The tempo of development of impartial sellers on marketplaces shouldn’t be waning anytime quickly. Propelled by strong on-line gross sales, impartial — or third-party — sellers as a phase are anticipated to rise by triple digits within the subsequent yr. But anybody trying to get in on the sport wants a transparent technique, and an understanding of the challenges they face.
According to Amazon’s monetary report launched final February, the net large had $4.8 billion in gross sales from impartial sellers alone in the course of the kickoff of the 2020 vacation procuring season, the four-day interval between Black Friday and Cyber Monday. And in knowledge offered by Marketplace Pulse to Reuters, Walmart’s market swelled to 70,000 impartial sellers final yr and is poised to rise 146 p.c by the tip of subsequent yr.
Michael Bennett, cofounder and managing director at Envoy, advised WWD that Amazon’s third-party market “has offered business owners an amazing opportunity over the years to reach millions of online shoppers worldwide and increase brand awareness.”
“The year-over-year growth has been explosive and it seems everyone wants a slice of this profitable pie,” Bennett mentioned. “Business owners and individuals new to the e-commerce world are scrambling to get their accounts set up to private label or pivot their dot-com or brick-and-mortar stores to Amazon. There are over 6 million third-party sellers on Amazon and more than half of them sell in North America. Amazon is rapidly expanding its reach internationally and there will soon be an additional surge in other marketplaces.”
While the chance is ripe, anybody trying to be a third-party vendor wants a sound marketing strategy and a transparent technique. Bennett mentioned “the roadmap must include a long-term strategy of which path your business will take. Many are looking to make a quick buck by reselling branded items, others are looking to build something from the ground up or simply expand their current business within the e-commerce channel. Creating a structured path will allow sellers to simplify their approach and avoid many hurdles.”
Entrants to the world of impartial promoting on marketplaces even have to concentrate on the challenges. “More often than not, e-commerce sellers on Amazon and Walmart are caught flatfooted when faced with the policies, fees, and approval processes that these platforms enforce,” Bennett defined. “Before diving into the deep end, it’s imperative to research the category you are selling in, dialing in your fees and bottom-line numbers, and being prepared to spend on Pay-Per-Click. Many have been in the trenches with these issues and finding the right resources to guide the journey can potentially save sellers hundreds of thousands of dollars, precious man-hours and brand loyalty.”
Mousumi Behari, digital technique apply lead at Avionos, mentioned the third-party vendor’s market is rising quickly, “and on Amazon alone, the marketplace generated between $25 billion and $39 billion in profits in 2020. Initial growth was sparked by a surge in online shopping due to the pandemic; however, this current market will continue to grow as consumers’ reliance on the convenience of e-commerce increases.”
“In fact, 59 percent of consumers shopped at major retailers — such as Walmart, Target and Amazon — more often during the pandemic than before March 2020,” Behari mentioned.
“Amazon is the mecca for third-party sellers, and the relationship is mutual,” Behari advised WWD. “For the third-party seller Amazon gives them access to a customer base, and a platform that they can build a sales strategy to drive revenue and growth. For Amazon, an increase in third-party sellers leads to competition in pricing and products, which ultimately benefits the customer.”
Behari additionally urged newbies to have a method, and perceive all the choices and guidelines that every market has in place. Once the platform is chosen, the e-commerce technique is anchored by the product show web page.
“Building a strong digital and e-commerce strategy on a marketplace starts with personalizing the product page to look and feel like the brand itself, rather than creating just another landing page on Amazon or Walmart’s website,” she mentioned. “This page should provide consumers with everything they need to complete their purchase, while feeling like an extension of the brand itself. Customizing this product page to meet the target consumers’ needs builds trust with shoppers and encourages repeat, loyal customers.”
Behari mentioned that past the product show web page, “understanding the customer through data and insights around purchasing habits and interests is crucial. These insights provide third-party sellers with the ability to create more personalized experiences, relevant product recommendations and a better e-commerce experience to make shopping on their specific marketplace page even easier.”
In regard to different challenges, Behari mentioned one of many greatest obstacles third-party sellers face “is standing out from the competition within the marketplace. “Amazon boasts over 2.5 million sellers, which can be daunting for someone looking to make a profit.”
To stand out, she suggests enhancing the net procuring expertise, whatever the market, which “starts with doubling down on customer favorites like great product information, and helpful reviews.”
“Additionally, focusing on fulfillment can leave a lasting impact on consumers,” Behari mentioned. “Third-party sellers risk harming customer loyalty and potentially creating bad reviews for products if delivery and fulfillment aren’t met promptly. Reviews can make or break the success of a brand, so refining the aspects of the customer experience you can control — such as fulfillment, product quality and brand credibility — is crucial to standing out in the marketplace and succeeding.”
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