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Online marketplaces are some of the best marketing channels known to man. Since the rise of giants like Amazon, eBay and Alibaba, brands have rushed to thrive, compete, or be beat on these online storefronts.
If you’re an eCommerce manager or store owner or even a junior marketer you need to get some online marketplace skills in your toolbelt.
So today I would like to share with you a quick breakdown of some of the top marketplaces, strategies for success, and the tool you need to blast off.
Let’s dive in.
Why expand to new online marketplaces?
First things first, why should an eCommerce business consider expanding to other marketplaces?
The obvious reason is increasing sales and growing your user base, but there are other reasons as well. Let’s look at the top reasons for marketplace expansion.
the obvious benefit of expanding to marketplaces is the potential to make more sales and increase your profit. Each marketplace has its own audience (often overlapping) and its own fee structure. For example, Houzz charges 18% commission while Etsy only takes 5%. There is a lot of opportunities to find the right marketplace for your brand with the right product and audience fit.
Growing your brand
you’d be surprised how many people find a product they like on Amazon or eBay and then buy from it directly on the company’s website. It happens all the time. Plus, the more that customers see a certain brand, the more familiar it becomes to them and they are more likely to buy or recommend its products to their friends. Brand growth isn’t really quantifiable but marketers can measure it by the overall site traffic and branded searches.
There are a ton of opportunities to combine online marketplaces with affiliate marketing. Some affiliates will only work with you if your products are on Amazon for example. So selling on Amazon can open doors for you to build long-term partnerships with affiliates, coupon sites, large publications, etc.
Last but not least, once you get traction on an online marketplace (if your product is good and you’re getting positive reviews) then you can often expect long-term growth. The channel will require the normal customer service and operations efforts to ship and service your customers. And you can continue to optimize your listings, but you won’t need to re-invent your business. This is the epitome of “not putting your eggs in one basket”.
Ok, so there are a ton of benefits of selling on online marketplaces.
Let’s cover some of the general marketing strategies that are common across all marketplaces before we narrow down on the specifics.
What are some general marketing strategies for online marketplaces?
Excellent customer service
This sounds like a no-brainer but when you sell on an online marketplace you have to go above and beyond on your customer service. Every marketplace builds different customer expectations on the shipping and customer service and you have to match those to be successful. For example, Etsy customers expect every communication to be really personal. Houzz expects brands to ship the product in under 48 hours.
I recommend responding to every message from a customer in under 24 hours, no matter the channel. You should consider being more flexible on a new marketplace, offering discounts, free returns, and in general, satisfying the customer even if it goes beyond your usual policy. Give yourself time to adjust to the customer expectations and grow your reviews, that’s the key to establish yourself as a top seller.
Optimize your listings
It’s always good to optimize your listings for SEO purposes and to improve your click-through rates. Have good pictures, research keywords and tags and include them in detailed product descriptions.
Your focus should be writing for the customer-first, so make sure that you have all the product information that the customer might be looking for (dimensions, specs, instructions, etc). Also, make sure to use the various SEO tools that are available for the channel that you are working with.
Automate your pricing
Adjust your pricing to every single online marketplace. The price should vary by channel because the fee structures are different and because the audiences are different. There are also marketplaces like Overstock that require you to have the lowest prices anywhere on the internet, and that gets hard to track.
So the best way to keep track of all the pricing on every marketplace is by using a pricing automation tool. A pricing tool will keep all the pricing info for you and allow you to adjust it automatically and publish it out to the marketplace.
Advertising and promotions
A lot of marketplaces offer advertising solutions to their sellers. Amazon is the most famous example where sellers are literally raking in tens of millions of dollars in revenue by using ads. eBay also has an ad platform that is quite developed. Other channels are slowly developing their own - like Etsy and Houzz. These are less robust and don’t offer the customization that you would expect on Amazon or Google Ads but they are still really powerful in getting more impressions, clicks, and sales.
Promotions are also quite powerful. Later in this guide, we cover some specific promotion strategies for various marketplaces. A common practice is to test out a weekend vs weekday promotion for 10-15% off. You could also run a month-long promotion and see how it does.
With all of these benefits and strategies, businesses are still very conservative when it comes to this kind of expansion and the reason is they think that it takes a lot of time and money to do this.
In the last couple of years, there have been a lot of tools and platforms that came out and significantly reduced the cost and time needed to expand to new marketplaces.
Here are some of them.
What are the top eCommerce marketplace tools?
Shipstation is the top inventory management tool that lets you keep track of all your orders from all the channels that you are selling on. It integrates with all of the top marketplaces and easily lets you monitor inventory levels, change SKUs, and create automation rules that let you ship items with just one click.
Skuvault is an inventory management tool that does everything from multi-channel synchronization, organizing purchase orders, performing quality control, and monitoring inventory levels for each item. It’s a great system to use to make sure that everything is organized.
This is a great tool to find the best shipping cost for your items. If you are not using third-part fulfillment like FBA then you want to make sure that you are getting the best price. Use Desktop Shipper to find the best shipping option for you.
SellerActive is a multi-channel repricing tool that lets you monitor and change prices on products by channel. If you are selling on a few online marketplaces then it’s hard to keep track of
Deliverr is an innovative shipping company that can fulfill your orders for you. They distribute your items throughout their network of warehouses around the US to ensure 2-day delivery times for each order. So you can get the same service as Amazon without having to use FBA. The advantage is that your item arrives in your own packaging, and without Amazon’s tape all over it, which is a great plus for growing your brand.
What are the top online marketplaces?
What do you think of when you think of online marketplaces?
Are you thinking Amazon? eBay? Ali Express? There are probably close to 150-200 large online marketplaces around the world. So if you are only focusing on a few of them, it might be time to expand.
Here is a list of some of the largest ones with some key marketing strategies for you to follow.
Amazon is the biggest marketplace in the US and it has over 300 million customers and 100 million of them are Prime members. and the average consumer spends around $1,400 per year. It can be competitive for a lot of the categories but it’s an incredible opportunity for any business. A lot of retailers choose to ship with FBA which has a lot of advantages.
Average conversion rates on Amazon are 13% for non-Prime members and 74% for Prime members so you want to make sure that your products are available on Prime.
Amazon is established in many countries and markets so this gives you an added benefit of working with a global marketplace. If you rely on FBA, then you simply ship your goods to an Amazon warehouse, and then they disperse them across their warehouses to ensure fast shipping. Amazon is famous for 2-day shipping and you can use their shipping for other marketplaces and marketing channels, which is a great plus.
Top Amazon marketing strategies:
-Invest in SEO and optimize all of your listings. This is really crucial for an established marketplace like Amazon. Spend the time researching the best keywords, optimize your descriptions, work on formatting your product names to include the right keywords for the best click-through rate.
-Amazon ads are a HUGE source of revenue for retailers. Make sure that you have someone on the team that specializes in running ads on Amazon or pick an agency. There are a ton of agencies and marketers (lots of them are here at Mayple) that can help your sales skyrocket.
-Excellent customer service is key on Amazon. Maintain a 24-hour response rate to every single question or complaint. Make sure that you answer everything on time. load up some templates that will be automatically sent for you when the order moves across the various stages. Also, make sure to respond to every single negative review to show that you care.
Etsy started as a marketplace for handmade and artisan goods and has expanded in the last few years to manufactured goods that are still designed by people or brand owners. There are many middle to large-sized brands that are popping up on Etsy every single day.
Etsy had over 2.5 million sellers in 2019 and over 39.4 million Etsy buyers worldwide. They charge a 5% commission which is significantly lower than other marketplaces and their user interface is beautiful and much more user-friendly than most.
Top Etsy marketing strategies:
Use product tags - I cannot say this enough. Product tags are probably one of the most powerful features of your listing (after the title and description of course) and you should use the maximum 13 tags on every product. There’s a great free tool called eRank that you can install on your store and it shows you which products aren’t fully optimized, so you don't have to go digging through your entire inventory.
Optimize your listings - there are a whole lot of other options that sellers usually skip, but are essential. Things like the holiday or occasion, color, dimensions of the product, materials used, personalization, are all features that might land you a top spot on a user’s search. Don’t skip these, go through them and test them out.
Post videos - videos were just released on the platform and it’s a great way to differentiate yourself. You can post tutorials and guides on how to install/use your product, you can post promotional videos, and more. Etsy will start displaying more and more videos as they develop this feature so it’s a great time to jump in before everyone is using it.
Branding - branding is super important and it’s not for the reasons you think. Branding is a way to differentiate your images from your competitor’s images. One particularly successful brand that did this is Lily and River. It’s a small company based in Phoenix and run by David Stuebe. They post these pretty best-seller badges on their images which absolutely blow up their click-through rate and sales.
eBay has 182 million users worldwide and provides a really amazing opportunity for brands to sell their goods. There are certain categories that are more popular on eBay than on Amazon like sporting goods, consumer electronics and health & beauty.
eBay also has lower fees compared to Amazon, they are $0.3 per listing and a 10% commission rate on each sale (in most categories). Amazon in comparison has a 15% commission rate on everything. It’s also easier to start selling on eBay because they give sellers 50 zero insertion fee listings per month.
Top eBay marketing strategies:
Promotions - promotions are absolutely key on eBay. You do need to get on the store plan with them (which is a monthly payment) but it’s well worth it. eBay tends to prioritize promotions that are about to be over so a great way to optimize promotions is to make them run for 2 days, so 15 promotions per month.
Ads - another great way to double your impressions is to advertise every single listing you have. When you do this, eBay creates duplicates your listing when it displays the advertised one on specific search results. The amount you advertise it for doesn’t really matter in the beginning and can be tested/optimized later on.
Wish is a marketplace for unbranded goods that are at rock bottom prices. It was built by two former Google and Yahoo developers and it quickly became the:
- #1 shopping app in 42 countries
- #1 downloaded app in the US in 2017
- valued at $11.2B in 2019 (CrunchBase)
What is the secret to its success?
It went after the “invisible half”, as they call it, which is those shoppers that are looking for the best deal, and don’t care which brand they are buying from. You can think of Wish as the American version of Alibaba (without the wholesale potential).
“We never hypothesized going after value conscious consumers with unbranded goods, but the early data was indisputable. There was a large underserved market of consumers that prioritized price over pretty packaging, fast shipping, and brands. Despite our metrics, we were told repeatedly and at every stage by Menlo Park investors that they didn’t know anyone that would shop on Wish.”
- Peter Szulczewski, CEO of Wish
Wish became an eCommerce giant in the US because of its pricing strategy and how they prioritized pricing over the user experience. But this marketplace isn’t going to work for everyone. A brand needs to be able to price their products very low and have very flexible worldwide.
Top Wish marketing strategies:
Wish Express - try to get as many products on Wish Express, which is Wish’s program for 2-day shipping. It will boost your rankings in the algorithm and your sales.
Global shipping - offer global shipping to your customers and choose products that are cheaper to ship, more compact, etc. This will make or break your selling experience on Wish.
Wish ads - Wish has a great and easy-to-use ad platform where you can advertise your products based on bids & keywords as well as run promotions. Spend considerable time on this, it will pay dividends in the long run.
Online marketplaces are a great way to grow any eCommerce business, you just have to find the right ones. Look for marketplaces that have the ideal audience that you would like to market to, and make sure that it’s a fit in terms of margins, commission fees, and shipping policies.
Once you launch on an online marketplace and get some traction, replicate your efforts on another channel and continue growing. Use inventory and pricing automation tools and utilize the marketing strategies we mentioned and you will be successful.