Having a presence on ecommerce distribution channels is crucial to succeed, if you are looking to expand your business’s reach and start selling online. However, it can be challenging to determine which channel is the best suit. Here are our recommendations for the top 5 best ecommerce distribution channels to thrive your business.
I. Top 5 ecommerce distribution channels for your business
Amazon is no doubt one of the best ecommerce distribution channels until now. This American business specializes in E-commerce, Ai (artificial intelligence), online marketing,… and also provides customers with a range of products/services.
Any type of business can benefit from using Amazon eCommerce. It is especially well-suited for businesses that specialize in tangible goods (clothing, toys, electronics, furniture, …), and digital products also ( music, movies, software,…).
Benefits of Amazon
- Global reach: With more than 310 million active users worldwide, Amazon provides a global reach for sellers (Source: Amazon Statistic). You can reach your potential customers all over the world and offer them your products.
- High trust: Amazon is one of the world’s most reputable e-commerce sites. must undergo careful testing to guarantee user safety. As a result, companies list their goods on Amazon in an effort to boost their brand’s reputation and gain more customers.
- Access to a diverse range of products: With Amazon, you will be able to offer a wide selection of products to your customers, update new products and stay ahead of the competition
- Easy to set up and use: Amazon provides easy-to-follow instructions on how to set up an ecommerce store. Also available to you will be helpful customer service and technical support.
Drawbacks of Amazon
- High fees: Amazon charges various fees for selling on their platform, including referral fees and fulfillment fees, which can reduce your profit margins.
- Competition: With so many sellers on the platform, competition can be fierce. Thus it can be difficult to stand out from the crowd.
- Limited control: Amazon has strict rules and guidelines for sellers .It might make it harder for companies to manage the prices at which their products are sold and how they are distributed.
eBay is an American e-commerce platform founded in 1995. It has since become one of the largest online marketplaces in the world with millions of registered users and billions of dollars in annual sales. eBay is also one of the best ecommerce distribution channels to drive revenue.
Benefits of eBay
- Large audience: eBay has 138 million active buyers worldwide, which can help you reach a wider customer base. (Source: Number of eBay total active users, Statista).
- Niche products: eBay can be a good choice for selling unique or niche products. eBay’s audience tends to be more focused on specific categories and interests, such as vintage items, collectibles, and handcrafted goods.
- Customization: eBay allows sellers to personalize their storefronts with their own branding and design, which can help to establish a unique identity and draw loyal customers.
Drawbacks of eBay
- Fees: eBay charges sellers various fees for using its platform, including listing fees, final value fees, and payment processing fees. Although eBay’s fees are typically lower than Amazon’s, for sellers with thin profit margins, they can still add up.
- Limited product categories: eBay’s product categories are frequently more geared toward consumer goods and collectibles, and may not be well-suited for businesses selling specialized or industrial products.
Alibaba is a Chinese multinational technology company with expertise in e-commerce, retail, the internet, and technology, founded in 1999 by Jack Ma.
In terms of Ecommerce, Alibaba (Alibaba.com) is the leading B2B e-commerce platform for global B2B trading. As of 2021, this e-commerce giant owns several global retail marketplaces, including Lazada, AliExpress, Trendyol, and Daraz.
Alibaba is primarily used for bulk or wholesale purchases. It is one of the ideal ecommerce distribution channels for companies looking to source goods from China and other Asian countries, as well as for Chinese manufacturers looking to market their goods internationally.
Benefits of Alibaba
- Large market: Alibaba has a massive market with over 40 million active buyers and sellers from over 190 countries. (Source: Alibabagroup.com)
- Large supplier base: Alibaba has a sizable global network of manufacturers and suppliers, making it simpler for companies to find the goods they require at reasonable prices.
- International trade services: Alibaba provides various international trade services, such as logistics and customs clearance, to help businesses navigate the complexities of international trade.
Drawbacks of Alibaba
- Language and cultural barriers: Since Alibaba’s platform is primarily intended for businesses in China and other Asian countries, it may present difficulties for those operating in other regions due to language and cultural differences..
- Limited product categories: Alibaba’s platform is primarily focused on industrial and commercial products, which may not be suitable for businesses selling consumer goods or services.
- Complex buying process: Alibaba’s purchasing procedures can be time-consuming and complicated, especially for companies that are new to the platform or unfamiliar with international trade.
Shopee, which has its headquarters in Singapore and is a Sea Limited subsidiary, is among the leading ecommerce distribution channels in Southeast Asia. It operates in several countries including Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam, and Taiwan.
Small and medium-sized businesses (SMBs) and independent sellers who want to connect with a sizable customer base in Southeast Asia should consider Shopee.. The platform offers a user-friendly interface, low transaction fees, and a range of marketing and promotional tools to help sellers increase their visibility and sales.
Benefits of Shopee
- Growing customer base: Shopee has a rapidly growing customer base in Southeast Asia, which can help sellers reach new customers and expand their business. As of Q3 of 2022, Shopee reported having 2 billion orders processed on the marketplace (Source: Statista)
- Low transaction fees: Shopee charges lower transaction fees than many other e-commerce platforms, making it an affordable option for SMBs and individual sellers.
- Social commerce features: Shopee has social commerce features that allow businesses and sellers to engage with customers and promote their products. Including Shopee Live, Shopee Games (in-app gaming), Shopee Feed (a message board for users to share content about items), Shopee Live Chat (allowing buyers to interact with sellers directly and find more information before a transaction).
Drawbacks of Shopee
- Less established reputation: Shopee is a relatively new platform compared to other e-commerce giants like Amazon or Alibaba. As a result, it may not have the same level of trust or credibility in the eyes of consumers or investors.
- Limited market reach: While Shopee has a significant presence in Southeast Asia, its market reach is primarily limited to this region. This means that businesses looking to expand into other markets may need to consider additional platforms or strategies.
Your own E-commerce website
About own E-commerce website
It refers to an online platform that is created and managed by a business/seller to sell their products or services directly from their website. Unlike third-party ecommerce distribution channels like Amazon, eBay, or Shopee, the business/seller has full control over the website’s design, functionality, and customer data.
Benefits of an own E-commerce website
- Branding: An owned e-commerce website allows you to establish and reinforce your brand identity. You can create a customized online store that reflects your brand and values, which can help you stand out from competitors and build brand recognition.
- Control: With an owned e-commerce website, you have complete control over the user experience, from the layout and design to the product presentation and checkout process. This allows you to optimize the buying experience for their specific target audience and make changes quickly as needed.
- Customer data ownership: With an owned e-commerce website, you can own the customer data and can use it to personalize your marketing efforts and create targeted campaigns.
- No transaction fees: Unlike other ecommerce channels, businesses do not have to pay transaction fees for each sale made on their website.
Drawbacks of an own E-commerce website
- Initial setup costs: Building an owned e-commerce website can involve significant time, effort, and financial commitment. You need to invest in website development, hosting, security, and maintenance.
- Marketing and traffic: As opposed to using third-party e-commerce channels, companies/sellers must spend money on marketing and advertising to promote their own e-commerce websites. This can be difficult, especially for new companies or sellers who don’t yet have a strong online presence.
- Technical knowledge: For a seamless customer experience, maintaining an e-commerce website requires technical know-how and frequent updates. If you don’t have a lot of technical knowledge, you might need to hire someone or outsource these services.
II. How can Enosta help your business?
Although using third-party ecommerce distribution channels can offer a number of benefits, having an owned ecommerce website is also essential for businesses. In addition to providing more control and flexibility over the user experience, it also enables more significant brand recognition and more effective business scaling.
Businesses can achieve a custom-tailored online presence that best represents their brand and draws in more customers with the help of Enosta’s professional ecommerce website design services. Don’t be reluctant to get in touch with Enosta right away to begin creating your own e-commerce website and advance your online venture.