Why Promote Your Online Store on E-Commerce Marketplaces?
A website and an online store are musts for e-commerce, but they’re also only a good start.
Industry analysts say small online retailers also need to establish a presence on multiple marketplaces to stay competitive and reach more potential customers.
You have more marketplace options than you may realize—and because the marketplace marketplace is so competitive, many marketplaces work hard to make selling, shipping, and marketing easier for their merchants.
Nearly all consumers—97%, as of June 2017—search on marketplaces at least some of the time.
Avoiding marketplaces means missing out on product searches by virtually all online shoppers. Not only that, but about a third of shoppers search on marketplaces before heading to a retailer’s own online shop, which means marketplace accounts are marketing tools as well as points of purchase.
So signing up your store for one of the big marketplaces like Amazon or eBay should be all you need to do, right? Probably not.
The marketplace industry is growing, with new, niche, and international options coming online all the time. For example, Tokyo-based Mercari’s June IPO raised $1.2 billion and it’s planning to expand its current US peer-to-peer market.
Limiting yourself to one marketplace limits your exposure to potential buyers. Sticking with big marketplaces also means ignoring smaller marketplaces that may cater better to your audience.
And each marketplace has its pros and cons – one may have more visitors overall, while in another your shop has less competition. Your shop doesn’t need to (and couldn’t possibly be) on every marketplace, but being on the right marketplaces for your business is important.
Major E-commerce Marketplaces
Here’s a quick rundown of some of the largest and best-known marketplaces along with a few niche options and some peer-to-peer platforms that can also work for certain types of small business.
1. Amazon Marketplace
Amazon Marketplace reaches 150 million unique visitors in the US each month, plus more abroad. The marketplace offers businesses who pay a base monthly rate of $39.99 more support and options than individual Amazon sellers receive, like payment processing, geolocation-based offers, and fulfillment.
2. Walmart Marketplace
Walmart Marketplace reaches 110 million monthly visitors and only charges referral fees on each sale. Those fees range from 6% for personal computers to 20% for jewelry, with everything else at eight, 12, or 15%. Store owners have to pass Walmart Marketplace’s approval process, which can take up to two weeks.
Ebay had 113 unique US visitors a month in late 2017. Like Amazon, eBay gives individual sellers and businesses a platform for selling. Businesses can choose from a range of monthly plans that include a set number of listings, from a couple hundred (like my tiny resale shop where I offload thrift-store finds) to several thousand. Store subscriptions come with marketing tools, store customization capabilities, and reports.
Etsy, which started as a marketplace for crafters and artisans, reaches some 19 million shoppers. It just announced changes that include new paid plans for shop owners that come with more tools than the free plan. Etsy focuses on handmade goods, vintage, craft supplies, and items manufactured in compliance with the company’s policies. Etsy also connects retail buyers with sellers that have the capacity to produce wholesale lots.
Other US Marketplaces
Besides the “big three” marketplaces, you have other options.
- Japan-based Rakuten runs a US-only marketplace for US sellers that charges monthly fees plus a commission and fee on each sale.
- Sears runs a marketplace with a similar fee structure.
- Tech marketplace Newegg operates in 50 countries and offers tiered membership plans, discounted fulfillment help, and promotion tools.
- Bonanza is a smaller marketplace that excels at getting seller’s wares to rank high in Google search results through careful optimization and helps sellers manage their inventory across marketplaces.
If your business is already thriving at home, it may be time to look for growth overseas. Depending on demand in foreign markets and your budget for cross-border selling costs, expanding into Latin America and Asia may be doable.
MercadoLibre is the biggest online marketplace in Latin America, and it offers shipping and translation support for merchants outside the region who want to reach its 33 million customers. Approved merchants pay a 16% commission on sales, with no listing fees, but there is a $500 minimum for wire transfers to merchant bank accounts.
Alibaba is China’s largest operator of online marketplaces, with more than 440 million customers. The company’s Tmall Global platform is open to US merchants who pay commissions on sales plus yearly fees that range from $5,000 to $10,000 depending on the category, so it’s a viable choice only for small businesses with budgets that can accommodate the fees.
Other Marketplace Options
There’s not quite a marketplace for every type of product, but there are a lot:
- For runway designer clothing resale, there’s TheRealReal.
- For fine jewelry and watches, TrueFacet.
- Partsmarket is one of several auto parts marketplaces.
- Reverb caters to musicians looking to buy or sell instruments and gear.
Whatever you sell, check to see if there’s an active, specialized marketplace for it.
How to Track All Your E-commerce Marketplaces
As you add marketplaces, be sure to track your traffic and sales in each new channel, so you can see which of your new channels is delivering the best results.
If your business is very small and you’re only selling on a couple of marketplaces, you may be tempted to try to manually track your sales across all your channels. At best, this is not the highest and best use of your time as a business owner. It’s a shortcut to unhappy shoppers if someone buys the last of an item in your store only to learn that it’s actually out of stock because a customer on another marketplace already snagged it.
It’s a better idea to start using multichannel management tools when you set up your marketplace accounts, so your inventory, fulfillment, and shipping are synced from the start. If you’re just adding a couple of marketplaces, your e-commerce service may have plugins available so you can manage everything from your shop dashboard.
Another option is a third-party service like ChannelUnity or SellerDynamics that offers integrations among a dozen or more different platforms and marketplaces.
Choosing E-Commerce Marketplace for Your Online Store
The bottom line on marketplaces is that they’re where the customers are these days. Research your customers to find out which marketplaces they spend their time on, look into fees and selling requirements, and go meet your audience where they like to shop.