eCommerce vs. Marketplace: Where Should You Begin Selling Online?

Categories: Business Development, eCommerce, EntrepreneurshipBy Published On: January 31st, 2023

There are countless advantages to selling products online. You can reach more customers than a traditional store, sell at all hours of the day, and avoid the need to construct a physical storefront.

However, “online” is a deep and wide term, especially with the infinite number of eCommerce options and the new sites popping up. Choosing the best place for your company to sell products online can be difficult.

Several retailers consider starting their business on a marketplace or by developing their own website.In the beginning, let’s define each of these terms:

  • A marketplace is a third-party website that contains product listings from multiple sellers across multiple product categories. Amazon, Noon, Jumia, Facebook Shops, and Affiliate Marketplaces are a few examples.

  • An “own website” is an independent eCommerce website run by a seller, where buyers purchase goods directly from the business’s website. Many are created with eCommerce platforms such as Shopify, Magento, BigCommerce, WooCommerce, ExpandCart, Wuilt, and Zammit.

The primary distinctions between marketplaces and eCommerce sites are simple and highly dependent on who you are and what you are selling.

Marketplaces will provide you with millions of visitors, but you will also be competing for visibility with thousands of other sellers. Yet, an eCommerce website can help you stand out, but it will require significant effort to increase traffic and drive sales.

Which is better for your business?

Learn: Where Should You Start Selling Online?

What are the edges of selling on an online marketplace?

There are lots of benefits to selling on a third-party marketplace. Let’s discover why many sellers use this option.

It’s simple to get started and maintain.

An online marketplace can make eCommerce easier, particularly for new sellers. The infrastructure is already in place, saving retailers the time and hassle of creating a website from scratch.

As long as these marketplaces are not owned by individual sellers, the marketplace management handles the transaction and payment, and the seller only needs to take a few steps to add and modify product listings.

There are already a large number of customers who make purchases there.

Marketplaces are well-known and trusted websites. People are at ease making purchases on them and are accustomed to going there to find products rather than elsewhere.

Many marketplaces are already household names (Amazon, Noon, and Jumia are examples), with millions of shoppers looking for products similar to yours. So, getting your products in front of potential customers doesn’t take much effort.

What are the drawbacks of selling on an online marketplace?

While it may appear to be the easiest option, there are some drawbacks to using a third-party site to sell your products online.

There are various competing brands in the same place.

Though your product is unique, similar offerings are competing for the attention of your potential customers. In a crowded marketplace, your product may not stand out.

Furthermore, your competitors may target visitors to your listings and place advertisements for their products on your pages. Depending on the level of competition in your product category, you may not get the exposure or easy sale you desire.

People who buy your products may be unaware that your brand exists.

Many people who shop on marketplaces mistakenly believe they are purchasing from that marketplace (even though they are purchasing your products). The shopper will remember the marketplace rather than your brand the next time they buy. The focus of most marketplaces is on the products rather than the sellers.

This makes developing brand awareness and recognition, and ultimately differentiating your business, extremely difficult.

You cannot create a customer database to market to in the future.

Because marketplaces serve as a third party, sellers are not permitted to communicate with buyers outside of the website (However, the marketplace can contact your customers again in the future). This means you won’t be able to send future promotions, new product announcements, or simply remind customers about your products to drive future sales.

The reality is that retaining a customer is much easier (and less expensive) than acquiring a new one. Without a customer list, you can only rely on new sales; you can’t benefit from past purchasers.

Why should you sell through your own website?

There are multiple reasons why you should create and sell on your eCommerce website. Let’s discover the top benefits of doing it yourself.

Demonstrate complete control of your brand.

When you run your eCommerce website, you have complete control over how it appears, what it says, and how it functions. It does not have to be generic or monotonous. This is your chance to show the world the personality of your brand.

You can design the shopping experience that you want for your customers.

Therefore, many eCommerce platforms provide design flexibility, pre-built templates, and integrations with other systems with few restrictions, standard guidelines, or character limits.

You can re-target customers to turn them into repeat buyers.

One of the most significant benefits of running your eCommerce website is having direct access to your customers, which allows for better customer service and, ultimately, more upsell opportunities.

You can advertise to people who visit your website, market to people who have already purchased from you, and stay in touch in the future.

Building an email list, on the other hand, can help you raise awareness, generate consistent revenue, and run promotions to get rid of inventory.

What are the downsides of selling your products on your eCommerce website?

Setup can be time-consuming and technically demanding.

Building your website can be as simple or as complex as you want. It’s never been easier to get your website up and running thanks to the rise of eCommerce platforms and do-it-yourself tools. However, you may encounter technical difficulties or, at the very least, time constraints when setting up your eCommerce website.

There are many steps to take, such as selecting a domain name and hosting service, installing shopping carts and credit card processing software, and creating content for the site. Some solutions will streamline and manage these processes for you, but there will still be work involved in setting up and maintaining the site.

Working hard to attract customers to your website.

Your work does not end once your website is launched. You need to get customers there. Visitors will not magically flock to your website, or even find it right away. There is a marketing effort that goes into creating the right campaigns to spread the word. You must know, learn, or pay for expertise.

After they visit your website, you must convert them into paying customers. You should optimize your website to provide a great user experience, which includes a compelling message, button placement, a mobile experience, and more.

So, how do you choose the right platform for your products?

The best place to sell online will differ depending on the retailer’s products, needs, and goals. Each marketplace and eCommerce platform has its own set of edges and drawbacks.

Both have monetary costs associated with them. Marketplaces can charge a variety of fees, including listing fees and a percentage of each sale. Many eCommerce platforms that assist you in the creation of a website charge a monthly hosting fee. You can also spend a lot of money on advertising for each, as well as managing your eCommerce shipping.

However, many online merchants sell on both marketplaces and their own websites to increase customer reach and brand recognition. Some choose one to begin with and then expand into others as they gain experience.

Whatever eCommerce platforms you use, they must integrate with the other technologies you use. When systems are linked, they can communicate with one another, allowing for greater visibility and fewer manual processes.

ShipBlu‘s logistics and fulfillment software integrates seamlessly with all major eCommerce websites. The following is how ShipBlu works:

  1. An onboarding session will be scheduled with one of our onboarding specialists to go through the ShipBlu platform and integration processes.
  2. Syncing your online store will only take one meeting with our tech team.
  3. You will be ready to provide your customers with an award-winning shipping and fulfillment experience!
Start Shipping Smarter, ShipBlu