eCommerce Strategy Consultant - Rick Watson - RMW Commerce Consulting

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Marketplace Success Definitions Have Changed

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?