Aren’t our lives have become faster and easier than it was a decade ago? Indeed, it has become faster and easier because of technological advancements. Technological advancements then and technological advancements now are so different and revolutionized. Similarly, reaching out to our daily needs or any other things like clothes, shoes, jewelry, and many more are available online. ‘Are available online’ what does this exactly mean? And how they are made available? Let’s know the answers to these.
Online Marketplace, this term itself somewhat describes it working or the actual meaning. The online marketplace is a website or application that is available for sellers to sell and for customers to buy the desired products online. The owner of the online marketplace doesn’t hold any kind of catalog but they assist the sellers or the merchants to sell through the marketplace to make it a seamless selling experience. The best examples anyone can give for online markets are none other than Amazon, Flipkart, or eBay. The online marketplaces are becoming more competitive day-by-day and this is because of the wide customer base that these online marketplaces serve. The online marketplaces aggregate products from a huge list of sellers, the selections from the customer’s side become wider. Every seller or provider strives hard to stand out in the competition, to get their product highlighted, and to improve their sales.
There are also types of online marketplaces and mainly they are divided into three types. They are:
- Vertical: A vertical online marketplace sells products from different sellers or providers but they all belong to one specific product type. For example, ShoeCarnival.com is an online marketplace that is totally dedicated to the online selling of shoes, from different brands.
- Horizontal: The horizontal online marketplace sells different products by have similar characteristics. For example, Greenobazaar.com sells different products but they all are organic.
- Global: The marketplace that sells everything from groceries to electronic appliances is known as global marketplaces. For example, Amazon and eBay.
As every good side has a bad side and vice versa, the same is with the online marketplace. Let us have a glance at the pros and cons of an online marketplace!
Pros:
- Sales: If you are planning to sell on Amazon, you certainly have to act as per their rules and regulations. But this is nowhere harming your sales. Amazon’s wide database of customers will always assist you with better positioning when it comes to sales, visualize huge benefits with immense exposure. Your customers will never doubt you as a seller if you are selling on Amazon!
- International Reach: Amazon is a global, trusted brand. There are chances that your customer might belong to different geography, and with the services that Amazon provides, it is very much easy to reach out to them. This will give you a chance to move your business from a local scale to a global scale.
Cons:
- Competition: It’s obvious that being such a huge marketplace, Amazon is giving opportunities to all the sellers across the globe. So as your customer reach is widening, so is your competition.
- Lack of Control: Amazon and even other such huge online marketplaces have their own guidelines for the sellers to list their products and sell. You can never, as per your own wish, sell or advertise on such marketplaces.
- Fees: As long as you are normally selling on Amazon, you only are facilitated by having your products listed on the marketplace. All the other things – order fulfillment, shipping, return management, etc. are to be done by the seller all by himself. For Amazon to take care of everything, you need to become an FBA (Fulfillment by Amazon) seller. This service comes with a fee, depending upon what sort of facilities you are expecting from Amazon.