In addition to their online shop, retailers can access a wide variety of e-commerce platforms and thus use the existing infrastructure. But which platform is best suited and what are the advantages and disadvantages from a dealer's point of view? Insight into 5 alternatives to your own online shop.
Use Market Power But Avoid Dependency
Dealer programs offer some advantages for shop operators. Online shops with sometimes very low reach can make their products available on Amazon and other shopping portals. They can take advantage of their market power and increase their sales relatively quickly. However, caution is called for. Whoever puts himself into the hands of the big ones will sooner or later indirectly strengthen their market power. The result: Amazon and Co. higher and higher sales fees. To avoid dependencies, shop operators should pay attention to a broad positioning as far as possible and also use alternative marketplaces. Especially since smaller platforms are often cheaper, even if their range is (still) shorter.
1. Amazon's Reseller Program
Amazon is undisputedly the largest online shop in the world and has a market share of over 30 percent in Germany alone. Unlike a "normal" Google search, almost all search queries contain a direct intention to buy. Once shop operators have reached an Amazon Top Placement, their conversion rate increases almost automatically. There is also another advantage when selling products on Amazon. Products that are sold on Amazon are almost always ranked higher than that of Google in a search query. So if you know how to utilise Amazon SEO, you are killing two birds with one stone.
Advantages And Disadvantages Of Amazon
Sales of products on Amazon are similar to the usual reseller programs of other e-commerce platforms. Retailers can enter their goods in Amazon's product catalogue and sell them via the platform. Millions of customers who regularly shop at Amazon are potential customers for their products - not only in Germany but also on five marketplaces throughout Europe.
The downside? Amazon charges considerable commissions for selling products through its portal, some of which are far above those of its competitors. Also, there is a subscription fee for more than 35 items sold per month or a fixed fee per item sold. For example, Amazon charges a 15 percent sales fee for car and motorcycle categories
For Which Online Shop Is Amazon Suitable?
Generally speaking, Amazon is suitable for every shop owner if you want to get more sales and higher turnover. For many retailers, Amazon is the only mainstay of their business, without having their own online shop. Customers around the world trust and know Amazon and it is exactly this constellation that dealers can use to win new customers. However, Amazon is only of limited suitability for strengthening your own brand. Amazon does not allow you to create your own templates. Everything appears under a uniformed CI, not even a linking to your own online shop is possible, or only complicated and inconspicuous.
2. The eBay Reseller Program
On eBay, online retailers have the opportunity to set up a shop as a sales platform. eBay offers commercial sellers three different shop variants to choose from:
- basic shop
- enhanced shop
- premium shop
The variants differ mainly in the number of fixed price offers and the monthly basic fee. In the Top Shop and Premium Shop variants, dealers receive an additional discount on the sales commission.
Advantages And Disadvantages Of eBay
Unlike Amazon, eBay has the advantage of creating custom templates. The range of eBay is also very considerable, although not as strong as Amazon. Many customers have known eBay for years, and so there is an advance in trust, which in turn serves retailers. A disadvantageous factor is the commission model, which is not immediately apparent. In addition to the fixed price fees, eBay also charges other premiums for auctions. Also, the fees, similar to Amazon, are sometimes very high, depending on the product category.
For Which Online Shop Is eBay Suitable?
Just like Amazon, eBay can be useful for any online shop operator. Especially the design of your templates should be interesting for dealers who value their brand. A disadvantage, on the other hand, could be the still close connection with many customers to the auction house. Many of them still use eBay as an auction portal instead of an online shop for new goods. Also, in recent years some customers such as dealers have complained about a constantly changing layout, which severely restricted functionality.
3. The Dealer Program Of Rakuten (Japan)
The Rakuten e-commerce platform focuses entirely on the sale of products by third parties. For a fee, traders not only get a platform to sell their products but also a consultant to support them. Also, individual shop designs can be created through the Rakuten platform.
Advantages And Disadvantages Of Rakuten
A clear advantage of Rakuten is the construction of independent shop designs. Another plus point is the comparatively low costs for dealers. In addition to a monthly basic fee, Rakuten charges a sales fee of 5 to 9 percent, depending on the product category. The one and only disadvantage is that the e-commerce platform has a relatively small reach but they do have unique market insights into the Asian market. However, whoever is well placed here can take up a unique position on the portal.
For Which Online Shop Is Rakuten Suitable?
There is also no predefined assortment for Rakuten, making the platform suitable for all shop operators. However, traders cannot (yet) enjoy the same range as on eBay or Amazon. However, Rakuten offers much freedom for branding your own brand.
4. The Retailer Program Of LadenZeile (Germany)
The shopping portal LadenZeile is focused on fashion, furniture and lifestyle products. The business relationship with shop operators is based on the cost per click (CPC). In some exceptional cases, LadenZeile also calculates per order (CPO). The partner shops are supported by a specially trained team of shopkeepers. The e-commerce portal is interesting mainly due to the high traffic.
Advantages And Disadvantages Of LadenZeile
Ladenzeile has a very good visibility index, which is why shop operators with well-placed products are likely to be successful. However, there are no customizable templates, so branding effects are marginal. Also, the assortment is limited. Another major downside is the fact that this portal is not available in English, so get onto your international friends! The categories car and motorcycle are missing as well as computers and electronics. Also, the shop line requires a listing of at least 150 products.
For Which Online Shop Is LadenZeile Suitable?
LadenZeile is primarily suitable for online shops in the fashion and clothing sector. However, jewellery, watches, toys and office supplies can also be offered. Due to its specific focus on lifestyle, the portal can be of interest to online retail shops. However, the minimum listing must then be observed. Accordingly, online shops with technical products are unsuitable for the shop line.
5. The Alibaba Membership Program
Next to amazon, Alibaba is probably the largest portal for both small and large businesses to reach their customers. Alibaba owns the Chinese marketplace and fought off stiff competition by the likes of eBay over the past number of years. Their year on year growth shows and their positioning have given them a strong foothold in the European marketplace. Suppliers and other small businesses can reach their target audience directly through Alibaba, whether they are selling single products or bulk orders of 100,000 items.
Advantages And Disadvantages Of Alibaba
The great advantage of Alibaba is its specific focus on connecting small business owners to their target audience. As a result, a company's range of products can easily be sold to customers world wide. Alibaba has a range of Gold Supplier packages for businesses which range from a free basic package right up to a premium package. The main disadvantage is the cost especially if you are just starting out internationally, but it can put you in direct contact with who you want.
For Which Online Shop Is Alibaba Suitable?
The e-commerce platform is not suitable for every shop operator. It is mainly suited for B2B business owners who either want to deal in bulk orders or commissions. However, Alibaba are changing their business model in the near future where it will become both a B2B and B2C marketplace, so watch this space.
Away From Traditional Marketplaces: Shopify
With Shopify, Facebook is heralding the next step towards the purchase button on Facebook. The app is not yet available in some European countries, but experts are already predicting enormous growth potential in the e-commerce industry. Why? Shopping on the social network will then be possible via status messages as well as on the website of the merchants participating in Shopify.
Facebook users do not have to leave the network when shopping. You simply pay within your news feed. You will then no longer be redirected to external pages via ads as before. Shopify is likely to serve as a kind of key to the network with more than 1.3 billion people. But not only the sale on Facebook is planned, but Shopify should also allow you to sell products directly on Pinterest and Twitter.
Conclusion: Valuate Marketplaces Not Only According To Their Reach
Amazon and eBay offer the largest reach in Germany so far, which is why their marketplaces (as far as the margins and automatic feed integrations allow) are very important for their own sales. However, marketplaces such as the shop line or avocado stores are good alternatives, especially when it comes to special assortments. In addition, alternative platforms often entice users with more favourable conditions and greater freedom in the creation of templates. For your own online shop, however, SEO, SEA and SMM measures remain the best ways to increase reach.
About the author
Herbert Buchhorn is the CEO of Clicks Online Business (offices in Berlin, Dresden, Cologne, and Munich) and an expert in search engine optimisation (SEO). Since 2007, his online marketing agency has been successfully working for companies from a wide variety of industries throughout Germany and internationally. He regularly publishes specialist articles on the subject of SEO & e-commerce in various online and print magazines, is an acknowledged speaker at conferences and regularly holds seminars and workshops on the subject of online marketing.