Starting a marketplace business is: complex, digital, uncomfortable (because new), intangible and you may go through a lot of resistance until the first products are live and sold online through the platform.

In the following we would like to compare the opening of a "normal" retail store with the opening of a marketplace channel. To make it more specific:

What is the difference between opening a 100 m² store in Munich and a new marketplace presence through Zalando's Partner Program for Germany?

It's the same, same but different.

You need the following for both the Retail Store Opening and the Marketplace Opening

Employees

Whether they're setting up your retail store, stocking the products or advising your customers, you need employees right away. This is also the case for the marketplace business. Here, your employees don't put products on shelves and serve customers in the shop, but they have to create all the structures so that the products can go online first of all. They have to set up and integrate data structures, processes and software. Marketplace managers have an incredibly broad range of tasks, especially at the beginning.

Merchandise

In the retail store, you need merchandise that you show to the customer on site so that they can try it on and buy it. In the marketplace business, you need the goods physically in a B2C warehouse to be able to send them to your customers and you need the appropriate online content for it. This means the right images have to be created (they have to be in accordance with the guidelines of the respective marketplace) and all product data should be set up properly. Only then can the goods be presented online.

Equipment

What the shop fittings are in the retail store, i.e. shelves, mannequins, clothes rails etc., the software is in the marketplace business. Software ensures that the goods are visible online.

IT & Software

Without cash register systems nothing works in a retail store and without marketplace software you will never put an article online. IT & software, as different as they are in scope, without them nothing works. And in the marketplace business software is very extensive. You have to deal with different interfaces and providers until you have found the right strategy and the right partner for you.

Marketing

If no one knows that you are opening a retail store, then no one will come to the opening. This is why you will most likely place different ads, distribute flyers or the like. In the marketplace business, too, customers won't know automatically that you are selling via e.g. the Zalando marketplace from now. In order to present yourself online among the wide range of online shops in your category, you can take various online marketing measures to become more visible. In both cases, the more visibility the better.

Conclusion: This is where the marketplace opening scores points

Everything you need to open either a retail store or a marketplace business is different, but similar in many ways. 

For both, it takes about 4-6 months in the best case scenario until you can "open" the business. 

However, the costs differ considerably: for a retail store of 100 m², costs of approx. 100,000-180,000 € arise. The costs for starting a marketplace business, on the other hand, are more manageable: approx. 10,000 - 25,000 € for onboarding, integration of software and other service providers. In addition, you can easily expand the marketplace business to include other marketplaces without high additional costs.  

The difference in customer reach is even greater: if we reach an approximate number of 2 million customers with our retail store in Munich, we can reach 46.3 million customers in Europe through Zalando.

So a retail store opening compared with a marketplace opening are "same, same but different". The conditions are different and yet somehow similar. However, when it comes to the costs and the potential customers you reach, the retail store doesn't stand a chance against the marketplace business.

If you want to learn more about how to make your opening in the marketplace business a success, check out our Marketplace Uni courses .

Request more information or send us a message. We will be happy to help you!

Der Beitrag Marktplatz Opening vs. Retail Store Opening erschien zuerst auf Marketplace Manager Training.

Do you remember the famous Zalando slogan "scream for joy or send it back"? It first hit the screens in 2012 and brought Zalando a lot of attention. In recent years, not only the iconic slogan has changed, but also Zalando and its business model. The company has evolved from being an online shoe seller to being the biggest fashion destination in Europe and step by step from a pure e-commerce retailer to an online marketplace. For the latter, Zalando has developed its Partner Program as well as its Connected Retail Program. Through the Partner Program, you can not only connect your fashion brand directly to the marketplace, but also use additional services such as Zalando Fulfillment Solutions (ZFS) or Zalando Marketing Services (ZMS).

If you sell your brand on Zalando, you are also well positioned internationally, because Zalando is already online in many European countries and is still expanding.

In the following, you will find out in detail what other advantages the Zalando Partner Program has for brands and manufacturers. One thing first: the sooner you start, the sooner you'll be on the winning side with your brand - Europe-wide!

What is the Zalando Partner Program?

Zalando sees itself more and more as an online marketplace and is innovatively planning ahead in this direction. As the first point of contact for everyone interested in fashion, Zalando is already nowadays unbeatable and will become even stronger through new strategies. With its Partner Program, the internet marketplace enables fashion brands to reach their end customers the easiest way possible. This means that not only well-known brands from the fashion industry will benefit, but also new labels. The currently more than 48 million active Zalando customers are a guarantee of success. In addition, there are 23 European markets that Zalando serves up to now. In order to keep a cool head in view of this large reach, Zalando offers you as a brand numerous analysis tools with the help of which you can monitor and continuously optimise your performance on the platform. Last but not least, the Zalando Partner Program gives you control over your pricing at all times, but more on that later.

Difference between Zalando's Partner Program and the Connected Retail Program

While the Zalando Partner Program is aimed directly at you as a brand, Zalando's Connected Retail Program is primarily geared towards fashion retailers. In other words, retailers who also sell your brand to the end customer. That is the biggest difference between the two program types. Both programs are certainly interesting for the fashion sector. Connected Retail, as the name implies, is primarily intended for stationary retailers so that they can connect their shops to Zalando's online marketplace and increase their sales. Although the Connected Retail Program can also be used directly by brands, they always need a retail shop, which not all brands have. In addition, the Zalando Partner Program offers brands and manufacturers another decisive advantage: they can manage their business centrally from one warehouse and do not have to manage different warehouses at the same time. Therefore, the Zalando Partner Program is the better solution for them.

Advantages of working as a brand with Zalando's Partner Program

There are five striking reasons why you, as a brand, should work with the Zalando Partner Program. The large reach and the established structure of the Zalando Partner Program offer you the ideal basis for more sales, marketing and international awareness.

1st advantage: make up for lost turnover from the wholesale sector

Zalando is focusing on expanding its marketplace business and is therefore strengthening its Partner and Connected Retail Program. For example, Zalando wants to double its gross merchandise volume (GMV) to 30 billion Euros by 2025. The share of the platform business in the GMV is expected to grow from currently 32 per cent to 50 per cent during this time.

At the same time Zalando wants to reduce its wholesale business. Therefore, it is better to start with Zalando's Partner Program sooner rather than later. The earlier you join, the further ahead you are of your competitors. But of course that's not the only advantage you get for your brand at Zalando.

2nd advantage: Outstanding brand positioning on Zalando

To present your brand in the best possible way, Zalando supports you using its own concept for success. More than 45 million customers use Zalando internationally in 23 European countries, and the number is growing. With your brand, you are entering a pool of customers who are just waiting to discover something new at Zalando. Right from the start, you will find customers who are active and willing to buy, and you will work together with the biggest fashion player in Europe. Your brand is where your customers are: They don't first have to find their way to you through costly marketing strategies. This not only saves you money, but also an enormous amount of time.

3rd advantage: Keep control over your brands at Zalando

Zalando's Partner Program allows you to be your own boss. You decide which of your products are sold on the marketplace, how you price them and in what way you want to present the products and your brand. You control your marketplace business yourself and thus retain control over your brand positioning. You will most likely find retailers on Zalando who offer your brands. They do not use the Partner Program, but the Connected Retail Program, as mentioned earlier. You cannot influence the retailer presentation of your brand. However, if you are at the forefront of the Zalando Partner Program, you keep control over the products you offer.

In addition, you can also sell products through Zalando's partner program that were not covered by wholesale. For example, you have the possibility to offer long-tail products that were not previously ordered by the Zalando buyers, but could be interesting for your customers.

4th advantage: Determine your own price on the online marketplace

The price sovereignty is entirely in your hands, i.e. you can determine the price at which you sell your items. Of course, you should consider the competition. Especially if other retailers offer products of yours, you want to avoid competing with your own brand. Ultimately, however, it is you who determines the price of your products and on Zalando you can be sure to not be subject to any restrictions or limitations in this regard, as can be the case with other marketplaces.

5th advantage: Usage of Zalando Fulfillment Solutions

To get a clear overview of the benefits of Zalando Fulfillment Solutions, it is important to understand what Zalando Fulfillment Solutions (ZFS) are in the first place. With ZFS, the Zalando logistics network and its services are at your disposal. Whether you want to ensure that your products reach your customers on time or that returns are handled quickly and easily, you want to reduce your logistics costs or internationalise your business, with Zalando Fulfillment Solutions (ZFS), Zalando Shipping Solutions (ZSS) and Zalando Return Solutions (ZRS) you will always find the right solution.

It is entirely up to you whether you want to use all of the services 100%, partially or not at all. Of course, you are also free to use your own logistics to deliver your goods to the end customer. Nevertheless, ZFS offer enormous advantages that turn the original five reasons to join the Zalando Partner Program into eleven beneficial reasons that speak for the marketplace.

Your advantages thanks to Zalando Fulfillment Solutions

#1: Save logistics costs

With ZFS, Zalando has the best price/performance ratio in terms of logistics costs compared to most marketplace logistics providers we have seen so far. The prices are usually better than the prices you get from DHL and Co. as a brand. This is simply due to the large volume that Zalando handles day after day. This also applies to the prices for delivery to other countries. In addition, the pricing is very transparent, as almost all contents are combined in one price. This makes the service easy to compare and the business case easy to calculate.

And the best part of it for you is not only the cost and time savings, but the fact that you can also use it to cover the logistics for other marketplaces if necessary.

In addition, Zalando takes over your B2C logistics, which is especially interesting if you don't yet have B2C logistics yourself and would have to build it up first. Most brands have B2B logistics in place and can easily serve their wholesale partners, but there is a significant difference between sending 100 large shipments per year and sending 100 small packages to end customers every day.

In addition to shipping to the customer, ZFS also handles all customer returns through ZRS and ensures that they are processed properly and to the satisfaction of all parties involved.

#2: Promote sustainability with Zalando Fulfillment Solutions

ZFS are also a benefit for the environment, because the customer's orders are collected and packed into one shipment, so that no more parcels than necessary are sent on the journey to him. This means greater convenience for the customer, because he is served by one carrier and does not have to visit different parcel centres to get his order in case of doubt. The returns system is handled in the same way by Zalando. Both services are not only good for the environment, but also convenient for your customers.

#3: On-time comfort for your customers

Zalando is also very concerned about keeping fast delivery times so that customers can enjoy the full comfort of the online marketplace. That's why Zalando ensures that your brand's products arrive on time and are delivered properly. If you, as a brand, fail to meet the Zalando Guidelines in terms of delivery speed, Zalando will rigorously punish you. In the worst case, the penalty can lead to your products no longer being available on Zalando.

#4: Recognition & visibility

As a result of ZFS, your product is more likely to win the Buy Box on Zalando, which makes it stand out yet again. In other words, your product will be displayed in a prioritised way on Zalando, especially if there are multiple sellers of the same product. The functionality is similar to Amazon's Prime Badge. This increased visibility puts your product in the customer's focus more quickly and makes it more likely to be bought.

#5: Easy internationalisation

As of October 2022, ZFS makes it possible for you to have your brand's products delivered to 17 countries without any problems. Zalando has already connected all relevant carriers per country to its platform. This means you don't have to deal with contract negotiations and technical interface development yourself.

Moreover, this way you can test markets such as Switzerland or Norway. These are countries that are either not part of the European Union or have high customs duties. Please note that you may have to take into account additional costs when trying out these countries. Still, it is a great way to test an expansion for your brand without taking any risks.

#6: Sale - sell-off via Zalando

Zalando Fulfillment Solutions also offer you the opportunity to automatically participate in the Zalando Lounge program. This is an exclusive and closed Zalando shopping club where customers can purchase products at reduced prices and thus also buy your brand at a discount. If, for example, you were not able to sell your assortment for the season, it will automatically be moved to Zalando Lounge and offered there at a discount, if you wish. In this way, you limit the amount of old stock in the ZFS warehouse and have an easy way to re-market your items without having to relocate them. By doing so, the risk of having to dispose of old stock is reduced.

By the way, ...

... if the above-mentioned advantages have not convinced you of ZFS, perhaps this one will: From our expert network we know that it is necessary to reduce the price of one's products by about 5 per cent in order to win the Buy Box if one does not use ZFS.

Conclusion: The best opportunities with Zalando

Convinced? The Zalando Partner Program coupled with ZFS offers you as a fashion brand the great opportunity to sell more profitably by increasing your sales and reducing your cost. In addition, Zalando enables you to expand the awareness of your brand. Get started now and your brand will benefit over-proportionally. The advantages are obvious. So don't waste any time. If you don't know HOW to get started or are unsure about the specific steps to take, our Marketplace Uni courses will help you. Here you will learn everything you need to know to successfully join the Zalando Partner Program or various other marketplaces to boost your sales.

Der Beitrag Zalando Partnerprogramm: 5 Gründe als Marke jetzt damit zu starten erschien zuerst auf Marketplace Manager Training.

Being a Marketplace Manager is not a full-time job? Far from it! In the digital age, many brands not only work together with online marketplaces, but also sell themselves on Zalando, Amazon, Otto and Co. The management of an online marketplace may seem simple at first glance, but as is so often the case, the devil is in the detail. From calculating the business case to setting up the respective online marketplaces to marketing, the Marketplace Manager's field of activity is extensive and demanding.

 

In the end, an expert is needed who holds a permanent position in the company. However, due to the wide-ranging expertise required for this job, the profession as Marketplace Manager is still very rare. To fill the gap of the ever-growing demand, training yourself or your in-house staff to become a Marketplace Manager seems to be the best solution.

 

But what exactly do you do as a Marketplace Manager and where is your place in the company? Here you will find comprehensive answers about this new job role!

What does a Marketplace Manager do?

As a Marketplace Manager, you are responsible for a whole range of different tasks. In order to find the best possible solutions to emerging issues, it is important to have extensive background knowledge. At the beginning, as an online Marketplace Manager, you are a project manager who builds up the sales channel for your brand. You are responsible for everything that has to be done in this context and ensure that the onboarding runs smoothly. In addition, you are the first point of contact for all internal and external partners and act as an interface to all relevant online marketplaces.

Internal and external contact & strategic coordinator

As a Marketplace Manager, you are in charge of setting up your marketplace business, because you are accountable for all matters and details related to it. That means you calculate the business case, you decide which online marketplaces should be considered for onboarding and you determine which marketplace your brand should start with first. In addition, you select the best partners for collaboration, e.g. which middleware or which full service partner is best suited for your company? A middleware, by the way, is a software that runs between your company and the various marketplaces. It guarantees the exchange of data and ensures that the marketplaces are always up-to-date with your product data and the corresponding information. A full service partner, on the other hand, takes care of everything that has to be done in relation to the marketplace business - from data preparation to get your products onto the marketplaces, to logistics and customer service.

 

Another task of a Marketplace Manager is the handling of logistics and marketing. You should be able to clarify questions such as: Who offers the best logistics solution in your industry to bring products to customers and manage returns? Who can support you with product shootings and marketing?

 

Part of this selection process is negotiating respective contracts and keeping your superiors in the company informed with decision papers. Since you work with several different in-house departments as well as external partners during and after the set-up process, communication skills are essential for you as a Marketplace Manager.

Strategic expansion & development of the marketplaces

In order to grow marketplace business, it is important to stay up-to-date with new trends and emerging online marketplaces. The marketplace business is extremely fast-moving: retailers suddenly turn into marketplaces, existing platforms suddenly put their focus on categories you wouldn't have associated them with before... So you should be vigilant, especially when it comes to expanding to more national marketplaces.

 

But business doesn't go quiet internationally either. That means you will be confronted with another unique set of rules. Some marketplaces are more open, others are more reluctant to accept new brands. So here, too, you need to make contacts and ensure necessary approvals.

 

Thanks to your ability to analyse the market and observe competition, you should be able to develop and implement new strategies. In the long run, these skills will help you incorporate your observations into a competitor ranking analysis. This way, you will always have an eye on the market and stay up-to-date.

Operational contact for the fashion assortment

As a Marketplace Manager, you are also part of the operational business. You take care of online orders and plan the assortment for your online marketplace presence. To do this, you coordinate closely with the wholesale team. In particular, you ensure that the budget and order limits are planned accordingly. In order to be able to prepare a budget plan and stick to it, you always have to be well informed about each product's market. That's why it's important that you also keep an eye on inventory and goods management. You must be able to forecast how sales will develop in the future and what is the best strategy for your business. 

 

Assortment planning also includes developing a pricing strategy for all products listed on online marketplaces. After all, the price is a decisive factor in whether a product is sold or not. A potential buyer can always compare prices online, unlike it is the case in bricks-and-mortar retail. Therefore, price plays a central role in online business. However, it is not the only decision criterion for a purchase. The product presentation (content), the availability of goods and the delivery time are also important factors when it comes to selling your product.

Reporting & key figures for a detailed analysis

Reporting and analysis are central tasks for you as a Marketplace Manager. This is because you plan your further course of action on the basis of figures. Important key figures include: Profitability, turnover and the return rate. After you have analysed all relevant figures, you calculate how your online marketplaces should develop and which goals should be achieved. It is your job to draw up a three-year plan and show what opportunities your brand has to become even more successful.

Marketing is also part of the job as a Marketplace Manager

As a Marketplace Manager, you are also responsible for running marketing activities. Depending on the online marketplaces you are on, marketing possibilities vary. Some marketplaces offer self-service marketing, where you do everything yourself, while others have their own marketing team that you work with and allocate a budget to.

 

In general, marketing on online marketplaces is quite diverse and offers different ways to present your brand to the customer. For example, you may plan the look of your brand store on an online marketplace with the marketing team of your company and coordinate promotions such as Black Friday, Prime Day or Christmas campaigns.

 

In addition to the above-mentioned marketing measures, you and your internal marketing team take care of so-called performance marketing activities such as Pay Per Click (PPC) advertising. PPC advertising generates traffic for your products on respective online marketplaces, which is optimised to convert into sales. Therefore, you and your marketing team need to know who is your brand's target group, where and how they are looking for products and what buying behaviour they show.

Content and master data management

As a Marketplace Manager, you manage the content and master data for your online marketplace activities. You ensure that your content is up-to-date and, if necessary, you adjust what is outdated. Furthermore, you ensure that all marketplace-specific requirements are met. This can be, for example, adherence to certain dimensions for product images or the omission of certain terms in the product description.

What qualifications are important for the job as a Marketplace Manager?

Most online marketplaces have English as their main language, especially in an international context. Therefore, it is important that you know both German and fluent English, written and verbal. Product descriptions must be flawless, whether they are written in English or German. You also need to be able to communicate and negotiate confidently with partners to make your plans work. Nevertheless, language is not the only qualification you need for the job.

Professional, technical & digital knowledge

Of course, you also need computer skills in the context of digital offers for the fashion industry. This is a basic requirement for the job of Marketplace Manager. You should know Microsoft Excel and Office, including Sverweis and Pivot, like the back of your hand. As a Marketplace Manager, you must therefore be able to handle these courses with confidence. Because you carry out a lot of strategic planning and analyses, a high affinity for numbers and a certain understanding of analysis are also essential for you. In addition, you should enjoy working carefully and above all digitally and have a technical understanding of the daily challenges of the job.

Personal requirements of a Marketplace Manager

As a Marketplace Manager, you combine strategy, planning, operations and marketing in one person. You are also able to make decisions quickly on an analytical basis. To have appropriate personal skills is therefore quite important for the job. In the field of fashion, a basic understanding of clothing in order to be able to address the target groups accordingly is a further plus point.

 

Do you have a hands-on mentality? Perfect! Because as a Marketplace Manager you have to be focused and make a lot of decisions. If you are also self-confident, convincing and communicative, these are very good basic prerequisites. Your hands-on mentality will pay off especially in contract negotiations and in discussions with external partners and internal departments.

 

In the fast-paced world of online retail, it is necessary to respond quickly and adeptly. If you not only want to keep up with developments, but also stay one step ahead of them, you need to have creative ideas and be able to think out of the box. This requires an appropriate mindset and, of course, an interest in innovation. You should also be a good team player, because managing an online marketplace can only work as a team.

"Nice to have" skills as a Marketplace Manager

In addition to the basic qualifications mentioned above, there are a few "nice to have" skills that can give you a competitive advantage over other candidates as a Marketplace Manager. One of these is prior knowledge of the marketplace business. If you have also actively applied the expertise you have gained here in the past, you will clearly stand out from the crowd. For example, if you have already gained experience with middleware partners and perhaps worked with their software, this is definitely a big plus point for you in the interview for the position of Marketplace Manager. If you also have contacts with marketplaces and marketplace-relevant partners, the door is more or less open to you. Ideally, your "nice-to-have" skills will be rounded off by an existing routine in working with industry-standard key figures, particularly in the fashion sector.

Facts about the job of a Marketplace Manager

Many large brands and companies are looking for Marketplace Managers on a full-time basis due to the wide range of tasks they have to fulfil. Especially in the fashion industry, there is a high demand for experts, because brands want to expand internationally and follow up on their success by leveraging the potential of online marketplaces. The starting salary as a Marketplace Manager ranges from 45,000 to 55,000 Euros per year and can double with good performance, depending on the company you work for.

What makes the Fashion & Sport division special?

The fashion and sports industry comes along with its very own challenges for you as a Marketplace Manager. Just like in DIY or consumer electronics, there are numerous marketplaces that specialise in the sector of fashion and sports. These need to be found and the most relevant ones for your brand need to be identified. In addition, you may not want to sell your entire assortment on all online marketplaces, but curate it according to the relevance of the respective platform. 

 

Of course, you have to coordinate the assortment internally with your colleagues beforehand and write the corresponding orders so that the goods are available at the desired time. Here, the various seasonalities and mid-seasons must be taken into account. In addition, the areas of sports, fashion and shoes have their own category-specific characteristics that you have to take into account, e.g. the return rate. Unlike in other categories, returns are very high in fashion, especially for clothing and shoes. It is important to consider this when creating product-specific content, because the more your description reveals about the product, the lower the return rate. This in turn has a positive effect on your business case.

 

In addition, in the fashion industry there are usually several variants of one and the same product, e.g. different sizes and different colours. Assigning the different variants to each other and making them easy to find for the customer is a challenge of its own that you as a Marketplace Manager have to master. And if you don't want to take care of this yourself, it is at least your task to find a reliable service provider who has the relevant specialist knowledge and can take care of the handling for you.

 

As you can see, a Marketplace Manager for the fashion and sports sector has to meet some very specific requirements.

Conclusion: Marketplace Managers have a direct influence on the success of a company

As a Marketplace Manager you have a direct influence on the success or failure of a company. Depending on how good the strategy is that you work out for your company, you will generate more or less turnover from your activities on online marketplaces. You are the central contact person for all internal departments and external partners - both nationally and internationally. You have a lot of responsibility and the online business depends to a large extent on the skills you can demonstrate as a Marketplace Manager. It's a job that demands the best from you, and at the same time is highly fulfilling. Take the opportunity to be one of the first to take on this great new job and become a Marketplace Manager to actively help your brand become more successful!

Der Beitrag Der Expertenjob Marketplace Manager – was sind seine Aufgaben? erschien zuerst auf Marketplace Manager Training.

"We don't want to sell online because we want to protect our brick-and-mortar retailers." I've heard this sentence over and over again in the last 9 years since I started selling online. However, I hear it less and less in the fashion industry. But just look at another industry and we're back to the same starting point. It seems that only the fashion industry started a process of change towards online marketplaces for fashion a few years ago. I would say that this is a brave attitude, considering that we are talking about brick-and-mortar retailers. And have you ever thought about what's best for your end customer? I mean, after all, they are buying your products. Can the end customer get your products where they prefer and where they normally shop?

I would like to share my knowledge from the last 9 years in online sales with you. In a "real, in-depth conversation" about exactly this topic and at the same time give you more insights and expertise along the way. I have seen all the sites Amazon internally, the brand sites internally and the own online shops externally and now have this 360 degree view. I have also noticed that online sales no longer pose such big questions. It's now more about the business with online marketplaces, which always poses difficulties for brands because there is a huge lack of knowledge here. Why? Because it's a relatively new topic and also complex.

"The question with online sales is no longer "if", but rather "when and how?". Especially when it comes to online marketplaces."

So it's time to take a brief look at the world of online fashion marketplaces.

Two options for online sales channels with online shops such as Amazon, Zalando & Co.

Online marketplaces for fashion are different sales channels for brands and retailers to sell their products online via large online shops, e.g. Amazon. There is the wholesale business, which is still a B2B business. You have a buyer who pre-orders your items and sells them on behalf of the online shop. At Amazon this is called Amazon Vendors, for Zalando it is the normal wholesale business.

In addition to wholesale, you can also sell your products as a brand via the marketplace itself - you use the online shop for this. You have to stock the product yourself and sell it via the online shop, e.g. as a seller on Amazon, and also send it to your end customer. The good thing for you as a brand is that you can decide where you want to sell your products and at what retail price. If you sell via the wholesale business, the online shop itself decides on the retail price and sells your products.

In Germany and Europe, there are several online marketplaces for fashion, which are also known as partner programmes of online shops such as Amazon, Zalando, About you, Otto, Klingel, Ebay, Sportscheck, Mytoys, Limango, Mirapodo, Galeria, La Redoute, Douglas, BOL and Allegro and many more. This small selection focuses mainly on fashion and lifestyle products.

What online marketplaces for fashion tell us about future growth

Marketplaces have become growth engines for large online shops. Zalando therefore declared in its 2019 annual report that it would increase its GMV share of the partner programme (marketplace) from 10% in 2018 to 40% in 2023/24, and to 50% in the long term. In 2019, they already increased the share of their 2019 annual report from 10% to 15% and in 2020 even to 24%. According to estimates, Amazon's sellers already generated 60% of total sales in 2019. These examples show that sales via online marketplaces for fashion will become significant in the near future.

"Marketplaces where you can sell all the products you want, depending on your selection"

I would like to use the graphic above to explain a case study in more detail. You are a retail brand that already sells its products via the wholesale buyer on Zalando (marked in dark blue).

 

• Your wholesale buyer orders 12 of your 20 bestselling models -> marked dark blue
• You add your 20 bestsellers via the marketplace / affiliate programme and sell them yourself 

• • • 8 out of 20 bestsellers that have not yet been ordered are now available at Zalando -> marked green
    • 12 of your 20 bestsellers were ordered via wholesale and you also sell them as soon as they are no longer in stock at Zalando due to high demand, lack of repeat orders or off-season -> marked light blue

This hybrid model offers you the opportunity to generate additional sales through items that have not yet been ordered wholesale or are out of stock. This gives you the opportunity to expand your online sales business by selling your products via the marketplace model.

The past has already shown that sales via the partner programme and the wholesale business benefit from each other. It helps you as a brand to sell new categories and styles that the wholesale buyer didn't want or misjudged in terms of demand for the pieces ordered. In my experience, you can usually achieve a market turnover of at least +10% if you are already selling a large selection of your range through wholesale. I have also seen market growth rates of +30% within 3 months of selling an additional category through the market. This was a test case for the buyer and afterwards they started to order this category in wholesale as well. If you still want to sell your products via wholesale and you are already selling via a marketplace at the same time, this is slightly different. In my experience, wholesale and marketplace benefit from each other.

Not all marketplaces are the same - two ways to open and close online marketplaces for fashion

Not all marketplaces are the same. Within the marketplaces there are differences in how they are set up.

Open marketplaces are open to everything and everyone

Open marketplaces are those that are open to any product without restrictions or pre-selection. This means that anyone can sell anything on these marketplaces. Amazon is a pretty good example here. There are many offers from all over the world, especially from Asia. At the same time, a single product (with the same EAN code) can be offered by multiple sellers. This leads to price competition for the same product. At the same time, you have no barriers to entry, so you can theoretically start selling tomorrow. You don't even have to have a well-known brand. On these online marketplaces for fashion, you can easily enter the market and start your business. Good examples of open marketplaces are Amazon, ebay, BOL (NL) and Real/Kaufland.

Closed marketplaces are more exclusive and less competitive

Closed marketplaces are subject to restrictions and are more exclusive. You need a sales permit to sell your products on these online fashion marketplaces for each brand from the marketplace teams or buyers. After this one-time permission, you are allowed to sell all products of your brand on these marketplaces. You can decide which product you sell. Not "everyone" sells there, so you can have a good brand experience. At the same time, there is also less competition, as only one EAN is (usually) offered by one seller at a time. This means that your recommended retail price is also more stable compared to open marketplaces. The barrier to entry for fashion is also slightly higher than when selling via open marketplaces. Good examples of closed online marketplaces for fashion are Zalando, About you, Klingel, Sportscheck, Mytoys and Mirapodo.

Which online fashion marketplaces are better for my brand?

This depends a lot on your brand, products, prices and strategy. I have already started the fashion marketplace business with several brands and opened this business with a well-known underwear brand. With this underwear brand, we had several challenges in terms of marketplace business. We were already a wholesale partner of all major online shops and now we wanted to start with the marketplace. We wanted to expand our selection and be our own backup when the products are out of stock.

 

• The number one challenge was our logistics headquarters in Hungary, which focussed mainly on B2B orders.
• Challenge number two was a lack of capacity in the e-commerce team.

 

It took us a long time to get an overview of the market. I was the only person responsible for the online business in Sales (without our own online shop). We made several decisions:

 

• Initially with online marketplaces for fashion at Amazon, Zalando, About you, Klingel and Otto, where we also had permission to sell our brand.
• We do not want and cannot ship B2C from Eastern Europe and we need a partner who can do this for us in Germany with a consignment stock
• We need a full-service partner who manages the main processes to save our team capacity and who is an expert in the marketplace business

 

Once we had made these decisions and selected a full-service partner, we launched on all five marketplaces four months later and increased online sales for our brand. We benefited from the mix of wholesale and marketplace business. On the one hand, this gave us the opportunity to expand our selection, secure our own stock and increase sales. I would recommend starting on a marketplace soon, as this is an important sales channel in the near future.

Do you need help setting up your marketplace business?

We from the Marketplace Uni are specialised in the marketplace business and offer various marketplace courses depending on the current state of development. In these courses, we teach you and your team in a practical way what you need to do to sell successfully on Europe's most interesting online marketplaces and thus increase your turnover. To the current Course overview.

Der Beitrag Online Marktplätze für Mode: Auf was du als Marke achten solltest erschien zuerst auf Marketplace Manager Training.

Online sales continue to grow, not only due to the Covid 19 pandemic. Zalando recently adjusted its figures to again report growth for 2020 and expects GMV growth of 10-20%. As an online shop, Zalando offers brands two ways to sell their products: As a traditional wholesale business, where Zalando acts as a retailer, and through its in-house online marketplace. What Zalando calls its Partner Program (PP) is also offered by many other online shops. This is called online marketplace. Amazon, About you, La Redoute, Bol, MyToys, Sportscheck or Douglas are some examples of marketplaces in Europe. And with most of them you have the possibility to do online marketplace and wholesale business.

There are so many different ways for brands to sell their products online. Here I focus on selling through an online marketplace in a B2C set-up and wholesale business in a B2B set-up.

1. wholesale business: sales, shipping & finishing

Online wholesale is the sales channel most brands are familiar with. Meet your buyer every season for your order appointment, get a budget based on the previous season's sales and show the buyer the new products for the coming season. You then receive the pre-order for the season, send the products to the online shop's warehouse when the season starts and provide your product data and product images.

Once the products are shipped, you don't have to worry about them anymore. Everything is done, and it' s quite convenient. Next season, you start all over again. Are there additional ways to support your products in sales subsequently? Sure, but you don't have to, however, it's up to you.

This is what the wholesale model looks like. The brand receives a budget and sends the order of products to the buyer. A selection of your brand's top items could look like in the table below. The buyer orders items 1, 2, 4 and 5. He is not interested in item 3 and therefore does not order it. The buyer receives the products and sells them in his online shop at a price of his choice.

The advantage of this model is less risk with your stock. The online shop may or may not adopt your recommended retail price. This is out of your control.

 

To summarise the online wholesale business for a brand:

- The buyer selects items
- Not all items are being ordered
- You have to work with a limited budget
- The buyer determines the selling price of your products
- Your end customer has no access to your complete product range
- You are dependent on your buyer
- It's a pretty comfortable business model

2. Combination of online marketplace and wholesale business by adding additional stock to selected items

In recent years, many online shops have started to offer brands the opportunity to sell their own products through their marketplaces. This means that you can combine your wholesale business with a marketplace business .

By linking your wholesale business to the marketplace business, you have the opportunity to offer additional stock for those items that have been pre-ordered by the buyer. You may feel that the buyer has not ordered enough of your top items. In our example, 800 pieces of item 1 were ordered wholesale. You then have the option to add another 50 pieces through the marketplace model to meet customer demand.

In this case, you serve as a backup as soon as your buyer runs out of stock of the item. Sometimes this is even the case with "never out of stock" products if the buyer has not reordered quickly enough. As a marketplace seller, you become your own backup when an item is out of stock. However, as the owner of your market stock, you also take the full risk.

Summary on the supplementation of the online wholesale assortment with additional items from the marketplace business

- Higher availability of your articles
- Fewer sold out items for your end customer
- More sales
- The inventory risk is on your side

3. Combination of online marketplace and wholesale business by selling additional items via the marketplace

Your buyer didn't order all the items you were hoping for? You want to show a much larger selection of your brand in the online shop? Or did you get a budget cut for some categories?

Besides adding stock to pre-ordered items, you can also add items through the marketplace that have not been chosen for wholesale ordering. This way you can decide which items to sell and where, or display your entire assortment if you wish. You do also have control over the selling price when you sell directly to end customers. However, depending on the market, there may be price competition for your items if other retailers sell the same products.

This means that you can add extra stock to items ordered wholesale and add further items you want to sell online yourself. This example shows how you add 600 pieces of your top 3 items via the marketplace.

Even if a buyer has selected 20% of your assortment, you can still offer 100% of your product range through the marketplace. 20% as a backup if the buyer runs out of stock, and the remaining 80% as an additional selection for the end customer.

To summarise the combined online wholesale and marketplace business for a brand:

- Brand decides on the range of products offered
- Greater choice for the end customer
- Brand controls the selling price
- More sales
- No external restrictions
- Brand is its own sales hero
- The inventory risk is on your side

4. Only sell via the online marketplace

You didn't get a budget for the coming season? You don't want to sell your products via online wholesale? Or is your brand only offered the marketplace model? This is your opportunity to decide independently which products you want to sell through the marketplace business. You can choose to sell your full assortment, just a few pieces or a curated range of products for each market and country. It's up to you and your options.

Building your own marketplace business means extra work, but at the same time the opportunity to become your own sales hero. You have to set up all your processes for B2C shipping and you have to control this sales channel yourself. Also, you can decide on the selling price of your products and it's also a good and fast way to test new products in my opinion.

The example shows that you have the choice to offer a selection from your assortment in the width and depth of your choice. As you are fully responsible for your marketplace business, you have to order and ship to end customers yourself and are responsible for all steps in between.

To prevent price competition on items already sold wholesale, the marketplace business gives you the opportunity to reinvent yourself and adapt your products respectively. You can consider optimising your assortment and creating entirely new items that are sold exclusively through the marketplace to offer unique products.

At the same time, you have the possibility to customise and diversify existing products. For example, you could create multipacks or matching sets, such as selling a multipack of leggings or a baby romper together with a matching jacket.

To summarise the marketplace business for a brand:

- Brand owns selection of items
- Brand bears full responsibility for the entire B2C process
- Brand controls the selling price
- Turnover restrictions are made by you if at all
- Fully flexible and responsible
- No external restrictions
- Brand is its own sales hero

4 ways you can benefit as a brand from the online marketplace and wholesale business

The 4 best practices - choose wisely!

Up to this point, we have looked at four different ways to sell your products through online shops:

- Only wholesale
- Wholesale & marketplace by adding stock for pre-ordered items
- Wholesale & marketplace by adding additional items that have not been pre-ordered
- Only marketplace

As a brand, you are free to choose which marketplace and wholesale business model best suits you and your products. Remember that each model has its own advantages, but also challenges.

Consider your online sales goals before you start. Wholesale is the more familiar and comfortable business model and carries a little less risk. The marketplace business offers many opportunities to grow your brand. You define your own selling price, are only limited by your own boundaries, e.g. turnover, and are fully responsible for your stock and processes.

Choose wisely! If you need help with this decision, feel free to contact us or use the Marketplace Uni to build your skills. Find our current courses here.

Der Beitrag Online Marktplatz und Wholesale Geschäft: 4 Wege, wie Marken davon profitieren erschien zuerst auf Marketplace Manager Training.

The job of Marketplace Manager is becoming increasingly important. Zalando connected 180 new partners to its marketplace in the first half of 2020, while the GMV with the partner rate increased by 100% compared to the previous year. Demand from manufacturers to sell their products via marketplaces increased significantly again in 2020 in particular due to the shift from offline to online.

According to a study, 67% of manufacturers were already offering their products via online marketplaces by the end of 2019. On average, the marketplace sales share for retailers and manufacturers in the study is 28.2%, even though one in five do not even know how high their marketplace sales are. Marketplace sales will continue to grow in the coming years and this new sales channel will become increasingly important for brands and manufacturers.

According to the study by ecom Consulting and Internet World Business, one of the main reasons against online sales is the additional effort and personnel (45.6%). However, new sales channels and processes in particular require well-trained staff who are extremely familiar with the new area.

Source: Marketplace Study Germany - Retailers' and manufacturers' perspectives, September 2019, Internetworld Business and ecom Consulting

Only a few retailers and manufacturers have trained marketplace managers on their staff

However, the study also clearly shows that the marketplace business mainly relies on rudimentary half-knowledge. For example, only 9.7% of participants stated that they had a good knowledge of Zalando as a marketplace. Where is the knowledge supposed to come from? In most cases, it does not come from within the company and there are only a small number of current offers to learn the knowledge. What's more, apart from Amazon, the marketplace business is a fairly new sales channel that has not been learnt and practised for decades. There are therefore no established training programmes that have been in place for years. Most of the knowledge is based on trial and error, which is usually long-term and quite costly.

 

And this is where the danger lies. In a market that accounts for more than 31% of manufacturers' sales, knowledge is the power to increase sales, boost profitability and further develop the business.

Source: Marketplace Study Germany - from the perspective of retailers and manufacturers, September 2019, Internetworld Business and ecom Consulting

The eternal search for the Marketplace Manager

Some brands and manufacturers know and want to start and develop the marketplace business. The decisive factor is often the human factor. There is a lack of capacity and expertise to set up and establish the marketplace business in the current business. This is where the search for a "marketplace manager" often begins, but the demand on the market is much greater than the availability of well-trained marketplace managers with experience.
The challenge often starts with the job advertisement. What are the tasks of a Marketplace Manager? What profile and skills are being sought? Where is the Marketplace Manager positioned in the organisation? In which salary bracket is a Marketplace Manager positioned? This position is often newly established in the organisation, so many new questions arise.

 

Once these questions have been answered, it's time for the interview. But how should the interviewer ask the right questions to recognise whether the person is really suitable for marketplace management in their own company? And how can you judge the answers if you don't have any knowledge of marketplaces yourself? I see these hurdles time and again when it comes to getting started in the marketplace business.

 

Another option is to develop a Marketplace Manager from within the company's own ranks. In most cases, this person is one of the first in the company to take over this business. However, there are very few internal opportunities to acquire marketplace expertise, apart from the lengthy trial and error process.

 

My path was exactly that of learning by doing and trial & error. I was employed by Amazon as a vendor manager for four years and spent two years building up the marketplace business for several lingerie brands. As a result, I had and still have a lot of prior knowledge and at the same time, this didn't prevent me from making a few mistakes. These were sometimes costly because they led to wrong decisions or often simply delayed the process of launching the marketplace business considerably. As is so often the case, the devil is in the detail. For example, if I know that I need a certain tax number at a certain point in the process, which I still have to apply for, I can apply for it early on and not wait until I need it for the rest of the process.

 

The marketplace business has established itself and will become a significant sales factor for many brands and manufacturers in the near future. This makes it all the more important to have highly trained employees in this area. Only then can the marketplace business be managed profitably and with strong sales.

The big knowledge gap marketplace business

I keep realising that there are still brands and manufacturers who don't know what marketplace business means and what potential it has. At the same time, there are some who are well aware of this and don't know how to go about realising it, simply because they lack the necessary knowledge.

Some then rush headlong into the marketplace business without having calculated a business case and with the quickest possible start. However, after a year in the marketplace business, they often end up hitting rock bottom because the return rates are higher than expected and the desired success does not materialise. It is therefore better to inform yourself in advance, work out a strategy and build up the relevant knowledge. But where should the knowledge come from?

Marketplaces have been around for several years now and new marketplaces are constantly being added. As a result, the need for trained staff is increasing on all sides, for manufacturers, brands, retailers and the marketplaces themselves.

6 ways to learn about the marketplace business and train marketplace managers

So what options do you have if you want to get started in the marketplace business and don't yet have the all-important prior knowledge? Where and how can I acquire this knowledge?

1. various studies & analyses on the topic of online marketplaces and marketplace managers

There are a few studies that focus purely on the marketplace, such as the 2020 marketplace study by Gominga and the Marketplace Study Germany. There are also many other studies and analyses, e.g. from McKinsey, which also write about platforms and marketplaces, where the topic of marketplaces is usually one of many other topics. The studies and analyses are very good for getting a good picture of the market.

Source: https://www.ecom-consulting.de/marketplace-landscapes/ 

2. trade journals and newsletters on the subject of online marketplaces and marketplace managers

In e-commerce there are a number of good trade journals and newsletters that keep you well informed about the latest developments in the marketplace business in general.

 

Here are some of my favourite newsletters:

 

• Internet World: various newsletters with different focuses, my highlights are the daily newsletter about all topics in e-commerce and marketplaces, the Amazon World News newsletter about Amazon topics and the Commerce Shots for decision-makers
• Etailment: Digital e-commerce magazine about national and international trade
• Internet Retail: International E-Commerce News
• OMR: Daily newsletter focussing on online marketing, including on marketplaces

3. events & conferences around online marketplaces and marketplace managers

Germany currently has the ECD as a large conference focussing purely on marketplaces. Of course, there are other conferences and events that sometimes also have marketplaces as a theme, e.g. ISPO, the K5 or the OMR. However, these have other main focus topics and the marketplace is one of many topics there. These formats are often very good for gaining an overview of new developments and making contacts. However, the knowledge imparted is really more of an overview than detailed knowledge.

4. seminars on online marketplaces and marketplace managers

If you take a look at the marketplace manager seminar landscape, you will see a whole host of offers. On closer inspection, 90% of the offers focus on the Amazon marketplace. If you as a brand or manufacturer have Amazon as a pure focus, there are some really good formats for this. However, if you want to go online on several marketplaces at the same time, e.g. Otto, Zalando, About you, Limango, etc., then the offer quickly becomes very poor. In addition, the seminars here are also very good for gaining a good overview in the 1-2 day seminars. However, often only little detailed knowledge is imparted here as well.

5. books on the topic of online marketplaces and marketplace managers

Books are similar to seminars. There is a lot of very good and up-to-date literature when it comes to selling your products on the Amazon marketplace. However, if you search for "marketplaces" or "platforms", the search results of the books cover many industries and other forms of marketplaces, but not the form of online marketplaces that you want to know more about in this case. In addition, the books are often a few years old and, especially in such a rapidly changing market as the marketplace business, they are often no longer up to date. In the last 5 years alone, the number of marketplaces has doubled.

6. exchange of experience with marketplace managers and online marketplace experts

One option I often chose was to exchange ideas with other experts and marketplace managers. This allowed us to exchange tips and tricks that we didn't know in detail and that helped a lot. However, not everyone has such a large network and contacts who already work in the marketplace business.

Conclusion

The flood of information about online retail is constantly increasing. The dedicated knowledge about marketplaces is usually included in the information about e-commerce. However, it is often tedious and time-consuming to filter out and simply not up to date due to the fast pace of life.

 

I can find out about the marketplace topic at many seminars, events, conferences and newsletters. However, there is no real knowledge building because the topics are often communicated very top-down. For example, there are many presentations from Zalando about their partner course and the opportunities there. However, there is no detailed information on how the operational implementation really works. And with all the information available, I think that's the key point. I can read a lot about marketplaces at a glance. But how the marketplace business actually works in detail when it comes to implementation is usually left in the dark.

 

The operational hands-on knowledge about the marketplaces that would save me from making many mistakes in advance is not taught. So it's still trial and error and learning by doing when it comes to establishing and expanding the marketplace business.

Hands-on Marketplace Manager training course at Marketplace Uni

The eternal trial and error and learning by doing are simply tedious and costly. If I had known many topics and details earlier, my projects in the marketplace business would have gone online much faster. It is simply tedious to learn everything yourself and to do pioneering work that has already been done. The knowledge about marketplaces is already available and is constantly being developed further.

 

From April 2021, there will be new Marketplace Manager training courses, especially for brands and manufacturers in the fashion, sports and lifestyle industry. The aim is to build up detailed knowledge of the marketplaces and develop your own strategies in 3 months. This is not done alone and by learning by doing, but in an exclusive group of participants who exchange ideas with each other and with selected experts who impart exactly the detailed knowledge you need to be successful in this business. The aim is to achieve higher sales and profitability on various marketplaces such as Zalando, Amazon, About you, Otto, etc. with your own product range through greater knowledge. As part of the Marketplace Uni you can easily register for this training. For me, this is the most effective and easiest way to gain exactly the knowledge you need.

Der Beitrag Marketplace Manager werden: 6 Wege dein Wissen aufzubauen erschien zuerst auf Marketplace Manager Training.