The IRP Offer Addresses the Profit Problem
The eCommerce Industry has a profit problem. McKinsey predicts eCommerce margins of 2 to 5% in a $14+ Trillion market. Even these low margins are skewed UPWARDS by large profitable companies like Amazon. The majority of SME Merchants are NOT PROFITABLE.
With so many failures in eCommerce - profit clearly takes more than TECHNOLOGY, it takes METHODOLOGY. With over 80% of IRP Merchants Net Profitable - the data proves our approach. Some IRP Merchants sell into 60+ countries with 8, 9 or 10%+ net margins - they think this is the NORM and that eCommerce is easy.
The more we research - the more we realise that the IRP Offer is compelling. This article unpacks the IRP Platform and Service Marketplace commercials. It is also a RESET - so that IRP, Merchants and Agencies understand each other. Success = Profit for ALL.
ECOMMERCE SALES ARE EASY BUT PROFIT IS HARD
How are Merchant Fees Invested by IRP?
For many SMEs up to £50M - the IRP Offer is the best in the market. eCommerce Success takes Platform + Services - and with the Service Marketplace IRP provides BOTH. How does IRP invest Merchant fees?
- IRP INVESTS 20–30% in Infrastructure, including Azure hosting, AI systems, PCI compliance and the technical backbone required to run our platform and real-time data processing.
- IRP INVESTS 20–30% in Agencies, Account Management is delivered through Agency partners. These Agencies play a critical role in driving Merchant profitability.
- IRP INVESTS 40–50% in RnD, ensuring IRP stays ahead of the market. Any excess funds are reinvested in R&D with local support services, helping IRP continuously improve the platform.
Why is the IRP Platform so effective? The short answer is that IRP is the only Platform built from the ground up around Merchant profit. It connects everything first party, crunches billions of datapoints - and offers the simplicity of a single Trading Platform - where Marketing, Analytics and UX are ALL built in.
Why did IRP create our Service Marketplace?
IRP thought deeply about the challenge of profitable eCommerce and we came to understand that technology alone isn’t enough. Success requires Technology AND Services - and a Service Marketplace addresses the problem. It is a PROFITFORCE.
Other platforms leave services to chance but our approach is better. Agencies and Service Providers are measured on their results. On IRP's Performance-Based Service Marketplace accountability is built in. When agencies have to deliver, they will deliver.
The IRP Service Marketplace brings all participants together around Merchant profit - creating competition and choice. The Service Marketplace is unique, it aligns all participants and it is embedded into the IRP Platform. It means we are all accountable and more importantly - it WORKS.
Why does IRP Share Merchants Fees with the Agency?
Behind the scenes each month IRP pays Partner Agencies between 20 to 30% of what the Merchant pays us. This "Pass Through Payment" is TRANSPARENT and the values are in the IRP World for all to see. But why do that?
It is part of the Service Marketplace. It's in everyone's interest that Agencies want Merchant sales UP and want Traffic Spend controlled. This motivation creates accountable Agencies driven to deliver results and Merchant profit. Will the IRP model always share fees with the Agency? Yes. We have no plans to change it - it keeps us all aligned.
All IRP Agencies are highly skilled and work to deliver eCommerce profits. Agencies must make money - so they strike a BALANCE between the Transaction Fees they earn and any additional Service fees or retainers they charge directly.
What Services do Agencies provide?
As IRP focuses on Platform - Agencies are the ‘go-to’ team for ALL the day to day Merchant Services.
Agencies are time bound based on their SHARE of Transaction Fees. They may need to augment their Transaction Fees with retainers for smaller Merchants. As Merchants grow the balance changes - it is a dynamic situation based on mutual benefit. Some Agencies may offer additional paid services like PPC and Facebook - or they use providers from the Service Marketplace.
At IRP, our focus is on AI, new features and making the platform more simple. IRP is moving away from day-to-day design - towards a self-service experience. A new flexible UX Editor is on the way. If a Merchant does NOT have Design skills - they will seek Design services from their Agency. IRP will develop Themes but over time we will NOT be directly involved in site design.
IRP plans to move to GMV in Q4 and publish our Pricing
IRP will be moving to GMV pricing in Q4 . The reason for this move is so that IRP rates can be fairly compared with the market. IRP Platform Costs are LOWER and the PROFITS we return for Merchants are HIGHER.
Shopify works off GMV so their headline rates do not match their real world Fees. Shopify Transactions Fees can track ABOVE 6% for international sales. These 6%+ fees are LOST if the goods are returned. The Shopify impression and reality are very different - some analysts estimate 80% of Shopify Merchants are not Net Profitable.
Based on GMV IRP offers the best value in the market. IRP we will be publishing transparent pricing for Merchants up to £10M GMV and above £10M GMV bespoke pricing will be made available.
Conclusion
So why this "Reset" article? Nothing has changed but we need CLARITY so all Merchants understand what IRP do.
Sales are easy but profit is hard. There are no magic solutions in eCommerce - just the reality of a market where 2 to 5%+ Net profit is GOOD. The IRP Platform + Service Marketplace is the only platform built around Merchant Net Profit.
Our aligned model works for ALL parties. It works for the Merchant, it works for IRP and it works for the Agency.
THIS RESETS UNDERSTANDING
