Are you selling products online, or thinking about starting an online product-based business? If so, you’ve probably been looking at Amazon, Etsy, and other well-known sites as potential venues to sell to the public.
Ecommerce selling on Amazon has skyrocketed recently, thanks to sweeping changes in the way people buy today. Millions of new online sellers join these sites every year and build their businesses entirely on these platforms.
Others, though, choose to sell their products through their own websites instead. They maintain websites that showcase their products, track inventory, and allow customers to complete their purchases without ever leaving the site.
Which one is right for you? In this article, we’ll look at some of the most common reasons sellers choose Amazon and other highly visible sites. We’ll also dive into several reasons why selling through your own site can give you advantages that Amazon can’t.
Why Amazon and other “big box” sites are attractive to sellers
1. Traffic and volume
It’s little wonder that these sites are the first places sellers think of starting. Amazon currently has more than 200 million Prime subscribers, 147 million of which are in the United States. Etsy has 81.9 million active buyers.
The sheer volume of business that these sites transact – and the reach they can provide – gives sellers the potential to grow their sales very quickly.
Sellers often see Amazon as a “shortcut” to getting in front of a virtually endless pool of buyers – something they believe would take years to achieve on their own.
2. Customer intent
When visitors come to an online marketplace like Amazon, they have a specific reason in mind. They want to buy a certain kind of product. This means that at that specific moment, they intend to either buy the product or learn more about it for future purchase.
Because the visitor intends to make a purchase – either now or in the future – they’re invested in the “customer journey” and already want the product. There’s less need to convince them that they should actually buy the product.
Sellers also benefit from product-based purchase intent on Amazon because customers are searching for the product, not the brand. With the right strategies, newcomers can compete with established brands on Amazon, even if no one has ever heard of them.
3. Targeting and placement
If you’ve ever shopped on Amazon, you know how the items you’ve been looking at can seemingly follow you around the Internet. That’s remarketing at work, and it’s something Amazon does extremely well.
But then Amazon takes it much farther.
Has Amazon ever suggested an item that you hadn’t been looking for, but was exactly what you wanted? That’s where their algorithmic magic shines – putting the ideal product in front of the ideal person at the ideal time.
For sellers who want to spend their time creating and selling products, instead of figuring out how to get people to buy, this can be a relief.
4. Amazon brand recognition
Amazon isn’t just one of the biggest online marketplaces in the world – it’s one of the most well-known. Unless you’re trekking through the steppes of Outer Mongolia, you’d be hard-pressed to find anyone who hasn’t heard of Amazon.
This kind of massive brand-recognition translates to trust. It’s not that Amazon never makes mistakes, but that they’ve built a reputation on fixing their mistakes promptly and holding sellers accountable.
Consumers read this trust into the Amazon brand. How many times have you thought of something you wanted, opened the Amazon app, and bought it without even noticing the name of the seller? You get trust by association, which makes it easy for buyers to say “yes.”
Does this mean Amazon is the best choice?When you look at the benefits of selling on Amazon or similar sites, it can seem like an easy choice. You get quick access to a large pool of buyers, and Amazon’s algorithm takes the guesswork out of putting your products in front of the right potential buyers. What’s not to love?
Despite the benefits that Amazon can provide to new product sellers, though, there are some distinct advantages to selling products on your own website. Although this option requires more planning and work up front, having your own website can position you for greater success in the long term.
Why selling through your own website is better for your business
1. Build brand equity
We mentioned earlier that new sellers can ride on the strength of Amazon’s brand. People know and trust their brand, and that trust extends to sellers on their platform.
The flip side? With every sale you make on Amazon, you’re strengthening Amazon’s brand – not yours. While that may help you sell a product to a new customer, it doesn’t help you bring those customers back to buy again and again.
When you sell through your own website, on the other hand, you build your own brand equity with each customer. They associate your brand identity with their entire customer experience, which includes the items they purchase from you.
If you consistently provide buyers with an easy, enjoyable experience and products that meet or exceed their expectations, they’ll turn into loyal repeat customers.
Even better, because they know your brand, they’ll send their friends to your website. We all love to tell others about products and customer experiences we love. When they buy from your website, they’ll talk about your brand instead of “some product on Amazon.”
2. Lower fees and fulfillment costs
New Amazon sellers are often shocked by how much they have to pay to Amazon for each product they sell through the platform. The company charges a “referral fee” – typically between 8 and 15% of the item cost – for each product sold.
If you choose to have Amazon store your items and fulfill your orders on your behalf, you’ll also pay a fulfillment fee for each unit sold. Fulfillment fees range from $2 to $6 on most items. You might also have to pay long-term storage fees, high-volume listing fees, and other costs.
All of these costs are on top of Amazon’s selling plan fee, which is a monthly subscription cost for sellers who move 40 or more units per month.
Because of these fees and costs, many sellers find it difficult to profit from their sales on Amazon.
When you sell through your own website, you can dramatically reduce your fulfillment costs. Some sellers use Shopify and similar platforms to sell physical products. Depending on the platform you use, you might pay transaction fees and costs of 3-6% for each item you sell.
You’ll also be responsible for the costs of storing, packaging, shipping, and tracking the products. Because you are in control, though, you have the ability to manage these costs in the best manner for your business.
3. Data and owning the customer Journey
The one thing that often gets overlooked when selling on Amazon is you lose out on owning the customer journey. Each purchase follows a path through a sales funnel, and the more engagement you provide during that journey the better.
And to own the path to purchase, data is key. Amazon doesn’t share the data they collect with you. When you sell on your own site, you’re in control of that data. Many have heard the expression, “data is the new oil”. It fuels the sales process and is vital to success. No one tactic contributes to sales growth, but the ability to have multiple touchpoints during the customer’s decision helps you engage at the right time and build your brand.. That includes, retargeting, building look alike audiences, email and text campaigns, etc.
4. Unlimited flexibility
Amazon sellers often become frustrated by the lack of flexibility when it comes to presenting their products. The listing format is the same across all categories, and is difficult to customize.
With your own website, you can present your product the way you want. If you want to include multiple videos, invite potential buyers to a Q&A or product demonstration, or create a truly immersive online experience, you can do that.
You can also add as much information as you want to your product listings. Amazon imposes strict character limits on product headlines, bullet points, and product descriptions. This can make it difficult to write persuasive copy that fits within these limits.
When you’re structuring product listings on your own website, you can also include photos and videos within the product description, which can help emphasize selling points that drive purchases.
Integrated platforms like BigCommerce, WooCommerce, and Shopify can help take a lot of the technical stress out of building product sales websites. This makes it simple for non-technical sellers to establish a presence online.
5. No competition
Amazon sellers quickly find out that there’s a mountain of competition on Amazon. Even the most obscure niches draw in crowds of sellers, all of whom are eager to sell to the same customers.
Competition means more choices for buyers. While that might be good for them, it makes it difficult for individual sellers to stand out. Many Amazon sellers end up competing by simply lowering their prices, which erodes profits – some even end up selling products at a loss.
When you sell through your own website, your visitors are yours and yours alone. They’re not comparing prices or looking to see if they can get it one day faster from another seller. They’re looking for an opportunity to buy from you.
Think of it as the difference between having the only pizza shop in town, and owning one of a dozen pizza shops on the same block. When buyers are on your website, you’re the only option for them at that moment.
So should I sell on Amazon or my own website?
As you’ve seen, Amazon and similar “big box” online marketplaces offer several key benefits that are attractive to product sellers. Selling through your own website, on the other hand, offers greater potential for long-term success because it puts you in control of your business.
No one answer is right for every seller. If you’re committed to a long-term vision, though, a product sales website should be a prominent part of your plan.
