People who want food delivered to the comfort of their homes are increasingly turning online to places like Uber Eats and GrubHub. Without owning a single car or restaurant, these two companies reported $37 billion and $683 million in revenue respectively in 2017. They have created an innovative solution through which independent drivers bring consumers food from local restaurants, serving as the platform that arranges the exchange. Both companies demonstrate the opportunities and demand for online marketplaces.
An online marketplace can be defined as any digital space in which two sides of a transaction are connected via technology and the owner or seller does not own any inventory, but rather, facilitates the transaction. Popular examples include eBay and Etsy, which allow people to buy and sell a variety of goods. The 75 largest online marketplaces grew by 30 percent in 2017, accounting for nearly half of all global online shopping.
Online business is booming in 2019. So much so that for some, expectations have already been exceeded for this year. But what’s in store for 2020?
Here are our predictions on disruptions in the Online Marketplaces for what to expect next year:
Businesses Moving Online
The positive growth of online marketplaces will be a huge draw for many businesses. Moving online provides an additional channel to market products, convenience for consumers, and the chance to explore new trade partnerships. More and more companies are taking the leap, such as the clothing brand Marshalls, which is launching an e-commerce store later this year. Companies can see this as an opportunity to grow and remain competitive.
Consumers Starting Online
Consumers are continually moving online to purchase products. E-retailers like Amazon generated over $140 billion in product sales in 2018. Not only is it more convenient than physically walking into a store, but it also allows prices to be compared easier. There’s more flexibility for businesses to provide additional choices and products, too. Soon, every interaction businesses and consumers have with goods and services will start with online marketplaces.
Starting Via Mobile Apps
It seems like there’s an app for everything. And there probably is at this point. 205 billion apps were downloaded last year, which include platforms from shopping to social and everything in between. In the future, speed and mobility will be key components for apps to thrive in the marketplace. Think about some of those companies mentioned earlier as Uber Eats – they thrive solely through apps.
Litigation will increase
Clickthrough litigation has exploded in the past 10 years. In fact, it has increased by 626% since it first appeared in 2002. This reflects the increase in both B2B and B2C internet companies defending the enforceability of their Terms of Service and other online agreements. The more this issue is litigated, the savvier courts become, and the more likely litigation is to continue increasing.
Becoming a Niche
As more businesses build their online presence, how can they sustain their growth? Online sellers will need to become more hyper-focused on a single sector. Specialized marketplaces allow superior customer experience, delivering value on each transaction. It also allows smaller businesses to break into the marketplace and compete with large retailers.
Implementing Click-Through
With each transaction in the marketplace comes potential legal risks. There’s a liability in on-boarding new consumers and providers that should be mitigated without impacting conversion rates. Clickthrough agreements are the best way to create secure exchanges. Contract acceptance platforms can offer standardized options that scale with businesses. They save legal teams’ time and reduce risk.
It might seem like 2019 just started, but 2020 isn’t that far off. We predict that the progress being made in the online marketplace this year will only continue into the following year. Companies are shifting online every day, creating new products and apps. Consumers are taking advantage of new trends and your business should, too. Join the growing online marketplace to uncover new growth potential.
