Best Buy has discontinued its online Marketplace after five years of operation, citing product overlap, customer confusion, and minimal revenue contribution.
In an email to its approximately 100 third-party sellers obtained by TWICE, Best Buy e-commerce president Mary Lou Kelley said the platform would be shut and all listings removed effective Feb. 24. “We believe we can continue to provide a positive customer experience on our site through other product sourcing methods,” she wrote.
Best Buy spokesman Jeff Haydock told TWICE that the Marketplace accounted for only “a tiny fraction of 1 percent of domestic revenue,” and created confusion among some consumers who believed they could return third-party merchandise to the chain’s stores.
There was also a 70-percent overlap in Marketplace items, he said, and “we want to provide a curated list of products we sell.”
Best Buy sellers have variously included such retailers as Beach Camera, Cameta Camera, DataVision, Electronic Express, Electronics Expo, ListenUp, Plessers, Rakuten, Stereo Advantage, Wayfair, Walt’s TV and World Wide Stereo, and such brands as Griffin, Monoprice and Rosewill (Newegg).
At the time of its launch, then-CEO Brian Dunn described the Marketplace as “a key development to our multichannel platform.” The approach has also been embraced by full-line and specialty merchants like Amazon, Jet, Newegg, Sears, Rakuten (formerly Buy.com) and Walmart, and by eager retailers who see it as an important sales adjunct in the e-commerce age.
For Amazon, which charges its sellers a 10 percent sales commission and provides them with profitable fulfillment services, marketplace merchandise accounted for 47 percent of all unit volume in the fourth quarter of 2015 and nearly 60 percent of total sales dollar value, ChannelAdvisor showed.
Haydock noted that the Marketplace reassessment was part of a routine review of all Best Buy businesses, which allows the retailer to free up resources for investment in other areas of the company.
