Like chickens laying eggs in factories’: The CEO of a hot European startup just launched a stunning critique of Silicon Valley culture

By Charlie Wood

Adrien Nussenbaum, cofounder and co-CEO of Mirakl.

  • Adrien Nussenbaum is the cofounder of French software services startup Mirakl, which raised $70 million in February.
  • He has strong views on Silicon Valley culture, which he says treats workers like “chickens laying eggs in factories” and has an unhealthy preoccupation with money.
  • Nussenbaum is proud of the culture he has developed at Mirakl, where staff are encouraged to keep a balance between their work and personal lives.
  • “I’m not part of the ‘yo, bro’ culture of Silicon Valley. At Mirakl, we try not to cultivate an egotistical culture,” he says. “Where Silicon Valley was once a role model, it has lost track in a lot of ways.”

Silicon Valley. A mecca for tech startups. Home to the most influential companies in the world. The breeding ground for 32 new unicorns in 2018. But not, it would seem, to everyone’s tastes.

Adrien Nussenbaum, the cofounder of hot French tech startup, Mirakl, which raised $70 million in February, has strong views on why California’s tech haven does not have everything right.

Speaking to Business Insider over the phone, he laid out a stunning critique of work culture in the Valley, contrasting it with the spirit he has attempted to establish at his Paris-based company, which helps brands like Walmart offer products from third-party sellers on their websites.

Nussenbaum’s views are not all-encompassing. He recognises that Silicon Valley is full of “passionate” and “bold” people, and that it remains unrivalled as a destination for raising finance. Indeed, some $168 billion flowed into the Bay Area from VCs between 2010 and 2018, The Economist reports.

But Nussenbaum says this fountain of cash comes at a price.

He thinks that tech giants like Google wring every drop of value out of their staff members by creating cultures that keep people in the office. Ping-pong tables, free food, and nap rooms might seem like attractive benefits, he suggests, but they hide a more sinister motive.

He explains: “When I visited Google’s headquarters, an employee told me that staffers are obliged to be no more than 25 yards from food… For Google, you are an asset, and Google will feed you up so you produce. They’re like chickens laying eggs in factories.”

Nussenbaum is not the first to touch on this issue. Reddit founder Alexis Ohanian talked about the fetishization of extremely long working hours last year, pointing out that it’s terrible for people’s physical and mental health.

“This is one of the most toxic, dangerous things in tech right now,” Ohanian said. “This idea that unless you are suffering, grinding working every hour of every day, you’re not working hard enough. It’s such bulls—.”

Nussenbaum contrasts this with his view on Europe: “Silicon Valley is full of passionate people, but here in Europe, we like debating; we like life outside of work. We have joie de vivre.”

On the culture he has attempted to create at Mirakl, he continues: “Our teams are obliged to eat away from their desks. They eat at a communal area. We have team lunches once a week, with a talk from a guest speaker.

“We offer yoga classes and language lessons. We also encourage everyone to teach their own hobbies to each other. For example, once a week, an employee who is into photography will teach everyone photography, the following week, an employee who is a keen mixologist will teach everyone mixology, and so on.”

The Mirakl Team.

Nussenbaum says Silicon Valley’s pursuit of the next big thing, of big backing, of unicorn status does not always draw out the best qualities in people and company culture.

“People envy one another. People are always open to being poached by rival companies. The people there don’t admit how central money is to their motivations,” he says.

“Silicon Valley has a ‘fail fast and move on’ culture. But that’s not Mirakl’s culture. At Mirakl, we refuse to fail. This results in more debate and more discussion [than there is in Silicon Valley].

“In terms of [Mirakl’s] funding, we’ve been very selective with our investors. Burning, burning, burning has never been our culture. Once a year, we take one-and-a-half days just to discuss strategy with our board. The talks are always hosted at one of the investors’ houses. Our investors are part of our family; they come to our Christmas parties.”

Since launching in 2011, Mirakl has grown to more than 200 employees and has raised a total of $100 million from backers including Bain Capital. As well as its Paris headquarters, it has offices in London, Munich, and Boston, a US city that Nussenbaum thinks has a healthier “approach to risk and reward” than San Francisco.

Originally posted on May 3rd, 2019 by Business Insider

It’s A Mirakl! You Can Have Your Own Amazon-Style Website Thanks To This Global Company

By Daniel D’Ambrosio

If it’s good enough for Amazon, it’s good enough for Walmart, Best Buy, Urban Outfitters and more than 200 other companies, says Adrien Nussenbaum, CEO of Mirakl, a global firm with dual headquarters in Boston and Paris, plus offices in London, Munich, Barcelona, Stockholm and Sao Paulo.

Mirakl co-founders Adrien Nussenbaum, right, and Philippe Corrot.

Mirakl allows its clients to adopt the same marketplace platform that transformed Amazon from a bookseller into a seller of, well, nearly everything.

“What Amazon is doing is not rocket science,” Nussenbaum said in a recent interview from Mirakl’s Boston office. “I think Amazon has been able to take a fresher look at retail and the consumer experience and that has freed them from some of the blockers that incumbent retailers have.”

Key to Amazon’s success is an online marketplace of third party sellers – obvious to anyone who has been on the Amazon website. Mirakl brings that same capability to its clients, according to Nussenbaum.

“Simply put, Mirakl provides the technology and the partner ecosystem to launch an ecommerce marketplace,” he explains.

Take Best Buy Canada, for example. The company has stores across Canada and a website.

“They decided to find a way to quickly expand the product selection on their website and provide more choice and opportunity for customers,” Nussenbaum said.

Best Buy uses Mirakl technology on its website to include third-party sellers.

To do that, Best Buy Canada turned to Mirakl technology, which allowed them to quickly partner with hundreds of third party sellers. Best Buy Canada was an “insignificant” player in baby products, Nussenbaum says. Through Mirakl, the company added thousands of baby products to its website through selected third party sellers, and within a year has become Canada’s number 1 seller of baby products online.

“That was very exciting to them,” Nussenbaum said. “It allowed them to very rapidly learn about this new cateogory, and ultimately identify two products they could also offer in their stores.”

J. Crew is another Mirakl client. It decided that on top of selling its own clothing label online, J. Crew customers would appreciate being able to buy “adjacent” products, like accessories and jewelry.

“Using Mirakl’s marketplace platform, J. Crew started partnering with hundreds of more niche brands, and now offers a selection of very nice items from emerging brands who are very interested in the opportunity,” Nussenbaum said. “J. Crew gives them the opportunity to surface their products on its website, which has a lot of traffic.”

Mirakl’s software takes care of all the complexities of a marketplace operation, Nussenbaum said, making it easy for partners to on-board their products.

“J. Crew may have very specific expectations about how products are described and categorized,” he said. “Mirakl ensures sellers provide content exactly as J. Crew wants it.”

Mirakl also takes care of order management when a customer buys multiple products on the Best Buy website coming from multiple sources, including Best Buy.

“Mirakl provides all the order management capacity in the background to direct the order to the right seller and makes sure the customer never sees that,” Nussenbaum said. “The customer only cares about getting the product in due time.”

And finally, Mirakl provides quality control, automatically surveying and supervising the performance of third-party sellers to make sure they ship within 24 hours, and tracking any customer dissatisfaction with their products.

So does J. Crew.

Nussenbaum, who is French, launched Mirakl seven years ago in Paris with co-founder Philippe Corrot. Corrot remains in Paris, but Nussenbaum is in Boston.

“I’m an adopted New Englander now,” Nussenbaum says.

At the end of February, Mirakl announced it had raised $70 million, led by Bain Capital Ventures, bringing total capital raised to $100 million. In 2018, Mirakl said it had added 60 new customers and launched a record 37 marketplaces, achieving year-over-year revenue growth of 80 percent.

Until this latest $70 million capital raise, Nussenbaum said he and his partner owned a majority of the company.

“Now my partner and I are still very much active in the company and on the board,” Nussenbaum said. “We retain significant ownership of the company, but we have more financial partners supporting our vision.”

And now for the obvious question. Has he gotten a call from Jeff Bezos?

“I have not gotten any calls from Jeff Bezos, but he is definitely influencing the way companies think about selling,” Nussenbaum answers. “I’m sure that people at Amazon know of Mirakl. It’s true that we see ourselves as providing a very powerful instrument that helps businesses compete and survive in an Amazon age.”

Originally posted on April 20th, 2019 by Forbes

Online marketplace technology vendor Mirakl raises $70 million

By Zak Stambor

To bolster its growth, Mirakl aims to build new tools to suit B2B business models, as well as to launch new analytics capabilities to help merchants leverage the massive trove of data coming from online marketplaces more actionable.

In the latest sign of online marketplace’s growing importance within ecommerce, online marketplace technology vendor Mirakl on Thursday announced it has raised $70 million in its latest funding round. Mirakl has raised $100 million to date.

The vendor plans to use the funding to hire additional staff members, invest in its technology and expand internationally.

Bain Capital Ventures led the round, which also included existing investors 83North, Felix Capital and Elaia Partners, bringing total capital raised to $100 million.

The vendor, which currently employs a little more than 200 staff, plans to add another 100 employees this year to bolster the company’s development, sales and marketing, research and development and customer success teams, Adrien Nussenbaum, U.S. CEO and co-founder of Mirakl, tells Internet Retailer. The vast majority of the new hires will be located in either the United States or Europe, although a small number will be in Latin America and Southeast Asia.

“The people we employ are our main fuel for growth,” he says. And the United States and North America are key markets where Mirakl is eyeing growth. “Clearly, from a geography standpoint, we see our business accelerating on that side of ocean,” he says.

The funding announcement comes a month after Mirakl announced its 2018 revenue grew 80% year over year and the gross merchandise volume on ecommerce sites that use Mirakl’s technology to operate marketplaces jumped 100% year over year. The vendor added 60 new customers last year and launched 37 marketplaces, including one operated by grocery retailer Albertsons Cos. LLC.

In adding a marketplace to its ecommerce site, Albertsons—the third-largest grocer in the United States in terms of market share and No. 178 in the Internet Retailer 2018 Top 1000–sought to create an “infinite aisle” that gives consumers access to more natural, organic, ethnic and “alternative” products. At the same time, the marketplace also has provided the retailer with data about customers nationwide that could help it identify shifting consumer interests, regionally specific shopping needs and new food trends, the retailer says.

To bolster its growth, Mirakl aims to build new tools to suit B2B business models, as well as launch new analytics capabilities to help merchants leverage the massive trove of data coming from online marketplaces in a more actionable way. It also aims to find ways to simplify the process for retailers and brands to launch a marketplace, onboard sellers and rapidly add SKUs.

Finding ways to cater to Mirakl’s customer base is crucial to its long-term success, Nussenbaum says. “We’re building the next wave of ecommerce technology,” he says. “If you look at the technologies that enabled the first wave of ecommerce, there were ecommerce platforms like hybris, Demandware and Magento. We believe the next generation of solutions that retailers and brands need will offer the functionality needed to extend their traditional ecommerce business into a marketplace.”

Marketplaces’ market share is rapidly growing. Last year, marketplaces accounted for 52% of global ecommerce sales. And sales on those platforms are outpacing the broader ecommerce market; online marketplaces around the world grew their gross merchandise value 23% last year, which compares to 18% growth among the broader ecommerce market, according to Internet Retailer research.

Originally posted on February 28th, 2019 by Digital Commerce 360

Bain Capital Invests $70M in E-commerce Tech Startup Mirakl to Take on Amazon

By Srividya Kalyanaraman

French-born Mirakl, a startup that provides technology to launch an e-commerce marketplace for brands like Urban Outfitters, J. Crew, Office Depot, raised $70 million led by Bain Capital Ventures.

Existing investors 83North, Felix Capital and Elaia Partners also participated in the round. Bain Capital Ventures Partner Scott Friend led the round whose previous investments include Jet.com and Rent the Runway.

This round brings the company’s total venture capital to $100 million.

Founded in 2007 in Paris by Philippe Corrot and Adrien Nussenbaum, Mirakl provides a turnkey tech platform to brands and manufacturers to allow them to set up their own marketplace. The company’s services include onboarding third-party sellers, making and managing product catalogs and order orchestration. It also provides operations support and trains their client teams to run an online marketplace.

Mirakl moved to Boston four years ago after meeting with some success in Europe. The company has an office near Davis Square in Somerville and employs a staff of 50 people. Mirakl’s CEO Nussbaum noted that he was keen on raising funding from a Boston-based investor.

“Our key goal through this was to find an investor who would be local, and there is no better representation of Boston than Bain Capital,” Nussbaum said.

Armed with a strong clientele of over 200 global brands including Walmart (Mexico), Best Buy (Canada), Urban Outfitters and B2B clients including Toyota Material Handling, Siemens Mobility, and Office Depot, Mirakl wants to help brands resist Amazon by enabling them with the technology to do it themselves. The company added 60 new clients and launched 37 e-commerce marketplaces in 2018.

“Before starting Mirakl, my co-founder and I had spent six years having our own online marketplace, because we wanted to resist Amazon,” said Adrien Nussbaum co-founder and CEO. “We decided we would help other companies enjoy the same benefits and successes we were able to enjoy. Very often, a lot of established companies fail to achieve their goal because of technology.”

Nussbaum noted that his company set out to build a strong technological infrastructure for big retailers and brands to keep up with Amazon’s standards. Mirakl’s value proposition, the co-founders decided, would be to provide amazing technology and professional support to allow their clients to run their own marketplace.

Mirakl has offices in Boston, Barcelona, London, Munich, São Paulo and Stockholm. Nussbaum said that Mirakl will soon expand to the Asia Pacific region. In Boston, the company plans to hire more than 60 people in Boston for roles in sales, business development, customer success, marketing and operations.

Originally posted on February 28th 2019 by BostInno

Mirakl raises $70 million to manage the marketplace of your e-commerce website

By Romain Dillet

French startup Mirakl raised a $70 million funding round. Bain Capital is leading the round with existing investors 83North, Felix Capital and Elaia Partners also participating.

If you’ve bought a few products from a third-party seller on an e-commerce website that isn’t Amazon or Alibaba, chances are you’ve used Mirakl in the past. The company has built a solution to manage the marketplace of your e-commerce platform.

While Mirakl doesn’t have a ton of customers, each customer is very valuable. The company has worked with some of the biggest names in e-commerce so that they could add a new revenue stream with a marketplace. Examples include Best Buy in Canada, Walmart in Mexico, Office Deport and Darty.

The startup also lets you create B2B marketplaces for bulk selling and other complicated transactions. Sellers can set minimum and maximum quantities and customize their listings.

In 2018, the startup managed to add 60 customers and launch 37 marketplaces — it doubled the gross merchandise volume compared to 2017. And it’s true that marketplaces are attractive. You can greatly increase your sales without any physical infrastructure investment as third-party sellers handle logistics.

Behind the scene, Mirakl has developed connectors that work with multiple e-commerce platforms. After setting up Mirakl, your third-party sellers will also get their own on-boarding back end. And Mirakl continuously helps you when it comes to maintaining a certain level of quality and handling orders.

More recently, Mirakl has developed a catalog manager so that you can more easily manage product listings. It lets you get product information, merge product listings and moderate your platform in general. Any e-commerce website can use it, not just websites that operate a Mirakl marketplace.

The company has also launched a services marketplace so that you can upsell your customers before they check out with extended warranties and insurance products from third-party companies.

Mirakl works with global B2B platforms as well as retail websites that usually operate in a country or a handful of countries. 30 percent of retail clients are French, 30 percent are American and 40 percent are from the rest of the world. The startup charges an upfront fee as well as a monthly subscription that varies according to the success of your marketplace.

With today’s funding round, the company plans to do more of the same, at a bigger scale. Mirakl will expand the team, expand to new countries and improve its product offering.

Originally published February 28th, 2019 by TechCrunch

Mirakl raises $70 million to facilitate ecommerce sales with software

By Kyle Wiggers

Logo-Mirakl-Blue-StandardMirakl, a Paris-based software company that develops ecommerce solutions for corporate and retail clients, isn’t shy about throwing its weight around in the $50.8 billion software-as-a-service (SaaS) enterprise app market. Case in point? It today announced that it’s secured $70 million in series C financing led by Bain Capital, with participation from existing investors 83North, Felix Capital, and Elaia Partners. That brings the startup’s total raised to $100 million.

That’s a lot of dough, to be sure — more than triple the size of its $20 million series A in July 2015 — but CEO Adrien Nussenbaum says Mirakl has the numbers to back it up. Revenue grew 200 percent from 2013 to 2014 and 80 percent from 2017 to 2018, and gross merchandise volume (GMV) — the total sales dollar value for merchandise sold through its online stores — was up 100 percent year-over-year last year, fueled by 60 new customer acquisitions and 37 new marketplaces. (Mirakl claims its clients have achieved $1 billion GMV to date.)

According to Nussenbaum, the fresh capital will be used to advance Mirakl’s technology and partner ecosystem, onboard a new cohort of sellers, and launch new analytics capabilities, as well as suss out opportunities for expansion into Asia-Pacific and Latin American regions.

“Mirakl is building a new category and ushering in a platform revolution,” he said. “We are paving the way to a new business model that can transform businesses and help them compete with giants like Amazon and Alibaba. We are thrilled that our investors recognize this vision and the huge opportunities in the marketplace space. This investment is a chance to bring our vision to the next level.”

Mirakl Backoffice

Above: Mirakl’s Marketplace cloud backend.

Mirakl — which was cofounded in 2011 by Nussenbaum and Philippe Corrot, who previously co-led online video game marketplace Splitgames — targets both B2C and B2B verticals with its API-based Marketplace platform. Much like Amazon Marketplace, it enables retailers and brands to offer products and services from third parties within their respective online stores, with support for all the features you’d expect from a modern ecommerce engine — order splitting, in-store returns, credit limits, segment targeting, and carrier selection.

From within Mirakl’s cloud dashboard, operators can see sellers and filter them by balances, ratings, order volume, and other metrics, and view historical and real-time stats on pending orders, current balance, revenue, and average order value. Marketplace handles a decent portion of the work automatically — retailers can tap prepackaged workflows for customer service and seller orders, create rules that mandate baseline customer service and seller performance, and automate tasks like onboarding, commissions, and payments. Moreover, all the while, managers get notifications that help to keep transparent all buyer-seller interactions.

In addition to Marketplace, Mirakl maintains a consultancy business that draws up business plans, conducts marketing studies, optimizes and streamlines workflow processes, and recruits sellers for clients. And through its Blink Partners program, it offers a curated list of 200 tech and service partners.

Currently, about 20,000 sellers and 200 customers in over 40 countries use Marketplace in some capacity, Mirakl says, including Siemens, Toyota Material Handling, Office Depot, Best Buy Canada, Walmart Mexico, Hewlett Packard Enterprise, Urban Outfitters, Carrefour Taiwan, Fnac, Leroy Merlin Brazil, and Albertsons Companies. The company claims it can deliver up to 162 percent return on investment within three years and revenues upwards of $412 million, and says that customers experience an average 15 percent and 7 percent increases in order size and physical store sales, respectively, with Marketplace.

Mirakl’s growth coincides with the rise in popularity of online marketplaces. According to analysts at Digital Commerce 360, sites like Alibaba, Walmart, JD.com, and Amazon accounted for 52 percent of global ecommerce sales last year and sold more merchandise than all standalone retail websites combined. Gartner, meanwhile, forecasts that more than 50 percent of all online sellers will adopt marketplaces or include third-party sales in their ecommerce ecosystems by 2020, and that 15 percent of medium- to high-GMV digital commerce companies will have deployed their own online storefronts by 2023.

“Marketplaces are experiencing rapid growth, and Mirakl is at the forefront of pushing the space forward,” said Bain Capital partner Scott Friend. “Its sophisticated technology, impressive customer-base, and high levels of customer satisfaction put Mirakl in a prime position to drive the shift to marketplace models among B2C and B2B ecommerce businesses. We are excited to join them on this journey.”

In addition to its Paris headquarters, Mirakl has offices in London and Boston. It says headcount grew by over 200 percent over the past two years, and it plans to add another 100 employees this year.

Originally published on February 28th, 2019 by VentureBeat

eBay adds home installation and assembly services to its marketplace

By Zak Stambor

eBay shoppers buying items such as TVs, bikes or furniture that require assembly or installation can book those services on the online marketplace during the checkout process via service providers Handy, Porch and InstallerNet.

As of Monday, eBay shoppers buying items such as TVs, bikes or furniture that require assembly or installation can book those services on the online marketplace during the checkout process via service providers Handy, Porch and InstallerNet.

“A massive amount of home and electronic items are sold on eBay daily, many of which require professional installation,” says Alyssa Steele, eBay’s vice president of merchandising. “With these new partnerships, we’re able to combine our incredible selection of inventory with easy access to affordable and trusted service professionals, making eBay a one-stop shop for our customers.”

Screen Shot 2018 11 07 at 2.45.10 PM

The online marketplace added the option for a consumer to select assembly and installation services from one of three service providers on a number of product pages. The shopper can add the service to his purchase during the checkout process. Once he completes the transaction, the service provider contacts the shopper via email to set up an appointment.

The service is similar to Amazon Home Services, as well as the tire installation services that eBay added to its platform late last year, which enables consumers to add professional installation when they purchase a tire on eBay.

While eBay is not the first retail company to offer professional installation services, adding the option helps differentiate it from some of its competitors, says Adrien Nussenbaum, U.S. CEO and co-founder of Mirakl.

“As consumers continue to push for more options and convenience, offering services is a natural extension that allows retailers to be a bigger part of the customer’s journey,” Nussenbaum says. “It’s not a new model. Retailers like REI have offered REI Adventures, and many retailers sell installation or even styling and beauty services in-store. What’s new is the ability to bring many more service providers to the table using the online marketplace model. As the retail industry continues to experience a services revolution, the marketplace model provides a unique opportunity to offer a comprehensive list of third-party service providers, which complete the purchase experience.”

EBay is No. 4 in the Internet Retailer 2018 Online Marketplaces, Amazon is No. 3.

 

Orginally published on November 12th by Internet Retailer

An online marketplace wants in on the home installation game

BY DEENA M. AMATO-MCCOY

eBay just made a move that could help it compete with the likes of Amazon, Ikea, Walmart and Best Buy.

Through partnership with leading home services providers, the online marketplace is enabling customers to book installation services on a vast selection of eBay inventory. The company is working with housecleaning and handyman app Handy; Porch, an online platform that connects homeowners with local home repair services, and InstallerNet, an installation solutions provider for the consumer electronics industry.

When purchasing items that require installation or assembly, eBay shoppers will have the ability to add a service from the most appropriate provider during the checkout process. If services are chosen, the selected company will connect eBay shoppers with pre-screened local service professionals available across their national network.

The new services coincide with eBay’s recent launch of tire installation services in late 2017. Through the service, eBay shoppers can bundle new tire purchases with professional installation available in their local area.

“A massive amount of home and electronic items are sold on eBay daily, many of which require professional installation,” said Alyssa Steele, VP of merchandising at eBay. “With these new partnerships, we’re able to combine our incredible selection of inventory with easy access to affordable and trusted service professionals, making eBay a one-stop shop for our customers.”

The deals will help eBay compete with other companies that offer similar services. For example, Walmart offers customers both in-store and online the option to purchase in-home installation and assembly services for merchandise, including furniture and electronics. The program is available through its partnership with home services provider Handy.

Meanwhile, Ikea introduced its TaskRabbit At-Home Assembly Service in a pilot in 2016. The company introduced the program online in select markets, and in six stores in the San Francisco and New York City area. The retailer said additional stores will add the service in 2018, including those in Los Angeles, Miami, Houston, Boston, Washington, D.C., and more.

Best Buy offers similar services through its Geek Squad. Amazon also features assembly services for merchandise including furniture, fitness equipment, and recreational items, including pool tables.

“This wise initiative … shows that retailers en masse are looking to differentiate themselves by offering services that help consumers use the products they buy,” said Adrien Nussenbaum, U.S. CEO and co-founder of Mirakl.

“As consumers continue to push for more options and convenience, offering services is a natural extension that allows retailers to be a bigger part of the customer’s journey. It’s not a new model,” Nussenbaum added. “What’s new is the ability to bring many more service providers to the table using the online marketplace model. As the retail industry continues to experience a services revolution, the marketplace model provides a unique opportunity to offer a comprehensive list of third-party service provider which complete the purchase experience.”

 

Originally published on November 12th, 2019 in Chain Store Age

The Rise Of Online Marketplaces In Digital Grocery—Learning From Amazon

by Adrien Nussenbaum/co-founder and U.S. CEO, Mirakl

Grocery retailing is being profoundly transformed. Within a decade, grocery shopping as we remember it will be unrecognizable. Amazon’s acquisition of Whole Foods in 2017 marked a milestone in the evolution of the grocery store, bringing an e-commerce first, technology-driven approach to a sector noted for its digital latency. The Food Marketing Institute and Nielson together estimate that 70 percent of consumers will buy at least some groceries online in the next five to seven years. In fact, online grocery sales are predicted to reach $100 billion by 2022 in North America alone.

Already, more than half of the world’s food retailers have begun preparations to sell their goods online. From Amazon Go to Instacart, HelloFresh to Peapod, we’re seeing a surge in on-demand, digital-first services designed to make food shopping more convenient for consumers. The shift from offline to online in the grocery sector is gaining momentum at a rapid pace.

As more consumers experiment with, or completely switch to, online grocery shopping, ensuring availability of a wide range of products over the web should be at the forefront of retailers’ minds. This is the time for grocers to make sure they have a large stake in the consumer’s mind. Brand loyalty is strongest in grocery, but mass merchants are starting to take mind and market share with advanced digital grocery initiatives. How are grocers going to adapt to offer all that customers want online?

One method in providing customers with an increased product assortment and greater customer satisfaction is the marketplace model. While the grocery industry overall grew one percent year over year, Amazon’s grocery business grew 59 percent year over year.

Growing marketplace mindset

Marketplace collaborations offer a great route to success for many retailers, and as such, many around the world are enhancing their platform infrastructures and redefining their product strategies. Using this model, they are able to grow their online grocery business through a larger product assortment of items many grocers don’t have in-store, helping to increase market share.

In South Korea, one of the most digitally mature e-grocery markets in the world, superchain E-Mart, sought to eradicate customer pain points and entice new shoppers to their stores while ensuring their offering was seamlessly omnichannel. To achieve these ends, E-Mart built a marketplace platform encompassing its many grocery formats.

In North America, Alberstons’, who currently operates grocery stores in 35 states under 20 banners including Safeway, Jewel-Osco, Shaw’s and Vons, is launching its own grocery marketplace to take its assortment to the next level. This online marketplace creates an endless shopping aisle that offers customers access to a wide assortment of hard-to-find products from the most experienced sellers and allows shoppers to quickly discover new items and trends that suit their tastes and lifestyles. These purchases are made directly from manufacturers and shipped to the customer for exceptional convenience.

Kroger also recently announced that they’re able to enter the Chinese market via becoming a marketplace seller on Alibaba’s Tmall.com. It’s clear that a marketplace strategy is at the heart of many grocers’ long-term planning to protect and gain market share.

Maximizing grocery marketplaces by including service providers

Grocers should launch their own online marketplaces to offer an endless aisle and access to unique products, but it shouldn’t stop there. Bringing service providers into the online experience—whether it’s personal shoppers, in-home chefs, access to cooking classes or any number food and non-food related services—is a significant opportunity for grocers to differentiate. It’s already happening with Instacart partnerships and on Amazon’s platform—why not think beyond food delivery?

In a world where convenience is king, it’s time for grocers to play digital catch up and take advantage of the marketplace model.

 

Originally published in The Shelby Report on November 7th, 2018

Albertsons Digital Marketplace goes live

By Russell Redman, Supermarket News

E-store serves up thousands of specialty products from third-party sellers

Albertsons Cos. has launched an online marketplace that provides a venue for third-party vendors to sell directly to its customers.

Announced in March, the Albertsons Digital Marketplace offers more than 40,000 specialty food and nonfood products. The virtual store focuses on natural, organic, ethnic and alternative products, including hard-to-find items such as spices and condiments, specific flavors of coffee, and unique health and beauty aids.

Plans call for the new e-store, accessed at Albertsons.com/Marketplace, to carry more than 100,000 products by the end of 2018, the Boise, Idaho-based supermarket retailer said.

“Albertsons Digital Marketplace helps customers discover exciting new products from innovative manufacturers that are then shipped directly to them, creating an infinite aisle. This marketplace is just another example of how we are using digital technologies to reinforce and extend our core capabilities of offering exciting new products and a wide assortment,” according to Narayan Iyengar, senior vice president of digital and e-commerce at Albertsons Cos. “Our infinite aisle also helps a large number of specialty sellers like small businesses and budding entrepreneurs get exposure to our vast customer base.”

Powered by technology from Boston-based e-commerce firm Mirakl, the digital marketplace also is expected to help Albertsons keep atop product trends and hot new items. Data gleaned from the marketplace can be used to help identify changing consumer interests, shopping needs by region and emerging food and wellness trends, the companies said. That capability, in turn, can help Albertsons respond to customer needs more rapidly by adding assortment from its network of sellers.

“Our digital team is focused on removing the limits on how people shop for food. Today, people are trying to squeeze the best out of each day in their busy lives. While some customers want an extended selection or unique specialty products, there are other customers who simply prefer to have bulky items like pet food shipped straight to their front doors,” explained Jon Fahrner, head of marketplace for Albertsons.

Fahrner and Karl Varsanyi, group vice president of digital product management, are key architects of the marketplace, Albertsons said. Before coming to the company, Varsanyi helped turn Macys.com into a leading retail e-commerce site in the United States. Fahrner, meanwhile, was part of the founding team at Zappos.com.

“This is just the beginning. We are excited to continue to innovate new models to better fit people’s lives,” Fahrner added.

Through the marketplace, small businesses and sellers of niche products can showcase their wares on a much broader scale. Albertsons said one artisan vendor that’s receiving more visibility via the platform is Spicemode, which sells all-natural, handmade simmer sauces and spice blends. The Chicago-based company’s products have been available online and in select retail stores, but now its offerings get a national scale on the marketplace.

“We started this company on the premise that global flavors should be available to everyone,” commented Amar Singh, chief flavor officer at Spicemode. “Albertsons Digital Marketplace lets even more customers begin their flavor journey with small-batch cooking sauces and spices.”

For vendors, the Albertsons Digital Marketplace offers an easy way to create an online presence and get access to Albertsons’ large customer base, noted Mirakl. The site, which uses the Mirakl Marketplace Platform, also gives vendors insight into regions where they might want to invest in building distribution.

“By choosing the online marketplace model, Albertsons Cos. is truly distinguishing itself from the competition, and Mirakl is honored to be working alongside Albertsons on this journey,” according to Adrien Nussenbaum, co-founder and U.S. CEO of Mirakl.

Added Iyengar, “The Mirakl team, and McFadyen Digital’s team, have been instrumental in achieving our launch goals.”

First Published in Supermarket News on October 17th, 2018.