Can you compete on your own against a conglomerate like Alibaba or Amazon?
Maybe when you cater to a niche that is as isolated as possible from the rest of retail?
Amazon’s Handmade could steal both Etsy’s customers and its merchants. Handmade, Amazon’s craft goods marketplace, is a direct competitor to Etsy and bolstered by Amazon’s brand and logistics network. While Etsy has nearly 31 million active buyers and 1.8 million active sellers, Handmade threatens to steal them by offering specialized stores, a better customer experience, higher-level AI, and better analytics for merchants. To stave off this threat, the company has finally started to turn to outside resources for developing better tech, including with its acquisition of AI startup Blackbird Technologies, which Silverman highlighted on the earnings call for its ability to revamp Etsy’s consumer experience and boost conversion rates. Pursuing similar investments could improve Etsy’s technology standards, helping it generate more revenue, and remain in the black.
I’d go further. Every small to mid-tier marketplace provider needs a strong API strategy that allows easy collaboration with providers of technology and services. It needs to be as seamless as possible to plug in. Only then can you hope to compete with a system like Amazon or Alibaba. Those systems themselves utilize seamless microservice APIs inwards to rearrange parts of their whole.
This doesn’t necessarily mean an ‘open’ API that can be used with automatically created access keys. It can mean robust APIs that are ready for connecting to outside services, once a partnership has been agreed upon. It can, and in most cases should, mean both: public APIs and private partnership APIs for different areas of the business.
Even beyond APIs, partnerships and cooperations are the only way forward; besides acquisitions as mentioned above.
Think of what Lazada is doing with LiveUp.
You can not win alone against Amazon or Alibaba.
More food for fought on this topic:
- Alibaba’s Lazada Launches the First Real Amazon Prime Competitor With LiveUp
- Amazon’s Ruthlessness and Growing Power Across Industries Creates Powerful Enemies
- How to Evaluate Amazon Prime and Other Subscription Businesses
- This Startup Shows Us the Future of Amazon’s Plug&Play Delivery & Fulfillment Services
- What the Amazon Hub Locker Means for the Industry in the Medium-Term and Long-Term
- Flexe, the AirBnB for Warehouses, Is Shaking Up Online Retail in the US
- Shopify’s Buzzfeed Channel and the Massive Potential for Innovation in Shoptech
- How Walmart Can Win Against Amazon