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Global Online Marketplaces: Unlock a world of opportunity

Global cross-border eCommerce is expected to reach $1 trillion by 2020, according to a study from Accenture and Alibaba Group's research arm, AliResearch. It represents a phenomenal uplift of 335% when compared to the eCommerce market at the end of 2014. With more shoppers regularly purchasing online and new data from International Post Corporation showing that 63% of frequent cross-border buyers shop internationally at least once a month, global expansion is a must for all brands and retailers, no matter their size.

As cross-border shopping gains popularity, online marketplaces are increasingly becoming important channels for retailers wanting to connect to global consumers. Industry experts responding to an Ecommerce Foundation and Nyenrode Business University study predict that by 2020 online marketplaces will own nearly 40% of the global eCommerce market, and already 66% of online shoppers would choose to purchase from a marketplace.

But what really makes these platforms so appealing to merchants?

Global marketplaces represent a huge opportunity for retailers looking to expand internationally, since they are well-established consumer channels that profit from high local penetration rates and enjoy large numbers of repeat customers.

And we are not talking just about the online giants of eBay and Amazon. In New Zealand, the leading online marketplace Trade Me has more registered users than Facebook, while in China, 90% of all online transactions are completed via marketplaces.

So, retailers can use these platforms to expose their products to highly engaged audiences and increase international brand awareness. 

Marketplaces also provide marketing levers to help retailers promote their products within the platform, further increasing exposure. Marketplace representatives provide invaluable local knowledge to help retailers better understand the local market and to tailor a successful cross-border strategy.

For those looking to accelerate their international expansion, marketplaces are a great way of introducing products to a new market quickly, and without the risk of potentially expensive set-up and legal costs. This means that marketplaces are an ideal testing environment for retailers looking to trial product success in new markets, before setting up a direct online presence or a physical store. 

However, for some, there is a perception that marketplaces can damage brand values, since they are seen as outlets for discounted or clearance stock. And while some marketplaces do focus more on discounted products, there are over 450 online marketplaces worldwide that cater for different products, tastes and budgets.

In South-east Asia, these virtual shopping malls replace the lack of physical malls, filling a retail void in the region; in the US and Europe, specialist marketplaces cater solely for tech products, apparel or craft items; and in China and the Middle East there is a demand for luxury goods, so marketplaces have been created to cater purely for high-end products.

European brands are particularly sought after by international consumers, since they are seen as high quality, desirable products that carry a certain status. Luxury brands Burberry and Moschino have embraced the opportunity to expose their brands to a wider audience, by opening up marketplace stores on both China's Taobao.com and Russia's Ozon, respectively; helping them to access a further 1.5 billion consumers.

In the case of Burberry, their branded Taobao.com store expertly reflects their core brand values and captures their European heritage and product exclusivity. This is certainly not a discount store, but a carefully crafted shop window into an expectant new market.

High street brands have also unlocked the power of online marketplaces to help increase their international footprint. For instance, American outdoor brand, Timberland, launched their product line on Spanish flash sales site Privalia, British footwear manufacturer Dune can be found on French marketplace La Redoute, and fast fashion retailer Forever 21 are targeting India's 18-25 year olds through app only marketplace Myntra.

The influence of global marketplaces is continuing to grow, and retailers that want to benefit from first mover advantage in a region should look at marketplaces as a serious route to market.

On Wednesday 23rd March, 2016 the industry leading global marketplace event, Fashion Without Borders will return, to share further insights on how online marketplaces can propel international growth.

Speakers from the world's foremost online marketplaces, including Ozon, La Redoute, Priviala, Myntra and Amazon, will disclose local knowledge about their customers, discuss which are the most sought after products and reveal exclusive insights to help promote cross-border success in their respective regions.

Delegates have the opportunity to arrange one-to-one meetings with the marketplaces throughout the day and thought leadership sessions will examine how to navigate the ever changing global eCommerce landscape.

To secure your place at Fashion Without Borders this spring, book your ticket here. If you would like to find out more about Fashion Without Borders or are interested in sponsoring the event, please get in touch with Jenni Day on: +44 (0)7946 605992 or email: jenni.day@pentagon-interactive.co.uk

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Pentagon Interactive

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