Your own online shop or Amazon and ebay: Where should retailers sell?
There are many different ways and solutions to design your first entry into online trading. On the one hand, there is the possibility of approaching carefully and on the other hand, retailers can also go straight to the start with their own extensive online shop and a broad product portfolio. Whether your own online shop or via the marketplaces Amazon and ebay ? One thing is certain, whoever wants to trade online has a whole range of options. In this blog post we reveal which sales platform is best for you.
Check out the advantages and disadvantages of online marketplaces and your own online shop
|Amazon & ebay
|Investment & reach
|Capital is usually required for your own online shop. A fee is usually due monthly (for cloud-based systems) or annually (for licenses) for using shop software. In addition, the site must be set up with all the necessary functions and filled with content, which calls for special knowledge or external experts, whose services may incur additional costs. If the page is then ready to start, it takes time for the first customers to find it. In addition, there is an urgent need for marketing to make users aware of the shop.
|Selling on the marketplaces often only requires a small amount of seed capital. In addition to sales commissions, which are only incurred if a sale actually takes place, additional monthly fees may be incurred. Both are visible in advance and stored in the terms and conditions and are therefore transparent. The biggest advantage: Almost everyone knows Amazon and ebay, which has a positive effect on the number of users. Once the product has been entered, it can be found and ordered directly using the search function.
|Technology & service
|The shop operator is primarily responsible for the organization, administration and costs of technology and service. Depending on which shop system is used, support can be used and certain tools made available. It is of great advantage if the shop operator is already active in the industry or has the appropriate prior knowledge, which means that he can manage and implement a lot himself without having to resort to third parties.
|Marketplace traders pay fees and receive working software in return, so that the processing of sales can be guaranteed without any problems. But here, too, it should be noted: Should problems and technical difficulties arise, the retailer can usually not exercise any influence on the problem solving and is dependent on the provider.
|Your shop – your rules! With their own online shop, retailers can choose their own individual functions and designs and offer their own customers the experience they themselves deem appropriate.
|Retailers have very little influence on the product presentation and the corresponding design. Marketplaces have strict guidelines that traders must adhere to. Colors, fonts and layouts are largely standardized, even if ebay offers more options than Amazon. In the event of a violation, dealers can be warned or the product can be excluded from sale.
|Pricing & Pricing
|Here, of course, retailers have the great freedom to calculate their prices appropriately and individually. Since there are no fees in contrast to sales via the marketplaces, the profit margin is generally significantly higher. Another important effect is that visitors to the shop do not have a direct price comparison as long as they are on the site. While the price is often the decisive criterion on the marketplaces, general perception and a successful brand image play a major role in your own online shop.
|At the market places where customers can choose between many similar offers, the price is often decisive. Users choose the retailer where the product is only a few cents cheaper or where there are no shipping costs.
However, there are already great repricing tools for retailers that support price calculation and make them competitive on the marketplaces without destroying the margin.
|Online shops also compete as soon as they offer similar products. The motto here is to build up your own customer base, to bind regular customers to the company through targeted marketing measures and to increase awareness through branding measures.
|Price dumping and competition is a known problem on marketplaces. Because the more retailers with the same products are represented on the platform, the more the pressure increases to achieve the best possible price. This results in products being sold below the margin and traders gradually having to distance themselves from the marketplaces.
|A good online shop convinces first and foremost with good product quality, shipping speed and friendly service. If these criteria are met, the customers remember the name and can thus be permanently linked to the online shop. Here, too, of course, your own online shop offers a lot of freedom when it comes to remarketing.
|In general, one can say that customer loyalty on the marketplaces is rather limited. For many users, it is not necessarily relevant who they order from. What counts here is the seller’s rating profile, a good price and problem-free delivery.
|When it comes to building a brand, there is no question that having your own online shop naturally offers more options. As already mentioned, it takes a while until the shop is up and running and can be found by the first customers. So retailers are initially starting from scratch and have to work to raise awareness of the shop through targeted measures. There are already excellent opportunities to draw attention to yourself via social media channels, Google, partner sites and many more. However, it should be noted here that this can be time-consuming and costly.
|Basically, the marketplaces forbid traders from mentioning their company in any way. Amazon is particularly strict here; the shipping giant forbids its retailers to insert business cards, for example, or to mention their own shop on invoices that are included in the packages. Branding for one’s own brand can therefore hardly be carried out on the marketplaces. However, retailers who sell private label products have advantages in terms of branding. In addition, products can be placed more prominently within the platforms through fees or advertising bookings, thus promoting sales.
Having your own online shop offers you complete freedom of design, but requires long-term optimization with regard to SEO so that it can be found on the web in the first place.
Either … or? Why not both! Pursue a multichannel strategy
More and more companies are no longer deciding whether they would rather sell with their own online shop or on marketplaces such as Amazon, eBay & Co. They are pursuing a multichannel strategy , meaning they sell their products through multiple channels. In this way, the advantages of marketplaces and your own shops can be combined. In addition, this approach reduces dependency on a single platform: if, for example, sales from your Amazon business decline, for example because you have dropped in the SEO ranking and thus lost visibility, sales through your online store could compensate for this loss.
However, we should not fail to mention that multichannel is not just a sales strategy, but rather a growth strategy. Newcomers to e-commerce may not want to sell through different channels right from the start because, with all the advantages, this also entails a higher administrative effort. Automated solutions are often required here in order not only to place your own products on different platforms, but also to sell them effectively and competitively.
SnapTrade, the all-in-one solution for marketplaces and online shops
With SnapTrade you get dynamic repricing for your Amazon and eBay products. You can sell your items within fixed price ranges using various sales strategies. This increases your visibility and guarantees you competitive pricing.
The ShopSPY included in SnapTrade analyzes the products in your online shop using common comparison portals such as idealo, Google Shopping and billiger.de. Based on the results, you will receive price suggestions for your items.
Our recommendation: Rethink multichannel! In fact, when choosing a distribution channel, there are enough good reasons to use multiple tracks. It is recommended, for example, to start online sales on a platform in order to try out and analyze aspects of implementation before setting up your own online shop. In this way, among other things, you can of course test very well whether online trading is even suitable for your own company, internal processes work and the selected logistics partner is reliable. If retailers opt for a single sales channel, in the worst case scenario they may fail to take advantage of the opportunities.
Tip: Our ASIN advisor can help you to find new niches and articles with potential and to find out the prices of the competition. Find out more here!
In summary, one can say that the marketplaces are a very good school for e-commerce newcomers, as they are extremely focused on customer satisfaction and do not involve any special investment or knowledge. If the retailer gains the necessary experience, he can approach the plan of opening his own web shop more calmly because he now knows what his customers want and what a successful shop needs.
We are also happy to support your start in e-commerce with our broad product portfolio. Find out more about our solutions here!
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Frequently asked questions about the marketplace or your own online shop
What is better, own online shop or marketplace?
Unfortunately, the somewhat unsatisfactory answer has to be: “It depends.” Whether your own online shop or a marketplace is the better choice for you depends very much on your business model and your products. If you’re in a niche market that gets little visibility, it can be worth leveraging the reach of marketplaces. If your products are of particularly high quality and/or can possibly be individually manufactured, it makes sense to have your own online shop, as you can adapt it to the needs of your customers and, for example, offer consulting services directly.
What are the advantages of having your own online shop?
The clear advantage of having your own online shop is the great freedom of design. When creating your shop, you are not bound by the specifications of the marketplace. In addition, selling on marketplaces is always associated with fees. In addition to a monthly usage fee, there are usually transaction costs.
What are the advantages of online marketplaces?
Online marketplaces are established platforms with millions of visitors accessing them every month. You can
How to create your own online shop?
You can create your own online shop using various shop systems such as Shopify, Shopware, Magento or the like. Vendors offer their systems in different packages, so small and large businesses can find some suitable solution to suit their needs.