Brands are primarily focused on their owned e-commerce sites. As for other sales channels, new survey results show that marketplaces are now winning slightly more brand investment than retail partner-owned digital platforms.
For brands and retailers responding to Glossy and Modern Retail’s Q1 2023 survey, marketplaces came in second place, in terms of the sales channel accounting for most investment from brands. In first was brands’ owned e-commerce platforms. Retail partners’ owned digital channels and physical stores tied for third, each chosen by 14% of respondents.
When asked where their company will focus sales channel investment over the next 12 months, 48% of brands and retailers said their e-commerce site. As direct connections with customers become more of a priority, brands are building out their online capabilities to win their customers’ e-commerce sales.
For its part, YSL Beauty has made directing customers to its e-commerce site a central element of its NFT strategy. Customers who bought into its latest Opium perfume NFT launch in January received a physical and digital gift with purchase, but only if they bought the Opium perfume through the brand’s website.
“On their own sites, brands can showcase their products and the designer’s intent, packaged in an aspirational lifestyle that helps convey the brand ethos better than any other place, with a depth of rich storytelling that is difficult to achieve to the same degree via other channels,” said Romney Evans, co-founder and CEO of Shoptrue, an AI-driven fashion discovery platform.
Making the online shopping experience they host as seamless as possible is a key focus of brands’ current investment. “There’s still a lot of opportunity to remove friction from the shopping experience wherever possible,” said Evans. For example, Shoptrue is working to leverage personal sizing data to eliminate friction by filtering out items that are sold out in a shopper’s recommended size.
The survey findings showed that 15% of respondents said online marketplaces account for their highest sales channel investment. According to market intelligence platform PipeCandy, the top e-commerce fashion marketplace in the U.S. in 2022 was Amazon, with over 86 million unique visitors a month. Walmart has over 15 million visitors, while Macy’s has over 5 million and Nordstrom has over 4 million.
“Marketplaces play a unique and important role in major e-commerce verticals, including fashion, driving approximately 67% of all e-commerce sales volume,” said Evans. “The very best ones are figuring out how to personalize experiences to help shoppers efficiently cut through the massive inventory and find products that have the highest propensity to fulfill them.” According to marketing company Epsilon, 80% of consumers say they’re more likely to purchase if the experience is personalized.
Brands’ marketing investments are also focused on digital platforms, with 73% Glossy-MR survey respondents saying online marketing receives most of their marketing investment. That’s compared to offline marketing, at 16%.