John Lagerling, Mercari U.S. CEO, joined The Final Round to discuss the top trending items on the site as parents and teachers prep for the upcoming school year and that state of ecommerce amid the coronavirus pandemic.
MYLES UDLAND: All right. Welcome back to The Final Round here on Yahoo Finance. Myles Udland with you in New York.
Well, as the school year has gotten underway, there has been a laptop shortage as parents try to outfit their kids anticipating, a partial year, full year, half the week, all kinds of combinations of in-person and at home instruction. And this, of course, again putting a lot of pressure on parents to come up with the gear needed for their kids.
One company trying to help fill that void for parents is Mercari. And we're joined now by the company's CEO, John Lagerling.
John, let's just kind of to talk about what you guys are seeing on your platform and sort of how you've tried to kind of keep this market moving with such a rush of demand for parents trying to outfit their kids that, you know, previously probably didn't have their own device, and now they need it to just get through the school year.
JOHN LAGERLING: Yeah, it's been a bit of a perfect storm obviously, where people have rushed to buy these things for their home to set their kids up for studying from home. And whether it's iPads or laptops, we've seen those categories go up 200, 300%.
And what's happening is essentially the same thing as when you run out of sugar, you'll go to your neighbor and see if they have sugar. And it's kind of what we do in the platform. We have other families that maybe have, or people, that have extras that they don't need. You have laptop from last year that you don't use anymore. You upgraded that iPad. But for a lot of people, those items still have a lot of value, especially now when you can't go and get them in the usual channels over the last couple of months.
And I think that's where Mercari's come into the picture and allowed people to buy these preowned items, often almost unused or unused or lightly used, and immediately put them in the hands of their kids that absolutely need them for this new paradigm of learning from home.
MYLES UDLAND: Yeah, so you know, we're kind of getting into this conversation through, you know, laptops, things you need directly for school. But when you think about your platform more broadly in the last few months, where have you seen demand increase? Where have you seen demand ebb? And sort of what patterns, I guess, are you seeing not only among stuff people are buying but what is being listed, I guess, more aggressively by sellers as well?
JOHN LAGERLING: Absolutely. I'd say, you know, things like-- listings are growing in all categories. I think people spending more time home, they want to declutter more because you care more about your home environments. So listings, I think, have grown across the board, from fashion items to electronics.
But the things that have really gone gangbusters in terms of sales have been home furniture, collectibles, toys, things that keep you busy at home, essentially. And those categories have gone up. I'll give you an example. Learning and education toys, up 279%, home and furniture decoration, up 350%, arts and crafts, another thing to feel better and keep busy, up 310%. Posters, prints, up 300% as well.
So really it's about decking out your home in a way, either practically or, you know, emotionally, so that you feel really good while many of us have been sheltering at home, as I am as well, as you can see.
- And John, Mercari is a Japanese company based in Japan. You are the US CEO. Tell us about the sort of how you've been able to build the business here. Because is there this automatic association? How are you able to attract new customers? Because, to be quite frank, there are tons of players in the US space. Why would someone be going to a Mercari versus an eBay versus a Walmart versus Best Buy?
JOHN LAGERLING: Yeah, absolutely fair question. I think the success story that we're seeing in the US is actually similar to what happened in Japan, where the eBay of Japan was Yahoo Japan. So good affiliation there. But we were able to beat them because we produced something, we built something that was consumer first. And I think a lot of these bigger auction platforms are really dominated by players that are, you know, full-time sellers. And we want to be for the casual seller, for regular folks who have extra items that they don't need anymore [INAUDIBLE] but they did purchase at some point.
So I think our mobile first, very consumer-centric strategy, where people are selling to other regular folks, has worked out pretty well. And that's positioned us in a unique way.
I think the other factor is that with Mercari, both in Japan and also here in the US, everything ships. So you don't have to go and do a meet up. And obviously, in the last couple of months that's been a bigger deal. But even before COVID-19, the convenience of not having to try to match your schedule with an unknown person in an unknown place, you know, bringing cash in an item for a transaction, but just getting a shipping label that we provide that is discounted up to 40%, typically, I think that's also been another success factor that, again, is very similar to what happened in Japan that seems to be working really well here in the US as well.
MYLES UDLAND: And then, John, just finally, thinking kind of broadly about where you hope the business goes in the US. Obviously there's been kind of this step change in e-commerce penetration over the last few months. Did this change, did this pandemic, I guess, change what you thought, what the team thought the ambitions could be for your market share in the US or how big that addressable market might be? Or is there still kind of you expect a moderation maybe as things hopefully get back to normal, you know, in the next couple of years?
JOHN LAGERLING: I think this unique situation has accelerated the inevitable that people find the convenience of doing things online. I also do think that re-commerce is something that's always been something that's been on people's minds. But because of the scarcity in the regular e-commerce channels, more people, so to speak, had to go to the neighbor to borrow some sugar. And I think this has happened now where people have found these platforms, including Mercari, and they're willing to buy and from each other, as opposed to everything going via corporate America.
So I feel very confident that we have a good product market fit. And it's been very exciting to be useful to people in this unique situation. And from all the numbers that I can see, and obviously, we looked at this very carefully, we continue to have very good momentum.
And you know, as we head into the [INAUDIBLE], any marketplace that is doing shipping is facing increasing costs for shipping. But we're not going to pass on these surcharges to our customers. We feel like 2020 is a year where we want to really make shipping and buying and selling things on our marketplace really convenient for people. So that's going to continue to be our focus.
MYLES UDLAND: All right. John Lagerling, CEO of Mercari US. John, thanks so much for joining the program.
JOHN LAGERLING: My pleasure. Thank you.