Marketplace vs eCommerce: Differences, Pros and Cons

Imagine that the entire world is a gigantic shopping mall, where each store offers a unique experience. Now, expand that vision to the vastness of the Internet, where two powerful tools dominate the stage: eCommerce vs marketplace. Before choosing where to start selling your products, it's wise to know their details.

eCommerce is its own store on the web with its own identity and way of managing sales, while maintaining the exclusivity of its offer.

On the other hand, marketplaces work like huge shopping centers, where different brands and sellers compete on the same platform to offer their products.

The characteristics of both business models are as different as the experience they provide to the user.

What is an eCommerce

The eCommerce, or ecommerce, represents the modern trend of business model which allows the realization of online business transactions.

In essence, when we talk about ecommerce we refer to virtual stores Where a firm or mark offers and sells their products or services directly to consumers via the Internet.

Las e-commerce stores They make it possible to shopping experience digital, in which the customer can purchase what they want without the need to physically travel to an establishment.

Some examples of these types of stores are Zara, Apple and Zalando, who have shaped their digital platforms to provide their customers with a user experience agile and satisfying.

There are several business models within the eCommerce universe, such as B2C (Business-to-Consumer), B2B (Business-to-Business), and C2C (Consumer-to-Consumer), thus adapting to different types of potential customers.

Main features of an eCommerce

Within a eCommerce, operated as a webshop, the business owner is the one who provides the stock of products and takes charge of the sales transaction.

This includes everything from inventory management and infrastructure technological, going through the purchase process, to ensure that each order successfully reaches the door of the end customer.

In this kind of business model, the seller -who is himself store owner- is responsible for offering a customer support effective, as well as to control the management of shipments and returns.

La webshop In a eCommerce is characterized by being custom-designed, reflecting the aesthetics and values of the mark, and placing special emphasis on user experience to achieve not only sales, but also customer loyalty and the dissemination of your business establishment in the digital space.

What is a marketplace

Un Marketplace It's a digital platform In which multiple sellers Exhibit and sell their products or services.

This operation is performed in a single virtual place, with the platform acting like a middleman between buyers and sellers.

In a marketplace, Vendors are responsible To list and manage your products, while the platform provides all the infrastructure and hosting necessary for the business environment.

In terms of operations, a marketplace not only acts as an exhibition point, but it is also responsible for all sales operations, this being responsible for executing the transactions, to later transfer the percentage of the sale to the sellers.

It is important to note that these platforms usually maintain the warehousing and delivery logistics in the hands of advertisers.

In short, a marketplace simplifies sales channel online offering different brands the possibility of reaching a majority of potential customers, all benefiting from a centralized system that manages key elements such as customer support and payment processes.

Prominent examples of marketplaces are Amazon, eBay, MercadoLibre and AliExpress. Each of these examples clearly illustrates the way in which a marketplace puts in the hands of sellers the managing your own inventory, assuming the shipping and return policies.

Key features of a marketplace

Marketplaces are known for bringing together multiple sellers on a single digital platform, thus offering a wide range of products and product categories.

These platforms charge a tariff to sellers because of the visibility and use of their system, although some marketplaces offer the free publication of a limited number of items.

One of the great advantages of a marketplace is the wide scoping that they provide to businesses thanks to the traffic and reputation of the platform itself. This means that from day one, even a new business can be discovered by a large audience.

Another outstanding feature is the lower initial investment required by sellers, since they can make use of the already established infrastructure of the marketplace instead of designing and creating a website from scratch.

These spaces offer ease of use for both sellers and customers; integrated customer care services, logistics and payment systems offered by most marketplaces save time and effort, which improves the shopping experience and the sales transaction for all parties involved.

Marketplace vs eCommerce: What is the buying process like

El buying process In a eCommerce In front of a Marketplace it has similarities in its outer façade but diverges in the internal gears that propel it.

In a eCommerce, the business owner It's who manage all stages of the sales process, becoming the only seller on that digital channel.

From the storage to logistics, passing through the Marketing And the customer support, all decisions and operations are sole responsibility of the seller, resulting in a process of high personalization and branding.

On the other hand, in a Marketplace, the sales process is diversified due to the intervention of several different sellers that offer their products on a single platform.

Although as a customer, the experience may seem identical, you're actually accessing different stocks, shipping and return policies and even at different levels of customer support, depending on the individual seller you're transacting with.

The final result for the customer may not reflect the operational complexity behind your shopping experience fluid, but without a doubt they are two business models with different operating dynamics.

Purchase process in an eCommerce

In the infrastructure of a eCommerce, the brand or virtual store you have full control of your product catalog.

It's the vendor Who manages the product information, sets up the website, manages the inventory stock and executes the logistics of shipping orders.

In addition, it is responsible for the customer service, ensuring a shopping experience personalized and consistent.

This level of involvement requires a significant effort, resources and time, but it also gives eCommerce itself the possibility of cultivating a direct and closest relationship with their buyers.

Keep them pricing consistently and promoting a solid brand image are part of the strategy to generate trust and loyalty in customers.

Purchase process on a marketplace

El Marketplace, on the other hand, is presented as an intermediary that makes it possible for multiple sellers offer their products to a wide audience.

Here, buyers benefit from being able to compare a wider range of options and transact from the comfort of their home.

In this model, sellers manage their own inventory and shipping and return policies, but it's the platform who provides the basic infrastructure for transactions.

The responsibility of a logistic and operational management detailed can be partially or completely outsourced, thanks to the additional services that the marketplace provides, such as publicity and logistic support.

This gives sellers more space to focus on expanding their product catalog and Reach more potential customers without concern for technical issues or peculiarities of the platform.

Main differences between eCommerce and marketplace

La Main difference between an eCommerce and a marketplace lies in the Concept of ownership And the managing of the sales experience.

While a eCommerce It represents a webshop Own to a Single brand or company that controls the entire sales process, from the stock to customer service, a Marketplace It's a digital platform Which hosts multiple sellers, where everyone is independent and is responsible for the management of their inventory and the post-sales of their products.

In an eCommerce, the store owner Get the totality of profits, while taking care of all the logistics and after-sales service.

On the other hand, in a marketplace, the owner of the platform Get a commission for each sale performed, while diverse businesses have access to established infrastructure of the platform, thus reducing its Initial investment and delegating certain competencies to the marketplace.

Business model

La main difference in the business model is reflected in the relationship between the seller and the customer.

In a eCommerce, there is a direct control About the customer experience, from product exposure to post-sales. El owner of the online store is responsible for the entire business process, and benefits from this management by not having to share profit margins with others.

In contrast, a Marketplace Act like a shopping mall digital where diverse Merchants offer your products or services. Here, the platform only provides the technological infrastructure and they charge a fee or commission per sale.

This system reduces the reversal And the direct responsibility on product management, while offering the possibility of reaching a extended audience thanks to the visibility provided by the platform.

Shopping experience

With regard to the shopping experience, an eCommerce tends to offer a buying process plus uniform and controlled, with specific policies that reflect your brand identity.

La personalization is a key advantage, since it allows the adaptation of the webshop according to the customer's needs.

On the other hand, in a marketplace, the standard experience offered is because there is a Common framework that all sellers must follow.

While this may limit personalization, buyers enjoy the ability to Compare products, pricing, and Read reviews of other users on the same site, which expands your options and makes it easier to make decisions.

Range of products

With regard to the product range, a marketplace beats a typical eCommerce.

Los Marketplaces They offer a variety of brands and products, from low-cost options to items from High-end, and all this under one virtual roof. Customers can browse and shop at multiple stores without having to leave the platform.

On the other hand, a eCommerce store focuses on products from a brand or individual company.

This can be beneficial for consumers looking for a private brand or are interested in a more shopping experience personalized and cohesive. However, if you compare the purchase options, an eCommerce tends to have a more limited catalog in the face of the vast diversity present in marketplaces.

Sales channel

Un eCommerce represents the scenario where a company controls and manages its own online business establishment.

This includes the responsibility to build and maintain all of the technological infrastructure necessary, as well as to manage all Stages of the sale, from marketing to delivery and customer service.

In contrast, a Marketplace works as a digital meeting place for multiple sellers, who list and manage their products within a common platform.

Here, the digital platform provides the infrastructure, but does not actively participate in sales or logistics processes. It is a kind of intermediary that facilitates transactions between buyers and sellers, expanding the product range without having to manage your own inventories.

User Experience

The user experience in a Marketplace offers the possibility of compare products and prices, consult opinions from other users and personalize the shopping experience through a range of options payment and shipping. These platforms tend to provide a diverse and dynamic shopping experience.

On the other hand, the eCommerce, being managed by a single company, offers a more shopping experience uniform and controlled.

Users navigate within the brand's ecosystem, which can simplify the purchase decision. Here, the personalization is total, which means that the brand can create and manage its image and its interaction with the customer according to its needs.

Profit margin

El profit margin In a Marketplace may be lower compared to a eCommerce because the owner of the platform charges a commission for each sale.

Los sellers on marketplaces They assume less inventory risks but they have to compete with others for customer service, which can put pressure on prices.

On the stage of eCommerce, the benefits may be greater, since the seller keeps all the profits from each sale, since there are no intermediaries.

In addition, the costs associated with the management and promotion of the store are directly absorbed by the company, which can increase margins according to the effectiveness of its management and strategies online sale.

Estas practical differences are critical when establishing and running an online business and must be analyzed in depth to determine which one best aligns with the objectives and capabilities of each company.

Advantages and disadvantages of eCommerce

Online commerce has simplified the way in which we relate to the purchase of goods and services.

However, launching and operating a webshop in the eCommerce format it has its advantages and disadvantages compared to a marketplace.

Let's analyze what these consist of and how they can impact development and business model Of a firm.

Advantages of eCommerce

• ‍Wide range: one of the main advantages of eCommerce It's your global reach, which makes it possible to business expansion without physical limitations, thus reaching national and international clients. this is a significant advantage for business establishments who seek wide dissemination.
• ‍24/7 availability: Operate the 24 hours a day is another competitive advantage, since it allows customers purchase products at any time, adjusting to their schedules and routines regardless of time differences.
• Customization: personalise the shopping experience According to the seller's needs, it is a crucial benefit of eCommerce, allowing us to adapt the design, interface and functionality of the web to create a user experience unique and differentiated.
• Independence: the possibility of maintain your own domain gives online businesses greater control over their brand and is crucial for Build loyalty in a niche market through personalized service that increases customer loyalty. In addition, by not having to share profits with intermediaries, the seller of an eCommerce can enjoy the full profit margin in each sale, representing a significant economic advantage.

Disadvantages of eCommerce

However, starting an eCommerce comes hand in hand with particular challenges.

• La Initial investment can be significant: having to create a website from scratch and cover the costs of domain, hosting and brand positioning.
• Positioning: The task of Position the brand In search engines it takes time and a considerable effort in SEO or WITHOUT to generate visibility in front of consumers.
• Diversity of products: depending on the type of business, in an eCommerce, customers face a lower variety of products when compared to marketplaces, which house a wide range of product categories offered by multiple sellers.
• Resource balance: although eCommerce allows you to keep all the Profit from each sale, this can be counterproductive if you don't achieve a shopping experience optimal one that generates enough sales to cover expenses and generate profits.
• Competence: E-commerce can deal with more difficulties for compete with other sellers because they must face directly against other businesses that may have more resources or more aggressive strategies of online sale.

Advantages and disadvantages of the marketplace

El Marketplace is a growing business model that allows sellers to offer their products in a digital platform established, functioning as a large online mall.

However, like eCommerce, it offers certain advantages and disadvantages that must be evaluated before deciding if it is the right model for a business.

Advantages of the marketplace

• Visibility: marketplaces like Amazon or eBay attract a large number of potential customers, thanks to its established reputation and traffic generated. This is a great benefit for new sellers looking for Immediate exposure and access to a larger audience without large investments in advertising.
• Logistics: one of the biggest advantages of joining a marketplace is the simplified inventory management and logistics. Services such as FBA (Fulfillment by Amazon) allow sellers to free themselves from many logistical concerns, since the marketplace handles the storage, packaging and shipping of products.
• Loyalty: The power of customer loyalty of a marketplace is also relevant.
• Trust: Buyers tend to trust and return to platforms that they already know and use in their daily lives, which can lead to recurring sales for sellers, based on the previous trust of users in the platform.

Disadvantages of the marketplace

• Competitors: the proficiency in a marketplace it's much more visible. Products face direct comparison with offers from other sellers, which can intensify competition and put pressure on price margins.
• Little control: When selling on a marketplace, businesses face less control about their business model, since they must adapt to the platform's rules and policies. Las commissions charged for each sale are a direct decrease in profit margins of sellers, which can result in economic challenges, for products with low margins.
• Customization: decisions about personalization and presentation are now limited by what the marketplace allows.‍
• Attention from customers: A marketplace focuses only on the product and not on the seller or the brand behind it. This can hinder the development of brand identity and long-term customer loyalty. El Attention time The number of visitors is reduced given the immense variety of options, making the time spent on each specific product fleeting and, consequently, affecting purchasing decisions for a particular product.

In conclusion, although trading on a marketplace can offer immediate access to an extensive clientele and facilitate aspects of logistics, it is accompanied by intimidating competitive visibility and less capacity to develop and project one's own brand.

These factors must be taken into account when choosing between an eCommerce and marketplace such as business model For the sale of products online.

Conclusion: marketplace vs eCommerce, which one to choose?

In the digital landscape, choosing between a e-commerce And a Marketplace It's a decision that doesn't follow a predefined formula. It all depends on the business strategy And the specific business objectives.

A marketplace provides access to a wide range of product range and brands, which often exceeds the variety of a store or webshop specific.

On the other hand, at the economic level, the cost-benefit tends to be more attractive in a marketplace, as it has multiple sellers and, therefore, greater traffic from potential customers that can be translated into sales without the need for a large Initial investment on the part of each seller.

However, the choice between adopting a business model of online sale focused on the e-commerce or immerse yourself in the dynamism of a marketplace, it must be aligned with the company vision and the goals set.

Each company must evaluate your resources, the shopping experience you want to offer and how these factors influence your profit margin.

Both sales channels have their merits, but ultimately, the choice must resonate with the identity and aspirations of the company involved.

If after reading this article you are still not sure, we invite you to put yourself at contact with us. We'll show you which of these two options best suits your digital business so you can position yourself as a leader in the sector.