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Which USA Marketplaces are Most Likely to Drive eCommerce Success?

September 17, 2019
Guest Post
Brian Roizen
Co-founder & Chief Architect @ Feedonomics

Brian Roizen is the co-founder and chief architect of Feedonomics, a full-service feed
optimization platform that optimizes product data for hundreds of channels. He has been
featured on numerous podcasts and webinars, and regularly contributes to Search Engine Land
and other industry-leading blogs. Brian graduated summa cum laude from UCLA with both a
bachelor’s and master’s degree in Mechanical Engineering.

As merchants look to diversify and find new options for revenue streams, one avenue that is worth exploring are marketplaces. While there are many marketplace options to choose from, which ones are most likely to drive more revenue?

Amazon

Amazon is the marketplace that continues to dominate year after year. This should come as no surprise considering that over 55% of all product searches start on Amazon and 92% of those who start on Amazon end up purchasing from there.

Amazon Prime is a separate subscription service that offers free two-day shipping. In addition to purchasing items, Prime members can stream movies and TV shows. Amazon Prime Video is a value add-on, enticing customers to stay in the Amazon ecosystem as Prime customers. According to a recent Statista study, Amazon Prime members spend on average approximately $1,400 per year.

How does it work?

Customers can shop from a computer, on a mobile device through the Amazon app, and via Alexa which is Amazon’s virtual assistant found in Amazon Echo devices. The marketplace offers a vast selection of products ranging from electronics, clothing & accessories, health & beauty, books, etc.

 Benefits for Merchants

-Amazon offers sellers a way to reach a global audience, at a scale unlike any other.

-In 2017, over 50% of the products sold on Amazon came from third-party sellers. Amazon’s third-party marketplace represents a big opportunity for small and medium-sized businesses to expand their customer base.

-In general, shoppers prefer low or free shipping. Shoppers are more likely to purchase a product that is “Shipped by Amazon” then from a merchant that they’ve never heard of. Amazon provides merchants the opportunity to improve their shipping by way of Fulfillment by Amazon (FBA).

Google Shopping

Google recently gave their shopping platform a fresh, new design that is user-friendly for both buyers and sellers.

Googles Shopping for eCommerce Merchants

How does it work?

Log into your Google account and click over to Google Shopping. The landing page will greet users by name with personalized product suggestions. Product recommendations are based on your browsing behavior and past search history.

Customers can purchase products from multiple retailers in one quick transaction with the use of a universal shopping cart and stored credit card information.

When you Buy on Google, those purchases are backed by a Google guarantee with Google handling the customer support and returns.

How does Google Shopping work?

 

Benefits for Merchants

-Merchants can sell their products across multiple Google platforms like Google Search, Google Assistant, Google Home devices, and even Google Images.

-Shoppers can buy products from multiple retailers in one quick transaction with the use of a universal shopping cart and stored payment information. The ease of use often leads to a higher conversion rate for merchants.

-By offering a quality user experience, it creates a greater level of consumer loyalty, leading to repeat business.

-A common question from online retailers is “Should I pursue a cost-per-sale model with Google Shopping Actions or continue with PLAs (pay-per-click)?” Our clients have found that the best way to maximize sales is to combine Google Shopping Actions and PLA.

Walmart

While Walmart is mainly known for their brick and mortar stores, the company has asserted itself into online retail in a big way.

The retail giant recently rolled out a one-day delivery service, called NextDay. This one-day delivery service is free, provided that you spend a minimum of $35.

Walmart for eCommerce Merchants

According to a 2018 Jumpshot study, Walmart is growing 3.5 times faster, year over year, than Amazon in several major categories. They say “don’t put all your eggs in one basket” and for merchants looking to diversify and not rely solely on Amazon, Walmart is a great marketplace option for merchants.

Instagram

We know that Amazon has captured a large market share, but other challengers, like Instagram, are coming to the forefront. Shopping on Instagram helps people discover products and brands more easily, allowing businesses an opportunity to create an immersive storefront.

Instagram’s new program, Checkout on Instagram, represents another opening for merchants to get their products out in front of millions of Instagrammers.

To Sum It All Up

There is no magic bullet for success. Different retailers grow at different rates, depending on the product category. It takes commitment, as well as an investment of time and resources to list your products across multiple marketplaces. As a merchant, you’ll want to research how your items perform compared to your competitor’s products and what search terms are driving product views to different sites. The main takeaway is to diversify and not go “all in” with one marketplace.

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