Introduction
When a business decides to move to online sales, the obvious next step is to create its own online store or enter a marketplace. Right at this stage, it is worth realizing that there is no "good" or "bad" decision in such a situation. Much depends on the goals, scale, and overall needs of a particular business. Furthermore.
What is an online store and a marketplace: what is the difference?
An online store is a proprietary e-commerce platform with a specific assortment, functionality, pricing, delivery terms, customer communication, etc. In general, it provides complete independence from third-party platforms.
A marketplace is a unified online platform for all sellers and buyers. It has its own functionality, delivery terms, and other built-in features that should be considered when listing a product. Marketplaces also take a percentage of sales.
Each approach has its pros and cons, which we will outline in the next two blocks.
Pros and cons of a marketplace
The advantages of a marketplace logically follow from the previous block – they have ready-made functionality and an established audience. With such a starter kit, it is easier to launch online sales without the need to create your own platform, thus saving the budget at the start.
But these advantages also bring obvious disadvantages – third-party marketplaces can charge commissions according to the platform's terms, not to mention the constant competition right "next door" on the adjacent page. Marketplaces also have their own control over customer interaction, logistics, and overall rules of use, which introduces certain adjustments.
Pros and cons of your own online store
Among the obvious advantages of an online store is full control over the functionality, design, and the product brand itself. No third-party platform dictates cataloging conditions, marketing approaches, or the customer journey. It won't happen that one day the products end up blocked due to an unobvious rule violation.
Given the above, it is hard not to foresee the disadvantages – the need to invest a budget in the development, growth, and technical support of the site. Not to mention that the audience has to be built from "scratch" by investing in advertising.
Do not forget that for the creation of your own e-commerce platform, you should turn to professionals. To get the most positive result, entrust the creation of an online store to Geniustudio!
Which option is more profitable for a business?
Considering the previous points, there is no "bad" or "good" solution. If you need to quickly test a product or the budget does not allow for creating your own platform, a marketplace becomes the obvious choice, even if it has its own conditions and competitors "a page away," which must be taken into account.
Your own online store ensures brand independence and control over sales conditions and customer interaction. Depending on the product, it can become necessary when scaling, although it requires an appropriate budget. In conclusion, you need to rely on the current state of the business, its goals, and opportunities for further scaling.
An online store together with marketplaces: can both be used?
The short answer is "yes." For a more detailed answer, let's go through the points:
An online store as the main "anchor" of the brand – a proprietary platform that remains the calling card for the brand's services or products. It becomes a place where all successful solutions are accumulated, with an established structure and internal cataloging featuring a refined customer journey, logistics, and ad campaigns.
Marketplaces as an additional tool – in this case, they act as a source of extra sales, an instrument for testing product demand, and attracting a new audience.
Both approaches create synergy – after a successful launch of an online store, you shouldn't immediately abandon marketplaces, nor should you give up your website due to successful sales on marketplaces. When used rationally, both resources form a successful synergy for the business, performing different tasks.
However, it is worth remembering that simultaneously managing an online store and marketplaces can eventually raise questions regarding order centralization and customer base management. We talked in more detail about managing multiple sales channels in our article on CRM for online stores and marketplaces.
Conclusion
Given the above, there is no universal answer. When the choice arises to create an online store or use marketplaces as a platform, you must remember that they are not mutually exclusive, but in some cases, they complement each other. And if you have decided that it is time for your business to have its own sales platform, order the creation of an online store from Geniustudio.
