OnBuy boss talks 2020 successes and 2021 plans
RTIH catches up with Cas Paton, head honcho at UK-based online marketplace OnBuy, to discuss navigating the coronavirus outbreak, busting e-commerce monopolies, breaking records and going global.
RTIH: As we approach the end of a hugely eventful 2020, what are your key retail takeaways?
Cas Paton: The biggest takeaway from this year is the global switch to online shopping we’ve seen since the start of Covid-19.
The shift towards online shopping was already fast-moving, but this trend leapt forward five years in the space of six months in both the US and the UK. I’m confident that we’re witnessing a lasting change in consumer behaviour.
Alongside this, shoppers have been leaning towards shopping with small and independent businesses more and more. Although the closing of physical retail has been detrimental to many small businesses, retailers that have been able to shift online have been able to reap the rewards of the e-commerce boom.
One of the most recent trends we’ve seen is the desire to get Christmas shopping wrapped up as early as possible. When the UK entered the second nationwide lockdown, we saw a huge surge in users as shoppers scrambled to prepare for a month at home with no physical access to non-essential retail to do their Christmas shopping.
Between 1st and 8th November, users on our marketplace increased by over 600% and our sales growth increased by 837% compared to the same period last year. We believe a proportion of this uplift can be attributed to shoppers getting their Christmas shopping done early.
Products that sold during that week included board games, iPads, perfume, hair styling tools, and console accessories, showing that people were thinking about the festive season nearly two months in advance, which is much earlier than in previous years.
Although online shopping has really taken off, it’s still been a difficult year for a lot of retailers, so I’d say any business that’s successfully weathered the Covid-19 storm so far is a winner.
RTIH: How has 2020 been for OnBuy?
CP: Despite the pandemic, we’ve continued growing at an exceptional rate and we’ve seen a record number of new retailers joining us; our seller base is increasing by 10% every month as we welcome more and more small, medium and large retailers on board.
It’s been a record breaking year for us in many respects – including achieving an incredible 24,000% growth in just four years - and as we’re not a retailer ourselves, all the growth and success we’ve achieved directly benefits our sellers.
For example, online book wholesaler Paperback Shop witnessed an enormous 507% increase in sales on OnBuy between June and September 2020 compared to the same period in 2019.
VidaXL, an international online retailer, experienced more than an 80% leap in sales on OnBuy during just one month alone, from April to May 2020, and sales continue to outpace previous years.
As a result of such rapid growth, we’ve expanded our team. We’ve tripled our workforce this year alone and we’re recruiting for a further 22 positions by the end of the year.
We’ve just announced that we’re opening an additional office in the UK as well, so in 2021 we’ll have offices in Poole and Manchester.
Our growth shows no sign of slowing down, and we’re about to begin our worldwide scale-up into over 140 additional countries, starting with 42 sites in 2020, so we’ll create over 100 jobs in Manchester to support our global expansion.
RTIH: You’ve said that you started OnBuy with the vision that one day soon, the e-commerce monopoly would be broken. How are you faring in that respect?
CP: We’re the fastest growing marketplace in the world and we’ve only just celebrated our fourth birthday, so this really is just the beginning for us.
There’s so much more to come, but I’m confident that we’re firmly making headway in levelling the online marketplace playing field.
Just a few weeks ago we saw major records being broken with nearly 1.5 million users browsing OnBuy between 1stand 8thNovember, and this monumental growth isn’t slowing either.
With over 800% growth this year and Q4 sales records getting smashed week on week, it’s safe to say that the appetite for a fairer, more transparent and ethical marketplace is growing at a meteoric rate.
And with our differentiated approach, OnBuy is a wise move for any online retailer looking to grow their sales with a marketplace they can trust.
We’re about to take the ethical e-commerce ecosystem we’ve created worldwide, giving both small to medium businesses and bigger players across the world equal footing when it comes to growing their customer base.
RTIH: Amazon had a very good 2020, thanks in no small part to the coronavirus outbreak. But they continue to attract a lot of criticism, for instance over their treatment of employees. Are they a force for good or bad?
CP: I firmly believe that any e-commerce platform that positions itself in direct competition with its sellers has a flawed business model, as selling through your own platform is a conflict of interest and tips the scales in your favour.
I’m very vocal about why OnBuy is unique and what this means for online retailers and e-commerce as a whole. Our business model is designed to champion our sellers, not to compete against them.
Unlike other marketplaces, we don’t sell our own products and never will. Our success is our retailers’ success - when we grow, they grow, so everything we do is geared towards supporting them and driving sales for them.
I’m all about providing an inclusive, positive, and transparent company culture as well. I value each and every member of my team and make sure they know this.
I want everyone to thrive and feel comfortable, equal, and appreciated. As CEO, part of this is being accessible, so my door is always open and team members at every level of the company know I’m just a message away.
“I firmly believe that any e-commerce platform that positions itself in direct competition with its sellers has a flawed business model, as selling through your own platform is a conflict of interest and tips the scales in your favour”
RTIH: What are the biggest challenges facing the online retail sector right now?
CP: In previous years, the biggest concerns for retailers around this time of year have been scaling their operations to handle the surge in orders over the festive season.
Retailers are up against the same challenges this year, but the sudden spike and continued uptick in online shopping this year means that many retailers have already adapted to larger order volumes, customer enquiries and so on.
I would say the biggest concern for retailers overall is Brexit – preparing for the end of the transition period in the busiest quarter of the year won’t be easy, but our sellers know they can count on us for support.
RTIH: Online sales have surged this year. Do you expect this to continue into next year, or will things cool down as physical retailers begin to reopen?
CP: With online shopping having increased in popularity significantly during the pandemic, including a 30% increase in online grocery orders, moving to e-commerce should be an absolute priority for small, medium and large retailers. I don’t think this is just a trend, this is a consumer habit and it’s here to stay.
Online platforms have been a lifeline for so many independent British businesses this year. The ability to sell online on platforms like OnBuy - where we work with our sellers rather than competing against them - allows retailers of all sizes to quickly maximise on these emerging trends in shopping behaviour.
The growth in online shopping is at a point that now makes it impossible to ignore and online retail will remain a mainstay long after the global health crisis is solved, yet high street players needn’t feel overshadowed.
While online shopping has classically been seen as a competitor to the high street, it is now coming into its own to supplement and complement physical trading, providing what could look like a long-term solution for retailers of all sizes.
Many brands have already successfully moved to a hybrid or omnichannel operation, proving that online sales can be complementary to, rather than at loggerheads with, a bricks and mortar presence with the right approach, especially if it involves selling with OnBuy.
RTIH: What sort of Black Friday and holiday shopping season are we about to see?
CP: The British public – like the rest of the Western world – have fallen in love with Black Friday, while for retailers, it's the second best date in the Golden Quarter after Christmas.
I predict that the 2020 Black Friday and Cyber Monday weekend will attract record numbers of shoppers but may see a drop in the following weeks. Job losses and economic uncertainty only encourages more deal hunting.
Shoppers, particularly parents, will be keen to secure the best gifts at the very best prices and so will be shopping around to secure the lowest price possible over the Black Friday weekend.
However, this trend is likely to continue well into 2021 so retailers should be prepared for shoppers to be less willing to purchase unless the price point is competitive.
We’re encouraging the British public to support independent retailers this Black Friday and beyond through an e-commerce platform that truly has the seller’s best interests at heart. That’s why we’ll be dropping more than £50 million in prices in this year’s site-wide Black Friday Price Crash sale.
Our approach to sales reflects our fair, supportive ethos: we drop our selling fees to offer our customers discounts, rather than expecting our sellers to foot the bill, so sellers can have the best possible Black Friday.
Our sellers can also add their own discounts on top of ours to really make the most of the surge in customers.
RTIH: What can we expect from OnBuy in 2021?
CP: Our major £1 million TV ad campaign, which is currently airing across all ITV channels nationwide, sets the tone for what you can expect from OnBuy in 2021… big things!
We’d planned to launch a TV campaign in 2021 but given how difficult this year has been for retailers, we brought our plans forward to give them an extra boost for the festive season.
We’re planning to launch an OnBuy app next year for both iOS and Android to offer customers even more convenience. Additionally, as I mentioned, we’re in talks to secure office space in Manchester as part of a £10 million investment into our expansion, which will create at least 100 jobs in the area over the next two years.
We’re in the process of a worldwide scale-up into over 140 countries by year-end 2023, starting with 42 initial sites by year-end 2020.
Using a combination of 525 million products, robust global partnerships and an efficient infrastructure, we’re rapidly scaling into more territories than any other marketplace has been able to reach before. Each country will have a completely tailored platform with local currency payment enabled unlike other major e-commerce platforms.
We have so much more in the pipeline, so 2021 will be another incredible year for both us and our sellers – watch this space.
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