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Global Marketplaces to Boost your Sales in 2019…

18 Jul 2019

Online Marketplaces

Which online marketplaces should I be selling on to increase my international eCommerce sales?

In April 2019, there were 2.4 billion combined mobile & desktop global visits to Amazon. As truly gargantuan as that number is, there will be few with their mouths left agape. If online marketplaces were the royal hierarchy - Amazon would be king.

It isn’t just a marketplace, after all - it’s an ecosystem (and we’re not talking about the rainforest here). Whether it’s Media, Video, Web Services, Entertainment or Technology, Amazon are in the market...but let’s not forget what their core service is:

The selling of goods, online.

Further to their own retail activity, the introduction of their FBA (Fulfillment by Amazon) service was revolutionary in the eCommerce game. By providing would-be entrepreneurs with the simplest means of selling their products, Amazon offered to take care of the fulfillment & delivery.

That’s why 50% of all Amazon sales are made through third-party sellers.

In fact, Amazon’s third-party marketplace is now worth twice as much as its own retail operations – it’s services being valued at $250 billion, compared to a measly $120 billion for its own retail operations.

 

Amazon were one of the first eCommerce companies to pioneer cross-border selling, first as a seller themselves - then, as a third-party marketplace.

Amazon

But what do we mean by third-party marketplaces?

A platform where small businesses & sellers can list their products, allowing them unrivalled access to a extensive customer-base, without having to do any of the commercial work themselves.

In the case of Amazon, sellers can reach a domestic & international audience using their marketplace. Whilst, at the same time, have Amazon take care of their logistics when a purchase is made.

Assuming the seller can get their product to Amazon’s fulfillment centers - Amazon will do the rest.

Whilst the eCommerce giant may have taken the retail world by storm, there is still another 50% of online sales that are made elsewhere. The usual suspects in the UK include the likes of eBay or Fruugo. However, unlike Amazon, these platforms are yet to supply fulfillment, pick & pack or international shipping as part of their service.

Therefore, for eBay sellers, the responsibility for packing & distribution is very much on their shoulders. For a time, this can be done out of a garage or a bedroom - but when volumes increase, a specialist third-party logistics partner (3PL) is critical to continuing that growth.

Find out about our International eCommerce Delivery Service today!

MHI eCommerce Logistics

Everyone knows about Amazon, many are selling on the marketplace, and most are reaping the benefits. But there are faster-moving third-party marketplaces in the emerging world that e-tailers simply cannot afford to ignore…

The Countries & Marketplaces you need to be selling on:

China: Taobao & Tmall

Chinese Marketplaces

Whilst UK eCommerce sales volumes continue to grow, the growing middle classes of the world grow faster – China more than most.

With 87% of consumers in China looking to buy British, it would be unwise to disregard this market & it's increasingly wealthy population.

Alibaba is no longer the novel B2B marketplace that drop-shippers used to discuss in hushed voices, as the ping of a yet another sold alarm clock rang out across the coffee house.

Jack Ma is the sovereign of B2B eCommerce & Alibaba is the biggest eCommerce company in the world. But as buying power grew amongst China's populace, Alibaba adapted with it's own B2C marketplaces: Taobao & Tmall.

It's these marketplaces you need to listing your products on should you wish to ride the Asian giant's wave of consumerism.

With China’s exports seeing the biggest fall for 2 years, due to rising wages, greater consumer spending and an attritional trade war with the U.S – China is no longer the mass exporter it once was.

Alongside the fact that Chinese workers earn 25% more than Mexican factory workers, this is why the U.S is turning to Mexico as producers – and China’s trade surplus is narrowing.

It’s a paradox, I know. We've known China as the great exporter for so long, and now we're supposed to be selling to them? Yes. Perception is everything & British products are selling like hot cakes - or should I say hot scones.

India: Flipkart

Indian Marketplaces

The Indian middle class is growing almost as quickly as it’s eCommerce industry.

In fact, a report by Deloitte India claimed that eCommerce will be the engine of consumer growth in the coming years. It’s an industry currently worth around $200 billion & is forecasted to grow to an awe-inspiring $1.2 trillion by 2021.

This can be attributed to a number of factors including greater access to the internet, a growing youth population who are mobile-savvy and, of course, an expanding middle class with more money to throw at material goods.

What are they buying?

As of March 2018, the share of spending on products in India showed:

  • Electronics: 48%
  • Apparel: 29%
  • Home & Furnishings: 9%
  • Cosmetics (Baby & Beauty): 8%
  • Books: 3%
  • Other: 3%

With increased awareness & better income, Indian consumers are willing to spend on international brands & better-quality foreign products – so those social media strategies need to be aligned with this.

Speaking of social media...find out what Instagram Checkout really means for e-tailers.

Which marketplaces are they using?

Flipkart is the major eCommerce marketplace in India, offering over 80 million products in more than 80 different categories. In 2018, Wal-Mart acquired the company for just over $16 billion – and with good reason.

The marketplace is the entryway for UK sellers who will find an audience who genuinely want to buy their products – especially if it’s electronics or apparel.

Snapdeal & TataCliq are two other Indian eCommerce marketplaces & with some controversy surrounding recent FDI (foreign direct investment) policy, it could be a shrewd move to get selling on these platforms before the sales storms begin.

The scope for growth in India is staggering. With the ongoing digital transformation in the country, they could surpass the United States to become the 2nd largest eCommerce market in the world by 2034.

China 2.0, anyone?

Indonesia: Tokopedia

Indonesia Marketplaces

South-East Asia’s biggest economy is home to 52 million people, spread out among its sprawling 17,000 islands. Due to its dispersed geographical nature, it’s unlikely that Indonesia, and South-East Asia for that matter, could reach half the heights of China – but with a consistently-improving economy, a young demographic & a culture that values start-ups, Indonesia is flying the flag for South-East Asia.

Millennials are driving change…

As seen in many of the emerging economies, internet penetration and mobile commerce are the prime reasons for the rise in online consumerism. James Bryson, of HB Capital Indonesia, claims this is through a group of sophisticated, well-informed millennials, who, through the use of social media, are pushing online consumption.

With Indonesia’s baseline growth for consumption being about 5% annually, a lot of this is down the oft-mentioned millenial & their changing buying habits.

Which marketplaces are they using?

We mentioned earlier about the 17,000 different islands. When it comes to next-day delivery & logistics, this will always pose a problem, at least until drone-delivery overtakes road vehicles - but that’s another story.

Tokopedia is the big eCommerce platform in Indonesia. Innovative till the end, the marketplace connects merchants over the country’s islands by forecasting demand from a decade’s worth of purchasing data – ensuring each inhabited island has the correct number of products from each seller on the platform.

Perspective is needed, of course – Indonesians still have one of the slowest internet connections in the Asia Pacific region, many are still wary of online payments & relatively poor infrastructure raises the price of logistics so that final price of shipping is greater than most countries.

But those are the teething problems of the largest archipelago in the world, testing the waters in the fastest-growing industry there is.

With the country’s eCommerce market set to grow to $130 billion in 2020 & registering an annual growth of a staggering 50% - it's a market you want to be a part of!

What are they buying?

The top products that are selling are apparel, cosmetics, food & drink, mobiles & tablets.

Any other marketplaces?

It’s worth a mention that Tokopedia aren’t the only marketplace making strides in Indonesia. With the Chinese market slowing, Jack Ma has set his sights on their South-Eastern cousins.

Alibaba-owned Lazada are the second-largest eCommerce marketplace in Indonesia. With the backing of the eCommerce giant it’s certainly worth spreading your range & becoming a seller on both platforms.

However, be aware that Lazada serves the whole South-East Asian market & not just Indonesia. That opens you up to more than 500 million potential customers in the likes of Hong Kong, Thailand, Vietnam, the Philippines, Singapore & Malaysia. – which is hardly a bad thing.

Latin America: Mercado Libre

Brazil

Whilst Latin America is the global leader in mobile commerce growth, it would be irresponsible to pit the territory besides the likes of China, India & South-East Asia in the growing middle class stakes. For one, there are 33 different countries in the region, with 448 languages spoken in South America, alone.

It’s difficult to label as a single market.

However, it is home to two of the three fastest-growing countries in the world: Argentina & Colombia. Argentina's eCommerce growth rate is 31% annually; Colombia is growing at a rate of 24% - with each country’s mobile commerce at double those figures.

If we take Argentina & Colombia as the top-tier countries to target, then the second tier, the real emerging economies that could bring Latin America up to the level of the countries above are…

Mexico & Brazil.

Mexico has more than 76 million internet users & an economy that is growing exponentially. As stated above, it is still very much a producer and, as of very recently, has become the United States’ top trade partner, overtaking China. Even considering it’s still in the early stages of middle-class growth & with a very uneven wealth distribution - Mexico should be a target market.

Consider that last year, there was $8.72 billion eCommerce sales in Mexico, whereas in Brazil, there was $19 billion worth of eCommerce sales made. Nothing to be sniffed at, but it’s not quite the hundreds of billions seen in China, India & South-East Asia.

Which marketplaces are they using?

The benefit of a marketplace that serves the whole of Latin America, is that their leading platform, Mercado Libre, serves 19 of the region’s leading economies - including Argentina, Colombia, Brazil & Mexico.

It’s the 7th most visited eCommerce website in the world with more than 1 million items sold daily, it provides an integrated translation service so you don’t need to worry about localization and, most importantly, it welcomes international traders to sell to its Latin American customer base.

There is a very simple seller registration process, whereby you are given one account to work from & Mercado Libre automatically creates local accounts for each region you wish to sell to.

Honestly, it couldn’t be easier.

What are they buying?

  • Beauty & Personal Care
  • Energy Drinks
  • Pharmaceuticals
  • Personal Computers
  • Smartphones

What to watch out for?

There’s a reason why we class Latin America in a different category to the other markets mentioned above. Primarily, this is down to infrastructure, security & payment systems. Since the region has a very underbanked population, most consumers still use cash payments. Naturally, this makes eCommerce payments difficult – unless you want the customer to post you the cash in return, of course…

As for delivery: Start-up, Rappi, have taken to digitizing the delivery ecosystem of a number of Latin American countries. Seeing substantial inefficiencies in delivery & inconsistencies between retailers, Rappi took it upon themselves to deliver “anything in under 30 minutes, for less than a dollar”.

As impressive as Rappi’s rise has been, reaching a total of 8 million monthly orders across seven countries, it has had a human cost; many of its workers going on strike alleging unsafe working conditions & low pay.

This is why emerging economies are just that: emerging. But there’s plenty of reason for cheer in Latin America – and eCommerce is a good place to start.

MHI Van

Conclusion

You have your emerging middle classes; you know what they’re buying; and you know the platforms to get to them.

It seems simple enough, but it’s staggering how many domestic e-tailers aren’t taking advantage of these global marketplaces & the billions of customers that use them.

A lot of that comes down to a lack of understanding of the logistics process involved; smaller retailers think high delivery costs & high duties will price them out - but it isn’t the case.

At MHI, we’ve been specializing in International eCommerce Delivery for over a decade. As your international daily volumes increase, we can provide enviable carrier rates for your key markets, before collecting the orders from your headquarters & shipping them to your customers using our networks.

It’s not too good to be true, it’s simply what we’re good at.

For a list of international carrier rates based on your average order weight, get in touch today & we’ll respond within 24 hours.

With increasingly youthful demographics across the globe, record numbers with access to the internet and mobile use at an all-time high – there’s never been a better time to begin selling internationally.

Dare I say it: for a Britain on the cusp of Brexit, these International marketplaces could well be your savior in the short-term.

Either way - one thing’s for sure:

Amazon are not alone.

Calum - Marketplaces

Calum White

Head of Marketing at Mail Handling International

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