Kogan Marketplace declines amid "soft market conditions"

Kogan.com’s third party seller platform Kogan Marketplace took a hit due to “soft market trading conditions”, following three straight years of growth.

Kogan Marketplace reported gross sales of $260 million in the 2023 financial year, down 28.5 percent from $363.8 million year over year.

The online retailer said the decline was in line with the broader online retail market, with Marketplace seeing highs from the COVID-19 pandemic period in previous financial years.

Kogan.com also said overall seller fees on Marketplace declined by a smaller percentage due to improvements in seller management and experience.

For the overall business, Kogan.com reported revenue of $489.5 million in the 2023 financial year, a 31.9 percent decline from $718.5 million year over year. It also reported a loss after tax of $25.8 million, a 27 percent improvement from last year’s loss of $35.5 million.

“Kogan.com was launched over 17 years ago with one key mission - to make the most in demand products more affordable and accessible," chief executive Ruslan Kogan said.

"That mission has never been more important for our customers than now."

"We are obsessed with delivering Aussies and Kiwis great value products to help them through these difficult times of increased cost-of-living pressures,” 

“FY23 marked a significant milestone in the history of our Business."

"For the first time ever, Kogan.com’s platform-based sales contributed the majority of our Gross Sales and Gross Profit."

"Importantly this has enabled us to deliver better quality earnings as we successfully transitioned into a higher margin, lower risk, platform and software based business while offering our customers increased competition and improved value.

“We have set ourselves up for success in FY24 and beyond, and in doing so, we have ensured we’re in the best position possible to deliver exceptional value products and services to millions of customers.”

Looking ahead, Kogan.com expects Kogan Marketplace to return to growth into the 2024 financial year, particularly with the introduction of a new advertising platform for sellers.

Kogan said that having returned the main business to sustained and increasing underlying profitability in the second half of FY23, the company was looking to FY24 with confidence.

"We expect the number of Kogan First Subscribers to accelerate following the expansion of the program, continued growth in our Verticals, a return to growth in Kogan Marketplace as well as our recently introduced Advertising Platform, the launch of a new Vertical in New Zealand and continued improvement in our Product Division’s profitability.”

“These initiatives are expected to underpin continued growth in the business and support ongoing growth in shareholder value.”