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Retail vs. Marketplace


                        Manu Midha


                    Views mentioned here are personal
Infibeam and Buildabazaar does not endorse any statements made during the
                               presentation
Difference in business models

                    Marketplace                                            Retail

                                                    i.     E-commerce company act as the seller on
i.     E-commerce company act as an
                                                           record for the product being bought by the
       intermediary between a seller (merchant)
                                                           buyer
       and a buyer;
                                                    ii.    Inventory risk is borne by the e-commerce
ii.    Merchant is the seller on record
                                                           company
iii.   Inventory risk is borne by the merchant
                                                    iii.   E-commerce company fulfills – ships orders
iv.    E-commerce company may fulfill on behalf
                                                           to customers
       of the merchant
                                                    iv.    Risk of stock-out lower than a marketplace
v.     Risk of stock out higher than a retail
                                                           business – therefore customer satisfaction
       business – therefore customer satisfaction
                                                           optimized
       could be compromised
                                                    v.     Retail margins vary between single digit to
vi.    Typical marketplace commissions vary
                                                           50% depending on product category, brand
       between 1%-13% of the product revenue
                                                           and make
       based on category sold
Key metrics to look at?

                    Marketplace                                                   Retail

i.     Inventory Turns : High
                                                         i.     Inventory Turns : Lower
ii.    Inventory risk : Low
                                                         ii.    Inventory risk : High
iii.   Higher capital required; less capital efficient
                                                         iii.   Higher capital required; less capital efficient
iv.    Margins : Lower than retail
                                                         iv.    Margins : Higher than marketplace
v.     Best suited for
                                                         v.     Best suited for
       i.     Low velocity products/SKU’s
                                                                i.     High velocity products/SKU’s
       ii.    Product categories with high variety –
                                                                ii.    Product categories with lower variety
              eg. Apparel, accessories, prescription
                                                                       – fewer best selling SKU’s – Mobile
              eyeglasses
                                                                       phones, printers, pen drives, cameras
       iii.   Vendors spread across geography; eg.
                                                                iii.   Products with back to back return
              Banaras sarees, Lucknow chikan,
                                                                       terms with suppliers, eg. books
              Ludhiana sport goods, Tirupur t-shirts
                                                                iv.    Low risk of obsolescence
       iv.    High risk of obsolescence
Summary
•   A hybrid of marketplace and retail is best suited for India e-commerce to optimize
    on customer experience and be capital efficient (high turns, low inventory risk)

•   Each category and sub-category to be evaluated on the parameters above; fast
    moving products in each category – good candidates for stocking in retail; In case
    margin increase drastic by stocking – good candidate

•   Reactive buying / marketplace agreements to be kept in place; inventory
    information to be refreshed every day ideally with merchant partners to ensure
    zero defect

•   Ensure rating and reviews of merchants on marketplaces (could be internal /
    external)
Updates on Latest Features
                 Retail vs. Marketplace
Recap


 Features discussed during last webinar.:-
    Shopping Cart Summary & Overview
        Helps you give your customers a quality engaging experience,
        keeping them updated and giving the access to their shopping cart
        throughout the store, without even needing to click and go to
        shopping cart page.
    Shipping Pin-code Checker
        Helps you to notify your customers upfront for the availability of
        COD as a payment option thereby reducing hassles for customers
        and providing a quality engaging experience with the store front-
        end.
    Abandon Cart Reminder
        Helps you to capture lost sales by following up with customers who
        added some products to the shopping cart but didn’t make a
        purchase for some reason.
How to use In Build SEO tool?

 Feature: This Feature is used for SEO
  purpose. Although all our websites are SEO
  friendly still if you want to add additional
  tags, keywords, description, etc on your site
  for SEO purpose than you can use this Page
  Info section. Following are the steps on how
  to add page info on a particular page. The
  process remains same for all the available
  pages on the website.

 Benefits: Helps you increase the ranking of
  your ecommerce site as well as various
  pages like Home Page, Category pages,
  Product Pages and various static pages i.e
  About Us, Privacy Policy, Terms &
  conditions, Shipping Policy, Contact Us, etc.



  Disclaimer: The feature is non customizable and is provided on an as – is basis.
Advanced Carousel Widget

 Feature: This feature is developed to give
  store owners better control over various
  aspects of widget which are like speed of the
  banner transition, mouse hover effect on
  banner, previous-next buttons, different
  transition effects, etc. With help of this
  feature you can use various transition style
  and use various widget style more effectively
  inside carousel widget.

 Benefits: This feature is more like an
  enhancement feature for the site. As you
  can give control to user to change the
  banner and hover over mouse it asks for
  more customer engagement and increases
  the amount of time user spends on your
  site. Research show that More time the
  user spends on the site the chances of him
  buying from the site also increases.
  Disclaimer: The feature is non customizable and is provided on an as – is basis.
Social Media Buttons

 Feature: To make store more interactive
  with users we have added all the know
  social media buttons on the products pages.
  The feature allows user to share the
  products with their friends through social
  media like Facebook, Twitter, Pinterest and
  Google plus as show in the image.

 Benefits: Feature allows users to like the
  product or send to friends wall from the site
  itself. Various option like twit, pin it and +1
  is offered for user choice. The feature in
  very much useful in current scenario as
  everyone uses social media almost all day
  so they can easily share the product they
  like with just a click which does the most
  powerful know marketing trick that is
  “Word of mouth”.

  Disclaimer: The feature is non customizable and is provided on an as – is basis.
Questions & Answers

Question from Last session.
•   Are all the three feature mentioned by you free or should we pay for it?- Pranab Beriya
•   I want to add my payu paisapay gateway to my store, how can is this possible? – Ajay Kumar
•   I miss this presentation can get the soft copy of this presentation-Sudir kumar yadav
•   Can we have export feature of Product from our store to upload to other websites like ebay, Google
    products, Amazon? – Sachin Parikh
•   Can we have something which gives us a click report function? – Samir Kazi
•   Can we integrate the shipment updates directly integrated on our website?- Goel Mridul
•   Why can't we delete the products completely from the store?- Goel Mridul
•   Report generation should not take time as it’s our store and to get the list of our customers or other
    reports should be done immediately - Pranab Beriya
•   But the EMI thing is very important…please do look in to it.- Pranab Beriya
•   What's the best way of marketing now days ?- Yash Gupta

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Commerce in Context Ver.02

  • 1. Retail vs. Marketplace Manu Midha Views mentioned here are personal Infibeam and Buildabazaar does not endorse any statements made during the presentation
  • 2. Difference in business models Marketplace Retail i. E-commerce company act as the seller on i. E-commerce company act as an record for the product being bought by the intermediary between a seller (merchant) buyer and a buyer; ii. Inventory risk is borne by the e-commerce ii. Merchant is the seller on record company iii. Inventory risk is borne by the merchant iii. E-commerce company fulfills – ships orders iv. E-commerce company may fulfill on behalf to customers of the merchant iv. Risk of stock-out lower than a marketplace v. Risk of stock out higher than a retail business – therefore customer satisfaction business – therefore customer satisfaction optimized could be compromised v. Retail margins vary between single digit to vi. Typical marketplace commissions vary 50% depending on product category, brand between 1%-13% of the product revenue and make based on category sold
  • 3. Key metrics to look at? Marketplace Retail i. Inventory Turns : High i. Inventory Turns : Lower ii. Inventory risk : Low ii. Inventory risk : High iii. Higher capital required; less capital efficient iii. Higher capital required; less capital efficient iv. Margins : Lower than retail iv. Margins : Higher than marketplace v. Best suited for v. Best suited for i. Low velocity products/SKU’s i. High velocity products/SKU’s ii. Product categories with high variety – ii. Product categories with lower variety eg. Apparel, accessories, prescription – fewer best selling SKU’s – Mobile eyeglasses phones, printers, pen drives, cameras iii. Vendors spread across geography; eg. iii. Products with back to back return Banaras sarees, Lucknow chikan, terms with suppliers, eg. books Ludhiana sport goods, Tirupur t-shirts iv. Low risk of obsolescence iv. High risk of obsolescence
  • 4. Summary • A hybrid of marketplace and retail is best suited for India e-commerce to optimize on customer experience and be capital efficient (high turns, low inventory risk) • Each category and sub-category to be evaluated on the parameters above; fast moving products in each category – good candidates for stocking in retail; In case margin increase drastic by stocking – good candidate • Reactive buying / marketplace agreements to be kept in place; inventory information to be refreshed every day ideally with merchant partners to ensure zero defect • Ensure rating and reviews of merchants on marketplaces (could be internal / external)
  • 5. Updates on Latest Features Retail vs. Marketplace
  • 6. Recap  Features discussed during last webinar.:-  Shopping Cart Summary & Overview Helps you give your customers a quality engaging experience, keeping them updated and giving the access to their shopping cart throughout the store, without even needing to click and go to shopping cart page.  Shipping Pin-code Checker Helps you to notify your customers upfront for the availability of COD as a payment option thereby reducing hassles for customers and providing a quality engaging experience with the store front- end.  Abandon Cart Reminder Helps you to capture lost sales by following up with customers who added some products to the shopping cart but didn’t make a purchase for some reason.
  • 7. How to use In Build SEO tool?  Feature: This Feature is used for SEO purpose. Although all our websites are SEO friendly still if you want to add additional tags, keywords, description, etc on your site for SEO purpose than you can use this Page Info section. Following are the steps on how to add page info on a particular page. The process remains same for all the available pages on the website.  Benefits: Helps you increase the ranking of your ecommerce site as well as various pages like Home Page, Category pages, Product Pages and various static pages i.e About Us, Privacy Policy, Terms & conditions, Shipping Policy, Contact Us, etc. Disclaimer: The feature is non customizable and is provided on an as – is basis.
  • 8. Advanced Carousel Widget  Feature: This feature is developed to give store owners better control over various aspects of widget which are like speed of the banner transition, mouse hover effect on banner, previous-next buttons, different transition effects, etc. With help of this feature you can use various transition style and use various widget style more effectively inside carousel widget.  Benefits: This feature is more like an enhancement feature for the site. As you can give control to user to change the banner and hover over mouse it asks for more customer engagement and increases the amount of time user spends on your site. Research show that More time the user spends on the site the chances of him buying from the site also increases. Disclaimer: The feature is non customizable and is provided on an as – is basis.
  • 9. Social Media Buttons  Feature: To make store more interactive with users we have added all the know social media buttons on the products pages. The feature allows user to share the products with their friends through social media like Facebook, Twitter, Pinterest and Google plus as show in the image.  Benefits: Feature allows users to like the product or send to friends wall from the site itself. Various option like twit, pin it and +1 is offered for user choice. The feature in very much useful in current scenario as everyone uses social media almost all day so they can easily share the product they like with just a click which does the most powerful know marketing trick that is “Word of mouth”. Disclaimer: The feature is non customizable and is provided on an as – is basis.
  • 10. Questions & Answers Question from Last session. • Are all the three feature mentioned by you free or should we pay for it?- Pranab Beriya • I want to add my payu paisapay gateway to my store, how can is this possible? – Ajay Kumar • I miss this presentation can get the soft copy of this presentation-Sudir kumar yadav • Can we have export feature of Product from our store to upload to other websites like ebay, Google products, Amazon? – Sachin Parikh • Can we have something which gives us a click report function? – Samir Kazi • Can we integrate the shipment updates directly integrated on our website?- Goel Mridul • Why can't we delete the products completely from the store?- Goel Mridul • Report generation should not take time as it’s our store and to get the list of our customers or other reports should be done immediately - Pranab Beriya • But the EMI thing is very important…please do look in to it.- Pranab Beriya • What's the best way of marketing now days ?- Yash Gupta