The trend of online shopping is increasing rapidly in line with the impact of the retail industry due to the Covid-19 pandemic. With various rules and people’s preferences for staying at home, it’s no wonder that the value of online transactions both in the marketplace and online stores has increased dramatically. With this, more and more people are aware of the ease and convenience of shopping online.
Now for those of you who want to get into the world of dropshipping and resell business and intend to sell your products online, of course you will ask yourself about what platform is good to use to develop your business, either through a marketplace or online store on your own personal network. Instead of being confused, let’s understand what are the differences between the following 2 channels and their advantages and disadvantages.
Online Marketplace
Examples of marketplaces that exist in Indonesia today are Shopee, Tokopedia, Lazada, Bukalapak, and so on. They provide platforms, facilities, and infrastructure to bring together sellers and buyers from various industries and locations so that they can conduct transactions easily. Please note, marketplace companies do not sell their own products and do not have product stock.
How Marketplace Works
As online transactions develop, it is undeniable that fraud also occurs a lot because many buyers do not meet the seller face-to-face so that one of them easily escapes. Well, this is where the marketplace provides a solution. In this case, companies such as Tokopedia will be the guarantor or mediator between the seller and the buyer. The following is a schematic of the transaction process that occurs:
- When buyers place orders on the marketplace, they will transfer to the account of the marketplace company, not the seller
- The marketplace company will notify the seller that the buyer has made a payment, so that the seller can pack and ship the goods to the buyer
- When the goods have been received by the buyer, they can confirm with the marketplace company (or can also be detected from the delivery receipt) so that the marketplace company can cash out the transaction money to the seller
Thus, trust issues between buyers and sellers can be mediated by the marketplace as an intermediary.
The advantages of selling on Marketplace
1. Traffic on the marketplace already exists
When Shopee and Tokopedia do massive advertising on social media, we don’t spend a dime as a seller in the marketplace. Large marketplaces in Indonesia are generally already crowded with visitors and indirectly increase your sales potential because your store is seen by more potential customers.
2. Infrastructure that has been provided
Broadly speaking, starting to sell on the marketplace is very easy because we only need to upload products, write descriptions, and give prices. All infrastructure and facilities have been provided and as sellers we only need to focus on selling.
Disadvantages of Selling on Marketplace
1. Many competitors
It turns out that the hectic transactions in the marketplace not only benefit us as sellers, but also buyers. Through the marketplace, buyers have many options to choose a seller, so there can often be price wars when we sell similar and common products in the market. In addition, customers can easily switch from one seller to another, making it difficult to build customer loyalty
2. It’s hard to build a brand
When you bought a mask at Shopee, do you remember the name of the shop? Often we don’t understand who is selling, all we know is that we bought Shopee at that price. It’s different when the seller has his own store and brand, for example Guardian, a store that we often encounter in malls. Customers will still remember that they bought masks at the Guardian even though the masks that are sold are also easy to get in other places.
Own Online Store
Well, unlike the marketplace, this technique relies on a personal network as a selling platform. This includes followers on Instagram, Whatsapp contacts, and subscribers in your email, as well as visitors to your store website. Having your own online store gives you full control over your business. Now for more details, let’s understand the advantages and disadvantages.
The Advantages of Selling in Your Own Online Store
1. Full control
When you have your own store, you are free to do any promo, open at any time, and determine all the conditions according to your own wishes. You don’t need to rely on the marketplace as a middleman.
2. Opportunity to build a Brand
By inviting traffic to your online store, you are also building a brand in the eyes of your consumers. When you provide satisfactory service, it will certainly be a plus for your store and this will also be an attraction for your past buyers to make repeat orders.
3. No Pricing War
When a potential customer enters your website, what they see is all the products from your store on the website, not many similar items from various sellers like in the marketplace. This means that there is no price comparison with other stores and customers will find it difficult to stray to competitor stores as is often the case in the marketplace
Disadvantages of Selling in Your Own Online Store
1. Perlu mendatangkan traffic
When you have an online store, of course customers will not secretly stray to your store if you don’t do promotion or marketing.
2. Kurangnya kepercayaan dari calon customer
When your store is new and not yet well-known in the market, it is undeniable that some potential customers will hesitate to make transactions because they are not sure that you are a trusted seller.
Conclusion
From the explanation above, which is the best platform for selling? The answer is, both. We suggest you to build your store brand so that your position is not easily replaced by competitors. When you create a personal shop, make sure you always provide satisfactory service to customers so that they have a good image of your brand. If your product is unique and not widely available in the market, then selling on the marketplace also gives you a good opportunity to break eggs. The price will be much more stable if your item is not easily found in other sellers. After that, you can direct your buyers in the marketplace to also see other products in your online store.