If you sell products online, identifying the best channels for e-commerce is the fastest ticket to growing sales in your stores. This two-part series will give you a rundown on the eight types of channels that work best for an e-commerce business.
1. Marketplaces
Listing products in a marketplace such as Amazon, Ebay or Etsy has both advantages and disadvantages.
Your products will be visible to millions of potential buyers–but you’ll also have competition from thousands of sellers with competing products.
You won’t need your own storefront if you choose not to have a presence separate from the marketplace. You can just set up a product feed, make sure fulfillment is covered, and start selling. But you’ll have less freedom to set your own prices, and on most marketplaces, you’re expected to meet certain performance standards for things like conversion rates, shipping, quality control and returns.
On Amazon, most sellers use the Fulfillment By Amazon (FBA) option, which gives you “Prime” seller status and lets them take care of all fulfillment and returns. You pay extra commissions for this service but for most sellers the difference in volume with Prime status more than makes up for lower margins.
Within the Marketplaces category, there are a lot of individual ones to choose from.
The Big Three
Amazon and Walmart are constantly vying for top marketplace status as defined by global sales, with AliExpress (AliBaba) holding third place. You’ll have to compare benefits on platforms like Amazon vs Ebay and compare against the terms on other marketplaces like Etsy because they do vary a lot.
Alternative marketplaces worth a look
There are plenty of alternatives to the five bigger marketplaces mentioned above, including newer marketplaces, Europe and UK-based marketplaces that sell globally, and marketplaces for selling niche products or items for the home. See the linked articles for details on each type mentioned.
Comparison Shopping Engines (Shopbots)
Price-conscious shoppers searching for the best deals love shopbots, and will turn to these first when they begin their online shopping. These comparison shopping engines will surface your products if they are competitively priced, and in a category with some price flexibility.
The engine’s results page displays a grid showing the same products listed by other sellers, giving shoppers a clear picture of the best deal. To succeed with this strategy, you have to regularly monitor pricing and discounts being offered by the competition.
To participate, retailers upload their product data feeds, set bids for particular products or product categories, and the shopbot does the rest.
Most comparison shopping engines operate on a cost per click (CPC) basis. With CPC, you don’t pay anything unless a user clicks on your product listing to visit your website.
Once a shopper clicks on an advertiser’s offer, they are sent directly to the online store to complete the transaction.
Some of the common shopbots include
Retargeting
Retargeting is still seen as the most effective way to lure back customers who abandoned their carts. A 2018 SaleCycle study showed the average shopping cart abandonment rate for retail websites in 2018 was over 75.6. Given that 3 out of 4 carts get abandoned, recovering even a few of those missed sales is the reason why remarketing exists.
Retargeting allows advertisers to target shoppers who’ve previously visited their website. There can be many reasons why shoppers abandon their cart, Shoppers are often still interested but were simply distracted before they completed their purchase. You can get a lot of these shoppers to convert with retargeting.
Retargeting networks like AdRoll and Criteo are popular solutions. Besides those, retargeting services are also offered by channels like Google and Facebook. With most of these, a unique tracking pixel needs to be integrated onto the advertiser’s website.
Search Engine Ads
Search engine ads are designed to reach shoppers who are already interested and thus tend to convert more reliably. You use targeted keywords
Search engines like Google, Yahoo and Bing offer retailers several choices in ways to advertise. These include text and image ads like the ones you see above the organic results on a search page, product listings where you can sell directly (Google Shopping), and voice search marketing. Microsoft recently consolidated all its search assets (Bing, Yahoo and AOL) into a single ad program, so it’s now a three-fer: buy an ad on Bing, and you appear on all three. Because these search engines draw a lot less traffic than Google, rates are a lot lower too.
This ad strategy, also known as Search Engine Marketing or SEM, is related to SEO in its use of keywords. You bid on keywords, some of which may have high levels of competition and thus a high cost. An alternative strategy is to add more specificity to your keyword terms, which usually lowers the competition level and also helps shoppers who are looking for a particular size or feature in a product.
In Part 2, we’ll cover four more channels popular with e-commerce merchants today: Local Inventory Ads, Social Media Ads, Social Media Marketplaces, and Email Marketing.
