Global Trading Pool Platform
To remain competitive, brands should meet consumers where and how they shop and develop sustainable marketplace strategies as part of a broader channel strategy. Online markets are still shallow in many parts of the world. Yet, e-commerce may be a key opportunity for economic development. Online sales allow businesses to reach more customers, both at home and abroad.
The findings show the strong uptake of e-commerce across regions, with consumers in emerging economies making the greatest shift to online shopping.
Latin America’s online marketplace Mercado Libre, for example, sold twice as many items per day in the second quarter of 2020 compared with the same period the previous year. And African e-commerce platform Jumia reported a 50% jump in transactions during the first six months of 2020.
China’s online share of retail sales rose from 19.4% to 24.6% between August 2019 and August 2020. In Kazakhstan, the online share of retail sales increased from 5% in 2019 to 9.4% in 2020. Thailand saw downloads of shopping apps jump 60% in just one week during March 2020.
The trend towards e-commerce uptake seen in 2020 is likely to be sustained during recovery. But in many of the world’s least developed countries, consumers and businesses haven’t capitalized on pandemic-induced e-commerce opportunities due to persistent barriers.
These include costly broadband services, overreliance on cash, lack of consumers’ trust, poor digital skills among the population and governments’ limited attention to e-commerce.
An online market, usually B2B, in which buyers and sellers exchange goods or services; the three types of e-marketplaces are private, public, and consortia. An e-marketplace is a virtual marketplace in which sellers and buyers meet and conduct different types of transactions. Customers exchange these goods and services for money (or other goods and services if bartering is used). The functions of an e-market are the same as that of a physical marketplace; however, computerized systems tend to make markets much more efficient by providing more updated information to buyers and sellers.
For many years, the dynamic between manufacturers and retailers went largely unchanged. The status quo ruled. Those days are over with the rise of digital marketplaces. Fast-moving changes in the retail model have caught up with manufacturers— they must transform. And fast.
The emergence of electronic marketplaces (also called e-marketplaces or marketspaces), especially Internet-based ones, changed several of the processes used in trading and supply chains.
According to Bakos (1998), electronic markets play a central role in the economy, facilitating the exchange of information, goods, services, and payments. In the process, they create economic value for buyers, sellers, market intermediaries, and for society at large. Markets (electronic or otherwise) have three main functions:
(1) matching buyers and sellers;
(2) facilitating the exchange of information, goods, services, and payments associated with mar- ket transactions; and
(3) providing an institutional infrastructure, such as a legal and regulatory framework that enables the efficient functioning of the market (see Zwass 2003 for details).
Transforming Business Market
- • Determination of product offerings
- – Product features offered by sellers
- – Aggregation of different products
- • Search (of buyers for sellers and of sellers for buyers)
- – Price and product information
- – Organizing bids and bartering
- – Matching seller offerings with buyer preferences
- • Price discovery
- – Process and outcome in determination of prices
- – Enabling price comparisons
- • Others
- – Providing sales leads
- • Logistics
- – Delivery of information, goods,
- – or services to buyers
- • Settlement
- – Transfer of payments to sellers
- • Trust
- – Credit system, reputations, rating agencies such as Consumer Reports and the BBB, special escrow and online trust agencies
- • Communication
- – Posting buyers’ requests
- • Legal
- – Commercial code, contract law, dispute resolution, intellectual property protection
- – Export and import law
- • Regulatory
- – Rules and regulations, monitoring, enforcement
- • Discovery
- – Provides market information (e.g., about competition, government regulations