Why would they be? Amazon is literally the elephant in the room when it comes to marketplace ecommerce.
A month or so ago, it was reported that Shopify was acquiring a marketplace. According to reports, Shopify will take over Tictail, a marketplace that began in Sweden in 2012. Tictail also has a brick-and-mortar store in New York.
There is a primal allure of shoppers to marketplaces. The practise of browsing and getting deals in a Souq or a bazaar or a market is a tradition as old as commerce itself. Adapted into the SuperMarket and then the Hypermarket, now the concept has been appropriated by the likes of Amazon and Alibaba into a global online version.
For the consumer, marketplaces are a mostly good thing. Convenience and price competition are the main drivers. Amazon’s famous flywheel model of growth – a wider selection leading to more traffic leading to more sellers leading to lower prices and on and on…
For merchants, marketplaces have some pros – the biggest of which is traffic. Access to customers that would otherwise never find a standalone website. As players like Amazon build out concepts like ‘Fulfilled by Amazon’ (FBA), merchants can also benefit from handing over the logistics and fulfilment element of eCommerce, and focus on being merchants.
Focus on being a merchant is a very Shopify selling point. Software as a service (SaaS) offers sellers the promise of being able to create and merchandise products without having to have an IT department or DevOps specialists. There is a loss of flexibility, but for the sellers on Shopify, this doesn’t really matter as long as it works.
So, if all the Shopify sellers are already all using the same platform and back-end and payment gateways and integrated functionality, why not combine them all into a single front end marketplace for the consumer?
Suddenly, Shopify has a marketplace with hundreds of thousands of sellers – and a huge selection of products to offer customers. The sellers don’t really lose anything, and could in fact keep their own standalone Shopify storefronts.
I have no insight into what Shopify is thinking or their long term strategy. But I can see that a marketplace play would be ‘relatively’ simple to offer with few downsides.
Of course Amazon is now more than just its selection. The investment in the supply chain is immense. But there are some cracks starting to appear in the Amazon armour, brought about by its sheer scale. Sellers are also starting to get nervous about the Amazon private label offers and perhaps don’t want to have Amazon as the only channel to market.
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