According to a recent survey from British banking firm Barclays, one in four industry leaders believe that the events of 2020 have accelerated a “technological revolution” in UK retail, the world’s third-largest market for eCommerce. Globally, the online retail sector is projected to grow to $6.54 trillion in 2022, up from $3.53 trillion in 2019. It’s easy to assume that Amazon has the lion’s share of this market. But while Amazon is undoubtedly the biggest player in online retail, the company is growing at a slower pace than the market itself, indicating that there’s plenty of appetite from consumers for alternatives.
UK startup OnBuy believes that this is the case and has established itself as a major player in the marketplace arena. On the face of it, OnBuy is offering a comparable business model – an online marketplace where sellers can showcase their goods to consumers. However, the ethical way OnBuy operates has highlighted a chink in Amazon’s armor – that the Seattle-based company actually competes against its sellers for market share.
Amazon started life as an online bookstore, and as it grew, it expanded its reach into different offerings. Among these is an online marketplace, and another is producing its own goods for sale on its website. Therefore, if a vendor selling t-shirts chooses to use Amazon as their sales platform, they risk being pushed down the rankings by Amazon’s algorithm as the company seeks to promote selling its own t-shirts instead.
OnBuy set out to provide a fairer, more transparent and ethical marketplace, making for a more attractive place for retailers to do business. Based on the unprecedented growth of online retail in 2020, it could hardly have picked a better time to start. The company initially started out on its home turf in the UK and has seen a staggering growth of 24,000% since it began operating in 2016. It now has eight million customers and lists over 30 million products. Over 600 new retailers join the platform every month, and customers have given the company a 4.6/5 rating on Trustpilot.
Now, it plans to take its successful growth formula global. In July, OnBuy secured investment worth £5 million ($6.65 million) in a Series A round, which it’s using to fund an aggressive expansion designed to take the marketplace’s unique business model global. It plans to operate in 140 countries by year-end 2023, and has recently confirmed it will continue its partnership with PayPal for the global launch. The expansion is starting with the rollout of 42 new dedicated country websites by the end of 2020. OnBuy believes it can capture one percent of the global e-commerce market in the next five years, generating revenues of over $35 billion.