Marketplace or own eCommerce website: where to sell?

eCommerce is changing the way that businesses sell items and consumers make purchases around the world. In fact, eCommerce creates opportunities for businesses that struggle to make it off the ground with a brick and mortar store, since it gives them the opportunity to connect with customers both near and far.

As eCommerce sellers bring their products online, they have to make a decision as to where they are going to sell their goods. The options are selling on an online marketplace, building their own eCommerce website, or both.

In this post, we are going to give you the information you need to decide where to sell your products online. We will start by defining “eCommerce” and discussing the relevance of this type of business. From there, we will take a close look at both eCommerce marketplaces and independent eCommerce “storefronts” before comparing the two.

We’ll give you some tools to help you decide which option is right for you. To wrap things up, we will talk about a few of the top marketplaces for both B2B and B2C sellers and options for building an eCommerce website of your own.

What is eCommerce?

“eCommerce” is short for “electronic commerce,” and it refers to buying and selling over the internet. eCommerce has become more popular in the past decade as the internet has become more accessible. People can shop on their smartphones, tablets, laptops, and computers. Some sites even accept orders via their branded smart speakers.

In the early stages of eCommerce, many people were skeptical about entering their credit card information online due to underdeveloped security technology. Secure online payment portals have also made it easier for buyers to comfortably make payments online.

What is an eCommerce marketplace?

An eCommerce marketplace, which is also referred to as a “multi-vendor marketplace,” is a platform where different businesses can list and sell their products.

Some examples of well-known online marketplaces include Alibaba.com, AliExpress, and Amazon. Alibaba.com is a B2B marketplace, which means that it serves as a place for businesses to sell to one another. AliExpress and Amazon, on the other hand, are B2C platforms, which means that businesses use them to sell directly to consumers.

This type of platform charges sellers either a set membership fee or a commission on every sale. These fees are often worth it to sellers because of the perks that come with selling on a platform of this nature.

Let’s take a look at some pros and cons of using a marketplace to sell your goods online.

Pros

• Tools and resources for sellers
• Access to a large pool of active buyers
• Often works as a search engine (brings buyers directly to you)
• Often trusted by users
• Helps with expansion (in the local and/or global market)
• Facilitates exporting
• A safe place to manage buyer-seller relationships
• Secure portal for payment
• May include trade assurance and other programs that protect buyers and sellers
• Less effort and resources need to be dedicated to marketing

Cons

• Your offers can get lost in the sea of other products
• A small portion of revenue must be paid to the platform
• Distracting third-party ads and branding (not typically white-label)
• Less control over the functionality and layout of your storefront

What is an independent eCommerce website?

An independent eCommerce website, or a single-vendor store, is a platform owned by a specific business that primarily sells that business’s products. The items may be produced by different manufacturers, but they are generally sold under the site’s brand name.

This approach is considered more “high-risk”¹ than listing your products on an existing eCommerce marketplace because it requires a high initial investment with no promise that you will sell a single unit. Of course, it is not impossible to take this approach, but it is harder for new sellers to build a brand without making their products available via other channels.

Let’s take a look at some of the pros and cons of using your own website as an eCommerce storefront.

Pros

• No distracting branding or ads from third-parties
• More control over the site layout and functionality
• More flexibility on the aesthetic
• Users will not see advertisements or suggestions to purchase products from competitors

Cons

• High start-up costs
• More resources need to go to marketing and advertising on your own budget
• Additional fees for website development and maintenance
• More work goes into the setup of the platform
• Must generate your own traffic to the site

A side-by-side comparison

Selling on an independent online storefront and eCommerce marketplace each comes with its own set of pros and cons. In general, marketplaces generally provide more support, and using your own website gives you more control and flexibility.

Let’s take a side-by-side look at these two online selling options to see how they truly compare.

It is common for retailers to make their products available on both their own website and an eCommerce platform. This allows them to reap the benefits of both approaches, and ultimately, make more sales.

How to choose the right platform for your business

As we mentioned, there is no right or wrong way to sell your products online. You have to do what makes sense for your business and your individual goals.

Here are a few things to consider to help you make the decision on whether you should sell on your own website, a reputable eCommerce marketplace, or both.

Your target audience

Who your target audience is and how they are buying is one of the biggest factors that you should consider when choosing a place to sell your products online.

If you are selling to businesses in bulk, your average ticket is likely a lot higher than it would be when selling to consumers. Since these buyers are spending large sums of money, they might be more comfortable making the transaction through a reputable online marketplace. In that situation, it makes sense to use an eCommerce marketplace.

While an individual website can be morphed to fit any audience, choosing a marketplace is a little more restrictive. This is because platforms of this nature are generally either geared towards business buyers or consumer buyers. This is not a bad thing in any way, but it means that you need to be intentional when comparing platforms.

Your competitors

Has anyone ever told you that you “don’t have to reinvent the wheel” to find success? Take a look at what your competitors are doing. Determine how they are finding success, and model your approach around that.

If your competitors are successfully selling on their own website, why not give that a try? If they’re successfully selling on a well-known marketplace, give that a try, too.

Also, pay attention to what others are doing that is not working, so that you know what to avoid.

We recommend pulling inspiration from other sellers rather than copying them directly. Put your brand’s unique twist on whatever you do so that it makes sense for your offer and target audience.

Your brand’s reputation

If you have an established brand that is well-known among your target audience, selling on your own site should be no problem at all.

However, brands that are relatively new and haven’t yet built a loyal customer base may have a bit of difficulty selling products exclusively on their own site right off the bat. That is where an eCommerce marketplace can help out.

Even if you choose to sell on an eCommerce marketplace, you can’t go wrong by having a site of your own, as well. This way, you can have your independent site ready to go as your brand becomes more reputable.

Your budget

Your budget should be a guiding force for any decision your make for your business, and choosing the best platform to sell on is no different.

Selling your products on an eCommerce marketplace often comes with seller fees and/or commission dues. Using your own website to sell your products comes with costs for development and maintenance, annual subscription fees for hosting, and sometimes, commission dues, as well.

Pricing and fees will vary by the marketplace and website hosting platform.

Your goals

Last but not least, you should keep your goals in mind when deciding which direction you want to go in terms of eCommerce.

If your goal is to expand beyond your local market and start selling across borders, an online marketplace will come in handy. Alibaba.com, for example, offers support for auto-translation and currency conversion. These tools make it easy to make sales to buyers who do not speak the same language as you.

This is not to say that you cannot find success with your own site, but to point out that it is easier to scale globally with the support and tools that many eCommerce platforms provide.

Top 4 eCommerce marketplaces

There are many eCommerce marketplaces on the internet, but the key is to choose a platform that is well-known and reliable.

Some things to pay attention to as you choose a marketplace include protection for both buyers and sellers, secure payment portals, selling costs, storefront customization tools, and the general reputation of the platform. You’ll also want something that is user friendly for both you and your buyers.

If you’re selling to other businesses, you’ll need to choose a platform that sells to businesses, and if you are selling to consumers, you’ll need to choose a platform that sells to consumers. In this list, we will cover both B2B and B2C options.

1. Alibaba.com

Alibaba.com is one of the world’s most well-known B2B marketplaces. It offers a secure place for buyers and sellers to carry out transactions.

Many sellers are comfortable buying on Alibaba.com because the platform has several ways to verify the authenticity of sellers and past buyers can leave reviews to share their experiences. Alibaba.com also offers Trade Assurance, which is a program that ensures that buyers get what they’ve paid for in terms of quality and quantity.

Additionally, our secure payment portal gives buyers some peace of mind when spending money with a seller that they have not previously worked with.

The trustworthiness of Alibaba.com is very attractive to sellers, as well. Sellers know that buyers come to Alibaba.com ready to buy, so listing their B2B offers on this marketplace is a great way to connect with new customers and generate more sales.

With Alibaba.com, sellers own their relationships with buyers, but the relationship can be managed directly on the platform.

The seller registration is completely free and you can get a feel for how the platform works before committing to a paid membership, also known as the Gold Supplier membership. Except for the annual membership fee, Alibaba.com does not take a commission on most transactions.

2. AliExpress

AliExpress is a B2C platform that is operated by the same group as Alibaba.com. This platform is an online general store that sells everything from clothing to tools to electronics. All products on AliExpress are from independent sellers, meaning that nothing is produced by AliExpress.

One of the most notable features of AliExpress is “Buyer Protection.” Buyers that order items from verified AliExpress sellers can rely on a money-back guarantee and free returns on many items.

Again, if you choose to sell on an eCommerce marketplace, you’ll want to choose one that has a good reputation among buyers because it will yield the best results for your business.

3. Amazon

Amazon is a B2C marketplace that has become very popular over the past several years. It is a lot like AliExpress, but Amazon sells its own branded items in addition to items from independent sellers.

This platform has grown because it is reliable and convenient. Amazon offers a membership called “Prime” that offers 2-day delivery members.

Fulfillment by Amazon (FBA) is another unique feature of Amazon that is designed to help sellers scale their businesses. With FBA, sellers keep their stock at an Amazon fulfillment center, and Amazon fulfills orders for you.

Selling on Amazon can be a bit expensive as different products are subject to different commission rates. The commission is charged on top of a $39.99/month seller’s fee.

Amazon is very popular in the United States, but it facilitates transactions between buyers and sellers around the world.

4. eBay

eBay was one of the first eCommerce platforms to become popular in the United States. This platform was originally known as a C2C platform where buyers could bid on used items, but it has since grown to one of the largest B2C eCommerce platforms.

eBay facilitates the sales of everything from the latest and greatest electronic devices to antique cars.

Top 4 eCommerce website platforms

If you decide to build your own eCommerce storefront, you’ll need support from an eCommerce and online shopping cart solution provider. Here are a few of the best platforms for building an eCommerce website.

1. Shopify

Shopify is one of the most popular platforms for building an eCommerce site. This platform offers three different plans for eCommerce retailers with different needs.

In addition to easy-to-build storefronts, Shopify offers support for marketing, SEO, abandoned checkout recovery, inventory management, digital product sales, video and 3D displays, subscriptions, and more.

The most basic plan starts at $29/month. Additional transaction fees apply.

2. Magento

Magento is very similar to Shopify in terms of storefront building and functionality, and it has solutions for small businesses, mid-market businesses and enterprises. It also has tools for B2B selling. You must contact the Magento sales team for information on pricing.

3. WooCommerce

WooCommerce is a WordPress plugin that adds eCommerce capabilities to WordPress sites.

The key features of this tool include online storefront set up, flexible and secure payment, and on the go order management. WooCommerce is open-source software, which means that developers have a lot of flexibility in terms of customization. That said, it does require a bit of personal experience to make the most of this tool.

Users must have a WordPress subscription to use this plugin.

4. Squarespace

Squarespace is a website hosting platform that has eCommerce capabilities with its more inclusive subscription packages.

Squarespace offers tools for both coded web development and simple drag-and-drop website building. This means that you can use Squarespace to “DIY” your site or you could hire a professional to custom code it to give it a more professional touch.

Final Thoughts

Deciding where to sell your products online may feel overwhelming, but when you carefully weigh the pros and cons of single-vendor online storefronts and eCommerce marketplaces in terms of your business’s unique goals and needs, it shouldn’t be hard to find the perfect solution.

Selling on both types of platforms can be valuable because it provides the best of both worlds. It gives you a space where your loyal customers can shop your products without having to give commission to a third-party, while you’re also reaping the benefits of selling on an established eCommerce marketplace.

If you are a wholesaler or manufacturer who is selling to other businesses, we recommend making your products available on Alibaba.com, even if you are using a site of your own. This way, you can test your products in new markets and reach 14 million active buyers that would not have otherwise come in contact with your brand.