Myer takes on Amazon with online marketplace

By on
Myer takes on Amazon with online marketplace

As it faces hit on earnings.

Myer is launching an online marketplace to extend the range of products it offers ahead of the highly-anticipated arrival of e-commerce behemoth Amazon in Australia.

The retailer revealed the plan to investors at its strategy day on Wednesday.

Myer Market will partner with a range of carefully chosen retail partners to offer products in "adjacent categories" initially focused on lifestyle.

The marketplace, which will exist separately to the company's core myer.com.au website, is currently in beta and is expected to be launched early next year.

It is powered by Melbourne start-up Marketplacer, the firm behind the Bikeexchange platform.

Myer is currently recruiting vendor partners to the marketplace.

Chief digital and data officer Mark Cripsey said the intention was not to be the biggest online marketplace but rather to offer best-of-breed products for sale.

The retailer believes its point of difference to market leaders Amazon and eBay will be its Myer One data trove - the loyalty program will be extended to Myer Market - as well as allowing customers to return items purchased on the marketplace to physical Myer stores.

It sees the benefit of Myer Market as being able to "massively" expand its range of products without the traditional associated costs of doing so.

"Marketplaces don't hold stock or large assets - they connect sellers to customers," Cripsey said.

"[In this model] we don't touch the stock. The seller has the responsibility for uploading the product to the platform - where we curate it - and fulfilling that order. We're an intermediary.

"[Also] if you were to build your own marketplace platform it would cost tens or hundreds of millions of dollars, which was a hurdle too high for us. So we've partnered."

Myer CEO Richard Umbers emphasised that the retailer's core focus was still on the main Myer website.

"You're now seeing a lot of people using a marketplace-type of environment to achieve something that to the customer can look the same, but it's a more effective and progressive architecture over time," Umbers said.

"We can't out-Amazon Amazon, so a response based on price and range alone cannot succeed. Our response must play to our strengths and skew our resources towards what is working and what builds resilience."

A recent UBS report found Amazon's entry into Australia would have a big impact on retailer margins and prices, pegging Myer as one of the retailers that would be the most impacted by a predicted earnings drop of as much as 20 percent.

Copyright © iTnews.com.au . All rights reserved.
Tags:

Most Read Articles

Log In

Username:
Password:
|  Forgot your password?