How Can Using Marketplaces Give You an Advantage?
Marketplaces are booming. In fact, platforms like Amazon have seen exponential revenue growth since the early 2000s. And tens of millions of sellers are building or expanding their brands on these marketplaces.
But the big question is: why? What exactly does a marketplace offer to retailers that can’t be found in any other digital channel (including social media and eCommerce stores)?
In this post, we’ll explain what a marketplace is and look at the advantages of adding one (or several) to your business model. Let’s get started.
What are Marketplaces?
Marketplaces act as an online space where multiple retailers can come together to sell products to customers. In fact, they operate similarly to a farmer’s market, mall, or outlet. Each brand has its own profile that houses its own products (like a booth or physical store), but potential customers can easily navigate between them to find the products they’re looking for.
With an online marketplace, shoppers can use the search function to browse by product or category, rather than by brand. And because these marketplaces are online, all the products can be shipped directly to the customer’s door – no matter where they’re located. In some cases, they can even be fulfilled by the platform itself.
Here are just a few marketplaces you’re likely familiar with:
How do Marketplaces Give You an Edge?
While online marketplaces are much more competitive than your online store might be, they offer quite a few unique benefits in the way of branding, sales, and customer experience. Here are just a few notable advantages of marketplaces.
More Brand Awareness
Marketplaces are visited millions of times every year, which means you can get a lot of eyes on your brand just by selling your products there. Not only can customers find you when searching for products in specific categories, but they can also browse the rest of your products from your profile page.
As a result, you can build stronger brand awareness and generate positive feelings toward your brand. In some cases, you might also be able to drive more traffic to your own website or eCommerce store.
More Sales Opportunities
When you only sell your products on your eCommerce site, you limit the number of people who will buy from you. Some simply won’t find you online, while others may be nervous about giving you their payment and shipping information.
By branching out to new channels, like marketplaces, you increase your opportunity for sales. Not only can you capitalize on the trust the marketplace has already established with shoppers, but you can also reach potential buyers who prefer to do all of their online shopping on eCommerce platforms like Amazon, Ebay, Etsy, OfferUp, or AliExpress.
Social Proof Opportunities
Customers can’t try on clothes or handle products prior to making a purchase online, so they need a way to verify the quality of the item before they buy it. That’s where social proof comes in.
With social proof, new customers can get feedback from people who’ve already made the same purchase on everything from sizing and color to longevity and customer service. In some cases, they can get information on shipping time, pricing and return policies too.
Since marketplaces are designed to be social, they encourage and get this type of feedback much more than standard eCommerce websites do. For example, Amazon has nearly 5,000 reviews for Brooks’ Adrenaline GTS 21 running shoe, while Brooks’ website has zero reviews for the exact same product.
Thus, when you sell your products on one of these eCommerce platforms, you can earn more social proof for your products and increase the visibility of that social proof, exponentially.
Strategic Marketing Opportunities
One neat feature a lot of marketplaces have is product comparisons between brands. In other words, the “you might also like” or “people also viewed” sections on each product page.
In these sections, alternative products listed market themselves under the same SEO keywords and compete for the same business. This enables shoppers to compare prices, quality, reviews, and basically everything else they might want to, without leaving the site or page.
As a result, you can effectively compete for your customers’ attention directly on your competitors’ pages – which is incredibly useful when shoppers are still in the evaluation stage of the buyer’s journey. (Just remember, your competitors will also show up on your product pages.)
Marketplaces are a great way to sell your products. Not just because they’re one more business opportunity, either. By selling in an online marketplace, you can successfully build a stronger brand, capitalize on new eCommerce sales and marketing opportunities, and leverage greater amounts of social proof. And that leads to a stronger customer base and more revenue for your brand.