Marketplaces: Essential levers for internationalisation?

The European cross-border e-commerce market generated a global turnover of almost 200 billion euros in 2020 (excluding travel) out of a total 500 billion, with 115 billion euros coming from marketplaces (58%). Amazon and eBay marketplaces alone represent over half of the European e-commerce market, generating 44.3 and 22.8 billion euros respectively.

The thriving health of cross-border e-commerce is not unconnected to the Covid situation. The number of online buyers increased faster in 2020 than during the four preceding years: 71% of European consumers made one or more purchases online, compared to 66% in 2019. This situation has benefited marketplaces, which have registered an increase in European sales of 37.5% since the beginning of the pandemic. Globally, half of online sales now take place on marketplaces.

These figures show that e-commerce in Europe has grown rapidly and that cross-border sales account for an increasingly significant number of transactions. Cross-border e-commerce success is carried by marketplaces. Marketplaces have become growth levers for sellers wishing to target new foreign markets. They offer several advantages to merchants wishing to export their products:

• Marketplaces are extremely popular throughout Europe. The figures speak for themselves: Amazon logs almost a billion monthly visitors, followed by eBay with 366 million, Allegro with 184 million, Wildberries with 150 million and Zalando with 127 million. Such widespread popularity leads to high search engine visibility.
• Marketplaces are ideal platforms for testing new markets without taking risks, given that online merchants don’t have to create an online shop and can rely on logistics services offered by these platforms.
• Marketplaces also support the development of e-commerce in Europe by means of tailored features, such as generating European Article Number (EAN) codes for products, enabling automatic translation of information on products, domestic storage facilities and national and international deliveries, etc. Those marketplaces with a widespread presence in Europe (with a dedicated website for each country) offer to translate and localise product catalogs for each target country, adapting local currency and measurements, for example.

Using marketplaces to sell online in Europe, however, is only possible through product feed optimization for foreign marketplaces, whether domestic or international. The specific requirements of each country must be considered, in terms of language and currency, but also with regard to categories and attributes. This can be done using a fast product formatting service, such as offered by Lengow, a unique platform to manage your sales on international marketplaces.  The aim is to provide consumers in each country a buying experience similar to the kind offered by a local seller.

Whilst it is clear that a cross-border e-commerce strategy must use marketplaces as growth levers, it is just as important to choose the right platform for your products. Will an Amazon international platform help you conquer the e-commerce arena in Europe? Or should you focus on national marketplaces?

A double-pronged strategy could help you make your entry into a foreign market. This would mean simultaneously taking advantage of the popularity of international marketplaces as well as the potential of leading national platforms.

International marketplaces

The international companies are well known, especially Amazon, which ranks number one in Europe and has a tremendous influence. With several completely localised platforms – in Germany, Spain, France, Italy and Great Britain – Amazon can deliver throughout Europe. The same applies to eBay.

These marketplaces have the advantage of being generalists, offering every product imaginable. Even so,  your cross-border e-commerce strategy can include specialist marketplaces, such as Zalando or Spartoo for fashion, ManoMano for DIY, or Decathlon for sporting goods.

National marketplaces

There are many other national companies in several European countries (or language areas) that benefit from high search engine visibility: Fruugo or OnBuy in the UK, in France Cdiscount undoubtedly ranks first with its 50 million visitors per year, followed by Fnac, La Redoute or Rakuten (formerly ex-PriceMinister), Allegro in Poland (with a 4 billion euro annual turnover), Bol.com in the Dutch markets (the Netherlands and Belgium), Wildberries and Ozon in Russia, as well as Kaufland.de, OTTO, Manor and Ricardo in the German-speaking countries (Germany, Austria and Switzerland).

Choosing the right marketplace is absolutely essential to successfully execute your e-commerce strategy in Europe. But that’s not all – there are many complex parameters to take into account: studying target markets; being informed on costs for each marketplace and on the restrictions and customs formalities in each country; finding out about the correct address format; organising logistics and choosing reliable carriers; defining a coherent pricing strategy. The list goes on.

But there’s no need to panic: Lengow will be a powerful ally in your conquest of the European markets thanks to marketplaces!