It seems consumers are moving away from brand sites and turning towards marketplaces as shoppers now make more than half, 54%, of all their online purchases on marketplaces.
According to a report from Jumpshot about the growth of e-commerce platforms, the rate for purchases on marketplaces is as high as 60% for some product categories. And one out of every four brand search conversions occur in a marketplace, with 24% of click-throughs resulting in conversions in marketplaces.
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So why marketplaces?
"Marketplace sites are built to sell a vast quantity of products," Deren Baker, the CEO of Jumpshot, told FierceRetail. "Therefore, they can invest more heavily in an industry-leading shopping and checkout user interface, benefits like a loyalty program and memberships like Prime. "
For many brands, being in marketplaces is almost essential. For example, 50% of all Michael Kors sales happen on marketplaces. Adidas is another brand dependent on the marketplace, which makes up 54% of the brand's sales.
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However, when it comes to conversion rates, the study shows that Macy's outperforms Amazon for key retail brands such as Calvin Klein, Clinique and Michael Kors. Nike is one of the few retailers that drives the majority of purchases on their own website, 71%, but that could change as the brand recently began selling products on Amazon.
Baker said that brands need to play both fields, maintaining their own site while still working with marketplaces.
"Jumpshot research shows that brands can drive more than 50% of their online sales through marketplaces sites. In fact, brands’ search, retargeting and other advertising methods can contribute to a 20% or more increase in overall sales just on marketplace web sites," he said.
Baker reiterated that marketplace websites provide the best-in-breed user experience for their customers: faster shipping, greater selection, easy checkout, and brands that often don’t have the luxury of investing as much in that process.
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