Transcript
A (0:00)
Best Buy plans to launch a new third party marketplace in the US in mid-2025, according to Modern Retail. CEO Corey Berry told investors about the new marketplace on an earnings call in November, saying it would give its customers access to a larger assortment and new categories. It will also give sellers and advertisers a new avenue on which to increase their reach and build their brands. She said the new platform is a partnership with Miracle, a software company that also powers third party marketplaces for Macy's, Nordstrom and Kroger, which. Which you've definitely heard me say before because Miracle is also a sponsor of this podcast.
B (0:35)
Yes. Full disclosure.
A (0:36)
Yes. And it that complement this traditional e commerce sites with a larger selection from third party sellers. The move follows a previous attempt from 20, from 2011 to 2016, when Best Buy launched a marketplace to compete with Amazon but shut it down, it only brought in 1% of Best Buy's revenue and created confusion among buyers who thought they could return the inventory to Best Buy stores. A Best Buy store spokesperson told E commerce bites in 2016. Chris, this is also our A and M put you on the spot question.
B (1:08)
Wow, I'm on a roll with these questions.
A (1:10)
Yes.
B (1:11)
All right, let's do it. Yeah.
A (1:12)
Chris, Marketplaces continue to thrive and multiply. Call them the new retail media network. To that end, will marketplaces like Best Buy stand on their own long term, or will this proliferation of independent retailer marketplaces end up significantly consolidating?
B (1:29)
Interesting. Interesting.
A (1:30)
I don't know.
B (1:30)
I don't know if I agree that they're the new retail media of 2025. Yeah, I think, I think they're a little bit different here. And, and to answer that question, I don't really see any, I don't really see any consolidation. I think, you know, some marketplace efforts will be more successful than others and some will get the traffic, therefore, and others won't. But at the end of the day, running them has gotten so much more efficient because of the platforms that are out there that I think it makes it easier for people to try to do this and see to what degree a marketplace works for them. But yeah, I don't see consolidation of marketplace efforts happening. Which is why honestly, if I come back to the headline, I am decidedly pro on this move because, you know, the thing I'd call it, it's not 2016 anymore. You know, it's not, it's two, it's 2025 and you know, just to call it out, you know. Yeah, and, and retail and Best Buy have both changed a lot. In the last 10 years, like, I think this 10 years has seen the most change in retail that I can ever remember. Yes. And so a number of things I call out that are different than, you know, back in 2016. One, platforms like Miracle just make it easier. Like I said already, like, they make it easier and you know, there's a lot of platforms you can do this with. But, but you know, they're using Miracle, they're a sponsor, and it just makes it easier to do. Second, the omnichannel sophistication with which retailers are operating is far greater than it ever was. So the idea of returns being the hamstringing factor here isn't as large of a concern as it probably was before. I think people have started to figure out how to do things around that. Different business models, different technology solutions have come up around solving that problem and it will continue to get better and better. And then here's the last point I'd add too, or no, second to last point. Actually, I got another point after this. Third, I think subscriptions are a bigger part of the game here.