In accordance with the FDI policy guidelines, “Marketplace label of e-commerce means providing of your information technology platform by an e-commerce entity on a digital and electronic network to behave as being a facilitator between seller and buyer.”
The primary feature of this marketplace model could be that the e-commerce firm, like Amazon, Flipkart, Snapdeal, etc. give a platform for customers to activate which has a great number of sellers onboard to acquire an item online. Thus, every time a product from amazon is bought, you are actually acquiring it from a registered seller with it. As a result the merchandise is just not directly sold by amazon. Here, amazon is only a website platform which facilitates a meeting spot for the consumer to meets a lot of seller and offer various options and price levels for the service or product.
Whereas the Inventory-led websites have specialized but limited product range as well as the serious customers may signing in to the telltale website for the specific product range, including caratlane.com for precious jewellery, booknest.straight into buy books, swiggy.com for ordering food, 1mg.com for medicines etc.
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Anchor Seller and a Level Game
Most of the marketplace players have anchor sellers on panel, who are either their subsidiary entities or perhaps a large enterprise who have inked privileged handles them which helps them offer bargains or discounts to the customers. This could include a higher discount on products, Free postage, compensation for sales returns etc. The losses incurred on these deals /services are compensated from the Marketplace Player within a pre-agreed arrangement.
You regularly realize that some merchandise is available on your website at 40% -60% discounts that is even a hardship on the manufacturer to supply. You regularly realize that you will find 40-50 sellers for the online book store but excepting one anchor seller, fat loss to supply such exciting discounts or offers. They will mask other seller completely and corner almost entire demand for the products, thereby also frustrate these multiple genuine sellers to achieve the customers using honest pricing offers.
Just about all e-commerce players are on the verge of re-discovering their business models and desire to become profitable sooner. Truth be told, none have already been capable of seeing a cent in profit so far. Many big and promising e-commerce and unicorn players have perished because of unsustainable losses and lots of have already been out of stock to other people. Year 2017 would see more to lock belts and continue to keep solve this riddle lest they perish from the race to the survival from the fittest.
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