The Total Economic Impact™ Of Rithum Managed Marketplaces

Cost Savings And Business Benefits Enabled By Managed Marketplaces, A Commerce Solution For Brands And Suppliers By Rithum

Marketplaces are a rapid-growth channel in an otherwise anemic retail landscape. Seventy-seven percent of brand decision-makers say that online marketplaces are growing faster than their organization’s traditional wholesale business.1 Consumers want omnichannel purchasing options and brands need to manage multiple marketplaces without sacrificing profitability. By adopting Rithum Managed Marketplaces, brands can focus on enhancing multichannel presence, streamlining operations, and driving profitable revenue growth.

Rithum Managed Marketplaces, formerly known as ChannelAdvisor Managed Marketplaces, enables businesses to connect their product listings, inventories, and order management systems with leading online global marketplaces such as Amazon, eBay, Walmart, and more.2 These integrations facilitate centralized control and near real-time updates across multiple platforms, allowing for efficient management and synchronization of product data. This is an important capability for brands because the channels through which buyers shop are fragmenting, and the pace of e-commerce change is rapid. There is always a new emerging program or channel, and brands need the ability to integrate and adapt quickly.

Rithum commissioned Forrester Consulting to conduct a Total Economic Impact™ (TEI) study and examine the potential return on investment (ROI) enterprises may realize by deploying Rithum Managed Marketplaces. The purpose of this study is to provide readers with a framework to evaluate the potential financial impact of Rithum on their organizations.3

To better understand the benefits, costs, and risks associated with this investment, Forrester interviewed four representatives with experience working with Rithum. For the purposes of this study, Forrester aggregated the interviewees’ experiences and combined the results into a single composite organization, which is a high-volume brand with $2.5 billion in companywide annual revenues and a growing marketplace business.

Prior to investing in Rithum Managed Marketplaces, their organizations struggled to effectively manage their presence across online marketplaces and channels, leading to inconsistent customer experiences and missed sales opportunities.

After the investment, the interviewees’ organizations scaled their marketplace footprints and drove operating efficiencies.

Key Findings

Quantified benefits. Three-year, risk-adjusted present value (PV) quantified benefits for the composite organization include:

  • Increased speed of scaling to new marketplaces by 50%. The reduction of the average time to market for implementing a new marketplace from 24 weeks to 12 weeks allows the composite to save time and reach consumers more quickly. Each avoided week of marketplace implementation efforts saves the organization more than $14,000 in labor costs. Over three years and the implementation of seven new marketplaces, the faster time to market is worth $893,000 to the composite organization.

For , increased speed of scaling to new marketplaces might be worth over three years.

  • Year-over-year GMV and profit growth. Using Rithum allows the composite organization to reach buyers in their channels of choice, improve its Amazon Featured Offer win percentage, use reporting and analytics to make better decisions, and protect its margins, which helps drive GMV growth without sacrificing profit. The composite realizes 60%, 33%, and 25% year-over-year GMV growth in the first three years of the investment compared to a 10% organic growth rate in its prior environment. When attributing 50% of the growth to the Rithum investment and applying a 10% profit margin, the additional GMV is worth $175,000 in additional profit to the composite organization.

For , year-over-year GMV and profit growth might be worth over three years.

  • Technical labor savings of 600 hours per marketplace per year. Using the channel management solution enables a single-to-many connection that relieves technical resources from managing multiple unique marketplace integrations. The normalized data integrations helps the composite respond to requirement changes more readily, and the standardization of the integrations reduces the time to resolve break-fix issues. Over three years and a maximum of eight marketplaces, the technical labor savings are worth $1.7 million to the composite organization.

For , technical labor savings for marketplace management might be worth over three years.

  • Up to 85% efficiency improvement for marketplace management. Because Rithum offers a holistic approach to managing various marketplace aspects that simplify operational complexities, this allows the composite’s marketplace team to avoid manual tasks like updating catalogs, sharing order status updates, updating product feeds, and conducting inventory management. The efficiencies of scale lead to efficiency gains of up to 80% for the marketplace team and offset the costs of nearly six additional headcount.  Over three years, the additional efficiencies are worth $562,000 to the composite organization.

For , efficiency improvement for marketplace management might be worth over three years.

“I want to make my [organization’s] marketplace operations as efficient as possible. That’s why we work with Rithum.

Director of innovation and product, office equipment

“For us, [the Rithum investment] is justifiable because of the efficiencies of scale and the analytics and insights that we’re gaining. It would require a significant investment on our end in personnel management and in execution to do without Rithum. It also allows us to focus more on strategy versus the operational aspects of running marketplaces.

Vice president of omnichannel, fashion retail

Unquantified benefits. Benefits that provide value for the composite organization but are not quantified for this study include:

  • Working with Rithum on the roadmap for adding marketplaces onto the platform.
  • Receiving advice and guidance from Rithum as part of the managed service.
  • Gaining more visibility into two common marketplace challenges: channel conflict with traditional retail and grey-market concerns.

Costs. Three-year, risk-adjusted PV costs for the composite organization include:

  • Rithum Managed Marketplaces subscription costs totaling $420,000 over three years. Subscription fees for Rithum are based on the percentage of the organization’s estimated GMV.

For , subscription costs might total over three years.

  • Initial implementation costs totaling $283,000. The composite organization pays a one-time implementation fee to Rithum for integration with the platform. In addition, 11 internal business and technical resources participate in the initial implementation of Rithum including the implementation of a primary marketplace.

For , initial implementation costs might total .

  • Marketplace expansion and ongoing management costs totaling $430,000 over three years. As the composite organization adds additional marketplaces, it incurs internal labor costs for integrating those marketplaces. Four internal business resources dedicate 50% of their time to adding new marketplaces and to the ongoing optimization of the marketplace program.

For , marketplace expansion and ongoing management costs might total over three years.

The representative interviews and financial analysis found that a composite organization experiences benefits of $3.30 million over three years versus costs of $1.13 million, adding up to a net present value (NPV) of $2.17 million and an ROI of 191%.

might experience benefits of over three years versus costs of , adding up to a net present value of and an ROI of .

“We’ve been able to take a marketplace business from $9 million to $127 million over four years. I’d say the ROI on this investment is high — probably higher than most will ever see in their careers.”

Vice president of omnichannel, fashion retail

Key Statistics

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    Return on investment (ROI):

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    Benefits PV:

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    Net present value (NPV):

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    <6 months<6 months
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Benefits (Three-Year)

Marketplace scaling and speed to market Marketplace GMV and profit growth Marketplace integration efficiencies Marketplace management efficiencies

TEI Framework And Methodology

From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment in Rithum.

The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Forrester took a multistep approach to evaluate the impact that Rithum can have on an organization.

  1. Due Diligence

    Interviewed Rithum stakeholders and Forrester analysts to gather data relative to Rithum Managed Marketplaces.

  2. Interviews

    Interviewed four representatives at organizations using Rithum Managed Marketplaces to obtain data about costs, benefits, and risks.

  3. Composite Organization

    Designed a composite organization based on characteristics of the interviewees’ organizations.

  4. Financial Model Framework

    Constructed a financial model representative of the interviews using the TEI methodology and risk-adjusted the financial model based on issues and concerns of the interviewees.

  5. Case Study

    Employed four fundamental elements of TEI in modeling the investment impact: benefits, costs, flexibility, and risks. Given the increasing sophistication of ROI analyses related to IT investments, Forrester’s TEI methodology provides a complete picture of the total economic impact of purchase decisions. Please see Appendix A for additional information on the TEI methodology.


Readers should be aware of the following:

This study is commissioned by Rithum and delivered by Forrester Consulting. It is not meant to be used as a competitive analysis.

Forrester makes no assumptions as to the potential ROI that other organizations will receive. Forrester strongly advises that readers use their own estimates within the framework provided in the study to determine the appropriateness of an investment in Rithum.

Rithum reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester’s findings or obscure the meaning of the study.

Rithum provided the customer names for the interviews but did not participate in the interviews.

Consulting Team:

Veronica Iles

Tony Lam

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