Solving the Feud: Is Owning An eCommerce Store Better Than Selling on Marketplaces?

eCommerce store better than selling on marketplaces

Do you have a long list of suppliers, and your warehouses are rationally stacked with inventories? Are you also involved in the battle of choosing between an eCommerce store and an online marketplace? The selection between the two is like a maze with numerous permutations and combinations, hence choosing one is not an easy task.

It is not the costs that are creating a huge difference. But, there are a plethora of things that need to be analyzed before solving the feud, “Is owning an eCommerce store better than selling on an e-marketplace platform?”

Don’t fret! There is a solution to everything. Let’s take a look at all the options to resolve the battle between the two platforms.

What is An eCommerce Store?

What is An eCommerce Store

An eCommerce store is any website where buying and selling take place over the internet. eBay and Alibaba are some of the best examples of an eCommerce store.

The advantage of owning an eCommerce store is that you have complete control over your business. You can also personalize the look of your online store with some ready-made templates and position yourself differently from the crowds. Several eCommerce platforms like WorksLeader, Magento, etc., allow businesses to integrate new features using modules and extensions to enhance the experience of the customers.

What is A Marketplace?

What is A Marketplace

Have you ever gone to a shopping mall? Do you go to check multiple stores on different floors and buy one product from five distinctive stores? Now, picture the same thing in an online space. This is known as a marketplace.

A marketplace is a third-party eCommerce website where different sellers list their products and services for the buyers to choose from. Amazon and Flipkart are some of the marketplace-based eCommerce websites.

Owning An eCommerce Store vs. Selling on Marketplaces- Key Differences to Consider

Owning an eCommerce store and selling on marketplaces – each comes with its own set of advantages and disadvantages. It’s time that we look into how these two solutions compare against the top concerns of the vendors.

Here is the breakdown of the features of both an eCommerce store and a marketplace:

eCommerce vs. Marketplace: Traffic

The main factors that you need to consider are who is your target audience, and what is their buying behavior. Considering these factors will help you choose the platform to sell products online.

If you receive bulk orders from businesses, you are likely to earn a lot higher compared to selling to the consumers. As the business buyers spend a whopping amount of money to buy a product or service, they would like to transact through a reputable online marketplace. In this case, an e-marketplace platform will be a good choice.

On the other hand, an eCommerce website caters to any type of audience. You can even modify your website to fit your audience’s needs. In this space, the online marketplace becomes a little restricted. It is because online marketplaces are geared towards selling the products and services to either business buyers or consumer buyers.

Thus, you should keep the traffic of your website i.e. your target audience in mind, before deciding whether owning an eCommerce store is better or selling on marketplaces.

eCommerce vs. Marketplace: Marketing

Marketing is another important factor to consider while selecting to sell products online through an eCommerce store or a marketplace. An effective marketing strategy in the fast-paced business environment is a valuable asset to expand your business.

An established online marketplace offers instant access to a large audience base. It supports the marketing efforts of the sellers through attracting, nurturing, and engaging leads on the website. So, you don’t have to focus on driving traffic if you are just starting out. This way you can concentrate on more important things of the business.

On the contrary, the sellers have to take care of lead generation if they own an eCommerce store. He has to take care of other marketing strategies like SEO, landing page optimization, order fulfillment and shipping, and various other things.

eCommerce vs. Marketplace: Inventory

Inventory plays a crucial role in tracking down the products and supplies. An effective inventory management system keeps a record of the time of inventory purchased, sold, and the stock in hand.

Marketplace owners do not own the inventory they sell, unlike an eCommerce platform. Thus, the marketplace leaves the operational side of the business to vendors while their main focus is on brand promotion with a view to drive traffic and convert the site views into sales.

In contrast, an eCommerce store runs its own inventory. Due to this, they need to invest heavily in stock acquisition and management along with customer service, sales, marketing, social media, content, and much more.

Both the options are equally considered in terms of inventory. The choice of the platform entirely depends on your investment in inventory.

eCommerce vs. Marketplace: Time to Launch

The timing of the business opening decides on the success and failure of your business. If you launch your business too early, the market will not be ready for you, and your business will fail. But, if you become late in launching your business, someone else will beat the market and steal the limelight even before starting.

If you think of selling your products online, the marketplace offers quick steps to set up your business. You hardly require a day or two to set up your business on any online marketplace. You just need to follow the steps to register your business, and you are good to go.

eCommerce stores are difficult to set up as you need to know some coding languages, SEO, and various other things to build a foundation for your website. It can be a time-consuming process.

Therefore, time to launch is an important factor worth considering while opting between an eCommerce store and a marketplace.

eCommerce vs Marketplace: Cost

The costs are the guiding force of any business decisions and choosing the best platform to sell 

your products and services are no different.

Selling your products on marketplaces often comes with seller fees and commission dues (usually between 5 percent to 15 percent). Selling on your own online store includes development costs, maintenance costs, annual subscription fees for hosting, and sometimes commission fees as well.

Prices vary for both marketplace and eCommerce stores. Now, it’s your choice whether owning an eCommerce store fits your budget or selling on marketplaces.

Is Owning An eCommerce Store Better Than Selling on Marketplaces?

Is Owning An eCommerce Store Better Than Selling on Marketplaces

Deciding to sell your products and services online can sometimes become overwhelming. But, when you measure the pros and cons of marketplace-based eCommerce websites and a full-fledged eCommerce store in terms of the unique goals and needs of your business, it isn’t an uphill task to choose the better solution.

Both the platforms are equally valuable as they offer the best of both worlds. They provide a space where your customers can freely shop for their products and services without giving commission to the third party while also reaping the benefits of a reputable eCommerce marketplace.

If you sell your products in bulk to other businesses, we recommend you to make your products available on an established marketplace, despite having an eCommerce store. This way, you can expose your products in front of a large audience base which you would not have otherwise gained on your own branded website.

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