Selling on marketplaces
When you start your online shop, it can be difficult to attract customers. Reaching a huge audience is one of the main benefits of selling on online marketplaces. It is also an easy way to start selling cross-border. An online marketplace can also take care of your logistics and customer service.
Why sell on marketplaces?
First of all, online marketplaces like Amazon, eBay and Bol.com are increasingly popular. In fact, around 50 percent of European online shoppers visit third-party platforms according to RetailX. Online department stores have a huge customer base which is nearly impossible to establish on your own. Moreover, you can reach international customers more easily. Therefore online marketplaces can be a gateway to start selling cross-border as well.
As a new retailer it can be hard to attract customers, since they do not know or trust your store yet. Platforms have such a large user base, partly because they have already built credibility with consumers. When selling products in their store front, you can piggyback on their reputation and extensive marketing efforts.
Platforms have already built trust with shoppers.
Additionally, online marketplaces can do much of the logistical heavy lifting for you. For example, companies like Amazon and Bol.com offer payment processing and customer service, but also storage and shipping services. Starting your own store can be costly, from building your website to buying inventory. You may consider outsourcing some of these ecommerce costs to their market stall. And since partner seller platforms have a much bigger budget, you can simultaneously increase your service level.
Lastly, conversion rates tend to be higher when selling on a multi vendor website. This is because visitors are more likely to order when they are actively looking for something. This is often the case on marketplaces. In fact, nearly half of all online product searches in the United Kingdom and Germany start on partner seller platforms.
Leading online marketplaces in Europe
Do you want to start selling products on a multi vendor platform? There are many websites to choose from in Europe alone. In addition, it differs per country which online marketplace is the most popular. In Spain, for example, spin-offs from existing retailers such as El Corte Inglés and Privalia are industry leaders. However, the Dutch Bol.com is a homegrown online marketplace that has become the biggest ecommerce website in the Netherlands and Belgium. Are you still deciding where to sell your products? Take a look at our comprehensive list of the biggest marketplaces in Europe per country.
How to sell on an online marketplace succesfully
The marketing power and reach of retail platforms are huge benefits of selling on an online marketplace, but can also be a challenge for ecommerce merchants. Since you will not be the only retailer on the platform, it is important to stand out. To sell products on online marketplaces successfully, there are some best practices to keep in mind. The most important thing to optimize is your product listings. Excellent product information consists of three factors: findability, traffic and conversion. Of course these are not mutually exclusive. Products that are easy to find will gain more traffic and, as a result, sell more.
To ensure shoppers can find your products, look into the search terms they will use. Make sure to incorporate key terms in your product titles and descriptions. Applying the right product category and attributes is also more important than you think. These are the filters customers will use to look for something. Do not forget to include the brand, color, size and materials, for example. If suitable, an item can be sorted in multiple product categories to ensure that people find it. But preferably no more than two categories should suffice. All of these steps increase the chances of visitors finding your offer.
On platforms you will need to stand out from the crowd.
The next step to think about is traffic. You want to increase the chances of shoppers clicking on your item instead of someone else’s. To achieve this, grab their attention with high quality images. While other retailers will often use standard images from the manufacturer, you can stand out from the crowd with custom product photos. Moreover, make sure to motivate past customers to leave reviews. This can help you climb in the search results. It also can give shoppers that are on the fence an extra push to add-to-cart.
Optimizing your product page and pricing
Furthermore, you want to convert an online marketplace visitor into a customer. Therefore do not optimize your product page once, but come back to it regularly. Take a look at customer reviews and questions. Can you incorporate the answer in the product description or images? For example: does your laptop sleeve only fit certain types of laptops? Add the brands and sizes that fit in the description, so customers are not left with any doubts.
Optimize your product page regularly.
Lastly, price is an important factor on third-party platforms. Optimizing your pricing so that it is competitive is vital. You do not necessarily need to have the lowest price, but your offer should be reasonable. Take a look at competitors with similar inventory and compare. If your offer, product information and reviews are optimized, you can even convince customers to buy your product for a higher price. To choose strategic pricing, you can also use data from the online marketplace itself or your own Warehouse Management Software (WMS) to predict demand.
Platforms in addition to your online shop
Maybe you already have an ecommerce business that is running smoothly. You have been getting steady orders and are growing your customer base. In that case, you could add more sales channels. Selling on online marketplaces in addition to your own store can be an interesting growth strategy. After all, being an online marketplace retailer will give you more insight into customer demand.
For this reason, it is a good testing ground for merchants. You can reach a new audience with your seller account, such as international customers for example. You can easily start selling cross-border through a third-party platform. Especially since most of these websites also offer fulfilment and shipping.
Online marketplaces are a good testing ground.
Additionally, you can test a new product on an ecommerce platform to see if it is in demand before offering it in your own store. Multi-seller websites are also a good place to sell leftover stock and returns that are in good condition. In this way, it does not go to waste or become an even bigger expense.
Selling on online marketplaces has become a serious business venture in recent years. In fact, around half of all ecommerce sales in Europe come from multi seller platforms. Since online market stalls make up a growing part of the ecommerce pie, a new type of business has been born: the marketplace aggregator. These ecommerce aggregators aim to acquire successful partner sellers and grow their business further.
As a seller, you become an interesting acquisition prospect once you generate between 1 and 5 million euros in revenue per year. This is often the point where you are increasingly successful and growing your business, but also needing to invest to continue operations. For a takeover, an aggregator often pays up to 4 times the annual net profits of the original seller. Have you grown your online marketplace business and are you interested in selling? Take a look at our list of ecommerce aggregators in Europe.