Retail vs. Marketplace

Manu Midha

Views mentioned here are personal Infibeam and Buildabazaar does not endorse any statements made during the

presentation

Difference in business models

Marketplace Retail

i. E-commerce company act as an

intermediary between a seller (merchant)

and a buyer;

ii. Merchant is the seller on record

iii. Inventory risk is borne by the merchant

iv. E-commerce company may fulfill on behalf

of the merchant

v. Risk of stock out higher than a retail

business – therefore customer satisfaction

could be compromised

vi. Typical marketplace commissions vary

between 1%-13% of the product revenue

based on category sold

i. E-commerce company act as the seller on

record for the product being bought by the

buyer

ii. Inventory risk is borne by the e-commerce

company

iii. E-commerce company fulfills – ships orders

to customers

iv. Risk of stock-out lower than a marketplace

business – therefore customer satisfaction

optimized

v. Retail margins vary between single digit to

50% depending on product category, brand

and make

Key metrics to look at?

Marketplace Retail

i. Inventory Turns : High

ii. Inventory risk : Low

iii. Higher capital required; less capital efficient

iv. Margins : Lower than retail

v. Best suited for

i. Low velocity products/SKU’s

ii. Product categories with high variety –

eg. Apparel, accessories, prescription

eyeglasses

iii. Vendors spread across geography; eg.

Banaras sarees, Lucknow chikan,

Ludhiana sport goods, Tirupur t-shirts

iv. High risk of obsolescence

i. Inventory Turns : Lower

ii. Inventory risk : High

iii. Higher capital required; less capital efficient

iv. Margins : Higher than marketplace

v. Best suited for

i. High velocity products/SKU’s

ii. Product categories with lower variety

– fewer best selling SKU’s – Mobile

phones, printers, pen drives, cameras

iii. Products with back to back return

terms with suppliers, eg. books

iv. Low risk of obsolescence

• A hybrid of marketplace and retail is best suited for India e-commerce to optimize

on customer experience and be capital efficient (high turns, low inventory risk)

• Each category and sub-category to be evaluated on the parameters above; fast

moving products in each category – good candidates for stocking in retail; In case

margin increase drastic by stocking – good candidate

• Reactive buying / marketplace agreements to be kept in place; inventory

information to be refreshed every day ideally with merchant partners to ensure

zero defect

• Ensure rating and reviews of merchants on marketplaces (could be internal /

external)

Summary

Retail vs. Marketplace Updates on Latest Features

Features discussed during last webinar.:- Shopping Cart Summary & Overview

Helps you give your customers a quality engaging experience, keeping them updated and giving the access to their shopping cart throughout the store, without even needing to click and go to shopping cart page.

Shipping Pin-code Checker Helps you to notify your customers upfront for the availability of COD as a payment option thereby reducing hassles for customers and providing a quality engaging experience with the store front-end.

Abandon Cart Reminder Helps you to capture lost sales by following up with customers who added some products to the shopping cart but didn’t make a purchase for some reason.

Recap

How to use In Build SEO tool?

Disclaimer: The feature is non customizable and is provided on an as – is basis.

Feature: This Feature is used for SEO purpose. Although all our websites are SEO friendly still if you want to add additional tags, keywords, description, etc on your site for SEO purpose than you can use this Page Info section. Following are the steps on how to add page info on a particular page. The process remains same for all the available pages on the website.

Benefits: Helps you increase the ranking of your ecommerce site as well as various pages like Home Page, Category pages, Product Pages and various static pages i.e About Us, Privacy Policy, Terms & conditions, Shipping Policy, Contact Us, etc.

Advanced Carousel Widget

Disclaimer: The feature is non customizable and is provided on an as – is basis.

Feature: This feature is developed to give store owners better control over various aspects of widget which are like speed of the banner transition, mouse hover effect on banner, previous-next buttons, different transition effects, etc. With help of this feature you can use various transition style and use various widget style more effectively inside carousel widget.

Benefits: This feature is more like an enhancement feature for the site. As you can give control to user to change the banner and hover over mouse it asks for more customer engagement and increases the amount of time user spends on your site. Research show that More time the user spends on the site the chances of him buying from the site also increases.

Social Media Buttons

Disclaimer: The feature is non customizable and is provided on an as – is basis.

Feature: To make store more interactive with users we have added all the know social media buttons on the products pages. The feature allows user to share the products with their friends through social media like Facebook, Twitter, Pinterest and Google plus as show in the image.

Benefits: Feature allows users to like the product or send to friends wall from the site itself. Various option like twit, pin it and +1 is offered for user choice. The feature in very much useful in current scenario as everyone uses social media almost all day so they can easily share the product they like with just a click which does the most powerful know marketing trick that is “Word of mouth”.

Questions & Answers

Question from Last session.

• Are all the three feature mentioned by you free or should we pay for it?- Pranab Beriya

• I want to add my payu paisapay gateway to my store, how can is this possible? – Ajay Kumar

• I miss this presentation can get the soft copy of this presentation-Sudir kumar yadav

• Can we have export feature of Product from our store to upload to other websites like ebay, Google

products, Amazon? – Sachin Parikh

• Can we have something which gives us a click report function? – Samir Kazi

• Can we integrate the shipment updates directly integrated on our website?- Goel Mridul

• Why can't we delete the products completely from the store?- Goel Mridul

• Report generation should not take time as it’s our store and to get the list of our customers or other

reports should be done immediately - Pranab Beriya

• But the EMI thing is very important…please do look in to it.- Pranab Beriya

• What's the best way of marketing now days ?- Yash Gupta