Strategic collaboration is finding the right partners to reach customers
If you ask friends about eBay, most remember it as the “old auction site” where you put your stuff up for bid. Yes, many sellers still post used items on eBay auctions. To remain competitive, eBay quickly evolved to a marketplace where brands and retailers post new items for sale. However, what many have missed is how eBay is also transforming to be collaborative partner for bricks and mortar retailers. EBay has unveiled a new “Always Open” program that enables retailers to continue to market and sell products after their stores close. Always Open will be a fascinating case study of how previous “competitors” are now strategically collaborating in new ways to meet the rising expectations of customers.
Why this is important: In responding to customers escalating demands, most retailers do not have the resources to do everything in house. Finding the right partners can bridge gaps to create win-wins that will be critical for future survival.
EBay is not immune to competition, and must evolve to survive
It seems like eBay has been around forever. Maybe, that is because they started in 1995, which is actually 1 year after Amazon launched. EBay’s innovative auction format created a unique ecommerce marketplace for individual and small businesses to sell products online. What started as an “auction site” has evolved into a marketplace. EBay is also responsible for evolving a platform for safe ecommerce transactions through PayPal, now spun off as a successful company in its own right.
Amazon is everyone’s competitor. Amazon’s revenue is now multiples of eBay’s. While eBay grew revenue 7% last year, Amazon achieved 31% growth year over year. Most importantly, Amazon has one of the largest most well developed marketplaces in the world. Amazon has opened Handmade on their marketplace catering to unique items and small businesses that have typically sold on eBay and Etsy. Nor is Amazon the only fierce competitor. EBay also competes with Google in terms of search for items and pricing. So, how will eBay compete? Why not strategically collaborate with bricks and mortar retailers in more effectively reaching customers who are increasingly shop anytime and everywhere!
Always Open – A consumer demand creates strategic partner opportunity
What is rapidly transforming the face of retail are the rising consumer expectations. Consumers’ expectations increase as they experience new levels of choice and convenience in shopping both online and through click and collect in retail giants like Walmart. The list could be long, but in a nutshell today’s customers are looking for:
- Shopping after store hours – in fact they want 24/7/365 any time and everywhere
- Long tail, curated assortments – product options and selection beyond a local store
- Choice and convenience – the ability to purchase online and ship to home
Meeting these demands can be a major challenge for any retailer! It is not easy, or profitable to hire more staff to increase store hours. Providing state of the art ecommerce requires infrastructure and resources many smaller retailers do not have. Smaller to mid-size retailers are now searching for collaborative partners, who can assist in meeting omnichannel customer demands quickly, without all of the resources and investment required upfront.
EBay is creating “win-win” opportunity with bricks and mortar retailers
Image Credit: Alina Grubnyak, Unsplash
EBay has creatively launched a new service for retailers designed to address these issues. Essentially eBay’s “Always Open” enables brick and mortar retailers to use eBay’s platform to promote and sell products after stores close. In the words of Bob Kupbens, eBay VP of global trust and seller experience: “We believe that Always Open is one way we can further enable our seller community and drive incremental traffic and sales to their businesses on eBay.”
Make no mistake about it, Always Open is a strategic play by eBay to create incentives for retailers to join their “seller community” and sell through their marketplace. Driving the transactions through eBay’s platform generates much needed revenue for eBay. Always Open creates a value add proposition enabling eBay to compete with Amazon’s marketplace.
What is in it for the retailer? Always Open creates a “turnkey” solution for the retailer to offer its customers the option to purchase products “after hours”. They can potentially increase the range of their selection and offerings online. Retailers also need choice and flexibility beyond Amazon’s marketplace. Always Open enables them to structure the offerings and options for hours when the stores are not open. Moreover, it is never a bad thing to offer more ways to reach customers in way that they want to purchase.
The road to success is increasingly through strategic collaboration
One thing is becoming very clear: retailers do not have all the answers or the resources to compete with the likes of Amazon, Alibaba and Walmart. It is also clear that the “intermediaries” like eBay need to find ways to become more than a transactional platform for just sellers. To be successful, eBay must provide retailers value and a competitive solution.
To thrive, retailers need a collaborative network of partners who can help strategically address rising customer demands, enabling a shift from sales transactions to customer relationships. EBay’s Always Open appears to be an attractive alternative for retailers with stores that do not have all of the ecommerce options required for today’s omnichannel customers.
Will Always Open be successful? It is too early to tell. In today’s rapidly evolving retail ecosystem, the customers will ultimately decide which combinations win by voting with their “wallet” for what best servers their needs.
- FierceRetail: EBay helps brick-and-mortar stores stay ‘Always Open’, Jacqueline Renfrow; February 12, 2018
- eBay Photo: www.pixabay.com
- Open Sign Photo: Alina Grubnyak, Unsplash