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Amazon to launch budget marketplace to compete with Temu, Shein: The retailer is copying their playbook鈥攃omplete with cheap products and longer delivery times鈥攖o stay ahead in the ecommerce race.

Those initiatives include lower delivery fees and promotions, as well as moves by some grocers鈥攕uch as Kroger and Schnucks鈥攖o match their pricing on Instacart鈥檚 marketplace to in-store prices. Adding restaurant delivery has also helped increase order frequency, especially among Instacart+ members who receive free delivery on orders over $35.

New rules could hold ecommerce marketplaces liable for the sale of prohibited or counterfeit items. Shein is also under investigation for its business practices, adding another layer of uncertainty.

US retail marketplace ecommerce sales will grow 11.4% to reach $428.30 billion this year, per our forecast. Because Amazon (73.4%) and eBay (8.2%) will rake in the majority of those sales, smaller marketplaces like Shein, Michaels, and Wayfair are getting creative and taking the battle for sales in-store.

Ecommerce may be hit particularly hard after President Donald Trump ramped up tariffs on China to 245% and announced plans to tighten regulations on de minimis imports from China and Hong Kong鈥攎oves that will likely dampen sales from Chinese-based sellers on online marketplaces operated by retailers like Amazon and Walmart, as well as reduce growth for platforms like Shein and Temu.

As brands seek to diversify the number of places they sell their goods, retailers should consider building out a marketplace model that can help brands reach more customers while also cutting down on retailer costs and creating new revenue streams. You don鈥檛 need to be Amazon to launch a third-party marketplace鈥擬acy鈥檚, Michaels, and H&M have all gotten marketplaces off the ground in the last year or so.

US ecommerce marketplaces will account for $384.57 billion in sales this year, a growth of 10.2% over 2022, according to our forecast. That growth will accelerate through the end of our forecast period in 2027, at which point sales will surpass $600 billion. 鈥淎mazon has really written the playbook for operating a successful marketplace in the US,鈥� said our analyst Sky Canaves. Here鈥檚 a closer look at how the three biggest US ecommerce marketplaces stack up.

On today's episode, in our "Retail Me This, Retail Me That" segment, we discuss the sizes of different digital marketplaces, what their unique selling points are, and why smaller retailers are building out their own. Then for "Red-Hot Retail," our analysts give us four spicy predictions about the future of digital marketplaces. Join our analyst Sara Lebow as she hosts forecasting analyst Whitney Birdsall and analyst Sky Canaves.

Shein may soon directly compete with Alibaba and Amazon: The fast-growing fashion retailer is reportedly exploring evolving into an online marketplace that enables other merchants to sell on its platform.

US retail marketplace ecommerce sales will reach $603.20 billion in 2027, representing 34.8% of total retail ecommerce sales, per our forecast.

Walmart Marketplace is thriving: Black Friday and Cyber Monday were the two best-selling days on the platform, and those strong results are providing a boost to Walmart Fulfillment Services.

40.4% of US shoppers started their shopping journeys in marketplaces in 2023, down from 51.5% in 2022, according to a February 2024 report from Attest.

A quarter of US shoppers are influenced to buy products via ads on retailers鈥� websites, according to new research from Intellias, as reported by Search Engine Land. This is compared with just 13% of consumers who are influenced by ads on third-party marketplaces and 14% who buy after seeing social media ads.

But that success is mostly because of its firmly entrenched Marketplace product that鈥檚 turning 8 years old this year. Without Marketplace, TikTok would likely take the lead. Our survey found that 735 US social shoppers, or 60.9%, had bought something while using Facebook. A sizable number of them鈥�460 respondents鈥攊ndicated that they had purchased something from Facebook Marketplace.

Marketplaces are fighting for the crown in US ecommerce. Though Amazon remains solidly atop ecommerce sales, Walmart and Shopify are attempting to carve into Amazon鈥檚 revenues. Here are the latest updates in ecommerce, advertising, and partnerships from these major players.

The retailer is also broadening its appeal to shoppers via its marketplace, which has expanded its assortment by nearly 700 million SKUs. Those efforts are paying off: Marketplace sales grew 42% YoY in Q3, the fifth-straight quarter of growth over 30%. Walmart went all in on generative AI (genAI).

Etsy fights against Amazonification with new seller policies: The marketplace is overhauling its product designations to ensure all items have a human touch.

Starting next month, marketers鈥� shoppable display campaigns will be automatically extended across Instacart鈥檚 marketplace and Caper Cart鈥檚 digital screens. DoorDash is rolling out post-purchase banner ads in select categories to encourage customers to supplement existing orders by adding items from other stores.

Thanks to the strong penetration of Marketplace, Facebook claimed the largest share of social shoppers in our survey. More than 60% of respondents said they鈥檇 purchased something while using Facebook in the 12 months preceding our poll. But that did not result in Facebook shoppers significantly overindexing for purchases in any specific product category.

As CEO of Michaels, Buchanan employed a multipronged strategy to revive that retailer, including streamlining its supply chain, improving store cleanliness, restocking shelves, opening new locations, and revamping its website to enhance usability and introduce an online marketplace.

Lowe鈥檚 in December mapped out its long-term plan to gain share, which includes expanding its physical footprint, broadening its selection in rural stores, launching an online marketplace, and revamping its pro rewards program. Home Depot has invested heavily in its pro business to ensure it appeals to contractors of all sizes.

Western Europe鈥檚 regulatory backdrop continues to evolve, and stricter rules for digital players will disrupt Big Tech and Chinese marketplaces in 2025. At the same time, retail media and genAI adoption will accelerate, creating opportunities for growth across advertising and commerce. Regulatory enforcement will fundamentally affect Big Tech鈥檚 business models.