As a result of marked shifts in consumer behaviour during the COVID-19 pandemic, digitization has accelerated even further: 40% of consumers are buying more online than they had previously done. One of the winners of this COVID-19 are the marketplaces, or better known as Bol.com, Amazon, eBay, Google shopping, …
To win as a brand on highly competitive marketplaces, you should include this channel in your day-to-day operations & strategy. You need to nurture this project, spend time & put effort into it and have a strong marketing strategy. Otherwise, you will be disappointed by the results and become overwhelmed by the number of competitors.
Read these tips about how to start on marketplaces & discover the 4 main advantages.
Before starting: choose your platform wisely.
To participate in a specific marketplace, brands must link their brand equity and perceptions not only with the brand of the chosen marketplace but also, through association, with the other brands and products sold there.
Does the brand focus narrowly on apparel, or want to reach customers in adjacent categories or even expand into others?
If your brand focuses narrowly on apparel, start advertising on google shopping and Facebook marketplace. If you want to grow internationally take a look at apparel focused marketplaces like Farfetch, Marktplaats & Lyst.
Take a look at the competition before you start, by typing in relevant keywords. If you see a lot of ads showing up or many products that don’t fit your brand values, this isn’t the place for you.
Tip: Use tools to find niches on marketplaces. For example Junglescout for Amazon.
Adapt your Strategy
Deciding to participate in a marketplace means adding a channel that cannot be managed as other wholesale and direct-to-consumer (DTC) channels are. A marketplace-specific strategy, within the context of a broader channel one, should guide key decisions on how to participate in a marketplace.
- Assortment: Depending on the platform, people are looking for certain types of product on different types of platforms. For example, Bol.com is mainly focussed on functional goods. You need a flashlight, cause you are leaving on a camping trip tomorrow. Other platforms as Farfetch are focussed on new brands, trends in fashion & customers are placing an emotional buy. So depending on the marketplace, you should focus on different kind of collections & product types.
- Beware of the algorithms: Reviews are very important to have a high ranking on marketplaces. Make sure you gather enough reviews and client support to become the number one love brand of your niche. The algorithm considers three factors: reviews, purchase frequency and velocity.
- Advertisement: To rank high on marketplaces, you should consider advertisements on the most relevant keywords. Marketplaces offer brands and retailers value-added services, such as data-sharing agreements; consumer, product, price, and trend analytics; and digital marketing, including SEO/SEM support, media/content services, and PDP/photography support
Source New Digitalage
The 4 main advantages of selling on marketplaces:
- Huge audience access
- Low Start-up cost. However, keep in mind that you need to pay 12-15% commission on every transaction.
- Increase the trust level of your brand
- Reach global market
So, do I need to sell on a marketplace?
Yes: I’ve found the right marketplace for my product, where I have a niche position. My product feed is structured and ready to sync with the platforms and I blocked dedicated hours in my weekly work schedule to be ahead of the competition.
No: My brand is currently selling in different countries directly to the end consumer and I want to focus on this strategy and don’t want to issue a commission. I enlarge my markets first on google shopping & Facebook marketplace.
Getting excited? If you are looking for more information about selling on marketplaces, we are here to help!