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List of Online Marketplaces for eCommerce Business Owners
Are you thinking of expanding beyond your own eCommerce store? Smart move.
Selling your products on online marketplaces is a very good idea.
When you sell on an eCommerce marketplace, you suddenly have access to a huge range of shoppers you wouldn’t otherwise reach. You also don’t have to do anything extraordinary to reach those shoppers; they’re already in the habit of coming to Amazon (or Target, or Walmart, or another marketplace) to browse for products.
Marketplaces represent 59% of online retail sales globally, and Amazon’s just one of your options. It can be tempting to dive in and start selling on every platform out there, but some discretion is advised if you want to ensure a manageable (and profitable) online marketplace strategy.
Read on to get the details on the four most popular online marketplaces, plus the pros and cons for eCommerce business owners.
1. Amazon
54% of brands already sell on Amazon, and 72% plan to within the next five years. How come? For most eCommerce brands sellers, Amazon makes up a significant portion of their sales — anywhere between 26 to 70%.
Pros:
- Amazon is the biggest and most well-known marketplace. The global majority of product searches occur on Amazon, not Google, which officially makes it the largest search engine for eCommerce.
- It’s extremely easy to get started selling on Amazon. You can even use your existing customer account.
- With the exception of some obvious no-nos, like drugs and illegal items, you can sell almost anything on Amazon.
- With the Fulfilled By Amazon program, you can ship your products to an Amazon warehouse and let them take care of fulfillment for you.
Cons:
- Amazon doesn’t give you access to their huge customer base for free. The platform charges high referral fees, usually ranging between 8% and 15%, which eat into your profit margins.
- The customer base isn’t the only thing that’s big about Amazon. When customers search for your product, they’ll find your listing along with dozens of competitors. That leaves it up to you to find ways to optimize your product listings with competitive pricing, lots of reviews, and more.
2. Etsy
Etsy started out as a cute little website to sell your handmade items. Today, it boasts over 2.5 million sellers, who sell handmade crafts and vintage products to nearly 40 million Etsy shoppers worldwide.
Pros:
- Etsy has made the onboarding process very easy for online sellers, so you can get your Etsy store up and running quickly.
- Etsy buyers are very loyal to Etsy. 40% of their shoppers are repeat customers.
- Etsy offers advanced analytics for sellers. In your Etsy Stats, you can see what traffic you get from Etsy (through Etsy search, the app, and Etsy marketing tools). You can also see how much traffic comes in from external sources, like organic or direct traffic, social media, and paid ads.
Cons:
- Etsy is just for handmade items, craft supplies, and vintage items. If you sell anything else, you can’t sell it on Etsy.
- Etsy charges fees simply for listing your items — even before you make a sale. You’re charged $0.20 for each item you list, along with a 5% transaction fee for every item you sell.
3. Walmart
Walmart used to call itself the largest retailer in the world, until Amazon beat it last year. Still, the Walmart online marketplace has grown steadily for the past several years, with experts estimating it will represent 5% of all U.S. ecommerce sales this year.
Pros:
- Walmart may not be Amazon, but it’s pretty close. This online marketplace just edged out eBay to claim the #2 spot in U.S. eCommerce sales.
- Walmart has a large and loyal customer base — even more loyal than Amazon.
- Similar to Amazon, you can send your products to Walmart and have them fulfill orders for you with Walmart Fulfillment Services. They handle the customer service, too!
Cons:
- Walmart’s signup process for online sellers isn’t as easy as it is on Amazon or Etsy. You have to apply and wait to be approved by their team.
- It’s free to sign up for Walmart Marketplace and list your items, but you are charged a high referral fee on each item, which ranges between 6% and 20% depending on the product category.
- Walmart’s focus is split between their online marketplace and brick-and-mortar stores, which can slow innovation. With online-only marketplaces like Amazon and Etsy, you know the entire product team is focused on building the best eCommerce tech for their online sellers.
4. Target
Target+ is perhaps the newest and most secretive entrant on our list of online marketplaces. The bullseye-branded retailer launched Target+ in early 2019 as an invite-only online marketplace for just 30 merchants. Just a year later, the marketplace had grown to over 100 merchants selling 165,000 products and claims the #8 spots for U.S. online retail sales..
Pros:
- Target is America’s favorite department store. When you sell on Target+, Target makes it clear that you are a Target-approved brand, currying favor with their customers.
- Target customers can use their RedCard to shop on Target+, which may make them more likely to buy.
- While Target doesn’t offer fulfillment yet for Target+, they do manage the whole returns process, which is a major perk for eCommerce sellers short on time.
- Target lets you create your own Target+ storefront, offering the most expansive branding options of all the marketplaces on our list.
Cons:
- Target+ is invite-only and there’s no way to submit an application, like you can with Walmart.
- Target doesn’t offer the same fast shipping options on Target+ that they have on Target.com, so you could lose sales to faster delivery options on the regular site.
Online Marketplaces and Your eCommerce Store
Ready to craft your online marketplace strategy? Contact Your Marketing People. We specialize in helping businesses hone their strategy across online platforms, so you can achieve the best results.
