Finance Finance News Myer quietly launches its answer to Amazon Marketplace

Myer quietly launches its answer to Amazon Marketplace

Myer has discreetly launched its online marketplace.
Myer has discreetly launched its online marketplace. AAP
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Department store chain Myer has quietly launched its new online retail platform, The Myer Market, in what is widely seen as a strategy to compete with newcomer Amazon.

The ‘soft launch’ of the site on Thursday came just a month after the department store announced its plan for the site in a corporate strategy update.

It also came exactly one week after Amazon soft-launched its own Australian website – though unlike Amazon Australia, which is not yet available for most consumers to shop at, The Myer Market is up and running for anyone to use.

The Myer Market allows third-party sellers to market their products on the website in exchange for a listing fee and sales commission, much like eBay and Amazon Marketplace.

Myer enlisted Australian e-commerce specialist Marketplacer to provide the online platform for The Myer Market, and to get third-party sellers on board.

Marketplacer, which has founded 14 online marketplaces, most notably Bike Exchange, will also provide Myer with customer-data analytics, allowing Myer to understand much more about its customers’ shopping habits.

This is an area in which specialist online retailers like Amazon have a crucial advantage over their bricks-and-mortar competitors.

Jason Wyatt, co-founder and chief executive of Marketplacer, said this area was key – and the reason Myer outsourced much of the practical work to his firm.

“Our practical experience, our software and our investment in a new data-analytics platform means we can provide suppliers with deep insights into customer behaviours and needs,” he said.

“In today’s retail environment this is a critical part of fine-tuning range and increasing sales conversion rates.”

He told The New Daily that The Myer Market had ‘soft launched’ – i.e. launched without a big publicity campaign – to give them a chance to test it on a small number of users.

He said there had only been, as expected, a “very, very low subset of traffic” in the first two days.

Mr Wyatt said 65 sellers, 300 brands and 10,000 products – many of them Myer products – were already listed on the site, and more would follow.

But while he said The Myer Market was on the look-out for new sellers, he stressed that it would be selective.

“We’re not accepting all sellers. They must have the right brand profile and the right product. It’s not for everyone – it’s for the Myer customer,” he said.

Mr Wyatt said The Myer Market would be heavily promoted “when we’ve figured out that we’ve really linked to the customer”.

He did not say when that would be, or whether or not it would be before Christmas.

Fear of Amazon?

Myer’s decision to enter the online marketplace sector has naturally been seen as an attempt to compete with Amazon.

Mr Wyatt denied this, telling The New Daily Marketplacer had been in talks with Myer long before Amazon announced plans to enter the Australian market.

But e-commerce expert Scott Kilmartin said Myer would nevertheless find itself competing fiercely with the US disruptor, not just for customers, but also for sellers.

He said one seller he works with “wasn’t interested” in joining The Myer Market, “mostly because they’re on eBay and are about to be on Amazon”.

“How many platforms do you really want to be on? It adds complexity to your business, and if it doesn’t drive a certain amount of sales, it’s not worth it,” he said.

A key issue, he said, was how much Myer would charge sellers to sell on the platform. He said the likes of eBay and Amazon charge between 8 and 16 per cent of each sale.

Rumour has it that The Myer Market – which is pitching itself as a carefully “curated”, higher-end market place – will be charging a lot more than this, with figures as high as 25 per cent floating around.

Mr Kilmartin said if Myer charged that much, it might struggle to attract sellers put off by being asked to hand over a quarter of their profit margins.

“If they [Myer] don’t get enough sellers, then after a period of time what’s the point of running two websites?” he said, referring to Myer’s existing e-commerce site, which only sells Myer products.

The New Daily asked a spokesperson for Marketplacer how much The Myer Market was charging sellers, but was told the information was commercially sensitive. They neither confirmed nor denied the 25 per cent figure.

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