How to raise funds for a charity. 13% of people...
Having your own online shop is a great thing, but brings its share of challenges. For small and medium companies, selling on marketplaces might be an easier way to quickly generate profits. Here are some advantages and disadvantages of selling online on the 3 main marketplaces.
For the last 20 years, Amazon has dominated online shopping. At first, Amazon was actually an online book store, which then quickly evolved to become a place where we can find and purchase almost anything.
1. Huge number of visitors: Amazon.com is the 3rd most visited website in the United States. So You can imagine the size of the audience that is accessible to sellers. On the other hand, this requires you to find creative ways to stand out from your competitors.
2. Reliable platform. Amazon’s platform virtually eliminates the possibility of fraud and ensures the security of transactions. Consumers often tend to use large platforms like Amazon because they provide a better purchase security than the majority of online stores.
1. Major competition. There are a lot of vendors on Amazon with whom you will have to compete. Even if you can dominate your competitors in terms of positioning, these competitors can drag you into a price war.
2. Withheld funds. Depending on the situation, Amazon can withhold your funds for a period of 14 to 90 days after completing a sale. For smaller vendors, who have more cash-flow restrictions, this could lead to financial difficulties.
Newer than its great rival, Ebay has managed to establish an online presence similar to Amazon. However, their business model is slightly different. Ebay is the largest consumer-to-consumer (C2C) network on the Web. Almost anything can be sold for a fixed price or a bid.
Bidding system. If you are selling unique or rare objects, the bidding system could become your best friend since the purchasing price for some of your products could reach surprising amounts. If, however, your product is more common and available in large quantities, selling at a fixed rate might be a better option.
Many potential customers. Ebay.com is ranked at as the 7th most visited websites in the United States. You will certainly find someone interested in your products.
Counterfeiting. If you are selling goods that could easily be counterfeited, like clothing, perfume or other branded products, you might find that some competitors offer the same goods, but at a ridiculously lower price. Their goods are probably fake and fly below Ebay’s radar.
Paypal’s monopoly. Ebay requires that all transactions go through Paypal. This policy improves transaction security both for the vendor and the customer, but that could lead to some unexpected problems. Paypal is known to withhold funds for a long period, or even suspend your account after comments from unhappy customers.
Etsy is the newest marketplace of these three; the platform was created in 2005. At its core, Etsy is a platform where artisans could sell their handmade goods online. Etsy is also a great platform for collectors, because they can find a great wealth of antiquities.
The audience. In most cases, Etsy’s visitors know exactly what they are looking for. Furthermore, they tend to have more sophisticated tastes, which can bring you more sales if you offer a unique or stylized product.
Store customization. Etsy probably has the best display when it comes to personalizing your online store and recreating your business image. A well-designed home page for your Etsy store can bring you more customers.
A great place for beginners. If you are a designer or maker of unique handmade goods, Etsy is the best place to sell online. There is No risk of getting lost in the vast world of Ebay or Amazon. Starting on Etsy is the best way to stand out and to learn e-commerce.
Fewer visitors. Etsy is not as well known as its competitors. However, Etsy.com is still in the top 60 of the most visited websites in the United States and shows increasing growth in the last few years.
Limited product selection. If you don’t sell antiquities or artisanal products, you can’t sell on Etsy.com. So, if that’s not what you sell, you should consider other marketplaces.
Amazon, Ebay and Etsy all have a one feature in common: many potential customers visit their platform and are looking for products like yours. The only thing remaining is to attract customers with the right products, great prices and an excellent service. It’s not always easy to provide all three at once.
In short, Amazon is generally the best to sell products (if your pricing is very competitive), Ebay is the best place if you sell rare or unique goods, and Etsy is no doubt the best place to sell handmade or diy products.
In the end, the choice is yours. However, keep in mind that managing several marketplaces at once can be long and difficult, unless you use a software that automates this management. We will discuss this subject in another article…