Should You Sell on eBay, Amazon & Etsy?

Written by Jon on 18th February 2016

It seems like whoever you talk to has different opinions on whether or not Ecommerce stores should sell on third party marketplaces as well as their own stores. We certainly think they have their benefits as we’ll cover in this post, but as with all things, there are downsides to be aware of too.

Marketplaces such as Ebay, Amazon and Etsy all have a very active member profile and have built up a level of trust with their customers. While they might not all be suited to your business, you should at least be aware of them and how they could fit into your business, if not immediately, then possibly in the future.shoppingonline
Before we look at some pros and cons of using these platforms, perhaps a little introduction on each platform.

Amazon

Amazon LogoA shopping marketplace that also allows third party merchants to sell alongside their own, Amazon provides a range of selling tools but with less flexibility than ebay.  Setup time can be a much quicker process than ebay as you do not have to worry about product templates amongst other areas.

eBay

logo_0034_EBay_logoA true marketplace giving seller’s a wide range of tools to sell their products online, from the ability to customise your product listings to having your own online shop. eBay provides a comprehensive range of tools to get your store off the ground.

There are a lot of professional sellers on eBay so it is important to spend time on your listing and store view (if you have one) or you risk your listings getting minimum visibility and becoming a wasted effort.

Etsy

etsy-logoThe smaller of the three however not one to be ignored, particularly if you have the correct product fit. Etsy is particularly suited to handmade/crafted products that are unique and not easily found anywhere else.

In terms of customising your store, you are limited in your options but everything is well laid out and does not take a huge amount of setup time.

Pros of Selling on Marketplaces

  1. New Customers/Customer Acquisition

All of these marketplaces have an existing and very active customer database. Etsy is the smallest site but still currently has around the 40 million mark and therefore presents a great opportunity to sell your products to an entirely new set of customers.

  1. Advanced Selling Tools

While all of the platforms vary in terms of what tools they offer you to assist the selling process, all are mature enough to offer tools to enhance your online presence within the marketplace.

  1. Increased Visibility and Sales

All of these marketplaces have a large (and I mean HUGE!) volume of traffic coming to their website, it is not unusual to hear that a retailer’s business is mainly via third party marketplaces with their own website a distant 2nd or 3rd.

To give you an idea of traffic, Amazon.com attracts over 90 million unique visits per month, and with a strong conversion rate it is no surprise that merchants have an uplift in sales after joining Amazon Seller Central.

Cons of Selling on Marketplaces

  1. Marketplace Fees

These are all structured differently however they can get expensive, quickly! When planning on what to sell on these marketplaces it is a good idea to map these against costs or you could find listing and promotional costs alone outweigh any benefit from selling via these channels.

  1. Inventory

If you are selling via one online channel i.e. your own website, inventory can be relatively easily managed as the large majority of ecommerce solutions offer basic inventory management. However when you start selling via multiple channels, inventory can become a bit more challenging and, if not properly planned, can lead to a lot of headaches and even worse a lot of disappointed customers!

I see a lot of businesses looking for inventory solutions after they have started selling via multiple marketplaces, I recommend identifying early on that inventory will cause you issues and plan accordingly.

  1. Not Your Customers

This channel can be (effectively) used as a customer acquisition tool with the main objective of driving additional traffic to your website. However until they make that purchase directly from you, they’re not really your customer. Amazon particularly closely guards its customer details (such as email addresses) and insists all communication goes through the Amazon Seller Central portal.

It is your job to then direct these customers to your website where you can start to build new relationships with them.

Summary

Marketplaces can be a great way of increasing your online sales but I think it is important to have a strategy in place. If you know why you are using these platforms and only select the ones you feel will be most beneficial to your online business, then you can’t go far wrong.