Amazon appears to be an almost unstoppable behemoth, releasing a new revolutionary retail concept almost weekly. From the Amazon Dash to this week’s announcement of a grocery store with no payment tills, it seems like an exercise in futility to take them on.
Yet, in true British style, one company has a plan to challenge the retailer with little more than a smart idea.
Onbuy.com chief executive Cas Paton is the David to Amazon’s Goliath, pioneering the UK’s first subscription-based marketplace.
The concept behind Onbuy is simple, yet could change the online retail marketplace entirely.
Instead of charging sellers a commission on goods they sell, the model which has gleaned such success for the likes of Amazon and eBay, Onbuy charge a monthly subscription of around £50, allowing sellers to advertise as much as they want for as much as they want.
“The monthly subscription model gives consumers confidence that we are here to dominate market share,” Paton says.
“By not charging commission it means sellers can actually offer a lower price than they would normally offer. They could drop their price by 10 per cent and still make five per cent more than on Amazon. That is a brilliant way for us to launch.”
“I think the British populous are keen to find an ethical marketplace they can buy from.”
Despite the website already being live, with huge marketing campaigns planned for early next year, Onbuy started with a very different concept.
“We started the business in 2012. We soft launched in 2013, originally working with a large investor. There were three partners, I was one,” Paton reflects.
“I had a different idea about the business, so I ended up undertaking a management buyout in 2014. I bought it from them so I could build it and launch it in the way I thought was best for Onbuy.
“Originally the opinion was to follow in the footsteps of Amazon in the sense it was commission based. My feeling was that to take on a retail giant such as Amazon head to head, even at a few per cent cheaper, I think is an impossible task that needs some very very deep pockets.
“Amazon charge around 15 per cent, the partners I was working with were proposing 12 which doesn’t equate to a significant enough to discount to warrant users using a new marketplace they know nothing about.
“The one thing we didn’t really have was a clear USP.”
Onbuy’s USP is key, as Paton says “customers are very difficult to convince to use any new outlet” and it would take something great to draw people away from what they’re already familiar with.
Aside from its ground-breaking subscription model, Onbuy has many essential traits that should succeed in convincing people to make the jump.
One is familiarity. The platform will adopt all the features that make their favourite marketplaces so easy to use like in-depth categories and the ability to save card details and multiple addresses.
“Sellers are sick of selling on marketplaces that compete with them.”
Another key selling point is its promise to never act as competition to their users.
“Sellers are sick of selling on marketplaces that compete with them,” Paton says.
“What has happened over the last few years, and is accelerating, is that Amazon retail has learned or seen which products sell really well (on Amazon Marketplace) they then source that product and sell it directly.
“They don’t have to pay the sellers fees. They will then