Case Study: Vinted

Case Study:
Vinted

CONTEXT: Vinted is a peer-to-peer platform that enables individuals to buy and sell new & second-hand items, often at competitive prices. However, a key challenge for Vinted is cart abandonment, particularly for low-value items, due to high and unexpected postage fees. This issue is exacerbated by the presence of competitors like Amazon and ASOS, which offer free or integrated postage, creating a higher price sensitivity among users. The proposed solution, a subscription-based "Postage Pass," aims to alleviate this problem by offering discounted or free shipping, encouraging users to complete their purchases and increasing overall sales. This initiative aligns with broader industry trends toward transparent pricing and the growing appeal of subscription and loyalty models.

Hypothysis: If Vinted offers a "Postage Pass", then it will reduce cart abandonment and prevent the loss of sales due to additional postage costs, thereby increasing overall revenue.

Competitor Analysis:

Direct Competitors:

eBay, Depop, and Facebook Marketplace
These platforms provide similar peer-to-peer selling experiences with flexible shipping options, often including buyer responsibility for postage.

Indirect Competitors:

ASOS, Amazon: Both platforms include free postage as part of their appeal, offering streamlined, easy-to-use services with no additional shipping costs at checkout.
Sephora, Pretty LittleThing, Next & SpaceNK: These companies appeal to shoppers who value convenience and fast delivery. They also all offer Postages Packages.

Trends in the Industry:

Increasingly, consumers expect transparent pricing, including shipping costs, up front and activation of 'free shipping' after a certain spend.
Subscription and loyalty models, like delivery services (ASOS, Amazon etc), are becoming key competitive advantages, providing a predictable cost structure and better customer retention.
Vinted used to be a key competitor by allowing users to sell items without any fees. This competitive advantage worked well for a while but the 'no seller fees' model has recently been adopted by ebay meaning that Vinted has lost one of its major unique value propositions.

Busy Mum

Student

Pro Sellers

Buyer Insights

Buyer insight 1

"I often abandon my cart when I see a high postage charge. Often the addition of the postage charge means that the second-hand item in now so close to the price of a brand-new item from a company that I already pay for inclusive shipping for. I’ll just go to Amazon instead."

Buyer Insight 2

“When I’m buying a small item for £1, paying £3-4 for shipping it feels like too much.”

Buyer Insight 3

" Because Vinted has no central postage system, if I want to buy multiple items from different sellers, I have to pay Postage for each item, I often use that as a way to talk myself out of buying anything. "

Seller Insights

Seller insight 1

“I know some buyers are put off by postage fees, when I uploaded my very first Item Vinted offered free postage (I think as an incentive 'cause I was a new seller) If they know it works I don't understand why they can't always make it an option for us.

Seller Insight 2

“I get fewer sales for low-value items—offering free postage could really help but I don’t have the option.”

Seller Insight 3

"Sometimes buyers want something delivered really quickly for a gift or if they're just about to go on holiday. The only postage options are for 2/3 day delivery times. I can see why they just go on ASOS & PLT to get next-day delivery instead and it's often included in their premium postage subscription too. "

Research Findings:

Cart abandonment rates increase significantly when buyers are surprised by additional fees, especially for cheaper items.

The presence of platforms like Amazon and ASOS offering free or integrated shipping increases price sensitivity on Vinted.

Develop

Feature Prioritisation & MVP Definition:

Postage Pass: A subscription model offering a one-off/ monthly payment to cover postage for the year like Amazon Prime or ASOS Premier.
- RICE Score: High — this directly addresses the core issue of cart abandonment.

Seller Boost with Free Postage Option: Allowing sellers to offer free shipping as a way to entice more buyers.
- RICE Score: Medium — may benefit larger sellers more than individual ones.

Reward Program for Free Postage for Limited Time: Offering free postage for a limited period for specific users or categories.
- RICE Score: Medium — creates urgency, but may not solve long-term pain points.

Solution Options Explored:

Postage Pass: A subscription service that reduces postage costs for users, offering a predictable cost structure.

Free Postage Boost: Allowing sellers to add free postage for higher visibility.

Superfast Delivery Option: For urgent or gift purchases, providing faster shipping with guaranteed delivery times.

User Testing & Feedback

Insights from User Interviews:

Postage Pass had the most positive feedback, with users expressing that the subscription model would make them feel more comfortable purchasing multiple items, knowing the shipping costs are covered.

Free Postage Boost received mixed responses, with some sellers excited but unsure how to manage the cost-effectively.

Superfast Delivery was viewed positively for urgent purchases, but users were concerned about the higher costs associated.

Final Solution

Postage Pass:

How it Works: A subscription service offering highly discounted access to unlimited postage. This would be especially beneficial for frequent buyers and sellers, encouraging them to purchase more without worrying about additional shipping costs.

Why it Solves the Problem: By removing the surprise of high postage costs and the somewhat unique issue that if you purchase multiple items (from separate sellers) postage fees will cost you a lot more, the solution reduces cart abandonment, particularly for low-cost items, while encouraging repeat purchases and increasing overall revenue.

Launch & GTM Strategy

Launch Plan:

A/B Testing: Launch the Postage Pass for a subset of users to measure its impact on sales and cart abandonment.

User Education: Announce the feature through in-app notifications, emails, and social media, explaining the benefits of the Postage Pass.

Timing: Launch during peak shopping periods (eg: Christmas season or Summertime ready for holidays) to maximize user adoption and impact on sales.

Measuring Success:

Key Metrics to Monitor:

North Star Metric: Increased revenue from completed sales.

Leading Indicators:
- Reduced cart abandonment rate.
- Increased purchases per user.
- Higher seller engagement with the boost feature.
Lagging Indicators:
- Total revenue growth.
- Improved user retention rates.

Counter Metrics: Increased costs of subscription service could impact margins; monitor user adoption closely to avoid overspending.

Future Iterations

Potential Future Features:

Superfast Delivery Options: Provide expedited shipping for urgent purchases, especially gifts.

Seller Incentives: Reward sellers who offer free shipping with enhanced visibility or promotions.

Postage Reward Program: Reward users who frequently purchase with free or discounted postage.

Closing Summary

Summary: By addressing the issue of high postage fees, the Postage Pass solution directly tackles the core problem of cart abandonment, improving the user experience, increasing sales, and boosting brand loyalty. This solution will not only make purchases more attractive to users but also help Vinted stay competitive in a market where platforms like Amazon and ASOS dominate with integrated shipping options. The expected outcome is an increase in sales, customer retention, and overall platform growth.

Contact

alice.scott7810@gmail.com