Marketplaces vs. Your Own Online Store: Where to Sell in 2024
Posted: Thu Dec 26, 2024 4:18 am
We explore the pros and cons of sales channels with Maxim Dimitrov, co-founder of the Cave brand
03.07.2024 ⏱ 23 minutes
Marketplaces vs. Your Own Online Store: Where to Sell in 2024
In 2023, sales volume in the e-commerce market grew by 41% and amounted to 8.2 trillion rubles. Over the year, buyers made 5 billion orders, which is 81% more than in 2022.
Marketplaces were the main growth drivers: the number kazakhstan phone numbers of orders on them increased by 106% - from 1,976 to 4,076 million units. Other online platforms also grew, but to a lesser extent. Here, buyers made 23% more orders - 1,066 million.
Marketplaces attract a large audience and the fact that you can start selling on them faster. But they do not pass on information about buyers to sellers. Your own website allows you to collect data about customers, but promoting it is more difficult and expensive.
What other pros and cons does each channel have? What should a retailer choose or how to combine them correctly? Let's figure it out together with the co-founder of the Cave brand, Maxim Dimitrov.
Presentation of Data Insight research at Digital Retail 2024
Pros of Selling on Marketplaces
Cons of Selling on Marketplaces
Pros of Selling through an Online Store
Cons of Selling through an Online Store
What to Choose: Your Own Online Store or Selling on Marketplaces
The benefits of selling on marketplaces
For businesses, marketplaces are an outlet for a multi-million audience. Ozon and Wildberries websites are visited by 59% of Russian residents over 12 years old per month — that’s more than 70 million potential buyers.
Here are the main advantages of online platforms.
Quick start and sales growth. Marketplaces are a ready-made online platform. Companies don’t need to develop their own website and mobile app, attract traffic to it, or set up payment acceptance.
To start working with a marketplace, it’s enough to:
Register on the site.
Accept the offer.
Create product cards.
Prepare goods for shipment.
The marketplace takes care of all operational processes - it tracks orders, collects them, delivers them to the client, and processes returns. This allows companies to grow faster than when selling through their own online store.
Mediascope research on the e-com market
The Cave clothing brand sells on Wildberries, Ozon, and Lamoda. In 2021, the share of sales on marketplaces was 53%, and at the beginning of 2024, it was 90%.
CAVE Case: How to Double the Percentage of Repeat Sales
Cave sales volume on marketplaces
In the near future, Cave does not plan to enter other marketplaces, because the current platforms have enough capacity to develop sales.
"If you want, you can grow 2-3 times in a year on marketplaces. Here, whether you sell 1,000 items or a whole truck, the process is the same: order from the manufacturer, ship, fill out the cards, and then the marketplace does all the operational work.
In our online store, we will not grow 2-3 times in a year, because this requires colossal efforts and resources. For example, selling 30 T-shirts and three of them are returned per day is one thing. Selling 300 and 30 of them are returned is a separate process that needs to be built.
When your online store grows, the processes become more complicated, new ones appear. But on marketplaces, everything is simpler and faster."
Maxim Dimitrov
Maxim Dimitrov
Co-founder of Cave
Loyal audience and high traffic. According to the results of 2023, Wildberries and Ozon entered the top ten largest global platforms by number of visits. They took ninth and tenth place with 343 and 316 million visits per month.
Marketplaces care about attracting traffic:
conduct promotions;
send out mailings;
launch advertising;
stimulate new purchases with the help of cumulative discounts;
Reduce returns by charging for a refund and increasing the redemption percentage.
Wildberries and Ozon entered the top of the world's largest platforms by number of visits for the first time
Ozon Home Page
The seller can participate in promotions and get on the main page of Ozon. This way, more customers will see the product cards and this increases the likelihood of a purchase
"Marketplaces have traffic and regular customers. They fight for their audience with the help of cumulative discounts and promotions. It is convenient for customers to buy there - the card is linked to a personal account, there are pick-up points in almost every yard, the prices are lower than in an online store or retail outlet. For example, we sell goods 20-25% cheaper on the marketplace, because our competitors have such prices" - Maxim Dimitrov, co-founder of Cave
Developed and well-established logistics. Marketplaces have a developed network of order pick-up points. For example, Wildberries has more than 43,000 of them. Pick-up points are located in large cities and small towns in Russia, and you can also sell to other countries through marketplaces - Belarus, Kazakhstan, Uzbekistan.
Number of pick-up points on the Wildberries website
Number of pick-up points on the Wildberries website as of July 2024
A wide network of pick-up points allows businesses to expand their geography and saves time and resources on organizing logistics.
"Marketplaces have much better logistics than any online store. Even if you take the largest logistics companies, delivery will still take longer than with a marketplace. Pick-up points are located throughout Russia, in almost every yard - this is convenient for buyers" - Maxim Dimitrov, co-founder of Cave
4. You can choose a convenient work scheme. There are three sales models - they can be changed in the process of work or combined:
FBO, Fulfilment By Operator — delivery from the marketplace warehouse. The platform itself tracks orders, packs them, delivers them to the client and processes returns. Sellers only need to deliver goods to the warehouse on time and control the balances. The business gets several advantages at once: it saves time and resources, goods arrive to customers faster and they are higher in search results.
"We mainly work on FBO. It's convenient — the marketplace takes care of all the operational stuff, and we develop the product.
When calculating the logistics commission, the marketplace also takes into account the level of localization. This is the percentage of orders that Wildberries and Ozon deliver from local warehouses — for example, to a client from Kazan from a Kazan warehouse. Therefore, we ship goods to all regions up to the Urals, where people order from us. It's more difficult than delivering to one warehouse, but the logistics costs are lower for us."
03.07.2024 ⏱ 23 minutes
Marketplaces vs. Your Own Online Store: Where to Sell in 2024
In 2023, sales volume in the e-commerce market grew by 41% and amounted to 8.2 trillion rubles. Over the year, buyers made 5 billion orders, which is 81% more than in 2022.
Marketplaces were the main growth drivers: the number kazakhstan phone numbers of orders on them increased by 106% - from 1,976 to 4,076 million units. Other online platforms also grew, but to a lesser extent. Here, buyers made 23% more orders - 1,066 million.
Marketplaces attract a large audience and the fact that you can start selling on them faster. But they do not pass on information about buyers to sellers. Your own website allows you to collect data about customers, but promoting it is more difficult and expensive.
What other pros and cons does each channel have? What should a retailer choose or how to combine them correctly? Let's figure it out together with the co-founder of the Cave brand, Maxim Dimitrov.
Presentation of Data Insight research at Digital Retail 2024
Pros of Selling on Marketplaces
Cons of Selling on Marketplaces
Pros of Selling through an Online Store
Cons of Selling through an Online Store
What to Choose: Your Own Online Store or Selling on Marketplaces
The benefits of selling on marketplaces
For businesses, marketplaces are an outlet for a multi-million audience. Ozon and Wildberries websites are visited by 59% of Russian residents over 12 years old per month — that’s more than 70 million potential buyers.
Here are the main advantages of online platforms.
Quick start and sales growth. Marketplaces are a ready-made online platform. Companies don’t need to develop their own website and mobile app, attract traffic to it, or set up payment acceptance.
To start working with a marketplace, it’s enough to:
Register on the site.
Accept the offer.
Create product cards.
Prepare goods for shipment.
The marketplace takes care of all operational processes - it tracks orders, collects them, delivers them to the client, and processes returns. This allows companies to grow faster than when selling through their own online store.
Mediascope research on the e-com market
The Cave clothing brand sells on Wildberries, Ozon, and Lamoda. In 2021, the share of sales on marketplaces was 53%, and at the beginning of 2024, it was 90%.
CAVE Case: How to Double the Percentage of Repeat Sales
Cave sales volume on marketplaces
In the near future, Cave does not plan to enter other marketplaces, because the current platforms have enough capacity to develop sales.
"If you want, you can grow 2-3 times in a year on marketplaces. Here, whether you sell 1,000 items or a whole truck, the process is the same: order from the manufacturer, ship, fill out the cards, and then the marketplace does all the operational work.
In our online store, we will not grow 2-3 times in a year, because this requires colossal efforts and resources. For example, selling 30 T-shirts and three of them are returned per day is one thing. Selling 300 and 30 of them are returned is a separate process that needs to be built.
When your online store grows, the processes become more complicated, new ones appear. But on marketplaces, everything is simpler and faster."
Maxim Dimitrov
Maxim Dimitrov
Co-founder of Cave
Loyal audience and high traffic. According to the results of 2023, Wildberries and Ozon entered the top ten largest global platforms by number of visits. They took ninth and tenth place with 343 and 316 million visits per month.
Marketplaces care about attracting traffic:
conduct promotions;
send out mailings;
launch advertising;
stimulate new purchases with the help of cumulative discounts;
Reduce returns by charging for a refund and increasing the redemption percentage.
Wildberries and Ozon entered the top of the world's largest platforms by number of visits for the first time
Ozon Home Page
The seller can participate in promotions and get on the main page of Ozon. This way, more customers will see the product cards and this increases the likelihood of a purchase
"Marketplaces have traffic and regular customers. They fight for their audience with the help of cumulative discounts and promotions. It is convenient for customers to buy there - the card is linked to a personal account, there are pick-up points in almost every yard, the prices are lower than in an online store or retail outlet. For example, we sell goods 20-25% cheaper on the marketplace, because our competitors have such prices" - Maxim Dimitrov, co-founder of Cave
Developed and well-established logistics. Marketplaces have a developed network of order pick-up points. For example, Wildberries has more than 43,000 of them. Pick-up points are located in large cities and small towns in Russia, and you can also sell to other countries through marketplaces - Belarus, Kazakhstan, Uzbekistan.
Number of pick-up points on the Wildberries website
Number of pick-up points on the Wildberries website as of July 2024
A wide network of pick-up points allows businesses to expand their geography and saves time and resources on organizing logistics.
"Marketplaces have much better logistics than any online store. Even if you take the largest logistics companies, delivery will still take longer than with a marketplace. Pick-up points are located throughout Russia, in almost every yard - this is convenient for buyers" - Maxim Dimitrov, co-founder of Cave
4. You can choose a convenient work scheme. There are three sales models - they can be changed in the process of work or combined:
FBO, Fulfilment By Operator — delivery from the marketplace warehouse. The platform itself tracks orders, packs them, delivers them to the client and processes returns. Sellers only need to deliver goods to the warehouse on time and control the balances. The business gets several advantages at once: it saves time and resources, goods arrive to customers faster and they are higher in search results.
"We mainly work on FBO. It's convenient — the marketplace takes care of all the operational stuff, and we develop the product.
When calculating the logistics commission, the marketplace also takes into account the level of localization. This is the percentage of orders that Wildberries and Ozon deliver from local warehouses — for example, to a client from Kazan from a Kazan warehouse. Therefore, we ship goods to all regions up to the Urals, where people order from us. It's more difficult than delivering to one warehouse, but the logistics costs are lower for us."