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TheStreet Open House

Sears Launches Third-Party Marketplace

(Updated with additional Macy's comment.)

NEW YORK( TheStreet) -- Sears (SHLD) is following in the footsteps of Wal-Mart Stores (WMT) with the launch of a third-party marketplace.

The department store confirmed that the new service has been integrated with Sears.com to allow merchants to list their products on the site.

"The Sears' Marketplace platform provides new opportunities for us to deliver more shopping choices to our customers as well as open up new lines of communication with our business partners," the company said. "This current platform expansion is an evolution of a process we established with Internet partners last November 2008."

Earlier this month Wal-Mart announced it would add outside vendors to its Web site.

In August, Sears's site had 15.7 million unique visitors, Wal-Mart's 33 million, Amazon 69.5 million and eBay 76.8 million, according to Compete, a web analytics firm.

As more traditional retailers embark on this strategy, it could pose a problem for online retailers like Amazon.com (AMZN)and eBay (EBAY), which originated the third-party marketplace concept.

But at least one department store says it has no intention of climbing aboard the third-party train. Macy's (M) spokesperon Jim Sluzewski says the company's focus is "growing out business through multichannel integration of stores and online."

And Needham analyst Charles Wolf says he doesn't think any bricks and mortar retailer embarking on a third-party market place will surpass Amazon.

"Amazon is one-tier and Wal-Mart and Sears are two-tier," he says. "That means Amazon can sell at dramatically lower prices online, which, in turn, means Wal-Mart and Sears can't match Amazon's prices."

Amazon and eBay have also been working to upgrade their offerings. EBay launched an outlet section on its Web site, selling up to 70% off brand names. EBay hopes this move will allow them to become more attractive to retailers.

Earlier in the month the company also announced a partnership with designer Narcisso Rodriguez. Rodriguez, who is best known for dressing Michelle Obama, will create a lower-priced collection exclusively for eBay.

Amazon is also growing its merchandise selection by moving into private-label merchandise. In June the company launched a new collection of private-label kitchen utensils and now has its own design and sourcing team on staff.

-- Reported by Jeanine Poggi in New York

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