Hey friend!
Today we’re going to compare ecommerce platforms and online marketplaces.
There was a time when if you wanted to buy something, you’d have to go out to a physical
store and get it.
And in case you weren’t aware, you can still do that today — but with the Internet, we
also got ecommerce, which is where companies sell things online.
It makes life so much easier for buyers, since they can buy things from their own home.
It’s also fantastic for sellers like your small business.
But there’s more than one way to sell online, and today we’re going to look at the difference
between an ecommerce platform and a marketplace.
Let’s take a moment to define each one.
An ecommerce platform is an online platform where a business sells its own products directly
to consumers.
These platforms are usually used for online stores found on a company’s website.
So, if you go to a retailer like…columbia.com…and buy an item of clothing there, you’ve basically
made a purchase through an ecommerce platform.
Some examples of ecommerce platforms include Shopify, BigCommerce, and Magento.
You won’t immediately see the ecommerce platform a business uses unless you dive into
the technical side of their website, but just know that it’s there supporting their ecommerce
business.
An ecommerce marketplace works similarly to an ecommerce platform, in the sense that users
can visit some type of online store to buy products.
But there’s an important difference: Marketplaces aren’t limited to a single company.
They feature products from lots of businesses.
Probably the most well-known example of this is Amazon.
Amazon does sell some of its own products, but it also allows other businesses to sell
there.
So, you could buy a Columbia sweatshirt on Columbia’s online store, but you could also
buy it through Amazon or another marketplace.
Now that we’ve established what an ecommerce platform and marketplace are, let’s look
at the advantages that come with each one.
Benefits of ecommerce platforms There are a few major benefits of using an
ecommerce platform.
The biggest benefit is that it’s entirely controlled by you, not by a third party.
That means a few different things.
Firstly, you can set your store up however you want and allow it to reflect your unique
brand.
If you want to use neon colors and crazy fonts everywhere, you can!
You are free to do so — although that may not be the best design advice.
Secondly, when you run your own online store, you can gather data about the people who visit
it.
This first-party data is owned by your business, not a third-party.
You can use that data to recommend other products to users, show targeted ads across the web,
or follow up about abandoned carts.
Benefits of ecommerce marketplaces As nice as those ecommerce platform features
are, online marketplaces come with their own benefits.
One of the biggest ones is increased visibility.
When you’re running your own store, it takes time to get your products in front of people.
But if you sell on Amazon, for example, you’re instantly on one of the biggest sites in the
world.
Of course, you still have to take the time to get your products in the Amazon search
results.
But still, being on Amazon makes you much more visible than if you just sell your products
on your own site, and it comes with a lot more traffic.
Ecommerce platforms and marketplaces both have benefits, but they also both have drawbacks.
Here are a few of the cons of using each type of ecommerce.
Drawbacks of ecommerce platforms Probably the biggest downside of an ecommerce
platform is that it takes more work than a marketplace.
You have to invest a lot of time, effort, and resources into building and running your
online store.
To start with, it’s more work to set up the store in the first place.
You have to build your store entirely on your own, including coming up with an appealing
design.
But it’s also more work to run the store after it’s finished.
You have to bring in traffic, make sure all of your features work at all times, keep your
website from crashing, and more.
Marketplaces have drawbacks, too.
The main disadvantage they have is that in a marketplace, you aren’t in control of
everything.
You can list your products, and some marketplaces might let you customize your storefront a
little bit.
But overall, you have to adhere to whatever format and guidelines the marketplace gives
you.
That means if you want the sales process to work a certain way, or you want the pages
to have a certain look… tough luck.
Amazon’s not gonna restructure their whole site for you — you just have to accept the
layout they use.
So, when you’re looking at an ecommerce platform and marketplace, which one should
you go with?
Well, the simplest answer is: Both, if you can.
You may want to try a two-pronged approach where you sell both on your own website and
through marketplaces like Amazon.
That means you reach a wider range of consumers, so you make more sales and get the benefits
of both types of ecommerce.
But what if you only have the time or resources to manage one?
In that case, it’s probably best to prioritize your own website and its ecommerce platform.
That way you retain more control and raise brand awareness as more and more people visit
your store.
But, do what works best for your business and your budget.
Well, that wraps up our discussion of ecommerce platforms vs. marketplaces.
Now that you have an idea of the differences between the two, you can start setting them
up for your small business.
If you want to learn more about ecommerce and online marketing, you can subscribe to
our YouTube channel, or to our email newsletter, Revenue Weekly.
Thanks for watching, and we’ll see ya next time!