What: Woolworths' decision to shutter MyDeal, following Wesfarmers' closure of Catch, highlights the unsustainability of standalone marketplace models in Australia's competitive e-commerce landscape.

Why it is important: The A$350 million write-off reveals the significant risks of attempting to compete with established global marketplaces without clear differentiation or integration with existing retail operations.

Woolworths Group's decision to close MyDeal marks a significant shift in Australia's e-commerce landscape. The closure, announced on June 27, follows a strategic review led by CEO Amanda Bardwell, which concluded that the platform lacked a viable path to profitability. Woolworths had acquired an 80% stake in MyDeal for A$217.4 million in 2022, positioning it as a counter to Amazon's growing presence. However, by FY25, MyDeal was projected to contribute approximately A$20 million to a A$65 million loss across the company's MarketPlus and HealthyLife segments. The closure will incur substantial costs, including A$90-100 million in cash-related expenses and a A$45 million non-cash impairment charge. Industry experts suggest that successful marketplaces need to be integrated within existing retail ecosystems, citing examples like Bunnings and Myer, where third-party sellers complement established brand equity and customer relationships.

IADS Notes: The closure of MyDeal reflects broader trends in global marketplace dynamics observed throughout 2024-25. In October 2024, Amazon launched its "Haul" platform to compete with emerging players like Temu and Shein, demonstrating the importance of established infrastructure and customer base. By April 2025, regulatory changes significantly impacted cross-border marketplace operations, with major players reducing marketing spend and adjusting their business models. Meanwhile, traditional retailers like Myer have found success through integrated approaches, as evidenced by their January 2025 merger with Premier Investments, focusing on leveraging existing brand strength and customer relationships.

What the closure of MyDeal signals about the future of marketplaces in Australia