Marketplace vs your own store: employee or self-employed?

Hate over-protection? Or too much responsibility scares you? Figure that out, your type of business may depend on that.

If you venture for e-commerce online sales you usually have two options: E-commerce marketplace (team player or employee type) vs Your own website (front-runner or self-employed);



Marketplace – Employee type

fits mainly those who are just entering the market and dream of winning it with a new product.

As a novice you usually lack several things:

  • self-confidence;
  • clients;
  • money;
  • promotion experience;
  • well-thought delivery and payment systems;
  • clear prospects of your further business expansion;

It is also true for those who have reached some plateau in business and take decision to expand it even more.


At this stage it’s wiser to start partnership with someone more professional. Check-list if marketplace is your option:


   You need to test your hypotheses:

   You’ve got a new product and scarce information about its prospects. Marketplace is one of the best places to check if you’re on the right track. You can test various hypotheses and potential customers at a reasonable cost and collect all the information to line up your strategy for the product development. For example:

  • whether these products will meet the demand;
  • which configuration of the product will hit the mark;
  • if you have a competitive price;
  • if your business model is right;
  • if all your costs cover logistics costs and sales-associated cost;

   It’s one of the most painless places for gaining experience in logistics, payment, delivery and law matters to minimize risks for your business. Marketplaces do their best to demonstrate flawless customer service that can teach you how to operate within them.


 Your price is the best

    The same as with choosing the right candidate: if your salary expectations are the lowest you’ll have it all. Marketplaces are mainly price battlefields. You boast premium service and great content for users? Forget about this platform. Your price is number one attraction for the potential clients. But it’s not always the case. The main thing about your clients is still your clients. Even if your product is cheaper they will never buy it because of that.


 Your products match it

   Looking for a job you make sure you can fit in. You won’t apply to a travel agency if you’re programming software. The same is with products: they must match the marketplace’s aim. There are loads of various platforms and you’ve got to be very selective as to which products sell at which platform. You must pay attention to:

  • matching your targeted audience’s needs;
  • marketing strategy of the marketplace (position in Google issue, etc.);
  • partnership conditions;
  • % from sales;
  • monthly fee;
  • annual fee;
  • technical bonuses like possibility to automate the process;


 You need to check the demand for your products:

   You’re great but your fan club is limited to your mum and friends. Your products are just the same. You need to test their economic viability. And the best place to do it is a marketplace.

   Big platforms boast lots of clients by default. All you have to do is to choose between basic, standard and premium package of “popularity” and check how many people get interested. This is where you can use marketplace’s traffic to draw attention to your products.


  Your customer’s profile is vague or you want to enter new markets:

   You may have no idea who your clients are and what channels they use to come to you. Or you dream of stepping to new markets and lack information for it. Marketplace can help you to get at least the initial data you need.


 You have zero credibility from your potential clients by now:

   Marketplaces lend it to you. They are already “The Queen” of the e-commerce. There is nobody who wouldn’t have heard of them or distrusted them. So you get their credibility for free as a bonus for joining them.


 Marketing: “who’s paying for the party?”:

   Marketplaces are also your SEO and content writers. In case you rely only on yourself all digital marketing will be at your cost. If you are short of money it can turn into a problem. Then your SEO optimization, context marketing, re-marketing and promotion will be all your headache. Marketplace in this case is your magic wand which takes it all over.


Your inner processes are not fine-tuned:

   I’d bet that starting your new job you’re far from being its expert. The same is here. Marketplace is great for testing and building-up well-oiled schemes which would work for your business.

   You can start with downloading a small price-list in the marketplace system. Don’t use the big one as it will be hard to update it when you face the necessity to do it later. And go on using it connecting your payment and delivery systems to it. You can even consolidate files of your suppliers here.

   One more bonus: you can try several platforms during the same period and then decide which of them fits your business best.

   If all the above points have been true for you then marketplace is your choice. But staying for some time at marketplaces you may witness some negative changes coming. This may be the right time to switch to your own website.



Transition period:

   Leaving your ex-job may hurt. To make it smoother you’d better prepare the ground for your new place of work. Transition from the marketplace to your own website is just the same. You’ve been great together but it’s time to expand the horizons.

   Never disclose your intentions to your ex. Be sneaky. Staying at the marketplace invest some money in the development and make a research necessary for analyzing the feedback from the final customer. Thus, marketplace will remain an additional communication channel with your customers. There are also of course such channels as Facebook, Google, Yahoo, Google Adwords, Bing. But in the long run marketplaces are known as the cheapest the source of drawing the leads.


   Your own online store – Self-employee type it’s time to open your own online store if:


  You’ve got enough budget

   You have enough money to start independent sailing and now you have more options for a progress, but


  Sales start slowing down

   That’s the strong reason to start looking around. The marketplace has done it all and you need to move on.


  Your potential market volume is clear to you

   You’ve analyzed the market well enough to see what part you can conquer in this particular region.


 Your products need a better showcase

   No more fighting their places in the sun among thousands similar items. No competitors at hand, just your customer and you.  


 You need your brand

   Placing your products at a big platform has some substantial drawback: you lose your exclusivity. Your clients won’t remember your brand’s website link. They’ll remember your products as listed at Amazon. At your own website you have a strong chance to build up your brand’s name to stand out among your competitors.  


  Your inner processes are well-oiled now

   Your expertise has grown and now you’re ready for a free-ride. Your database enlarged and you need more options for adjusting your payment systems and channels of interactions with your customers.


 You need personalized promotion

    You can finally forward traffic directly to your website. Your design is limited only by your imagination and your budget of course. But you don’t have to abide to general rules of big marketplace. Besides, sometimes you reach the volume of sales you can’t cope with. In such case you can efficiently forward your marketing traffic to your most marginal goods and earn more.

You can also fight for organic traffic which you can get by SEO optimization and well-thought content. You can have a blog where you can delight your users with some useful tricks and write some articles according to their requests. And you can use traffic from such articles and convert it into sales. Besides you can analyze the traffic you get from various channels and then optimize investments in them accordingly.


  You lack feedback from your clients

   Now you’ve got direct access to your customers’ database and it gives great opportunity of collecting their feedbacks. In its turn it helps you to integrate various analytical tools into your website so that you always know who came to you and why.

   You can chase the clients who have visited your pages or almost made a check-out and changed their mind. It gives you strong chance to up-sell, cross-sell and re-sell your goods. Your product reaches flexibility it has never had being at the marketplace.  

   You can fine-tune analytics and thus understand which channels are mostly used by your customers. After it you can adjust your marketing campaign accordingly.  

So which is the best way? Professionals advise to combine both:



“I want it all! And I want it now!”

   Mind it that marketplaces are an additional sales channel which shouldn’t be neglected. When you have your own website it’s much easier to automate and manage your activity at the marketplace. So what are the recommended stages?

1.    Start testing your product’s viability with big platforms like Amazon, Etsy, Shopify. Use all of them during free trial period. Then keep on choosing one or two.

When you have your own website you usually use your marketplace for selling:

  • goods balance;
  • discounted goods;
  • accessories for top goods,
  • goods for up-sales;

2.    After your sales start slowing down think of adding your own website. You can start with a small version of your website: there are some platforms that can help you construct a basic one and take some fee for its support per month. It will help you to add more channels for promotion which will strengthen your brand even more. If you’re content with the result you can keep modernizing it adding functionality you need.


3.    After your total monthly income starts approaching to some more or less substantial amount, think of diversifying your products. Staying at bigger platforms can be dangerous: as soon as they change their rules you can lose everything you’ve achieved. So, that’s the moment to think of creating your own website.


4.    And the best time for changing to your own website is when your brand gains more popularity and you need to attract more serious clients. In such case listing at Amazon or E-bay will diminish your chances for really big projects.


5.    One more strong “pro” for joining both marketplace and your own online store is when


 You face the need to automate your processes:

The more you grow the less time you have. That’s where automation comes to hand:

  • There can be inner processes of the sales themselves, for instance you can make an operator working place for dealing with your logistics and your history of sales unlike marketplaces where you get some general information. Thus in the field of logistics you can automatically calculate your delivery time and cost and then make bills of lading and send to a forwarding company.
  • Or you can automate your ERP-system processes and after the update it can download XMLs or JSONs at your website together with your order and process it all at the working place of operator.
  • You can connect your website to Internet payment systems you need and adjust all logistics processes you have according to your needs.


   So is it possible to have it all? Why not! You can use marketplace as the additional communication channel with your customers and automate your processes at your own online-store until they are as smooth as an ice rink. The choice is yours.


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