Ecommerce marketplaces were responsible for 62% of global online sales in 2020 and sold $2.67 trillion in products.
This tells you, as an ecommerce store owner, that it’s probably a wise choice to get your store listed in an ecommerce marketplace.
What is an ecommerce marketplace?
An ecommerce marketplace is pretty much the online version of a shopping mall, a place where consumers can go to compare products, vendors and brands all in one location and make their purchase. The entire customer journey can take place in an e-commerce marketplace.
Benefits of an ecommerce marketplace?
Wondering whether you should connect your store to an ecommerce marketplace? Keep on reading – perhaps these benefits will convince you:
- Access to a large customer base – one of the main benefits of joining an ecommerce marketplace is the access it gives you to its existing customer base. If you can get your products ranked high up in any of the popular ecommerce marketplace platforms, you could increase your sales to a much wider audience.
- Additional channel for your sales – selling through an online ecommerce marketplace could be your only channel or a bonus channel to your existing store.
- Increased customer segmentation – the top e-commerce marketplaces have fine-tuned customer segmentation and targeting, making it easier to improve the customer experience and offer the right product to the right customer.
- Reduced marketing costs – if you’re selling through Amazon, you already have a massive number of customers searching for products each month, actively searching for products like yours.
- Increased level of customer trust – selling on a trusted marketplace gives your store a virtual stamp of trust itself
- Easier inventory management – sellers through ecommerce marketplaces, such as Amazon, have the option for Amazon to warehouse their products, saving on storage costs.
- Customer support – backed by a phenomenal customer support team at the top ecommerce marketplaces take the pressure off to establish your own world-class support team.
6 of the top ecommerce marketplaces
Etsy is one of the most popular global marketplaces for ecommerce sellers that specialize in art & crafts, homemade or vintage products. You’ll find micro-businesses or private individuals selling their goods in Etsy instead of more established, larger businesses.
Number of buyers: 81.9 million (Statista)
Number of sellers: 4.3 million (Statista)
Pros: Large buyer base, built-in analytics, easy to set up and maintain,
Cons: Saturated, products need to be handmade or vintage, listing & transaction fees
Amazon is the largest and most popular online retailer in the US, with net sales in 2020 of almost $386 billion. This giant of an ecommerce marketplace is not only a US leader but is also among the largest ecommerce marketplaces in the world, logging 5.7 billion visits per month. Consumers can buy anything from toothpaste to electronics so you’re likely to find your niche and ideal customer as an Amazon seller. According to a 2019 survey by Feedvisor, over 89 percent of buyers agreed that they would be more likely to purchase products through Amazon than from any other e commerce store.
Number of buyers: 150 million Prime subscribers
Number of sellers: 1.6 million active sellers
Pros: Huge customer base, exceptional customer service hub, shipping and warehousing options, low marketing costs, easier international reach, credibility and consumer trust
Cons: Intense competition, subscription fees/product commission, complex data feed
Walmart marketplace launched in 2009 to expand this retail leader’s online store to third-party sellers, in addition to selling their own products.
Number of sellers: 70,000 sellers
Number of buyers: 120 million unique visitors per month
Pros: limited seller fees, unlimited product range, control over your own return policy, less competition than Amazon, extend customer reach
Cons: strict pricing guidelines leading to lower profit margins, self-fulfillment and customer service
Alibaba is a B2B (business-to-business) global ecommerce marketplace for sellers that are looking to source products from China. Although the products ship from China, Alibaba has a global focus. The website is in English for English-speaking countries and over one-third of customers are from the US. Since 2019, US users are also able to sell through Alibaba to new buyers from China and other countries. In addition to the Alibaba B2B marketplace, Alibaba Group owns some of the world’s leading ecommerce marketplaces including AliExpress (B2C), Taobao (C2C) and Tmall (B2C).
Number of buyers: 10+ million active buyers (DigitalCommerce360)
Number of sellers: 150,000+ (DigitalCommerce360)
Pros: lower sourcing costs, lower minimum order thresholds, millions of products
Cons: longer shipping times, lower-quality perception, product inspection is difficult
AliExpress, a subsidiary of Alibaba, is the B2C ecommerce marketplace that connects international buyers to predominantly Chinese sellers. The most popular supplier option for dropshippers, AliExpress is one of the top ecommerce marketplaces for those who want to source low-cost products from international sellers.
Number of buyers: Over 150 million
Number of sellers: 150,000
Pros: access to dropshipping suppliers, low-cost products, huge product variety
Cons: shipping delays, risk of lower quality products, unable to inspect goods first-hand
Launched in 1995, eBay is the pioneering online commerce site. The site has evolved from its initial used goods marketplace to become one of the largest online selling platforms for new and second-hand goods that could also be put up for auction.
Number of buyers: 183 million (eBay)
Number of sellers: 1.6 billion active listings
Pros: access to huge customer base, easier to get discovered, auction leads to higher profits, seller protections available
Cons: multiple seller fees, limited listing control, very competitive
How to succeed on your favorite online marketplace
Once you’ve chosen your top ecommerce marketplaces, you now need to make sure you stick out from the intense competition that awaits you. There are tried-and-tested ways to succeed in an online ecommerce marketplace, such as:
- Resolving customer issues: customers expect first-class customer service, to meet the high bar set by Amazon. By listening carefully to customer feedback and resolving issues promptly can earn you positive reviews in the marketplace and help you get more customers and make more sales.
- Advertising through the optimal channels: your product is just a drop in the ocean of other similar or identical products. Getting your brand more exposure through online advertising can help you raise brand awareness and increase your chances of marketplace shoppers choosing you.
- Reducing costs to optimize profit margins: since marketplaces are so competitive, it may be necessary to be very price-competitive too. Using a profit calculator dashboard such as BeProfit can help you understand all your costs, revenue and current profits so you can make smart decisions to improve your profit margins.