“Don’t try to be all things, don’t throw all products in there, be coherent and clear,” is the advice Matt Coode of OC&C Strategy gives on starting a marketplace.
Speaking at Retail Week Live today, Matt Coode, partner and international head of retail at OC&C Strategy says that those who wish to tap into marketplaces field should consider the coherence of their product offering and the target base. He says that otherwise merchants risk creating something irrelevant for their consumers.
Pointing to a real-life example, he says a partnership with ASOS and Gucci failed as the product offering didn’t resonate with customers. The issue was that the brand was too premium for ASOS’ core audience – Millenials and Generation Z. Similarly, when Oakley, sunglasses brand, partnered with ASOS, shoppers found the brand not fashionable enough to meet their vogue standards. He calls this an ‘Aladdin’s cave’ notion, in retail terms a shopping portal filled with a variety of different products that might not match with shoppers’ buying intent. Matt says that these examples emphasise on the importance of not trying to replicate the look, ethos and influence of other companies but create a unique product offering that matches their audiences’ wants, needs and desires.
Looking at the marketplaces performance a decade ago, Matt says that their operating model has ‘exploded.’ In five years, Zalando have curated their product range, says Matt, that feels coherent and no longer an ‘Aladdin’s cave.’ Shoppers visit Zalando’s platform to research, explore and get inspired. He says that this transformation is noticeable at ASOS as they have taken control of their own brand image, taking their own photographs and deploying a team of copywriters. On the other hand, marketplaces now offer sellers holistic business management. He says that ASOS offers merchants comprehensive business care starting from acquiring customers, converting them, advising on product marketing as well as last mile fulfilment and customer aftercare. It is the philosophy of ‘taking matters into your own hands’ retailers should adopt to build a marketplace that conveys a unique personality and bridges the gaps in the market.