The majority of small business owners agree that online marketplaces have positively impacted their sales, according to a poll by Manta
The majority of small business owners agree that online marketplaces have positively impacted their sales, according to a poll by Manta.
Nearly 70% of small business owners polled stated that marketplaces like Amazon and eBay have helped them increase sales, while about 30% believe they have had a negative impact. Most small businesses (81%) believe that online sales are critical to their company's success, but most rely on their own websites as an e-commerce channel. Sixty-six percent of small businesses sell products through their own websites, 24% sell on Amazon, and 22% sell on eBay.
With competition among marketplaces increasing, some marketplaces are making it more difficult for sellers to be profitable as third-party merchants. In an effort to increase shipping profitability while keeping shipping costs and Prime dues low for customers, Amazon recently raised shipping fees for consumer goods suppliers. Additionally, Amazon recently enacted an automatic returns policy for Fulfillment By Amazon merchants to make the returns experience more consistent for shoppers; the feature automatically refunds customers without requiring them to return the product.
However, many marketplaces provide several services that could be beneficial to merchants.
- eBay recently bought a data startup called Terapeak to help its merchants increase sales. The startup recommends the best times to sell items or discount them, for example, by analyzing supply, demand, and pricing data. eBay integrated features from Terapeak into its Seller Hub, allowing third-party merchants to easily use the startup's order analytics.
- Shopify created an app, Arrive, that allows buyers to track online purchases on a live map by syncing gmail accounts to the app. The company also recently partnered with Instagram to bring Instagram’s shopping feature to its sellers.
- Alibaba launched a program last June that aims to teach US businesses how to sell to its 443 million Chinese customers. This could help small US businesses tap into a huge new market that has a voracious appetite for foreign brands.
Selling through a marketplace may provide small businesses with tools and opportunities that are typically unreachable to retailers with fewer resources. Small businesses should ensure they are knowledgeable of all the resources these marketplaces provide, and take full advantage of them.
For instance, social media is an increasinglyimportant channel for retailers, so Shopify merchants that don’t capitalize on the Instagram shopping features are missing out on a fast-growing segment. Meanwhile, 99% of shoppers say that order tracking is important to them, so Shopify merchants could encourage customers to use the Arrive app, which could possibly increase customer satisfaction.