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Top 10 Online Marketplaces
10 Best Online Marketplaces
Being an entrepreneur online can be quite a challenge. There are many aspects of your business that all require careful consideration and planning to succeed. One of the most crucial is choosing the right online marketplace to sell your wares. You need to find the right balance of popularity, listing fees, competition, intended audience etc. All of the top online marketplaces have their own benefits and drawbacks to them, understanding what each has to offer you will help your business flourish. You might want to pick a competitive marketplace or a more niche marketplace depending on what you plan to sell.
Making money on Amazon has never been easier, Amazon is the biggest online market in the United States. For this reason, it can be quite tantalising to go with them as the obvious choice. However, size isn’t the only point to consider.
- Amazon is absolutely enormous. With over 300 million active customer accounts as of 2016, there are plenty of customers available to find and purchase your products.
- As well as being incredibly popular, Amazon is also quite a general store. While other large online marketplaces may have a more niche focus, Amazon sells basically everything under the sun. Since the variety of products offered on the service is so diverse, many people search there as their first choice. This means any product you wish to sell has a place on the platform.
- Excellent reputation. Everyone knows who Amazon is and hundreds of millions of customers trust Amazon. This makes consumers more likely to try buying from smaller stores.
- Hugely competitive. Many online businesses have looked at Amazon and have all concluded that it is a great online marketplace to utilise. This means that any products you sell are also going to be sold by dozens, or possibly hundreds of other stores. So, you may have difficulty getting your products noticed by the general audience.
- Amazon takes a commission on all sales that your store makes. This is extremely common among all online marketplaces so it is a fact that your business will have to deal with. However, the commission that Amazon takes is significantly larger than most. This is the secret as to why they are so profitable.
- You will have very little control over the presentation of your store. Amazon has a uniform design for its product pages that you cannot alter. The severity of this drawback will vary from business to business, for some stores, this may not be an issue.
Another great marketplace, starting an eBay business is a great way to get started due to it probably being the second-largest online marketplace. For those unsatisfied with or intimidated by Amazon, eBay can seem like a much safer choice. Even so, some sellers are quite wary of selling on eBay.
- eBay is also an extremely popular platform. They have over 171 million active users which means that there is plenty of business to be had.
- eBay has guarantees in place to protect not only customers but also sellers from fraud and other potential problems. Through various automated processes and transaction tracking, eBay will help ensure the safety of your business and sales. This layer of security offered is extremely useful for smaller and less experienced stores.
- Unlike other online platforms, eBay offers you choice with how you sell your items. You can either go with the traditional option of just having a buy now option for customers. Additionally, you can also choose to auction your products off and let buyers bid for them. This is riskier as it can be hard to predict how much items will sell for in the end, but if the item in question is in quite high demand, then you could end up making a killing.
- While the immense popularity of eBay may make it seem like an easy place to earn a profit, in reality, the popularity can also be a curse as well as a blessing. Thousands of other stores have already been established on eBay, making it ruthlessly competitive. It may be hard establishing a consistent business amidst all the competition.
- Audience expectation can hinder your profit margins. Due to the many years where eBay was primarily an auctioning platform, users often have the expectation of it being a place to find cheap deals. You often won’t be able to price your items very highly before customers lose interest and seek elsewhere.
- eBay also has biases in its system that favour certain types of stores. If you are capable of shipping your items to customers in either the same or next day, then eBay will be rewarded by the platform. However, if you aren’t capable of doing this (as is often the case with smaller businesses) then you will suffer a bit.
Etsy is an online marketplace that shares similarities with sites like eBay. Etsy is quite a varied marketplace with a focus on handmade goods. Here are a few reasons to consider using Etsy.
- It is very simple and straightforward to set up a store using Etsy. For someone new to this business having any help at all from your online marketplace is a huge deal. You’ll be able to get things set up quickly and painlessly.
- As well as being helpful for new users, Etsy can also be a great place for more experienced store owners to set up shop. If you are SEO savvy you can easily get your items ranking highly in the search results.
- Etsy is also very supportive of any brand new store. Etsy has various algorithms in place to help support newly setup stores find business. One of the most difficult things when running an online store is getting the first few sales to build upon for your business. The extra steps that Etsy takes to help with this problem are greatly appreciated.
- You will have several fees that you will need to account for when budgeting using Etsy. Every sale you make, listing you add to your store, and PayPal transaction you take part in will result in you needing to pay Etsy a fee.
- When you create a store through Etsy you are surrendering a lot of control over to them. You have slightly more freedom to adjust the look and feel of your store then you would under Amazon, but not as much as many people would like to have.
- It can be hard to develop awareness for your brand. Many people simply use umbrella terms for online marketplaces rather than specific stores. When asked where they bought something many people will simply answer “Etsy” rather than the specific Etsy store that they used. This limits the effectiveness of word of mouth and can stifle brand growth.
Bonanza is a newer online marketplace that deals with business in many different countries including the UK, US, India, Germany, Canada and more. There is a multitude of reasons why you should consider using Bonanza as your online marketplace of choice.
- There are no listing fees associated with Bonanza. You still have to deal with commissions on your sales but having fewer fees to deal with opens up more opportunity to earn a profit.
- Bonanza has a large customer base, but not as large as other large online marketplaces. Bonanza is occasionally viewed as a smaller cousin to eBay. Since it gets overshadowed by larger businesses many of your potential competitors won’t be present on the platform. You will have greater freedom to develop a larger market share.
- Bonanza also provides plenty of opportunities to develop and customise your storefront to your heart’s content. Not being stuck to the rigid uniform design that many large online marketplaces railroad you into can give you a leg up over the competition. You can truly stand out amongst the crowd and create a strong brand identity that customers will get attached to.
- You are only renting space from Bonanza and have no intrinsic ownership of it. Bonanza has the final say over things regarding your store, so you have to be careful. If at any point you are in violation of the terms of service, even by accident, your store can be terminated without prior warning.
- Using Bonanza can be quite confusing at times. Initial fees are very low, but they have higher tiers that can be opted into. These offer bonuses like opening your product up to additional channels but also have higher fees associated with them.
- Direct checkout options for your store are locked until you have at least 10 positive feedback comments on your store. Many people don’t leave comments expressing positive views so this can take quite a while to reach depending on what types of people are buying from you.
Storenvy is an online marketplace geared towards indie brands. It’s a great place for emerging brands. Unlike Etsy, they are also friendly towards mass-produced items in addition to handmade items.
- Storenvy has no associated listing fees or fees for opening up a shop. This is great for brand new businesses that can’t afford steep setup fees.
- You have a lot of freedom to customise and design your storefront. Many stores trap you in rigid predesigned templates for your storefronts. Storenvy liberates you from that problem and lets you truly express your store and create a unique brand identity.
- You don’t have to use multiple listings for different versions of the same product. Sometimes a store heavily limits what variety a product can have in a single listing, Storenvy is not one of those stores. You can list all of the different variations of a product such as size and colour within one listing, you can even price all of them differently.
- Limited traffic for your storefront. Unfortunately, Storenvy is quite a recent marketplace and is not as established as stores like eBay and Amazon. Since not as many people know about it, it can be hard getting a lot of business. You may eventually plateau on the platform.
- The fees for each individual sale are comparatively high. Since they don’t charge setup or listing fees, they need to make their money somewhere. Unfortunately, this comes in commissions from your sale.
- Storenvy can be very awkward to get used to and isn’t very beginner friendly. It’s hard to utilise SEO to your advantage on the marketplace and you’ll have to deal with some messy coding to get a unique storefront.
Jet is a very new online marketplace, having only been established in 2015. Despite being such a young company, they have already carved out a name for themselves online. They are already one of the largest online marketplaces in the US.
- The reduced competition of the platform gives you a greater chance to expand and develop market share. You still have the large customer base that you would hope to see from a marketplace like this. The ceiling for how far your business can realistically expand is quite high.
- Incredibly easy to use service. Creating a shop and listing items to sell on your store is almost hassle-free. You can be making money within a couple of hours. For those less experienced this will make the platform especially appealing.
- You can personalise your store and heavily customise it. You can create a striking recognisable brand identity this way and you will likely develop brand loyalty this way.
- After Jet was acquired by Walmart their rate of growth has been somewhat reduced. It seems like Walmart are putting the bulk of their resources into their own service, and Jet is suffering as a consequence.
- Jet tends to incentivise customers with deals and discounts. You will have to participate in deals like this to remain competitive. You can benefit from this though, as maybe you get new regular customers that you perhaps wouldn’t have before.
Walmart is an incredibly popular chain of brick and mortar stores in the US, and they’ve been developing an online presence over the years. Perhaps joining their online marketplace is the right call for your business.
- Walmart is an incredibly well-known enterprise and has a very large and loyal customer base. There are plenty of potential customers on the platform ready and waiting for you.
- The only associated fees when using Walmart are the commissions from any sales you make. There are no listing fees, no monthly fees, no setup fees. Although these commissions are relatively high.
- Walmart will handle the customer service for you. Having the extra layer of support from your online marketplace of choice is always a welcome benefit. However, they won’t handle all customer issues. In some cases, the customers will be referred to the seller. But the reduced number of issues you will need to settle is nice.
- Walmart has extremely high standards of quality. One of the reasons that they are so large is just how much effort they place on being trustworthy. They expect great thing because that’s what the customers expect. You may not always be able to meet these high expectations, especially as a smaller business.
- Walmart doesn’t allow personalised products to be sold on its platform. Hand made items don’t always have the same quality guarantee as factory made items, so they don’t want to run the risk of selling lower quality items on their marketplace. You will have to use a different online marketplace like Etsy for those products.
- Amazon has very high standards for who they are willing to accept. You must have a well-established, successful and trusted store previously set up on either Amazon or eBay, or you must own your own warehouse. You will then need to apply for an invitation to join the Walmart marketplace.
Offerup is quite unique amongst online marketplaces. This is because unlike other marketplaces it is online only. This is not necessarily an issue as online shoppers are shifting more and more towards shopping on their phones. According to their own statistics the average user spends 16 minutes at a time on their app, compared to around 12 minutes on eBay’s app.
- Their interface is easy to use and beginner friendly. Created your store to begin selling your items takes very little time and expertise to do.
- The platform is heavily geared towards the mobile shopper market, which gives it a very unique market that other online marketplaces don’t have access to.
- The variety of products sold on the platform is very diverse so you can sell just about anything. You don’t have to worry about not falling under the correct niches.
- It can be very challenging to keep your items near the top of the search bar consistently. Because new items are constantly being submitted to the platform and the app is designed for constant scrolling from users, your items might leave the top of the search results quicker than you would like. If your product lines up with very specific searches, then this issue is somewhat circumvented.
- Shipping fees. If you decide to opt-in for shipping you will be charged a shipping fee for every sale. Be careful of this when considering what to charge.
- If you don’t want to opt in for shipping, then you will meet to physically meet up with your customer. This can be quite scary depending on your local area. Be careful and stay safe.
Folksy is another online marketplace that focuses on handmade items. Like Etsy, this is a great online marketplace to use if you wish to sell handmade items.
- You have a lot of freedom to design your shopfront. You can use custom banners, images, tags, and create a unique shop profile. A lot of marketplaces don’t offer this level of customisation so it’s nice to have somewhere that can truly create your own brand.
- The process of creating your own shop is simple and easy. New shop owners will probably appreciate the lack of hassle it takes to get up and running. No coding experience is required, and a variety of features are at your disposal. You can choose products to feature, and continuously update your store to keep it fresh and appealing.
- Folksy has a dedicated support team at the ready to help out and resolve problems that you may have. They will respond to queries quickly and efficiently. This is a huge incentive for inexperienced users to use Folksy over other options.
- The marketplace is not friendly towards mass produced items. You will have to be careful with regards to which items you are trying to sell on the marketplace.
- It’s UK based. You might experience difficulties with expanding into a global market because of this. While you can sell to other markets on Folksy, the platform isn’t well known in other regions so customers from those parts of the world are unlikely to find you.
Newegg is the last online marketplace we will be talking about in this article. They are a more niche market than other larger online marketplaces. Thankfully that niche is technology, which offers a lot of freedom for potential products to sell.
- Newegg offers a great way for non-US based businesses easy access to the US market. People in the US absolutely love their tech, so they are a great market to sell your technology to.
- Newegg has a fixed commission rate of 12% for global sellers. You will not have to worry about costs and fees increasing as you progress, which can be an issue with other marketplaces.
- Lower competition. Large online marketplaces like Amazon and eBay attract a lot of sellers and result in quite stiff competition. You won’t have to worry as much with this on Newegg.
- If you aren’t selling technology like games, equipment, computer tech or other similar items, this market isn’t for your business. Technology is very expensive to make in a lot of cases, so it isn’t worth branching out into technology just to use this market place.
- Fewer customers. The active user base of Newegg is roughly 10% of Amazon’s user base. This can really hinder your growth by plateauing your growth after a while. You may need to expand to other online marketplaces at that point.