Retailer marketplaces emerged as a key way for brands to scale up and diversify their ecommerce offerings amid a surge of online shopping in the height of the Covid-19 pandemic, and their popularity hasn’t diminished since.
In many ways, the components of a good retailer marketplace experience are the same as those of a good ecommerce experience generally: intuitive navigation, helpful product information, seamless checkout, and prompt fulfilment. However, retailers playing host to a marketplace have an extra dimension of UX complexity to deal with – how are marketplace products presented compared with the retailer’s own brand stock? Can customers tell what they’re shopping? How does the retailer handle checkout and fulfilment for the different ‘halves’ of its offering?
After taking a close-up look at the UX of several retailer marketplaces, including B&Q, Superdrug, The Range, Next, and the recently-launched Tesco marketplace, here are the components that I find are key to a seamless shopper experience.
As former Global Omnichannel Lead at Unilever Mark Walker wrote on LinkedIn about selling online and offline more generally, “Availability on shelf, at the point of need – the point of conversion[.] Without this, all your investment in online range, content, media is wasted.”
Playing host to third-party sellers in particular can bring inventory complexities, even if the strategy does at least alleviate the issue of storing stock.
Browsing Tesco’s marketplace, which was launched in June 2024 to add over 9,000 additional products to the retailer’s range (and which has since been scaled up to more than 300,000 additional items), I was surprised how frequently I was met with an ‘out of stock’ message. This included items highlighted on Tesco’s marketplace landing page, such as the perfume, scented candle, and laptop pictured below.
It could be that these are early-stage marketplace growing pains or tests while Tesco and its partners gauge the level of demand before they restock accordingly – or perhaps a general inventory update is just over the horizon. Demand may also be elevated during the winter holiday shopping season. However, inventory management can undermine the benefits of a broader range and additional scale yielded by a marketplace – there are many commerce solutions that offer third-party brands the features needed to consolidate inventory management.
Product data goes hand in hand with inventory management, and inconsistencies here can also be problematic. Browsing The Range’s marketplace, I was particularly pleased to find a new duvet and pillow set for our bedroom. Confusingly, though, one size of duvet was sorted under ‘Teal’ while another size for the same item was classed as ‘Green’ – due to a discrepancy in the product description that caused the two items to be listed under different colour filters. Fortunately, I was also browsing for a green-themed spare bedroom and so found both.
Data synchronisation aims to solve these kinds of discrepancies by ensuring standardisation (or transformation) across a third party brand’s different sales channels and platforms. Making sure product content is accurate and up-to-date across thousands of SKUs is challenging for any brand selling online (involving PIMs, digital shelf analytics and monitoring),
It may be inevitable that some minor issues such as these slip through the cracks when taking on a high volume of smaller sellers – but keeping errors to a minimum is vital so that shoppers can count on the right product being available in the right place.
In order to make sure that marketplace products benefit from the greater visibility that comes from being listed on a major retailer’s platform, it’s important not to silo the marketplace off into a separate area of the site.
However, when third-party products are listed alongside a retailer’s own stock, it can be helpful to mark them out so that the buyer knows what to expect going in – as fulfilment and returns arrangements can differ depending on the retailer and how they choose to manage these versus their own stock.
Some retailers like Next and M&S use the same approach – and channels – for fulfilment and returns across both first and third party brands, which reduces the need to signpost that items are being handled by a third party. Instead, they will generally specify the brand in product listings and on the product page, while listing the standard information about delivery and returns.
However, labelling marketplace items becomes more important when the retailer plays host to a wider, more varied portfolio of sellers who handle their own fulfilment. The inspiration for this piece originally came from an order I placed at B&Q that contained a marketplace product that I didn’t realise was a marketplace product until the day the item arrived. In hindsight, there were some indicators – but it goes to show how obvious retailers need to make things for the unobservant customer.
B&Q’s product pages feature a “Sold and shipped by” label with the name of the seller, along with a small note about products being “Shipped by a verified seller” (B&Q’s preferred term for third-party brands). In my case, the seller’s name sounded like it might be a department of B&Q, so it wasn’t entirely clear that this meant a third-party seller.
Due to this, I wasn’t able to familiarise myself with any of the detail on how marketplace orders would be shipped and handled differently – or what to do if I had a problem. Luckily, the overall process was very smooth and the item arrived without issues.
Retailers like Superdrug, The Range, and Tesco have chosen to include a ‘Marketplace’ logo on product thumbnails and product pages in branded colours, while Tesco also includes ‘Marketplace’ in its navigation breadcrumbs, with a description of its marketplace offering and the relevant delivery and return policies under each marketplace product page.
Ultimately the difference in UX may come down to factors such as the extent of the marketplace range, the type of products compared to those sold direct, difference in fulfilment options and so on.
After making a purchase, good email communication is key in ensuring customers are kept updated on the progress of their order and any further information or issues. This can particularly help when navigating a complex order that may be fulfilled by different sellers.
All of the retail marketplaces that I shopped with sent frequent updates on order progress, from confirmation to dispatch and then to arrival, sometimes with notifications of unforeseen delays. B&Q labels its emails as issuing from ‘B&Q Limited’ and ‘B&Q Marketplace’ respectively, to help with tracking different parts of a multi-seller order. However, as the emails don’t specify which item is being dispatched or delivered, I did have some confusion about which part of the order would be arriving on which day.
Superdrug does its after-sales communication particularly well, with marketplace orders labelled with ‘Superdrug Marketplace’ and the item specified in the email body. When a marketplace order has more than one item, Superdrug will helpfully label them with [order number]-A and [order number]-B.
Making a return can also be more complicated when dealing with different sellers. I was impressed how Next handles this, enabling returns to be requested for both Next and third-party products through the ‘My Orders’ section of the website and making it easy to arrange for a courier collection of any returned item.
A retailer with a marketplace is essentially operating two separate businesses under the same ‘roof’, but customers need to be presented with a seamless fulfilment experience to the furthest extent possible.
This means that retailers must make some decisions – and, sometimes, trade-offs – in order to meet this expectation. For example, although retail and marketplace orders are often fulfilled separately by the retailer and seller, respectively, the customer would generally expect to pay once only for delivery.
However, when checking out at Superdrug, I had two marketplace items in my basket and one small item sold by Superdrug. To my surprise, Superdrug added two sets of delivery fees – one for the Superdrug product and one for the marketplace products. Because this fee was more than the cost of the item I’d ordered from Superdrug, I simply took it out of my basket.
This is much more of a consideration with smaller orders than with larger purchases, where the shipping price becomes a negligible add-on compared to the overall order value – but it could impact the willingness of shoppers to buy small add-on items to an existing order ‘while they’re there’, which does do away with some of the convenience and utility of an all-in-one order.
H&M Group is another retailer that has branched out into a third-party marketplace, expanding its range with the addition of home and furniture items in 2020, and then launching ‘H&M with Friends’, a marketplace that offered apparel from third parties, beginning in 2022.
H&M’s furniture offering operated using dropship, a sales model in which businesses purchase an item them from a supplier in order to sell on to the consumer. This is a similarly ‘inventory-light’ approach to selling goods, but considered a separate sales model to a marketplace where third-party brands pay a commission to the retailer. Some businesses will combine the two approaches in order to enjoy the benefits of both.
Speaking at Ecommerce Expo 2024 in September, H&M’s Interim Head of Marketplaces, Kimmo Jukuri, distilled his experiences overseeing H&M’s marketplace into some key pieces of advice for retailers looking to do the same.
“I think it’s about doing your homework, first and foremost,” he said. “It’s not a magic bullet … It’s about how you actually define the strategy of what your marketplace is there to do – and how well is it anchored with the rest of the strategy with the company?”
Jukuri emphasised the importance of having a “very diligent change management process” around how the marketplace will change the brand’s core business model, and understanding what the investment and return will be in financial terms.
Secondly, he highlighted the need to understand the customer and what the customer offer will be from the marketplace: “What are we trying to introduce? How do we think it will be perceived by the customer?
“How do we validate these hypotheses that we’re taking forward on what the impact will be – and how can we get some early-stage testing in? Whether that’s through limited products in limited categories like we did for the UK Home test pilot, and then building it on from there.”
Finally, Jukuri advised that retailers consider “bringing in some marketplace-specific talent, at least into some roles … since the dynamics between the partners are slightly different, for example, from the traditional reseller or wholesale model.
“And then, of course, digital and tech competence is hugely important so that you can build this scalable and modular architecture behind it all – [and] make the right choices from the beginning so you aren’t limited later.”