Michelle Stark, Director at Fasthosts discusses the role of websites in the ever-growing landscape of online marketplaces and suggests how ecommerce focused SMEs can approach this balancing act.
In today’s world, having an online presence is as important to an ecommerce business as a shop was to commercial traders in the 20th century. In fact, Statista has predicted that an estimated 2.14 billion people worldwide would be making online purchases in 2021, that’s one in four people globally. But, when it comes to choosing which online platform is best for you and your customers, it can be a tricky path to pick.
If you’re an SME with an ecommerce focus, you might be tempted to use global selling platforms or online marketplaces, such as Amazon, eBay and Etsy as many small businesses do when starting out. It makes sense -they are a fairly low risk way of dipping your toe into the waters of selling online, building confidence in the demand for your product, and helping you prove your concept or offering.
But don’t be fooled by the apparent ease of using these global selling platforms. When a customer hears of a product, brand or business, their first port of call is likely to be finding proof of legitimacy, and of course more information on the brand or products it sells. A website is a one stop shop for this information and helps create trust with consumers. So, should SMEs perhaps be thinking about using websites and marketplaces in tandem to boost sales and grow as a business? Absolutely.
Global selling platforms are your virtual market stalls
We all know how global selling platforms like eBay work. You type in what you are looking for and a whole host of products that fall under that category appear. If you want to explore more from a particular seller you can pop onto their page and browse other products on offer.
Think of this as the virtual equivalent of what you might experience when going to a market. Stallholders display the products they have for sale next to their competitors and customers pass from stall to stall in search of certain products. The perks are that markets attract customers by selling in a collective space. Although as businesses find themselves selling alongside competitors, they need to work even harder to gain the attention and loyalty of passers-by.
The virtual space isn’t much different. When you have your products listed on a global selling platform, you’re increasing your chances of visibility on a global level and reaching new audiences in the process. You also get the chance to display your products next to your competitors, which is a great way of highlighting what you offer that they don’t.
These platforms have their perks, with Amazon for example claiming that in their marketplace, companies increase sales by up to 50 per cent by listing with them. But, there is a reason why vendors in the physical world often won’t solely rely on a market to sell their products.
Be wary of handing over sole control to a marketplace
Because marketplaces are also businesses, when you trade on them you hand over significant control of areas of your own business. When you list items on global selling platforms, you don’t have as much freedom as you would on your own website and this can impact your virtual credibility in a negative way.
Take the way you display your products-you won’t have free reign of key creative elements like font, colour and positioning, which are all part of the user experience and can help immerse your customers in the world of your products. In fact, website design is such an important factor that web credibility research by Stanford has found 75 per cent of consumers admit to making judgements on a company’s credibility based on the company’s website design.
And that’s not all, there are other areas that fall by the wayside when listing on marketplaces. Take SEO strategy for example, it’s an important analytical and strategic tool that you hand over control of. Other than SEO, think about other marketing activities that you only have free reign of with your own site. For instance, having a blog to engage customers on a deeper level and establishing yourself as an authority in your area of expertise, as well as freedom around how you collect customer details and engage with them as a result.
And we haven’t even started talking about the bottom line. Profit is key to a growing business and needs to be part of this conversation. When you list your products with sites like Amazon, you pay a fee which can be as much as £0.75 per unit excluding VAT and any additional selling fees. When you do the math, this adds up quickly.
While marketplaces can certainly bring in new customers, when considering the drawbacks, it’s clear that having a website that allows you to present your business as you wish to, free of listing fees and competition is an invaluable part of the SME ecommerce puzzle and shouldn’t be overlooked.
Don’t underestimate the power of a website
It is important to remember that having a centralised online space legitimises your business, helps build confidence in what you offer, and gives you control over your own profits and customer base, which just isn’t possible on global selling platforms, for example by nurturing customer relationships through newsletters. A website offers you the perfect home for all of this.
What’s more, some website hosting platforms allow you to seamlessly integrate these global selling platforms into your website, pulling across product details and costs. So, what’s listed on your website is aligned with what comes up on a global selling platform, ensuring consistency between the two. These online spaces don’t need to work independently from each other and being able to manage both from one central hub will benefit your business and improve time efficiency.
It’s important to keep your customers happy by keeping it simple. Pick a website provider that does the work for you and remember that creating a website doesn’t need to be a huge effort. Consider a platform that offers a highly customizable online store and allows you to manage everything in one place, with 24/7 support and SSL security included.
Although online marketplaces can be great tools in helping you reach a wider global audience, it’s still important to have somewhere your customers can find you, contact you and purchase your products in a trustworthy and familiar online space. The key is balancing the two. By picking a website provider that enables you to have a centralised point of control, you can experience the best of both worlds without compromise and in the knowledge that you’re covering all bases.