What is a marketplace and what opportunities does it offer for online trading?
We will look at the nature of online trading platforms and their advantages and disadvantages.
If you are an online marketer , you may have heard of marketplaces and the fact that they offer the opportunity to grow businesses like yours. You are probably wondering if this model is more successful than developing your own online store. What exactly is a marketplace and what opportunities does it offer for e-commerce? You will find the answers to these questions in this article.
Marketplace or online store?
Marketplace is a platform where retailers can offer their products or services and rely on high user traffic. The owners of these platforms aim to provide their customers with the best possible conditions to generate this traffic and stimulate sales. Each sale that is made on the platform brings a profit to the owner of the marketplace through a commission. Unlike these online platforms, the online store is a place where products are offered separately, and marketing and operational activities are the responsibility of the store owner.
Since the owners of the marketplace platforms do not own the products that are offered, they leave the operational side of the business to be run by the retailers. The main goal of marketplaces is to be as unique and easy to use as possible so that they can attract traffic that leads to sales.
Advantages and disadvantages of marketplaces
Thanks to the marketplaces you get the opportunity to access a wider audience, but to make the right decision whether this business model is for you, we will look at its advantages and disadvantages.
Why choose to develop your e-commerce through a marketplace?
One of the biggest advantages of online trading platforms is the number of customers who can learn about your products, but that's not all.
- You have access to more traffic (even international)
In some cases, you have the opportunity to sync your online store with the online sales platform and thus get more traffic than if you are trying to develop and promote your store yourself. In addition, a very big bonus is that you get a chance to expand your international presence and all this can happen in an easy and professional way.
- You get rid of the technical side
If you decide to work with a marketplace, you don't even need to have your own online store. You can completely entrust the technical part of the platform and just add your product catalog. You don't have to think about payment methods and logistics, as most platforms take care of that.
- It is cheaper than having your own store
One of the most important and expensive things for online store owners is online marketing . You do not need to spend time and money to develop your marketing strategies, because the platform takes care of it. You can start selling immediately after registration.
Although you won't have complete control over all the processes, you can rest assured that you don't have to think about domain, hosting, web design, copywriting, SEO positioning, sales funnels and so on.
- Increases your credibility and customer trust
When you are about to establish yourself in online commerce, the main thing you will have to deal with is building trust between you and your customers. In addition, there are many doubts about payment methods and data collection.
If you choose to grow your business through a marketplace, you can count on the good image of the platform and the trust it has already built over time.
What to look for when choosing a platform for your e-commerce?
Online sales platforms help you enter online commerce quickly, but they are also a business that must also be profitable. So let's look at the other side of the coin.
- A commission is charged for each sale of the platform
Always pay attention to the commission rate that will be charged on each sale. Usually this percentage can be from 5 to 20%. Against this background, you need to choose the right products to sell so that you can finally make a profit.
- Be aware of the competition
Competing to one degree is a positive thing because it stimulates us to be better at what we do. However, you need to be aware of the facts. And they are that it is possible for traders to have duplicate products and undercut prices. For this reason, you will often need to monitor what is happening in the market and what prices other retailers are announcing.
- If you decide to leave the market, you will leave information about your products and sales
In case you have developed your business entirely on the platform, if you decide to leave it, you will leave the information contained on it. Here we talk about product descriptions, sales history, various statistics, customer data and product reviews.
Be careful before choosing the platform to work with. Check the conditions and carefully calculate your profit margins.
It is true that it seems relatively easy and profitable to sell products through a marketplace. If you have a limited budget, these online markets are a great option for growing your e-commerce . Given all the advantages and disadvantages, you can make an informed decision on how to grow your business.
Online markets are an increasingly attractive option for those who want to enter e-commerce and reach a wide range of consumers.
BigArena Marketplace allows you to find all the products you need and to sell and buy all over Europe. Each order through the platform guarantees 100% security against fraud or money back. You can also count on a reliable dropshipping partner , affordable wholesale prices even for single units and competitive delivery prices. Send an inquiry for an offer on the BigArena Fulfillment page and our team will contact you with a suggestion on how to most effectively develop your business.