The future of digital marketplaces
Over the last year, we have started to see a race toward marketplaces emerge. At KPS, we are engaged in multiple digital marketplace projects.
Many are now investing in marketplaces in areas where it is becoming increasingly challenging for brands to gain market share, improve KPIs such as AOV and conversion rates. In some instances, we have seen the top two retailers in a specific market race to launch a digital marketplace before the other through the fear of being the one left behind.
This potential is illustrated in the recent valuation of marketplace technology leader Mirakl. In September 2021, Mirakl completed a round of funding that valued the company at $3.5 billion (up from $1.5 billion the year before). Mirakl technology supports over 300 marketplaces, many of which are businesses that sell to other companies. This valuation illustrates the vast opportunity within this area.
While building a digital marketplace is not suitable for every brand, there is a significant opportunity for many enterprises to radically evolve their current eCommerce platform. The rewards can be enormous if the implementation and required business change are managed well.