Amazon merging marketplace and retail operations

Dive Short:

• Amazon has actually largely merged its marketplace and retail groups, according to a business declaration distributed to several media outlets recently. Amazon didn’t immediately return Retail Dive’s request for more details.

Dive Insight:

Amazon started as a bookseller but quickly morphed into a mass merchant with a huge selection, progressively bolstered through the years by the third-party sellers on its marketplace. For more than a year, over half of the items sold through Amazonhave actually originated from third-party sellers.Those sellers have been

an advantage when it comes to sales and fulfillment. The market model enables Amazon to gain the advantages of sales without much if any expense of fulfillment and shipping. As those sales have actually taken over a higher portion of Amazon’s sales, its track record for first-class client service has actually suffered, as some sellers stop working to provide its consumers with options to issues, adequate product packaging or shipping speeds and, perhaps worst of all, genuine items or goods-as-advertised.

Amazon’s relocation to combine its market and retail groups is a signal that third-party sellers are core to its long-term business plan, Adrien Nussenbaum, co-founder and U.S. CEO of market platform company Mirakl, informed Retail Dive in an email.

“For years I’ve seen resistance to work together between these 2 groups, and not just at Amazon,” he said. “In fact, we had an entire session at our recent customer top committed to alignment since it can make or break the success of the business as a whole. I think Amazon continues to display a model worth duplicating, where the core of its organisation is continuously minding the balance between owned and third-party inventory, with customer-centricity as the constant driving force.”

As Amazon continues to invest in its marketplace, pressure is installing for it to fix the growing sales of counterfeits from third-party sellers. “Seller scams is a simple problem to overcome with the ideal services that guarantee compliance with quality standard,” Nussenbaum said. “As such, there’s no reason for a company of Amazon’s size with nearly unlimited resources to have not fixed this problem.”