d stronger economics of integrated marketplace models, such as those tied to existing retail ecosystems, as key reasons for the exit. “Woolworths’ closure of MyDeal proves that the standalone marketplace model has very little future. Without massive scale, deep differentiation or a unique customer value proposition, local marketplaces simply can’t compete with global juggernauts like Amazon and Temu,” e-commerce expert Mal Chia told Inside Retail. “MyDeal was always fighting a losing battle. Woolworths tried to play Amazon’s game without Amazon’s infrastructure, data or customer base,” he added. According to its ASX announcement, Woolworths acquired an 80 per cent stake in MyDeal in 2022 for $217.4 million, positioning it as a digital counterweight to Amazon. However, by FY25, the platform was projected to contribute approximately $20 million to a $65 million earnings before interest and taxes loss across the company’s MarketPlus and HealthyLife segments. Closing the business will incur cash-related costs of $90 million to $100 million, alongside a non-cash impairment charge of approximately $45 million. A $350 million lesson With the closure of MyDeal, following Wesfarmers’ decision to wind down Catch earlier this year, questions are mounting over whether standalone marketplaces can survive in a retail landscape increasingly dominated by Amazon, Shein and Temu.  Standalone marketplaces, like Catch or MyDeal, exist purely as platforms for third-party sellers, without the support or brand equity of a larger retail operation. In contrast, integrated marketplaces such as Bunnings or The Iconic integrate third-party sellers within an established retail ecosystem, allowing for greater control over product curation, brand consistency and customer experience. Chia sees the future as one of integration, not imitation. “The MyDeal failure shows that marketplaces need to be a complementary feature, not a standalone business,” Chia said. “This is a $350 million lesson in staying in your lane. Woolworths did not have a clear execution plan when they acquired MyDeal and now their shareholders are paying the price. Their focus is now back where it should be: on their core strengths and integrated offerings,” he added. E-commerce leader Nicola Clement, who led Myer’s online marketplace integration, told Inside Retail that the “best marketplace offerings” work around an existing audience and have a strong reason for existing. “That is usually as a complementary feature to an existing brand,” she said. “Myer and Bunnings are great examples of having an engaged customer base who value convenience. Through brand and range extensions, they are able to help customers meet more of their needs in one place, so they reduce the time they have to shop around and research,” she added. For retailers, successfully embedding a marketplace requires updating roles, responsibilities and KPIs across the business so that it is viewed internally as an extension that drives incremental sales, not as a threat that cannibalises higher-margin products, Clement said.  She contrasted this with standalone marketplace models that require a distinct value proposition.  “Amazon was able to build an empire through fast delivery, great customer service and huge range, in a time where delivery and customer service for most retailers was barely even an afterthought. They set the standard and captured a market through reliability and convenience,” she said.  “Catch, MyDeal and even the likes of Kogan are ultimately, in my opinion, aggregator sites of other brands with very little point of difference these days. Their product ranges overlapped with many other retailers and we don’t have a large enough market to support all these players,” she added.  The future of marketplace integration The rise of integrated marketplaces has created some user experience (UX) challenges, such as whether to inform customers about who is fulfilling each item in an order – the retailer or a third-party seller.  “When I have run tests making design elements related to marketplaces more obvious (higher contrast, prominent placement), they have shown a sizable decrease in purchases (~10 per cent). Customers are effectively ‘turned off’ by being shown additional information,” retail experience analyst Marieke van Bruggen wrote in a recent LinkedIn post. While the intent was to improve clarity and customer experience, these results show the complexity of balancing conversion metrics with customer satisfaction.  Clement offered some further advice: “Be customer focused, keep it simple, stay true to your brand, your proposition and what your customers love about you. Through leveraging customer insights, [Myer] took a ‘masked marketplace’ approach, where the customer experience does not change based on the fulfilment partner.” The end of imitation With rising customer expectations and fierce competition from Amazon, Temu and Shein, Woolworths’ closure of MyDeal highlights the challenges Australian marketplaces will continue to face without a clear and differentiated value proposition.  As Chia, Clement and other industry experts suggested, success in this space requires integration with existing trusted brands, customer-centric design and operational alignment. For Woolworths and others, the pivot away from standalone marketplaces toward leveraging core strengths and integrated digital offerings may well be the more sustainable path forward in a competitive online retail landscape.