With Black Friday upon us, and Cyber Monday just around the corner, we’d say it is the official start to holiday shopping! As a business owner, this could mean that your busy season has begun! As we are well aware, online shopping has become very popular for those who want to skip the crowds. If your looking to expand or bring your business to an e-commerce platform, below we found some great tips from the BDC! These tips were written by a BDC business consultant, Martin Wiedenhoff.
See the original article here!
Online marketplace selling 101:
1. Try buying a competitor’s product
As you start your online marketplace research, there’s no better education than buying something from a competitor! You will learn a lot about the purchase journey and you can even return the item for a refund (if possible) to get insights into their customer service process.
Tip: Compare the experience buying directly from competitors’ websites versus buying from them on an online marketplace. Is there a difference in their marketing strategy, prices, etc.?
2. Set up an account and list your first product
Armed with the information you gathered about your competitors, get started by selecting a marketplace where your ideal customers shop. Now, choose a product to list.
Once you have your product on sale, follow these steps;
- Watch customer engagement on a daily basis for the first month and experiment with improving your product descriptions, calls to action, images, etc., on a weekly basis.
- Ask for feedback from your first customers to understand their customer experience.
- See if there are any leads coming from the marketplace to your website and social media channels. In the hotel business, for example, some prospects will visit a marketplace like Expedia and then go directly to the hotel website to see if there is a better promotion, free upgrades or bundle with car rental. The same concept and opportunity applies here.
Tip: Add complementary products once you get comfortable after filling some orders. Additional products will allow you to up-sell and cross-sell. Some marketplaces might propose competitor products if you don’t!
3. Track customer returns and complaints
Even the very best online marketplaces have challenges in a highly competitive, global environment. If you fail to track customer returns and complaints, it can quickly hurt your business. It’s important to remember that Amazon’s terms and conditions always favour the buyer, so make sure to solve any disputes within a couple of hours. The same thing goes for issues with payment portals connected to online marketplaces such as PayPal. Stay on top of this.
Tip: Make sure your pricing is in local currency or U.S. dollars and is clearly stated. Order cancellations are often related to confusing exchange rates charged by credit card companies. Don’t expect clients to do the math!
4. Be consistent with your e-commerce pricing strategy
Many successful companies on Amazon and eBay face the pain of commission rate hikes when they start making serious sales. They change strategy and try to drive more business to their e-commerce site. This can be very expensive and counterproductive if your target customers are comfortable shopping on the online marketplace.
To avoid cannibalizing your online marketplace sales, we recommend you adapt your online sales strategy per channel. For example, you may want to sell returned goods on eBay because it’s known to work well for second-hand merchandise. Or you could decide to sell last year’s collection on Amazon at great prices to increase your score on the Best Sellers Ranking list. These are things to be aware of and consider when selecting an online marketplace.
Tip: Just like when large retail chains require exclusivity deals, you may wish to focus on a specific online marketplace that attracts specific target customers. Some online marketplaces focus on a niche customer segment such as Well.ca for green and natural brands.
5. Get your pricing right and be patient
Online marketplaces are different from standard e-commerce. They can offer a turnkey solution from pre-sales support to shipping to post-sales surveys. Others focus on moving large volumes of stock quickly. Some are focused on high-end niche products with a small audience willing to wait for weeks to get a custom order.
More than anywhere else a proper pricing strategy is imperative as many consumers are looking for a perceived deal. Success will not happen overnight, so be patient! You need to give it time before slamming on the brakes. Entrepreneurs who’ve been successful on Amazon and eBay have spent two to three years before seeing serious traction in new markets.
Tip: Don’t think you can do all the heavy lifting alone? Get help. Many entrepreneurs have told us that they got advice from their local chamber of commerce, a marketing or web agency, subject matter experts, etc. Reach out to your business partners and simply ask “Have you sold on Amazon (or any online marketplace) yet?” and get the conversation going.
Conclusion and recommendations
The entrepreneurs who succeed on online marketplaces are the same ones who do well in brick-and-mortar stores. They come prepared; they learn the rules of the game; and they conquer new markets.
To see what I mean, I encourage you to watch this video on Kicking Horse Coffee. Entrepreneur Elana Rosenfeld made the bold decision to stop selling from the company’s website altogether in favour of online marketplaces. Kicking Horse mastered the online marketplace sales strategy.
Think about how using an online marketplace could advance your brand and follow the BDC blog to keep up with the latest trends across the country.
For those of you who already have had success selling products using online marketplaces today, what recommendations do you have for entrepreneurs? Please share your comments below.