CommerceHub

How Much do Product Assortments Change?

Product assortments aren’t static. They change on a weekly and even daily basis as products are added and removed.

Marketplaces see changes in product assortments for very different reason than 1st-party retailers. A Marketplace platform such as Amazon or Sears, shares control of the product assortment with the seller. The Marketplace approves all listings, but cannot necessarily keep sellers from delisting products. The Marketplace might also delist products when a seller doesn’t have the required fulfillment performance.

1st-party retail works differently. A large brick and mortar retailer might take time selecting products, and execute fulfillment contracts with a manufacturer or distributor. Once a product is added to the storefront, it usually stays there for a while, and might only be removed when the product itself nears the end of its lifecycle or inventory is depleted.

Here is the question for this week: do Marketplaces have a more variable product assortment than 1st-party retail?

The answer is interesting: in the average week, Marketplaces have a net change in assortment size of about 12%. 1st-Party retail has a net change in assortment size of about 9%. Those number appear close, but the absolute difference when measured in products is gigantic.

Remember that in a prior post I showed you how Marketplaces account for 96% of all product listings across the 11 retailers and marketplaces that we monitor — over 340 million product listings! This means that in the average week a Marketplace might see a net change of 15 million products added or removed. The average 1st-Party retail site will only see a net change of 145,000 product listings.

Your typical Wal-Mart Super Center will carry around 150,000 items. That means the marketplace is adding or removing a quantity of products roughly equal to 100 Wal-Mart Super Centers.

The fact that 1st-Party retail sites are adding or removing products almost equivalent to one Super Center is impressive enough. But the variation we are seeing at Marketplaces is truly astounding. Even more so when you realize that those changes are a mix of new sellers joining, sellers leaving the marketplace and the marketplace delisting products because of poor fulfillment performance from the seller.