Selling on a marketplace is not the same as selling through, say, Google Shopping. When you place an ad on Google, it links back to your website where the transaction takes place. On a marketplace, in addition to creating the ad, the seller then needs to be able to receive completed orders and many others that come along periodically.
This simple difference has significant ramifications; managing your stock levels becomes more complex, existing processes may need to change to accommodate the new channels while your customer service team too has many more.
These added levels of complexity have led to a boom in the number of software platforms built to help users manage these marketplace channels but the question of which one to choose is one of the most common questions I get asked. If you’re in the market, here are the recommendations of what to look for in a listing tool, from someone who’s spent the last 20 years working with them and 10 of those, working for them. In case it helps.
1. PLATFORM TYPE
Platforms evolve – usually, in response to customer need – so there are a wide variety of tools out there that started off doing one thing but now, also do something else. Marketplaces tools are the same.
Your website platform may well claim to support Amazon listing but it’s not their core competence and I’ve encountered many an issue with platforms like this where we expose a critical flaw and they have failed to resolve it due to bandwidth issues and lack of demand.
ERP systems are often like this as are feed management platforms. They kind of work but not really.
The opposite is also true. Listing tools that boast Warehouse management functionality for example. The WMS features are ok but will soon need replacing as businesses grow.
In cases like this, I would never rule them out straight away but it does make me look at these features carefully and flag any potential concerns to my clients.
Analysis of the marketplace integrators by core competence
2. Supported Channels
While it may seem a little obvious, you’ll need to ensure that the tool you have your eye on supports the channels you… um… have your eye on. Some platforms support many channels in many countries and others only a support one or two.
Even if you’re only targeting Amazon right now, you’d be wise to consider a platform that supports a large number of channels to avoid future pain. Integrating a listing tool is not something you want to do too often as it can be time-consuming and complicated so set yourself up with a scalable platform from the start to avoid any unnecessary upheaval.
However, not all integrations are the same. Marketplaces require a three way integration: Product data going from seller to marketplace to create the listings; order data coming back; and shipping information going the other way. Some platforms seem to think the job’s done just by handling the first part.
There are other issues too. For example, when you create listings on a marketplace, sometimes (a lot of the time actually) they will reject your submissions and generate an error.
A decent listing tool will incorporate these error messages into their platform to help you diagnose and fix the issues. The language used though, can be quite technical and hard for mere mortals like us to understand so the better ones will translate these messages into English to help you diagnose the problem and might even provide help to fix them.
Marketplaces are a true global phenomenon.
3. Integrations
This is the flip-side of channel integrations. You’re going to need to manage your orders. That means being able to receive completed orders and then updating the marketplace when it has shipped with a tracking number and courier details.
How you go about this depends on how you are using your listing tool. If you are using the system as the master system for stock control, you could set up a terminal in your warehouse and train your staff to manage orders directly but, if your listing tool is slaved off a separate master system (perhaps your website or an ERP system), you probably want your orders to be handled in the same way and using the same systems as those from your other channels. And for this, you need to integrate. For more information, refer to my article on integrations here.
4. Automation
If you have more than a handful of SKUs and want to list on multiple marketplaces, you’ll need to automate. Not only can it save hours every day taking care of those tasks that suck up your time but they can also make your operation better.
The most obvious example of this is stock control. Let’s say you have a product for sale on both your own website and on Amazon. You have 2 units in stock so, if Amazon sells one it now knows tyou only have one left but, if your website sells one, Amazon will still think you have 2 left unless you tell it otherwise. Doing this manually for one product is ok but, imagine doing that for 30,000 products across 5 channels.
Other examples of automation would be to format your product data to create listings or sending shipping updates.
You’d be forgiven for expecting all listing tools to have these key functions automated but, unfortunately, that’s not the case so always check before committing.
5. Errors & Reporting
When you create listings on a marketplace, sometimes (a lot of the time actually) they will reject your submission and, when that happens they will generate an error message.
Errors are caused by errors in the product data which can take time to resolve. You need a system that reports these errors well: good filters; suggested resolutions etc. A decent listing tool will incorporate these error messages into their platform to help you diagnose and fix the issues.
As well as errors, you want to be able to diagnose performance – why are sales down? How does Amazon compare with eBay?
Most platforms I have worked with have a fixed set of reports making it hard to get under the skin of what’s happening. Ideally, you need to be able to drill down to isolate what is underpinning your results. If sales are down, is it across the bought or on all sites? Maybe some of your top sellers have gone out of stock.
If you can, look for a system that enables you to manipulate the data with good visualisation so you can see, at a glance, what’s going on.
6. Support
Customer support mechanisms come in three forms:
- Knowledge base
- Forum
- Support team
What they want is for you to find your own answers on the Knowledge base. If you can’t, then ask other users. Only contact us when you haven’t been able to find the answer yourself. If that last part can’t handle what’s left over from the first two parts, service will be sub-optimal, shall we say.
Take a look at the SLA’s to see what they have committed to in terms of support. It tells you how much you will be able to insist that something works even if it doesn’t guarantee a resolution.
See if there is any documentation available on the web because many platforms have it published for anyone to access.
Phone support and chat support tell you how confident the company is with its ability to cover customer issues.
7. Features
Features are a double edged sword. They should make the platform more useful but then they need to be maintained and evolved, adding cost to the business.
That cost is then passed on to the consumer so, in theory, you get what you pay for. At least in the breadth of its capabilities. But platforms do things differently. Where one is strong, another may be weak so work out what’s important for you and look at that in more detail.
I’ve mentioned most of these already but here are some of the features I tend to look for (many of these are:
Algorithmic repricer: Not many have this but it can grow your Amazon sales will simultaneously growing your margin. Works better than Amazon’s own.
Automated eBay disputes:
8. User Interface
Chances are you’ll be using the platform a lot so it needs to be pleasant to use. A platform that requires 3 clicks where one will do will really begin to get on your nerves after while.
Slow loading pages, files that take too long to process. It all leads to a miserable experience. Think about that when you’re assessing the usability.
Don’t forget about your devices. Even if you need to do the majority of your work on a laptop, a lot of people like to monitor the numbers on their phones so make sure your chosen platform is mobile compatible.
9. Fees
It’s one of the main criteria but I left it to the end on purpose because, it’s not about the cost, it’s about the value.
As mentioned before, not all systems are equal so consider the platform in the round before dismissing a platform based on cost. That said, don’t assume that, just because it’s expensive, that it’s any good.
If a platform doesn’t publish a rate card, it means their fees will vary based on the customer requirements and size. This also means that the fees will be negotiable so my advice is don’t accept the first offer.
On the whole, platforms charge on a revenue share basis – charging a percentage of GMV (the total value of items sold). A variation of this is where a platform charges based on the number of transactions rather than revenue but it’s much of a muchness.
There’s an increasing trend, in the more popular platforms at least, to demand fees up front. Getting paid in the way means they can invest sooner and grow faster but, because they still want to charge based on the activity of the client, this means they need a way to calculate the GMV before it has actually happened.
They do this by asking the customer to estimate their expected revenue. Whatever they commit to is charged at a base rate with any overage charged at a higher rate. The more you commit to, the lower the percentage.
10. Contracts
Please read the contract. If I had a penny for every time I encountered a seller who didn’t read the terms and then got irate because the platform provider wasn’t offering a service that they never agreed to etc.
Long contracts tend to be a red flag. As mentioned before, you can’t know how good it is until you use it in anger. You want to avoid a situation where you realise the platform has a serious deficiency but you have a year and a half left to run.
Insert a break clause after say 6 months if you can. This should give you sufficient time to know whether it’s right for you. Conversely, if you know it well you might consider asking for a longer contract at a reduced rate.
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