Three marketplaces that sell in a particular category were featured in the latest issue of Internet Retailer's Hot 100, which profiles the most innovative online retailers. Here's a snapshot of Houzz, Tradesy and Orchard Mile.

Marketplaces are popular online shopping platforms because customers are attracted to the large number of products available, typically at lower prices.

In fact, Internet Retailer estimates marketplaces accounted for roughly 50% of global online retail sales in 2017. The world’s largest marketplaces, operated by Alibaba Group Holdings and Inc., dominate the industry. But there are a number of other marketplaces growing at a rapid pace as well.

Marketplaces face a similar challenge as the rest of the e-commerce industry: How do you acquire customers who are increasingly shopping on Amazon? One way shopping platforms have succeeded is by selling products in one particular retail category, such as apparel or furniture.

Three of those marketplaces—Orchard Mile, Houzz and Tradesy—were featured in the latest edition of Internet Retailer’s Hot 100, which highlights the most innovative online retailers of the year. Here’s a snapshot of each of these companies’ unique strategy to acquire and retain customers.


Luxury apparel marketplace Orchard Mile, No. 72 in the newly released Internet Retailer 2018 Online Marketplaces ranking, aims to offer shoppers a personalized shopping experience—something the online apparel industry often lacks, says co-founder and CEO Jennie Baik. Take, for instance, My Mile, a page on the marketplace that shows a shopper a personalized feed of products curated based on filters customers choose: designers, sizes and wish lists. Consumers see the feature, which launched in June, after they register and log in to the site.

“The issue with marketplaces is that there’s so many products, so how do you dig through all of that? We don’t get rewarded for offering more SKUs,” says co-founder and CEO Jennie Baik. “My Mile is the answer to that. We give them the universe, but make it really easy to shop.”


“We track and measure and test, obsessively,” says Kamini Rangappan Lane, chief marketing officer for luxury consignment retailer Tradesy Inc., No. 34 in the Online Marketplaces ranking. The retailer wants to ensure it sends the right marketing message to the right group on the right platform. To achieve this Tradesy uses consumer data on what shoppers have previously looked at where and when to segment and personalize its marketing messages, she says. For instance, when the retailer recently launched a customer acquisition campaign focused on trendy designer handbags, it targeted female luxury shoppers with an affinity for certain brands on Instagram. Consumers who visited the site from the campaign viewed 25% more pages and had a 28% lower bounce rate than the average shopper.


Online home furnishings marketplace Houzz Inc., No. 10 in the 2018 Online Marketplaces ranking, is building a strong foundation for the future thanks to the wide selection on its platform and the massive amount of funding it has raised. In June, Houzz raised $400 million in a funding round led by Iconiq Capital aimed at fueling its international growth, the second nine-figure funding round raised by the company in the past three years. Houzz has more than 10 million products for sale in its platform from more than 20,000 sellers. The company attracts more than 40 million unique monthly visitors to its app and e-commerce site. Houzz has just about everything a consumer needs to embark on a home renovation project under one roof. is much more than a marketplace. It is also home to more than 14 million home interior images designed to inspire shoppers for their home improvement projects, and a place where consumers can select from 1.5 million home professionals from about 60 categories, such as contractors, flooring experts and architects.


To read about other innovative online retailers, download the free issue of Internet Retailer’s 2018 Hot 100.