Would increasing turnover by 30 to 50 per cent transform your retail organisation for the better? For most business leaders, this is a rhetorical question.
Australians spent a whopping $49.7 billion online between June 2020 and June 2021, according to the NAB Online Retail Sales Index: July 21. The rise and rise of e-Commerce has put an almost limitless array of options at the fingertips of local consumers, and competition across every retail category is fierce and unrelenting.
Creating your own online marketplace – a site displaying not only your own wares but potentially those of dozens or even hundreds of third-party suppliers – may enable your business to attract thousands more eyeballs and score more sales. Here are five ways this technology can help Australian retailers give their bottom line a boost.
In a nutshell, traditional retailing consists of buying an array of products in bulk and on-selling them at a healthy profit as quickly as possible. This limits the amount of capital at your disposal and your capacity to store and ship your inventory. When you establish an online marketplace, those limitations disappear. Instead, you have the option to extend your range by adding complementary products at no cost and with little risk. Doing so may enable you to turn your site into a specialty destination, perhaps even one that owns its category.
Is your typical sale a large, one-off purchase? If so, you’ll undoubtedly know how tricky it is to maintain relationships with customers who may not need to open their wallets again in your establishment for several years. Offering a range of complementary, lower cost and more frequently purchased items via an online marketplace can solve this challenge by creating opportunities for you to remain in regular touch with them. Doing so will keep your business and brand top of mind and increase the likelihood you’ll be the first port of call when the time for them to drop the big bucks eventually rolls around again.
Showing up in a search is very often the first step towards securing an online sale. Multiple studies have demonstrated how important it is to do so, given that around three-quarters of internet users typically don’t venture past the first page of results. Expand your product range and, with the aid of good SEO, you’ll increase the number of times your business pops up in front of potential customers.
Long gone are the times when new trends took months to emerge and years to dissipate. These days, trends come and go at warp speed, and retailers that want to capitalise on them need to pivot and respond at the same pace. That’s not always possible if you’re operating a traditional buying model, one which requires your merchandising team to seek budget, source the hot products du jour and wait for them to hit the company warehouse before you can begin spruiking them. Team up with a third-party supplier that already has them on hand, and you don’t have that problem. Instead, you’re able to start selling the second those items are listed on your marketplace – and without the risk that you’ll end up stuck with a stack of stock, should the craze abate abruptly.
Like the idea of adding upmarket or downmarket lines to your range or dabbling in altogether new market segments? Historically, experiments of this nature have been a costly gamble for retailers. But implementing an online marketplace platform allows you to de-risk the process of diverging from your tried and true playbook. Instead, you can experiment with new lines and categories, with the only danger being potentially that to your reputation if your customer base is underwhelmed by some of the items you add to your range.
Positioning for success
The past two years’ events have cemented Australian consumers’ long-time love affair with eCommerce, and retailers without a strong online presence will undoubtedly struggle in the months and years to come. Against that backdrop, enhancing yours with digital marketplace technology is likely to prove a very smart move.
Read more: How to build and scale an online marketplace