Selling through your own ecommerce web site vs market places (Amazon, ebay, Flipkart etc.)
So, you have decided to sell your products online and increase your customer base. There are two major options available to you. Either you can design your own ecommerce web site and sell it through that. Alternatively you can list your products in popular sites like Amazon or ebay and sell through them. Both options have their own merits and negatives. Lets explore the various parameters involved in deciding the options one by one.
Own Ecommerce web site vs marketplace
| Your own ecommerce web site | Market places(Amazon, Ebay, Flipkart etc.) | |
| Building Store | – Need to maintain a domain -Need to buy web hosting -In some cases, if you are not technical enough, need a developer support -You need to be conscious of the website content, branding, look and feel etc. -Need to ensure that the site is secure, scalable & SEO is done properly +You can have your own branding & look and feel |
+No separate domain needed +No hosting needed +No need to worry about to website content, branding / mails formats etc. +Site security, SEO are all taken care by the market place provider -If you use, the default desing, no need for technical help. If you want a store designs like what ebay offers, then you may need a developer support -Not much of branding is possible. In some cases limited branding is possible |
| Customer / User base | You need to drive the traffic to your website through your marketing activities. | The market place players will spend money to drive traffic to the site. But it is not that every user will buy from you. |
| Competition | No competition here. Visitors come to your site purely yours & you are the only seller | Intense competition. What ever you sell broadly, you will have loads of competitors selling very similar products. You will be fighting for the sale virtually on every item. |
| Listing price | No listing price as it is your site | There are various schemes are provided based on the market place. This cost will eat into your profit. |
| Commission | No commission as it is your own ecommerce web site | Apart from list price, may market places charge commission on every sale. Another % of your profit eaten up. |
| Payment processing fee | This will have to be born by you. You may have option to pass on to your customers. It may vary from 1-5% based on the card type used to purchase. | Varies on how it is packaged to you. One way or other it will be passed on to you. It may vary from 1-5% based on the card type used to purchase. |
| Price war | This will have to be born by you. You may have option to pass on to your customers if it is your own ecommerce web site. It may vary from 1-5% based on the card type used to purchase. | Varies on how it is packaged to you. One way or other it will be passed on to you. It may vary from 1-5% based on the card type used to purchase. |
| Ratings / Reviews | You can have a 100% control on what do you want to display to your customers | Everyone can rate you. Every mistake you made will come back to haunt you. They show case all your previous sales, reviews etc. This may be positive for experienced professionals, but for a new bee, it will be a nightmare. |
| Ratings / Reviews | You can have a 100% control on what do you want to display to your customers | Everyone can rate you. Every mistake you made will come back to haunt you. They show case all your previous sales, reviews etc. This may be positive for experienced professionals, but for a new bee, it will be a nightmare. |
| Inventory management | You can integrate, control, manage inventory with ease | It may be challenging to have single point of integrated inventory management. |
| Marketing the website & bringing the users | Making the website popular is the single most difficult thing if you are not sure about what to do. There are professionals like us can guide you on the steps to take to make the site visible to the users. |
All marketing are completely taken care by the market place providers. They have all tie ups across the channels to make this happen. |
Video: Ecommerce website using Own ecommerce web site vs Market place
Final Print:
Both options have their own merits and challenges. Having your Own ecommerce web site route needs bit of capital investment and your time to make it happen. But in the long run cost per sale will be cheapest only through your website. Market place is very quick to set up but you will have to share major chunk of your profit to the market place people. If you are a new bee with limited budget, start with market place and aim to have website in the long run. If you have loads of budget available you can start both at the same time and start your website marketing in parallel. In the long run, you will start driving traffic in your website to make more profit. At that time you can start reducing Market Place selling and increase the sale through your own website to maximise your profit.