Marketplaces: Unlocking International Expansion For Australian Retailers


Marketplaces Dominic Grevsmuehl By Dominic Grevsmuehl

Marketplaces offer a great platform to customers and retailers alike. The lure of a built-in customer base and established infrastructure attracts retailers; while customers flock to marketplaces for their broad product selection, reliable fulfilment options and frictionless payment methods. Couple these together and it’s clear to see why marketplaces are growing in popularity across the globe.

When it comes to consumers finding products to purchase online, close to 66% of consumers now shop cross-border. And consumers in China (83%), Japan (82%) and India (81%) are the most likely to use a marketplace to find products. As an Australian retailer with your eyes set on international expansion, these figures highlight why marketplaces should form part of your global strategy.

Where To Go?

From niche, product-specific marketplaces to international giants with tens of millions of loyal shoppers each month, there are plenty of marketplaces out there to choose from. The numbers can be dizzying – Europe for example has 335 marketplaces, making it seem overwhelming to identify where to begin.

When starting out, identify the regions you would like to expand to (considering issues like language, fulfilment and tax). Then you should identify the top players in that market, and the marketplaces that align best with your business model. You can always broaden your scope from there once you’re established and seeing success, but start small so as not to put pressure on your infrastructure.

Amazon is a popular marketplace for Australian retailers looking for a slice of CBT action. In the US, Amazon accounts for 43% of online retail sales. In Europe, Amazon accounts for 27% of the UK’s online retail spend, and this increases to 40% for Germany. So for Australian retailers with an eye on these regions, Amazon is certainly one to consider.

Similarly, eBay has a broad global reach with 167 million active buyers in Q4 2016 (up 2 million on the previous quarter). For retailers looking to sell to China, Alibaba can’t be overlooked, with Tmall boasting 493 million monthly active users in Dec 2016 and shipping an astounding 12 million packages a day.

Getting Started

How you approach expansion depends on whether you sell a well-known brand or not. If your brand is already known, you’ll need to research if there are licensed sellers or resellers advertising your products on the marketplace you’re considering. If your brand is not known yet, this is your opportunity to build awareness. It also requires hard work as you will need to stand out from the crowd.

Analyse your nearest competitors and establish what drives conversion. One of the most important factors we have seen working with retailers is that price should not be the only factor that influences conversion. Quality data, images and delivery options as well as loyalty programs and promotions to increase your basket size will be helpful to win a good share of customers on the marketplace.

Convey trust by offering high quality photos, detailed descriptions and accurate titles. List your full range or create new products to satisfy customer needs and ensure all payment and delivery options are as convenient as possible. All of these aspects will ensure that price is only one aspect customers consider when comparing your offering to others.

Make use of analytical tools, such as Terapeak, a plugin readily available in your eBay account. If you subscribe to advanced features you can also research your competition in detail, expand on SEO, and source from Alibaba.

Work With The Right Partner

Here at ChannelAdvisor we can help you in identifying new opportunities and to grow internationally. Not only do we have the expertise in local offices around the globe, we also have a network of partners that can help you in resolving tax questions, localising data, serving international customers and complying with local marketplaces rules.

Summing It Up

Cross-border trade continues to grow, with two-thirds of consumers having made a cross-border purchase. By expanding to new regions through marketplaces, you can reach an audience you never would have locally, benefit from diversified sales, and overcome seasonality for your products. Start small by expanding into one region first and apply your learnings and findings on the next launch project.

Wondering which marketplaces should be your starting point? Download our Broadening Your Horizons eBook for a selection of 13 marketplaces globally that should be on your radar.