The growth of retail marketplaces has been well documented. We all appreciate the massive scale (and continual growth) of Amazon, with more than $300 Billion in retail sales in 2020 in the US alone (per eMarketer). Meanwhile, the new guard of enterprise retailers have adjusted their go-to-customer model to include marketplaces as part of their mix. Their results have been overwhelmingly positive, with enterprise marketplaces growing 81% year-over-year. But, like love and mattresses, it’s what’s inside that counts. When we peer inside, we see that the heart and foam of marketplace growth is the seller. No seller, no product. No product, no shopper. So, it's the sellers that count.
These sellers, though, have largely been relegated to the shadows. While serving at the pleasure of marketplace operators, their story has not been told. This limited notoriety has bred misperceptions about quality and a lack of trust – obstacles that hinder marketplace adoption at a time when retailers need to consider every avenue to scalable and profitable growth.
The Mirakl Enterprise Marketplace Seller Report shines the light on the sellers, and in so doing, provides a true view of sellers based on the shopping activity of more than 50,000 sellers across 70 enterprise marketplaces, globally. Through this data-driven lens, the seller is on full display, from their profile, to GMV contributions, and the tenure of their relationships with marketplace operators.
The Face of a Seller
One of the greatest marketplace myths is that all sellers are essentially brand-less resellers playing middleman across an endless marketplace. The true profile of the seller differs. Brands are increasingly present on marketplaces, accounting for nearly one-third of all sellers, with their GMV contributions edging up to account for $1 of every $5 marketplace dollars in Q1 2021. While marketplace natives represent the majority of marketplace GMV, these brands are choosing marketplaces as an expansion channel, and in so doing, altering the composition of the marketplace.
A Growing Middle Class
The distribution of marketplace revenue has been outpacing pareto. As recently as 2020, the largest sellers - the top 25% by GMV - drove 93% of all marketplace GMV. Share-shifting is underway, though, brought on by marketplace growth and maturation, alongside the rise of brand sellers. The small and mid-sized sellers are growing in influence, and more importantly, delivering GMV. This middle class of sellers doubled their share in the past year, and, factoring in marketplace growth, tripled their GMV contributions. The large sellers will continue to shoulder a wide majority of GMV, but the middle-class is a meaningful source of marketplace growth.
The tired perception of transient sellers turning their lights on and off on a whim is a myth. Instead, the relationships between sellers and the marketplaces they support is lasting. Seller retention rates are strong; 93% of sellers transacted year-over-year. Most impressively, though, is the expansion within those sellers. Seller GMV retention was 164% - meaning that last year’s seller base generated 64% more GMV in 2021 Q1 than in 2020 Q1 - a figure that would solicit jealousy from SaaS CFOs across Silicon Valley. Clearly, the seller:operator relationship is proving to be fruitful, and sustainable.
With the cloak of mystery lifted, a clear view of sellers shows a thriving network that is powering the growth of enterprise marketplaces.
The deep-dive into enterprise marketplace sellers is here.
eMarketer: Amazon GMV and Growth