Jewelry Industry and Retail News
We permanently get informed by our friends and partners from around the Web - about news, trends and/or best practice advice, loosely related to the jewelry retail business. Therefore, we present you here the most interesting or most useful of this information every month - from the following 3 top categories:
| Trends | Sales | Tech |
|---|---|---|
| Hot new/continued jewelry trends as presented to your customers from around the Web. See what they see when they scour the Web and think about your inventory. | Marketing news and related info that you could use in your daily operations. How to get your name out there, wherever you can and get people to know about your business. |
Tools and Trends (mostly tech related) that can make your business life easier. These are tools or trends that can help your business grow, get more organized, save more money, and/or streamline operations. |
Hopefully, you will get some tips/suggestions for your own business activities from this!
July 2018
Forrester research shows: Half of online sales occur on online marketplaces
Last year, shoppers did half of their online spending through online marketplaces, and that could rise to two-thirds in five years, according to a report released Wednesday by Forrester Research.
The usual suspects are running the space: 75% of marketplace buyers shopped at the run by Amazon, Alibaba (Tmall), JD.com and eBay, according to the report.
There are downsides, however: shipping costs and commissions eat into margins and brands can get lost in the crowd, Forrester warned. From the online marketplaces’ perspective, third-party retailers often subcontract their online delivery services, giving marketplace owners less control of the end-to-end customer experience, Forrester also said.
For a while now, Amazon, eBay and Alibaba’s Tmall have been the big names in online marketplaces, and those three alone accounted for about $365 billion in sales worldwide in 2016, or 31% of all e-commerce sales, according to global market research firm Euromonitor. And the marketplace momentum is growing: Half of all merchandise sold on Amazon's sites now comes from third-party sellers.
Those three and JD.com are the top players, Forrester found. But Walmart this year has made a concerted effort to bulk up its long neglected marketplace, and sellers are flocking there in increasing numbers in an effort to diversify their online selling opportunities, marketplace commerce platform Feedvisor told us earlier this year. That only adds to marketplace growth.
"We look at online marketplaces as the new retail battleground," Jenn Markey, marketing vice president at retail strategy firm 360pi, told us earlier this year. "For the retailers that embrace them, it creates an endless aisle online without the traditional costs. But even Amazon is experiencing that it can be the Wild Wild West. The challenge is that some vendors are more legitimate than others."
Their large array of sellers and goods make online marketplaces ideal sites for browsing and research, and that drives shoppers to them. More than a quarter (26%) of European online shoppers used Amazon to research their most recent product prior to purchase, more than the 21% who used a physical store. Shoppers in Japan, India and China were the most likely to turn to online marketplaces over other sources to get information on potential purchases, the study found.
Ease of payment is key; especially in China, where more than 90% of Chinese e-commerce takes place on online marketplaces, and payment platforms are also gravitating to online marketplaces to fill the need and partake of the spoils. Last year three quarters of international spending on aliExpress involved alipay, its propriety payment platform, and three-quarters of alibaba’s GMV on China retail online marketplaces involved alipay in 2016. Not surprisingly, other payment providers want in: PayPal has recently announced a deal to extend its payment option to the Alibaba marketplace.
For retailers and the online marketplaces themselves, it’s not all rosy: costs are high. Delivery and fulfillment, along with sharing their profits with marketplace companies, are a significant drag that is difficult to avoid because free shipping or low cost shipping is what brings in customers, Forrester said. Online marketplaces are increasingly offering free or discounted shipping, secure and localized payment processing, online advertising and search, and fulfillment services for both domestic and international destinations.
But that inevitably hits profits. Amazon’s net shipping costs in 2016 exceeded $16 billion, but the revenues from the $99-per-year Prime membership and customer or retailer shipping payments covered just 55% of this. And it’s getting worse: Amazon’s shipping costs grew faster than its shipping revenues last year, and the e-commerce giant expects that to rise as more people join Prime. On eBay, most transactions across the U.S., the U.K. and Germany involved free shipping in 2016.
That's an issue in e-commerce in general that has yet to be fully grappled with, according to retail analyst Nick Egelanian, president of retail development consultants SiteWorks International. "When shipping costs are fully allocated to the consumer sometime in the future, we will see the rate of internet sales growth sharply decline," he said in an email earlier this year.
For the report, researchers used Forrester Data’s Online Marketplace tracker to look at 11 marketplaces across 16 countries to understand their share of the e-commerce market and their growth trajectories from 2015 to 2017. Forrester also examined the services and factors that will drive future adoption and growth for the top marketplaces, according to the report.
