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It's no secret that the ecommerce landscape is constantly evolving — a recent study by Forrester revealed that over 70% of brands plan to add new sales channels in 2022. This number is hardly surprising, given the ever-growing competition for consumers' attention and wallets.
As an ecommerce business owner, there are plenty of ways you can expand your brand beyond home ground. With more sellers looking for ways to differentiate their products and reach new buyers, marketplaces offer an attractive option for sellers to quickly and easily achieve global reach.
However, as with any decision, there are pros and cons to consider before making a choice. Let's take a look at some of the key factors to consider when deciding whether or not marketplaces might be the best for you.
The pros and cons of marketplaces for startups and growing businesses
On the plus side, marketplaces like Amazon and Shopee have helped simplify aspects like logistics and marketing for brands. For example, Amazon’s “Fulfilment by Amazon” (FBA) service provides businesses with access to Amazon’s logistics network. This greatly reduces the hassle for business owners, where Amazon does all the heavy lifting when it comes to receiving, packing, shipping, customer service, and returns. In addition, marketplaces are also great channels for generating awareness and traffic as they enable access to a large audience of potential customers who may or may not possess awareness of your specific brand and product.
That said, the recent ecommerce boom has seen marketplaces become increasingly saturated, with a myriad of similar brands competing for attention. This can make it difficult for brands without a distinct voice and loyal customer base to stand out.
Brand sites are an excellent way for brands to showcase their value proposition and stand out from the crowd. Business owners will regain full control over the branding, customer experience and pricing of their products, and avoid some of the competition and costs associated with selling through marketplaces.
Taking all these factors into account, there could be a strong case for ecommerce businesses to look beyond marketplaces and consider selling through their own website.
Setting your site up for success
So, how do you get started with selling Direct-to-Consumer (DTC)? Thankfully, there are a number of platforms that can help you get your brand’s site up and running.
Start by asking about the intended outcomes for your site — do you need to be able to conduct sales through your website, or will having it serve as a product catalogue suffice? What volume of transactions do you expect through your website, and what features will you need to support them?
If you’re just looking for a place to showcase your brand’ voice and personality, you can consider creating a simple product catalogue or mood board to help consumers better understand your brand. In this case, Content Management Systems (CMS) with drag-and-drop editors, like Wix and Squarespace, might work best. This will help to minimise hassle during setup, while enabling you to showcase the more aesthetic aspects of your brand. You can also add links to your marketplace listings to your product catalogue, which can serve as a great test bed if you’re unsure about whether your site will generate sufficient traffic to justify the setup of a full-fledged sales system.
Above: Example of links to marketplace listings on the Rexona (deodorant brand) brand site
If you’re ready to start conducting sales through your website, it may be worth migrating to a more advanced ecommerce platform like Shopify or WooCommerce. While CMS platforms like Wix are capable of supporting basic ecommerce transactions, they lack the infrastructure to support detailed inventory management and analytics required at higher sales volumes.
Our personal pick for DTC platforms is Shopify, an easy to use and affordable ecommerce platform, and a crowd favourite for startups and businesses that are just getting started in DTC.
One of the things we love about Shopify is how simple it is to use. Shopify provides all the tools you need to get started, from campaign management to payment processing. Its high level of customizability and intuitive interfaces allows brands like yourself to tailor the look and feel of your site based on your defined target audience and brand personality, and build your site your way. (Curious how to help your brand shine? Check out our previous piece on Brand Storytelling to see how great brands are built)
While a potential downside of managing your own brand site is that you will need to handle logistical matters on your own, it doesn’t mean that it needs to be difficult! If your business is based in the United States, you’re in luck — Shopify has its own fulfilment service, Shopify Fulfilment Network (SFN) that you can use to store your inventory and fulfil orders. Even if you are based outside of the United States, all is not lost. Shopify sites are armed with built-in inventory management tools to help break the numbers down for you, and there are plenty of Third-Party Logistics (3PL) providers out there that you can work with to simplify your process. Check out our previous piece on Logistics and Distribution for tips on how to find the best 3PL for your brand.
So, what does the future hold for your brand? Will you continue jostling with flash sales and discounts on Amazon, Shopee or Lazada, or will you venture beyond on a quest to help your brand find its voice? While the answer depends on your brand’s stage of growth, we believe that these options are not mutually exclusive. Expanding into new ecommerce channels is a great way for brands to reach out to new customers across different markets, and conducting sales through both marketplaces and DTC can help boost your brand’s presence to secure market share. The best news? You don’t have to do it alone.