Marketplace Success Definitions Have Changed

Marketplaces
Written By Rick Watson

Marketplaces at scale have really become advertising businesses. The thing is, retailers have these (somewhat) perverse incentives. They are optimizing for revenue, not for orders in all cases.

If someone clicks on an ad more often than they buy something, and the revenue is higher from the ad, that's success for the retailer as long as consumer retention and acquisition remain high and growing.

Is it better for the consumer? Hard to say. The consumer may learn about a new product. I suspect if the click through rate (CTR) of the ad is high enough it's a good thing, but the definition of success in a marketplace has changed.

What should be surfaced at the top?

Rick Watson

Rick Watson founded RMW Commerce Consulting after spending 20+ years as a technology entrepreneur and operator exclusively in the eCommerce industry with companies like ChannelAdvisor, BarnesandNoble.com, Merchantry, and Pitney Bowes.

Watson’s work today is centered on supporting investors and management teams incubating and growing direct-to-consumer businesses. Most recently, in partnership with WHP Global, Rick was a critical resource in architecting the WHP+ platform, a new turnkey direct to consumer digital e-commerce platform that powers AnneKlein.com and JosephAbboud.com.

Watson also hosts a weekly podcast, Watson Weekly, where he shares an unbiased, unfiltered expert take on the retail sector’s biggest players.

In the past year alone, Rick has spoken at many in-person and virtual events as well as podcasts on topics ranging from retail/ecom to supply chain/logistics and even digital grocery including CommerceNext IRL, ASCM Connect, and Retail Innovation Conference.

https://www.rmwcommerce.com/
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