By 2024, UK shoppers will spend 50% more than they do now on online marketplaces, new research suggests.
Spending via marketplaces will rise by £13.1bn to £39.3bn over that time, according to a new GlobalData report, Retail Channel Series: UK Online Marketplace Retailing 2019-2024.
It says that retailers that aren’t selling on marketplaces are set to miss out as more shoppers turn to them. It also says that retailers that offer choice on their own marketplaces, such as Asos, or offer product choices similar to a marketplace, such as Next, will be better insulated from this change.
“General merchandisers Amazon and eBay dominate the online marketplaces market and are forecast to account for over 90% of spend in 2019 as their reputations, huge product ranges and fulfilment options (in particular Amazon Prime) make them the first port of call for many shoppers,” said Emily Salter, retail analyst at GlobalData. “Spend on brand-new items will rise at a faster pace than spend on secondhand products over the next five years – 53.9% versus 29.8% – and the prominence of Amazon and eBay will significantly contribute to this as retailers look to these marketplaces as a growing revenue stream.”
Salter suggests that marketplaces will benefit as shoppers – and especially young shoppers – look for more sustainable and affordable options such as second-hand clothing and footwear. However, they will also often want to buy new items.
That said, the GlobalData report suggests that spend on secondhand products will make up less than 20% of total online marketplace spend in 2019.
“Growth in the secondhand market will be driven by sites dedicated to resale - in particular Depop, which looks and functions like Instagram with an intuitive and attractive app design that appeals to young digital natives, said Salter. "The presence of unique and often vintage items, lower prices and the concept of social shopping appeal to 16 to 24-year-olds and are alternatives to the ubiquitous model of fast fashion and big brands. Additionally, unlike many online marketplaces, Depop is perceived as a fashion destination, which is a huge contributor to its success.”