Freespee

The Future Of Marketplaces: Vik Barodia, eBay/Gumtree

Vik Barodia has been Head of Motors at eBay/Gumtree for close to three years, with this position he has garnered a front row seat to the current digital revolution hitting both marketplaces and the automotive industry. We had a few questions for Vik before his panel appearance at Freespee’s upcoming May 23rd event, “Do we really want to talk to robots?” in London. 


How has the buyer/seller relationship evolved in the last five years?

Gumtree and eBay are all about introductions. By that, we mean introducing buyer and seller so that they can agree on a transaction. That is the basic premise of marketplaces like ours. In the last years, what we have seen is that trust is now the single most important things deciding factor between the two parties. In fact, the “trust-drive” is so strong; buyers would rather pay more to buy an item from a trusted seller than a cheaper, identical item from a “weaker” seller. Trust is formed in many ways – experience reviews, ratings and a verified status all play a significant part.

Gumtree is focusing more on personalising the user experience, do you think the advent of AI will help or hinder this for marketplaces?

Artificial intelligence will play a very important role in the future of classified marketplaces. From booking tickets, buying and selling cars parts, and delivery – all facets of the buyer and seller chains can be impacted by AI. The challenge for marketplaces will be in our ability to use AI to build seamless experiences. Imagine a car part – AI can help the seller accurately list the part correctly for all the relevant vehicles it could be fitted into. The buyer gets the correct part every time. The use of AI can then help the buyer to fit the part themselves with DIY help or book the car into a service centre. All done seamlessly. Or a user buying a dress – AI can help them match that dress to a pair of shoes, handbag and even nail varnish colour – displaying all combinations for the user to choose from and buy. The options are endless – ultimately always driving success for seller and buyer which is what our platforms are all about. Personalising the entire value of any purchase is very much our focus in the coming years.

What part of the auto marketplace environment can be improved by the right technology?

For me, data is the secret to all success, and any technology, whether it be AI or predictive tools for users – dealers and private sellers – needs to sit on reliable and structured data. The auto sector has fantastic structured data, but the industry as a whole is not good enough at generating maximum value from it.

When its a high value purchase like a car, how do you build trust?

Trust on high-value items like a car must be built up for sure, both for buyer and seller, but also on the vehicle itself. Notwithstanding reviews and ratings for interested parties, we at Gumtree and eBay also help build trust in the vehicle itself by screening vehicles before they are listed. Every car listed with a number plate is checked in the background for four key things: Has the car been stolen, scrapped, exported or involved in a serious incident? That means that car is not sellable.
If at least one of these checks is positive, then the vehicle is blocked from being listed on the website. As a result, we ensure two things. Buyers on the platform can be sure that they have a choice of vehicles that are legal to sell that have a sound history. And by making this check visible, we remove inertia from the contact process, i.e. potential buyers do not need to go elsewhere to do this check – we keep the buyer on site and in front of the seller’s vehicle. This is great news for buyer and seller alike.

Do you see a collaboration between auto brands and marketplaces like eBay in the future?

Very much so. We can already see that the huge parts and accessory category on eBay drives vibrancy in the car selling category. We are not far from a world where car manufacturers use platforms like ours (because of the huge amount of traffic that we generate) to provide services to car buyers and car owners alike. The impact of eBay and Gumtree in helping auto brands to drive engagement beyond the car purchase/disposal should not be underestimated as they seek to find a new way to lengthen their relationship with those customers.

What is your view on the increase in car rental via marketplaces especially among millennials?

We are fast becoming a rental economy, and the industry is morphing into rental on demand. Disposable income is low, and millennials, with their funds fragmented in location and only in supply on a gig-to-gig basis, will make car ownership for this category difficult.
Enter CaaS –cars-as-a-service if you like, or any other fad name that can be applied. There are already start-ups with this model – today I need a small town car for a city meeting (renting for function), at the weekend, I need a convertible to go top down to the beach (renting for experience). How these early adopters fare will be interesting to watch as pricing is still quite premium. However as more come to market, and the choice is widened, prices should come down. I fully expect this sector to grow, alongside the more entrepreneurial car owners who use platforms to rent out their cars. It will be stronger as a proposition in cities where car picks up and drop off locations are more readily available as opposed to an out-of-town location. My thought is that it will take some time to become a standard mode of “ownership”, mainly because private leasing is still booming and is very affordable.

What part of the Freespee platform transformed your business? How?

The most significant impact across eBay and Gumtree has been our ability to demonstrate value to our dealers. This is not just about saying how many calls we generate for them as a return on their investment, but also to add value to the process too. The most loved feature we have is that of missed call notifications – telling dealers what number they have missed, but also linking that to the car they have listed. Notwithstanding the benefit of helping them sell more cars, we have been amazed to see how vibrant our Gumtree and eBay motors categories are. We can now claim that in any working day, between our platforms, we generate a call to a dealer every five seconds!
Find out more about Freespee’s May 23rd event here: https://lnkd.in/eeNiZZ8 

Why Buyer And Seller Trust Is A Vital E-Commerce Metric

A question that often arises with the topic of online marketplaces is, “how do you determine their value?” These channels for multiple sources of product are lauded for their ironclad business models and money-making prowess which seems to be unstoppable. “The online retail industry in Europe is expected to be worth around 602 billion euros in 2017, which would mean e-commerce in Europe will grow 14 percent compared to the situation in 2016,” according to E-commerce News. But the bottom line isn’t enough to determine the big value picture.
Success for these centres of e-commerce means a keen awareness of metrics beyond the monetary, but more in the operational structure and how it creates an environment of mutual benefit for brand, buyers, and sellers. Probably the most critical glue binding these three players together is trust.
How do you determine trust levels in the e-commerce realm? Trust metrics can be calculated in a few ways:


A solid customer review system

A 2017 Bright Local survey discovered that “85% of consumers trust online reviews as much as personal recommendations.” Amazon is probably at the forefront of this process, including both commentary and a star rating system for each product on their website. Amazon also offered a Vine Program in 2007 which, “was created to provide customers with more information including honest and unbiased feedback from some of Amazon’s most trusted reviewers.” This was an answer to the growing trend of paid online reviewers and scammers turning heads towards specific items using glowing reviews. While bad eggs are a common problem in marketplaces with a broader influence, developing a transparent system in a business reliant on a community is always a good idea.

Review response

A study by Cornell University found that “failure to respond at all to reviews is costly. Results showed that organisations that did not acknowledge or respond to reviews and customer feedback experienced lower review scores and overall ratings.” The study recommended further that successful management means focusing on the most negative reviews. “Ratings improve more substantially in connection with constructive responses to negative reviews than simple acknowledgment of positive comments.”

Seller happiness

Third party sellers will have their product on multiple marketplaces, and the responsibility falls on the overseeing marketplace to make sure these sellers are always front of mind. The general complaint among independent businesses selling on global marketplaces is the high take rate. “The key issue with take rate in online marketplaces is the tug-of-war between maximising profit and keeping customers within the network,” says The Motley Fool. Consulting with sellers regarding take rates is a necessary procedure, since losing sellers and increasing buyers is a common chicken and egg issue facing online marketplaces. At the end of the day, having a balanced ecosystem of buying and selling is the goal of most online retailers.
Trust metrics isn’t something set in stone, merely a suggestion. Though it seems more and more that in e-commerce, value is determined in multiple ways but always controlled by the community that creates it.
Via: Amazon, The Motley Fool, Cornell University, Bright Local, E-Commerce News.