Once you have identified the products you want to sell and have a brand for your business, it is time to get selling! Online merchants now have a wide range of channels for selling online, and many sellers do the bulk of their sales outside their websites. It is no longer vital for a business to have their website to sell online, and many companies will focus soles on selling through online marketplaces or social media.
That said, selling through third-party platforms means you are at the mercy of a small number of Silicon Valley leviathans. You have complete control over your website, enabling you to tailor your user experience and ‘own’ any customer you acquire.
One strategy is to start selling on marketplaces as they are cheap and quick to get going whilst building your business and developing a transactional website.
With the advent of fully managed website services such as Shopify and Wix, it has never been easier to set up and run a website. These platforms are not just websites but eCommerce platforms which a whole ecosystem of apps available from 3rd party developers. Selling through a website has the following advantages:
- Unlike marketplaces, you ‘own’ any customers sold to via your website, enabling you to market to them in future.
- Many online marketing techniques, e.g., Google ads, Facebook ads, require a transactional website to complete the sale.
Online marketplaces such as eBay and Amazon provide an all-in-one solution for merchants to reach customers. Many sellers are ‘marketplace sellers’ as they do not have a website presence. The popularity of Amazon and the convenience of their Fulfilled by Amazon (FBA) service has led to many ‘FBA brands’, i.e., brands that primarily sell through Amazon and fulfil by FBA and do not bother with a website at all.
Marketplaces offer the following benefits to sellers:
- Huge audience. Marketplaces have millions of daily users.
- Secure payments. Online payments are managed by the marketplace, reducing counterparty risk.
- Advertising. On top of natural search performance on the marketplace, merchants can buy additional advertising to boost their exposure and sales.
On the negative side, the marketplace will ‘own’ the customer and typically does not allow the merchant to market to the customer directly.
Marketplaces are an excellent way for sellers to get their foot in the door online and are a fast way to build sales and generate brand awareness. Many sellers start on marketplaces before graduating to selling through a website or even an offline store.
Some businesses sell only through their social media presence, with customers sending them payment directly using PayPal or a similar payment method. Facebook and Instagram provide a ‘shop’ for merchants, but no checkout is available when writing and purchases are made by visiting the merchant’s website.
However, it is only a matter of time before these platforms will give customers the option to checkout without leaving their platform. Facebook is also trailing a solution whereby companies can list their products on the Facebook marketplace.