eTail Europe 2021

London, UK

Best Way to Take Advantage of Marketplace Platforms Such as Amazon's

In 2019, the ecommerce market is staggeringly massive, and it can be difficult for up and coming brands to find a foothold. With huge brands such as Amazon already occupying dominant positions in the space, small business can sometimes feel like it's David versus Goliath.

However, many of these household name brands, including Amazon, offer marketplace platforms which small businesses can use to sell their products. While it can seem like a no-brainer to peddle your wares on a giant platform such as Amazon, doing so does confer some disadvantages.

It's a good idea then to make sure you're armed with all the facts ahead of deciding.

The Advantages

Many of the advantages of using a marketplace platform will be immediately apparent to any vaguely business savvy entrepreneur.

"There are millions of third-party sellers on the Amazon Marketplace worldwide, generating more than 50% of Amazon's total sales," writes Mary Weinstein for CPC Strategy.

Unless you have an in-depth knowledge of the inner workings of HTML coding, you are probably going to have to hire someone to build you a website. Sure, WordPress is relatively simple to get to grips with, but you are still unlikely to end up with a professional grade website at the end. Unfortunately, this means spending money.

Having a custom website built from scratch, you can expect to pay anything from a few hundred to tens of thousands of pounds. Design, coding, hosting, ongoing maintenance, all these factors start racking up the cost.

With a marketplace option, there is nothing but the usually very reasonable subscription fees to pay. Everything else is taken care of by the host, including digital marketing factors like SEO and referencing. All you need do is sign up, pay your subs, and list your products, with Amazon et al performing the rest of the heavy lifting.

One of the main benefits of using a marketplace platform such as Amazon is you open your business to a wider and more diverse audience. Amazon attracts over two million visitors every day and a massive proportion of those will not be the usual customers who would naturally be drawn to your website. However, while they're on Amazon, there exists the opportunity to discover your products.

"Keep in mind that managing accounts on Amazon takes time and knowledge on the part of the seller," continues Weinstein. "Amazon has particular requirements for its Marketplace and a considerable amount of time and knowledge are necessary to manage these campaigns."

Which brings us elegantly to...

The Disadvantages

From a marketing perspective, the main disadvantage of selling on platforms such as Amazon, when compared to your own website, is a loss of control over your brand image. Amazon gives marketplace users almost no facility to control the appearance of their page, with only a tiny space for a company logo in the top left corner of the listing.

Colours, fonts, and page layouts are pretty much standardised across all these platforms. Only eBay really allows for any customisation, but you're still limited to a single page of information within the standard format.

The only place you are free to express some individuality is in your product images, but then you run the risk of detracting from the items you're selling.

The other prominent downside to selling on a platform like Amazon is you may find your products in direct competition with the ecommerce giant. If the product you're selling is also available on Amazon, there's a good chance it will be cheaper, faster, and with free postage, if ordered direct rather than from your business.

This can result in a race to the bottom in terms of pricing, which is a race you will almost inevitably lose. Therefore, if you are selling items such as books or DVDs, Amazon Marketplace may not be the best choice for you. However, if your business operates in a more niche market, and you are selling products which Amazon doesn't, the Marketplace can be a great option to reach a wider audience.

Final Thoughts

There are good reasons for selling on marketplace platforms such as Amazon's, but it will not be an option to suit all businesses. You need to weigh the advantages and disadvantages of each option before deciding which, if any, is right for your brand.

You can hear Amazon's Director of Amazon Marketplace UK, Richard Marriott, speak at eTail Europe 2019, being held in June, at the QEII Centre, Westminster, London.

Please download the agenda today for more information and insights.

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