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What are the differences between having your own ecommerce and selling in a marketplace? If you want to sell online but you don’t know where, you’ve come to the right place.
In this article, we will analyze the differences between both: ecommerces vs marketplaces: Although both are online selling platforms, each one has its own features. In this article, we explain the differences between them and the advantages and disadvantages of each platform, so you can decide where to sell, whether this is by working with a dropshipping supplier like BigBuy or by using another model.
Ecommerce vs marketplace: Understanding the differences
There is one main difference, which is the following: in an ecommerce, the buyer will source products from a single seller. In a marketplace, the buyer will be able to access products from many different sellers.
This is the basic explanation, but let’s delve a little deeper.
If you set up your own ecommerce, you will sell whatever products you like and you will handle everything. To do so, the first step will be to choose an ecommerce platform (like Shopify or PrestaShop).
If you decide to join an already existing marketplace (such as Amazon or eBay, for example), you will sell your products alongside many other sellers that are already present on this platform.
With an ecommerce, you have full control and no competition (not on that same website, at least), but you are also responsible for attracting traffic, developing your store and much more. In a marketplace, the platform takes care of all these aspects, and your role is simply as a seller (but your sales margin is reduced).
Let’s look a little more into the advantages and disadvantages of each one.
Having your own online store vs selling in a marketplace: Pros & Cons
We are going to break down the pros and cons of each of these platforms one by one, so you have all of the information you need to decide where to sell.
Advantages of an ecommerce
- You make the rules: This is one of the main differences between an ecommerce and a marketplace. While in a marketplace you have to comply with the platform’s requirements, you have full control in your own store. That way, you can choose the design you prefer, create the product data sheets however you like, work on SEO…
- Your customers are yours: When a customer buys something on Amazon, the customer belongs to Amazon (although the product is sold by a third party). In your own ecommerce, the customers belong to you. You will be able to build a database, and use it to generate more sales in the future.
- You strengthen your brand: Although the seller’s name does appear in a marketplace, this usually goes unnoticed. In your own online store, the customer remembers the name of your company and, if the buying experience is positive, it is highly likely that they will come back to look for other products in the future.
- You have no competition: On Amazon or on other marketplaces, you are competing with many other sellers that are often selling the same products as you. In your own ecommerce, you are the only option available (however, there is also nothing to stop the user from leaving your store and going to look for another one they like more).
Disadvantages of an ecommerce
- You have to create it yourself: Nowadays, there are ecommerce platforms that are extremely easy to use (like Shopify), but this does not mean you don’t have to spend some time on it. If you want your own ecommerce, but you don’t have the time or know-how to develop it, you can use options like BigBuy’s Dropshipping Shop 360º.
- You are in charge of marketing-related tasks: In a marketplace, you have guaranteed traffic. In your own store, you will have to establish and carry out marketing strategies to attract users. SEO positioning, email marketing, paid campaigns, social media….There are many options for making your brand visible, it will be up to you to try them all to find the perfect formula to generate traffic (and, of course, sales).
- Customer service is up to you: This is an important point. In your own ecommerce, you will be in charge of resolving any query or complaint that your customers may have. The more you sell, the more hours you will have to spend on this aspect.
Advantages of a marketplace
- You can start selling immediately: Another key difference between selling on marketplaces and having your own ecommerce. If you want to start selling quickly, a marketplace is a very good choice. Obviously, you need to create your seller account and synchronise your products, but marketplaces are much more immediate than creating your own ecommerce.
- Traffic is guaranteed: Think of a marketplace as a traditional shopping centre. They put the structure in place, they leave you a space for your store and they take care of advertising campaigns to attract people. It is similar in the online environment: marketplaces work on their brand, they take care of positioning well on Google, they carry out paid campaigns…This means that the traffic to your store is guaranteed, so you won’t have to invest in marketing campaigns.
- Selling abroad is simpler: Many marketplaces allow you to sell in several different countries (eBay, for example, is available in over a dozen European countries). By selling in a marketplace, you can internationalise your sales more easily than having your own ecommerce as you are joining this platform’s cross-border strategy.
Disadvantages of a marketplace
- You have to stick to the rules of the marketplace: Of course, marketplaces have their own requirements. On product data sheets, for example, you will have to follow certain guidelines, and you won’t be able to get as creative as in your own ecommerce.
- Your margin is lower: Although you save on marketing and other expenses, marketplaces usually charge a monthly cost and a commission per sale, so your final margin is lower.
- More competition: In a marketplace you share space with many other sellers, so standing out is more complicated. Price is, by no means, the only variable. Among other factors, you need to optimise your product data sheets and ensure that you have good reviews.
Dropshipping: In your own ecommerce or in marketplaces?
Whether you choose to sell in your own ecommerce or in a marketplace (or both), doing so via dropshipping is a perfectly valid choice.
In both cases, you simply need to synchronise your online store or your seller account on marketplaces with your dropshipping supplier. Once you have done this, you will be able to choose which products to display and your supplier will take care of storing stock, handling shipping and all the rest.
Conclusion: Ecommerce or marketplace, which is the best option?
Now you know about the differences between ecommerce and marketplaces, you will see that there is no clear cut answer. The right platform will depend on each person, on your priorities and where you feel comfortable selling.
In fact, here at BigBuy, we recommend diversifying and selling on as many platforms as possible.
You can start selling on one platform and, as you learn and generate more sales, you can expand to other sales channels. In the digital world, changes are constant, and it is important to be present in as many places as possible in order to reach many types of potential customers.
