The trend of online buying is popular now, thanks to countless e-commerce websites offering multiple products under a single roof. They came by in order to cater to the diverse buying needs of online shoppers.
These marketplaces are known for the diverse choice in the quality, style, and pricing of goods. But they’re even more popular for making shopping extremely convenient. There are countless online marketplaces selling various goods to online shoppers.
With an increasing number of sellers offering their goods online, the level of competition across the internet has risen significantly. But the quality of the products has also improved in tandem. Hence, in order to ensure better profitability and online retail growth, business owners need to consider the following 10 issues before selling on a marketplace.
Top 10 Things To Consider Before Selling on Marketplace :
What are the key strengths of the marketplace
Before taking their business online, gain in-depth information about the strengths of the marketplace of choice. Business owners need to understand that no marketplace can sell all types of products to target audience with equal success, irrespective of what claims they might make.
Some marketplaces might have a better stronghold in selling low-value items. Others might be more suitable for selling bulk products or industrial grade items. It is also important to have a clear idea about the reach of the marketplace. Plus, also consider the stability and working policies to avoid losing good business opportunities.
One should not only verify the truth of the claims made by e-commerce websites but also conduct thorough online research on their own.
Level and strength of competitors
When choosing an online marketplace, pay special attention to the level of and strength of their competitors. Most e-commerce websites use multiple suppliers within a single category to ensure a better and wider choice for their clients.
Entrepreneurs need to carry out a complete analysis to understand
- the popularity of their competitors amongst clients
- their level of quality, pricing policy, and even market goodwill.
This is true not only in case of new businesses trying to create a niche in their chosen field but for established brands seeking an entry into the virtual marketplace.
Building a detailed and attractive catalog
One needs to present products and services in an informative and attractive manner to ensure success on a marketplace. Sellers need to understand that unlike in physical stores, online shoppers are deeply influenced by the manner in which a product or service is presented to them.
As such creating an attractive catalog that provides a multidimensional view of every product along with all the basic details such as the size, price, availability is of critical importance. It is also a good idea to have a separate information sheet for each product that contains all the above details plus a brief description of the product, color choices available and shipment details, for attracting customers.
Merchant Support Service
It is important to understand the kind of merchant support service they will be getting. The business owners need to make sure that the marketplace has a well-defined policy in place to help the sellers generate better sales for their products.
Most such websites even have a merchant support team consisting of experienced market consultants and other professionals. They work in close coordination with individual sellers to ensure that their products get featured in the marketing campaigns of the marketplace. The sellers need to ensure that merchant account managers understand their products and the target audiences. This way, they can devise result-oriented policies for better results.
System Access and Control
Entrepreneurs need to prepare themselves to face the restrictions that are integral to selling their goods through an online marketplace as compared to setting up their own website, in which case they have greater control.
However, the sellers should acquaint themselves with the administrative systems that the marketplace offers them for use. They should learn about the house rules of the marketplace including the maximum or the minimum number of listings allowed, the freedom to promote their brand using social media channels, restrictions on selling in specific regions and the access provided to customer data.
Margin, Fees, and ROI
There might be several reasons for sellers to join established marketplaces online. This includes the need to expand their market reach or increasing sales value. The sellers need to understand the fact that the virtual marketplace they choose cannot be used for lead generation or acquiring a greater market share.
In fact, almost every virtual marketplace will charge a set margin or every sale value from the sellers for goods sold through the website. In addition, the sellers should be prepared to shell out extra charges in the form of an annual fee, shipment fee, and listing fee, etc. However, in case the sellers feel that their sale margin and market goodwill has enhanced by a significant percentage, then they should not worry about paying the fee and other charges to get a good ROI.
Often the shipping mechanism differs with individual e-commerce websites. Some marketplaces handle the responsibility of shipping the products to the clients on their own. Others might defer this task to the sellers.
In the case of the former set up, the sellers might have to pay a small fee to the marketplace for this service. Alternately, the websites might even add the shipping charges to the price of the products, with or without the knowledge of the customers, in which case the price might become slightly higher.
- Payment mechanism
Timely and honest payments are critical for the success of any kind of partnership between a marketplace and sellers. The sellers should be extremely clear about how often and when they will be receiving the payment for the sold products.
Marketplaces should clearly explain fees and margins for each sale. They also need to specify how much would be deducted from the sale value.
Returns and Refunds
You need to consider return and refund policies supported by the marketplace before bringing products online.
Most virtual marketplaces have a uniform return and refund policy for all suppliers. This makes it necessary for the sellers to take back faulty products.
Dispute resolution process
It is extremely critical for the sellers to be aware of the dispute resolution policy followed by the virtual marketplaces. Generally, the marketplaces require the sellers to sign a contract. This details all the terms of the partnership and the method of handling any disputes.