe Le Duff, who’ve launched an extremely innovative B2B marketplace with Gourming.com that allows small food providers to sell directly to businesses, Metro Cash & Carry France, and Conrad, who are on the cusp of launching their marketplace – joined Olivier to share their stories in front of a packed room.

We also were joined by Forrester’s leading B2B Commerce analyst, Andy Hoar, who shared the results from a study Mirakl conducted with SAP Hybris exclusively focused on adoption of marketplaces by B2B Manufacturers. The study concludes that marketplaces offer B2B manufacturers a way to give their consumers a direct purchase experience, without creating channel conflict. To learn more about why this is the case, download the study.

DIY marketplace platforms have a short shelf-life

One of the highlights for me was being able to close the event with an expert panel – which included senior executives from Alibaba, Groupon, AirBnB an CDiscount. None of these companies are Mirakl customers – yet, but all have used the marketplace model to build successful companies faster than anyone thought possible. These seasoned professionals talked about their keys to growth, their organizational focus, and how they’ve risen to such success. But it was clear that their custom-built platforms have at times slowed down new innovation as they continue to pursue aggressive growth. Marc Vicente, COO of Cdiscount specifically said how he wished Mirakl was around when they started their marketplace development because of how hard and expensive it was to do it themselves.

The Mirakl Labs team is on fire 🔥

I couldn’t be more proud of our technical team which we call Mirakl Labs. The team is now 70 people strong, and our product owners gave an amazing showcase of the product innovation that’s taken place over the past year – such as launching 100 new features which have allowed us to deliver so much value to our B2C and B2B customers, and launch our new Services Marketplace offering. The next wave for B2C & B2B marketplaces is to offer services alongside products to give customers what they want: The total experience. In fact, AirBnB talked about how the dawn of AirBnB trips is just that – providing their customers with a total travel experience, not just a place to stay.

This epic event would not have happened without the support of our partners

Thank you to our partners, customers, and almost customers for joining us. We cannot wait to get back together in 2018.