Episode 58 of eCommerce Uncensored was recorded on the road, at a restaurant, during a “power lunch” due to a burst pipe in the building which houses the studio. That is the explanation for the unusual audio and background music for this episode. Work is underway to get things back to normal, but in the meantime, in Episode 58 Kevin, Jason and Paul talk about the benefits of selling your product on existing marketplaces like Amazon and EBay when starting out.
Why you should validate your product on an existing marketplace…
As said many times before, it is really important to know if your product is going to sell before you invest a ton of time and money into things like inventory and marketing. A huge piece of starting any eCommerce business is asking yourself, “do people want my product?”. Selling on an existing marketplace will answer this question. If you are successful, your job becomes to figure out the best processes to sell your product, so it becomes a matter of how rather than if.
Amazon and EBay already have a massive customer base so you are not spending the time and money searching for an audience. If you can successfully sell your product on these platforms you’re likely to experience success when you venture out on your own.
While validating your product on existing platforms is valuable, there are many reasons why you do NOT want to build your business on someone else’s platform…
- Large marketplace platforms like Amazon, EBay, Etsy, etc charge fees for selling your product, so you either need to take a hit to your bottom line, or raise your prices to compensate.
- You are not in control-at any point the ‘big guy’ can come in and shut you down or change an algorithm that completely changes your visibility and sales.
- They can take you over-Amazon has more than enough money to do anything that you are doing. If your product is selling like crazy, there is nothing stopping Amazon from manufacturing their own version of your product and taking you over.
- You cannot build a customer base. You are not growing your email list so you cannot resell to existing customers or even retarget them. Using these existing marketplaces takes away your ability to scale your business. You can’t upsell, communicate with your customers, email market, etc.
When testing your product out in an existing marketplace choose the right platform. Our very own Paul Chew makes handmade custom skateboard decks that are very cool, and uses Etsy as a platform to sell them. Check him out on Etsy at PostFourStudios and follow him on Instagram at Post Four Studios.
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