Technology is constantly evolving and influences lots of spheres in our life. Shopping is not an exception to the rules. It goes without saying that technology undoubtedly influenced the way people buy things. But the question is – can we suggest that online marketplaces will replace malls and department stores in the near future? Let’s have a look at this issue in greater detail.
Just have a look at the example. Uber and Grubhub announced their annual revenues in 2017 – 37$ billion and 683 million. Some of you think that massive amounts of inventory are needed to achieve that goal but these companies managed to achieve such incredible results without owning a single car or cafe. These are the most vivid examples of companies that have changed the traditional marketplace by introducing a new economy model.
If you are currently looking for the answer to the question of how to build a marketplace or think of whether this investment is worth money, just look through this post.
We can see that modern technology has changed the retail industry, but it’ a mistake to think that technology can replace it. Why malls were created? What is their main goal? Indeed, malls aren’t meant for shopping only. Modern malls and department stores are a good place to meet friends, relax after a hard-working day, and participate in various events. Retailers pay rent in order to be in the center of the engaged audience and draw their attention to their products or services. Simply put, they convert them into clients. Traditional malls create a pleasant brand environment where people can touch products and get acquainted with the services closer.
So we can see that both complement each other and today, both services are in a transitional period. Blending offline and online consumer experiences is a superb chance to increase your client base. For example, Amazon has a wide array of physical retail kiosks where clients can see their products, but this doesn’t mean that it influences their online business. Both complement each other.
As we have already mentioned, both areas are inseparable parts and complement each other. But let’s make some predictions for the future and try to look further to 2021.
Modern consumers proved that they are ready to buy absolutely any product or service online. So what do marketplaces do? They do their best to bring clients as many clients as possible. Conventional businesses that didn’t accept the online sales will finally change their mind and adopt marketplaces to finally bring their services online. To put it simply, they see that online marketplaces are a superb chance to improve revenue.
A few years ago, it was a hot question but today, it’s a basic assumption. The majority of existing marketplaces have mobile apps. They head towards the app-only future and therefore, they will relinquish their sites. Amazon, Uber, and lots of others are already using mobile apps. In doing so, they become closer to customers.
What does this mean? Everything is easier than you might think. There’s a tendency to being more verticalized. Future marketplaces are going to be more hyper-focused on this or that niche. They continue to grow, but the same happens to the competition in the market. Therefore, to attract more clients, they need to provide a superb customer experience but it is really hard to do this when you try to cover all the fields. When you are more focused, you deliver much better results!
Some online marketplaces adopt the technology of clickthrough agreement because it’s the best method to mitigate legal risks without influencing the conversion. Marketplaces are constantly dealing with a variety of new clients on an ongoing basis. In such a scenario, they wish to be protected from risks. Clickthrough offers a standardized experience that can reduce risks.
The biggest reason why buyers leave this or that marketplace is the lack of sellers that can meet their needs. However, this is not the only reason. Logistical challenges, additional fees from sellers, and too high shipping costs may also influence the buyer’s decision. Therefore, modern marketplaces need to be very adept at developing and launching new value-added services that will help them attract more buyers. All these factors will definitely influence the effectiveness of sales.
Overall, we see the tendency that more and more companies go online on an ongoing basis. Mobile apps have already become a standard. Today, successful marketplaces have demonstrated that being efficient in a smaller niche can lead to more value. Marketplaces won’t replace malls in the near future. But they can’t exist as separate units; they complement each other.