E-Commerce: Platforms or a store of your own?

Photo Credit : Shopify

E-Commerce: Platforms or a store of your own?

When entering the world of e-commerce, retailers often have to make a choice: do they sell their range through a marketplace or set up their own online store? Boutiques can opt to sell through global fashion platforms, such as Zalando, ASOS, Farfetch and Lamoda. There are also national and regional marketplaces. All these platforms charge commission on each sale (usually 5-25% of the gross price) and may also demand a registration or monthly fee. In exchange, the seller can use the website’s infrastructure and client reach, and products can generally be listed quickly and easily. Before you know it, your ‘market stall’ is live and you can start selling.

Conversely, building your own online shop can take several months, depending on the desired level of customization. It’s relatively complex, expensive, and incurs marketing costs to attract customers. This approach entails a lot of preliminary research to decide on the right features for the store. Programmers or agencies then need to be briefed and you will have to oversee the development process. Once your shop is up and running, products need to be listed and updated – this also requires skills and time.

Good quality product images and descriptions are essential for both formats. Wheth- er your item is modelled or simply pictured on its own, be sure to create a style that customers will recognize. The more images in your store and the more detailed the descriptions, the better. A few garment measurements (e.g., total length, leg sizes) are useful and will reduce returns. It’s your shop, so the product range, response times, delivery terms and charges, as well as the returns policy, are up to you. On platforms it’s a different story: if you don’t fall in line with the marketplace rules, you’ll risk not only penalties but poor ratings. And your competitors are just a click away: if your range isn’t special enough, the competition can be fierce – as can the pressure to lower prices.

High traffic is a draw for well-known platforms. They are able to reach the kind of large customer bases independent online shops can only dream of, thanks to their generous marketing budgets. It’s challenging to attract new customers as a sole e-commerce store, but the individualized approach makes it easier to reach and retain loyal customers: after all, an online shop enables continuous access to customer journey data. Some platforms analyze this information so intensively that they are suspected of copying their retailers’ bestsellers, an accusation recently levelled at Amazon.

Examine the individual pros and cons for your business model, and the various options available in terms of time and budget for product sales through various channels. Perhaps the middle way is the best: you could start on one or two online marketplaces while you wait to launch your own online shop.