Amazon’s Hold on E-Commerce is not a Fatality

It’s not a secret anymore

 

Amazon is killing everyone in retail, reaching 50% of e-commerce market share in the US, and it’s arriving very fast in Europe. A third of UK e-commerce transactions is made on Amazon, and two third of Germany’s e-commerce transactions are made on Amazon or eBay. The Long Tail is struggling to survive, facing the huge economy of scale these giants built.

 

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E-retailers can’t fight alone.

 

Amazon’s economy of scale and high network effects can’t be fought by small and medium retailers alone. Even though Amazon is well-known for their huge investments on customer service and aggressive price policy, their first key factor of success is the size of their catalogue of products. 500 million products are listed on Amazon. It drives unbeatable trafic and conversion. In other words, people go and buy on Amazon, and not somewhere else, because they find the products they want.

 

The real problem is that recreating such a wide offer would take a lifetime to any average e-retailer.

 

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Mutualise to survive.

 

The solution for e-retailers to build a competitive offer is to mutualise their inventory! Selling the products they have physically in stock is good for retailers’ margins, but not enough to be appealing to online consumers and thus competitive with Amazon. Today, retailers can make their catalogue deeper, with more references, more variations, more colours, more sizes, without taking any risk of buying and stocking the products. They can sell online products they don’t own, and make them shipped by other merchants, suppliers, drop shippers: other sources of stock.

 

Our mission at Stockly is to give this unlimited power to any retailer in the market. We build the first virtual global inventory, so that any retailer can sell online any product they want, and make it shipped by an other retailer of Stockly’s network. A huge revolution for e-commerce players. This way only, they will have the power to fight.

 

 

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