Recommerce is the new Ecommerce
Amazon Prime is going to be fabulous this year
Amazon has been having an amazing year — its stock price is touching all time highs, Prime subscription is on track to become more popular than cable subscription, it has acquired grocery chain Whole Foods and they even have their very own ‘holiday’.
This is going to be the third annual Prime Day and also the most anticipated and nearly every major news source has a list of the most anticipated deals for Prime Day.
The Scarcity Effect
Scarcity is one of the fundamental principles of social psychology and marketing.
Simply put, it means this:
Humans place a higher value on an object that is scarce, and a lower value on those that are abundant.
And it is one of the most commonly used marketing tactics for big and small companies. Having one day a year where many coveted goods are offered with a steep discount creates scarcity.
Even if the object itself is not scarce, the price offered is time-bound and the deals limited. This scarcity makes people buy things on an impulse. Who cares if I don’t need that french press right now, I don’t want to be paying much more for it later.
Such logic leads to excess shopping and while it does save us a lot of money on things we really wanted it also generally leaves us with tonnes of unwanted stuff.
Ecommerce already has a higher return rate than brick and mortar with over 30% of goods shopped online being returned versus only 8.89% for physical store. Not only that over 90% of the customers will buy something again if the returns process is easy.
Consumers expect a seamless returns process before they shop and Amazon excelled at providing it to them. With Prime they took it to another level with 2-day shipping, easy returns, same day shipping for selected goods and access to Prime Video.
So Prime Day- while amazing for customers - will also mean a flood of returns when people realise they don’t quite need everything they bought.
And it’s not just Amazon. Prime Day means other big retailers are also cutting prices to stay competitive. Retailers just as Best Buy and Macy’s also announced deep discounts around the same time as Prime Day.
It’s a shopping bonanza. But it will also be a “returns” flood.
What’s going to happen to all the returns?
This is where reverse logistics companies come into the picture. Reverse logistics companies help in the process of moving goods back from their typical final destination. For ecommerce that means collected returned goods from consumers or excess supply from retailers and manufacturers. They then resell this returned or excess merchandise with steep discounts.
Continuing the cycle of ecommerce via recommerce
Recommerce or reverse commerce is the process of selling refurbished or unwanted good over an ecommerce platform. An item that was returned by one customer might be valuable to another customer when offered at a steep discount. This prevents the product from going to a landfill and extends the lifespan of products. Not only is recommerce environmentally friendly but it also adds huge value for consumers looking to save money.
Events like Prime Day, Black Friday and Cyber Monday are great for consumers because they provide a monetary value. Recommerce is the trickle down effect of these events. Since the process involves re-retailing products that have already been listed once before setting up ecommerce websites is an easy and painless process. Simply plug into our product data APIs to pre-populate your catalog and have your site up and running in no time.
Interested in setting up a recommerce website? Get product data instantly.