People sometimes confuse the concepts of "marketplace", "aggregator" and "online store" and do not understand how everything is arranged in e-commerce. According to what scheme do these sites work, what do they live on? And if the store is large and works with hundreds of brands, is it already considered a marketplace? And why place there at all, if you have your own online store? We will answer these and other questions in the article.
What is a marketplace in simple words
Marketplace (trading platform) is an online platform for selling and buying goods and services over the Internet, in simple words, sellers place their goods, buyers choose the best options based on prices, characteristics and other parameters. The marketplaces themselves do not sell anything, their tasks are:
- To ensure the promotion of goods.
- Attract traffic.
- Make the site and product search convenient.
- Increase sales of sellers.
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How do marketplaces work?
Each platform has its own nuances, but in general, the principle of operation looks like this:
- The seller is registering.
- Creates product cards in a personal account with a photo and description.
- Brings batches of goods to the marketplace warehouse or places them in his warehouse.
- The buyer searches for goods, makes a choice and makes a purchase.
- The goods go to the buyer.
- The marketplace transfers the money to the seller.
How does a marketplace differ from an online store
The main difference is that the online store always represents its own business and deals with its development. Even if it is quite large, with a hundred brands and a rich assortment - for example, the "Eldorado" hardware and electronics store or the "Akusherstvo.ru" children's store, etc. - this business is its own boss.
The marketplace is not focused on a specific company, it is interested in sales in general and acts as an intermediary between the seller and the buyer.
In order for this ecosystem to work like clockwork, marketplaces dictate their own terms that both parties must comply with. For example, for sellers, these are requirements for packaging, product cards, mandatory commissions. Everything is easier for buyers, it is enough to pay for the product and delivery. However, the nuts and bolts began to be tightened here as well: recently, Wildberries introduced a 2% commission for buyers when paying with Visa and Mastercard cards.
How does it differ from an aggregator
Marketplaces are often confused with aggregators. Indeed, from a software point of view, both of them are huge databases of goods and services. But aggregators are actually like that: they don't physically exist, they don't sell real goods, they just collect information on one platform.
- On the sales commission. Each marketplace sets its own fees, which may vary depending on the type of product. It can be a percentage or a fixed amount in rubles.
Commissions for different types of goods may differ - here's what they are
- advertising and announcements. Mydanchiki constantly launch promotions and offers for which you have to pay.
To get to the main page, you need to participate in the promotion
- On payment of the cost of ice. On some marketplaces, the client leaves applications that cost money to respond to. This scheme works on Profi.ru and other sites.
Types of marketplaces
Marketplaces are divided into several types:
- Sale of goods. These are all the popular marketplaces listed above, where you can sell and buy goods.
- Sale of services. For example, freelancer exchanges FL or Etxt
- Sale of information and intangible goods: for example, Spotify, twitch, Google Play services.
- Investment and financial exchanges, crowdfunding platforms: boom starter.
Pros and cons for sellers
Traditionally, we will first list the advantages:
- They help to start sales from scratch: many marketplaces do not even require a store website. It is enough to obtain the status of an IP or LLC, register, purchase goods and start a business.
- Accordingly, there is no need to spend on the development and maintenance of the site, contextual advertising and SEO, you can do without programmers, optimizers and other specialists.
- The sale is actually organized on a turnkey basis: from celery, you need to bring the goods to the warehouse (or not to transport them at all, if you have your own or rented place for storage), make product cards, and everything else - storage, sales, delivery - will be taken care of by the marketplace.
- In the search results, marketplaces are steadily occupying the position positions in the top, which cannot be said about ordinary online stores.
- The first two lines after contextual advertising are occupied by them
- . More opportunities for promotion and more customers. Few people know about many online stores and their websites. And if they are placed on marketplaces, their brand will be more recognizable and the flow of customers will increase.
- There are product analytics: in your personal account, you can view statistics on views, baskets, and purchases.
- You can enter foreign markets by selling on AliExpress, Amazon and other international platforms.
But there are also disadvantages:
- A large number of competitors are other sellers. The cheapest products are usually shown in the top. In order not to get stuck in the tail of the issue, you have to constantly reduce prices, and this is often unprofitable.
- The same goes for promotions. Many sellers complain that if they do not buy advertising and do not participate in promotions, the goods will never take off in sales.
- It is necessary to thoroughly comply with all the requirements and conditions of the sites, starting from the packaging of the goods for the warehouse and ending with the requirements for the size and quality of the photo in the product card. Otherwise, the account or products will be blocked.
- Reasons for blocking on Ozon
- Commission and other payments. As we have already said, the commission is different — on Ozon, for example, from February 1, 2021, it ranges from 4 to 20%. At Wildberries, the basic commission for marketplace services is not less than 19%.
- Dependence on the marketplace: the contracts with the sellers of many platforms state that they have the right to change the working conditions unilaterally. That is, decisions are not discussed, you learn about them after the fact.
Allows you to collect statistics on downloaded content, site traffic, bookmarks placed by visitors on the site in their browser.
Who should be accommodated?
To understand if you need placement on marketplaces, study all the pros and cons and check yourself on the following points:
- Do you qualify? Does your company or you have the appropriate legal status? Will you be able to follow the rules all the time?
- Is the competition high in your niche and for specific products? For example, in 2021, selling Pop-Its was a risky business: on the one hand, the demand is huge, on the other hand, the competition is no less. And if there are many well-known brands in your niche on the marketplace that have the ability to make big discounts and buy advertising, you should think hard.
- Is it worth the effort — will the costs of commissions, promotion, and storage overshadow the possible profit? It may be better to sell products for which the commission is lower, or to store the products in your own warehouse.
- The FBS scheme, or sales from its warehouse
- Is there good demand for your products? If the demand is small and the cost is high, the placement will be unprofitable.
- Are your products of good quality? No amount of paid promotion will help if customers are unhappy. Brand reputation is very easy to damage.
Now about those for whom placement on the marketplace is unprofitable. Sell through an online store if you have:
- Highly specialized specific products that can simply get lost among the goods of general use.
- Perishable goods that cannot wait long in the warehouse for their hour.
- Premium-class goods. It's no secret that people are looking for cheaper products on marketplaces.
How to be placed on marketplaces
Choose a site for placement. Try one first to familiarize yourself with how it works and how it works.
- Register, create an account.
- Enter the necessary data: usually this is the country and region, the type of organization (LLC, sole proprietorship), your full name, the name of the online store, the main product categories.
- Fill in information about the company: store website, legal address and phone number, founding documents, payment details, product certificates.
- Sign the contract.
- Fill in the product cards, upload articles and photos.
- After approval by moderators, start work.