The document summarizes a webinar about multi-supplier marketplaces. It introduces the presenters and their backgrounds. Sucharita Mulpuru from Forrester discusses lessons from Amazon's marketplace success and key considerations for retailers looking to start a marketplace. Eugene Nikiforov from Ixtens explains how marketplaces work from the perspectives of customers, suppliers and the marketplace owner. Case studies are presented of companies that used Ixtens to set up successful marketplaces.

2. Agenda Brief Introduction of Ixtens and our Speakers Marketplaces in Action with Eugene Nikiforov What You Need To Know About Marketplaces with Sucharita Mulpuru Q&A How Marketplaces Work Copyright Ixtens, Inc. © 2011

4. Some of Our Clients Copyright Ixtens, Inc. © 2011

5. Ixtens Products Copyright Ixtens, Inc. © 2011

9. Amazon is the new Walmart

10. Trend 3: Investment in online marketplaces “ One of the most significant facts regarding eCommerce in recent years is how Amazon.com is growing faster than the rest of the eCommerce industry…. Retailers that compete with Amazon have come to discover that offering marketplaces on their own sites is critical to driving margins and remaining competitive on the prices and the shipping fees of the items they do stock in inventory. “

11. Agenda Lessons from Amazon’s marketplace Key considerations

12. Amazon is the force to reckon with online

13. This is a relatively recent notion Source: Amazon annual reports 2000-2010 Profitable Small and erratic! Profit as a % of sales NA NA NA 1% 8% 4% 2% 3% 3% 4% 3%

14. And oddly enough, this profit came in a counterintuitive way US Marketplace revenue and GMV ($B) US Marketplace Revenue as a profit driver Source: Amazon SEC filings; Forrester analysis

15. What is the marketplace? A product offered for sale by Amazon.com The same product on the same product detail page offered by other sellers

17. Some retailers have learned this the hard way, and others likely will follow

18. The implications of this business model are transformational Retailer 1 Retailer 2 Retailer 3 Consumer electronics sales 5% 10% 15% Est. margin from CE sales 0.5% 1% 1.5% Other categories 95% 90% 85% Old profit 1% 2% 4% New profit 0.5% 1% 2.5% % decline in profit -50% -50% -38%

19. Agenda Lessons from Amazon’s marketplace Key considerations

22. Two other important facts: consumers don’t really shop around… “ Thinking about your most recent online purchase, approximately how many online retailers did you visit during the purchase process?” Base, 3,179 US online adults Source: Q2 2010 Forrester Consumer Technographics Online Retail Survey

23. … and they seek selection and variety online Source: Q2 2010 Forrester Consumer Technographics Online Retail Survey Percent agreeing with statement Base: 4,114 US online adults

24. Thank you Sucharita Mulpuru [email_address]

25. Marketplace Origins How It Works Marketplace Today Marketplace in Action Agenda Copyright Ixtens, Inc. © 2011

26. Marketplace Origins Throughout History In the Age of eCommerce Buyers Money Buyers Money Copyright Ixtens, Inc. © 2011 Manufacturer Dropshipper Webmerchant

27. Amazon has proven the marketplace concept 1995 only books 1998-99 music, DVDs, toys, electronics, tools, and hardware 2002 Launch Amazon Marketplace (3rd party sellers) 2004 Launch Webstore Services 2010 40+ product categories Marketplace Sales are > 30% of Total $16 Million $610 Million $3.12 Billion $6.92 Billion $34.20 Billion Copyright Ixtens, Inc. © 2011

29. Marketplace Checklist Online Retailers I want to become a one-stop destination for my customers I want to expand my catalog without large inventory investment I want to experiment with selling adjacent categories ✔ ✔ ✔ Copyright Ixtens, Inc. © 2011 Media Companies I attract some traffic My visitors are loyal and trust my website My visitors could buy products related to my content I want to add a new revenue stream ✔ ✔ ✔ ✔

30. Marketplace Benefits Copyright Ixtens, Inc. © 2011 BENEFITS RETAILER MEDIA Increase your product offering Sell 3 rd -party products under your brand ✔ ✔ Get rid of your inventory cost Suppliers handle inventory, fulfillment and returns ✔ ✔ Simplify suppliers integration One-time onboarding of multiple suppliers ✔ ✔ Gain new float revenue Collect payment and pay suppliers after 15-30 days ✔ ✔ Transform your content readers into customers Stop sending your readers away when they are ready to buy Own the customer and the data ✔ Transform your advertisers into suppliers Extend your relationship with your advertiser ✔

33. Marketplace Fulfillment Customer Browses Catalog Items Marketplace Supplier A Supplier B Supplier C Single-Cart shopping experience Each Supplier responsible for fulfillment Unified Marketplace Catalog Marketplace Routes Order-Items to each Supplier Copyright Ixtens, Inc. © 2011

34. Marketplace Payments Customer Makes Purchase Payments $ Merchant A Merchant B Merchant C Your Marketplace is “ Merchant of Record ” Suppliers paid weekly or monthly Markeplace settles with Merchants Minus 8-20% Marketplace fee You Manage and Promote Destination Site $ Marketplace Collects Payment/ Holds float up to 30 days Copyright Ixtens, Inc. © 2011

35. View of a Marketplace Platform Copyright Ixtens, Inc. © 2011

38. Marketplace! Copyright Ixtens, Inc. © 2011