Below is an excerpt from the book How to Sell More Online: 40 Tips for the Small Online Entrepreneur:
There are many ways to sell online, not just on your website. Big businesses tend to have multiple sales channels: their own website, other retailers (both online and brick and mortar stores), print catalogs, and online marketplaces. Take the computer brand Dell for example; they sell on Dell.com, in other online and offline stores, print catalogs, and they maintain their own stores on Amazon and eBay.
If you want to earn more, expand your product distribution and sell your products in other places and not just in your own store. Selling in online marketplaces is a must for small online entrepreneurs. Online marketplaces, such as Amazon and eBay, allow consumers to purchase from many merchants on one website.
Online marketplaces are the Web’s version of shopping malls. Data from eBay and ChannelAdvisor Corp. shows that the two biggest marketplaces (Amazon and eBay) accounted for 29.1% of U.S. online retail sales, up from 26.8% the previous year. These numbers prove the effectiveness of these online marketplaces as an additional channel to market and sell your products. They are highly popular with customers and allows you to reach customers who may never have seen your products or heard about you. They can be your stepping stone in reaching the international market. Selling in these marketplaces also helps you establish and build trust with your target market.
Amazon is the leading e-commerce store and online marketplace today. More U.S. online shoppers look to Amazon first than any other e-commerce sites. If you’re not selling there, you are missing a significant part of the online buying population. Amazon’s massive customer base can give your business huge exposure to buying customers than you could ever hope to attract on your own.
Set up a seller’s account in Amazon.com. You can take it a step further by considering their Fulfillment by Amazon (FBA). It is a service where Amazon.com handles your back-end operations, including storage, fulfillment, and customer service. If you are part of FBA and meet certain performance requirements (e.g. on-time shipment, low cancellation rate, sales volume), you may be invited to sell in Amazon Prime– the $99 annual membership program that offers free shipping and other perks.
Here are other tips to consider when selling on Amazon:
- Focus on providing great customer service. Ship items correctly and on time, and quickly respond to customers’ inquiries.
- Get as many positive reviews as you can. Your visibility on Amazon hinges on your seller performance and part of this are your reviews.
- Be prepared to compete on price, especially if you are selling products that thousands of other merchants are selling. This is especially true if you are using the same suppliers or drop shippers. Note, though, that sometimes all it takes is to be $0.01 cheaper than your competitors.
- To avoid massive competition, find unique products to sell that are not offered by Amazon or any of the other merchants
- Sign up for the Professional Selling Plan. While you pay a monthly fee of $39.99, the $0.99 per item fee is waived. You will also be able to upload items in bulk and have more selling options.
- Automate listing of the items by using the Amazon Listing Loader.
- Increase your exposure by getting into the Buy Box placement, which is the holy grail of Amazon. According to Amazon, “The Buy Box is the box on a product detail page where customers can begin the purchasing process by adding items to their shopping carts.” To qualify, you must meet a stringent set of performance criteria that includes strong feedback and strong metrics.
- If you can’t win the Buy Box placement, aim for the Featured Merchants (box labeled as “Other Sellers on Amazon”).
- Market and reach out to your Amazon customers. Be careful, though, as Amazon views these customers as Amazon customers. As such, they prohibit marketplace merchants to directly market to them.
- Try advertising your products in the Amazon Sponsored Products listing or Amazon Product Ads (cost per click)
Apart from Amazon and eBay, consider other online marketplaces. Check out Jet.com, Bonanza.com, Easy, among others. Their fees are lower, and can provide merchants with better exposure in their marketplace as there are fewer merchants competing. You can benefit from being the first among your competitors to tap into emerging marketplaces. You can also try to sell in Walmart Marketplace or Sears Commerce Services. However, these marketplaces are extremely selective and invitation-only e-commerce platforms that prefer well-established brands.
There are a number of challenges to consider when selling in other places. Competition is fierce with millions of other sellers using these marketplaces, and you will be forced to compete based on price. You may even find yourself competing directly with Amazon as it expands into deeper product categories with its own house brand. If Amazon decides to sell in your product category, you may see your sales drop significantly.
You also need to pay fees. Online marketplaces charge selling fees, a percentage of your earnings from the business they bring you and other variable fees that can add up, which can impact your profitability. You need to learn different processes and systems in each marketplace, and there may be additional work with sales tax compliance. You also need to keep your inventory in sync and track your inventory levels.
Track how each of your sales distribution channels performs and what platform is most effective for the types of products that you sell.
Category: Online Shop