Sellers Are Suffering on Your Ecommerce Marketplace

Too Many Sellers on Online Marketplaces Are Getting it All Wrong

Enabling Sellers to Sell on Ecommerce Marketplaces
Enabling Sellers to Sell on Ecommerce Marketplaces. Gregor Schuster / Photographer's Choice RF / Getty Images

The marketplace model is the holy grail of your ecommerce business. With great effort and expense, you have managed to attract a large number of buyers and sellers to your platform. But regardless of whether you are Amazon.com, Etsy.com, or one of those hundreds of large online marketplaces that I may not be familiar with, chances are that you are facing a high rate of seller attrition. Some of this is a lack of understanding on the part of the seller.

But you can do a lot to help.

Here are some of the problems that sellers face.

Lack of Understanding of How You Display Products

Any marketplace worth its salt has several million products listed on it. A common lament I have heard from sellers is that there is no way a buyer would ever locate their product. In fact, when they try to navigate to their own product, they find it impossible, unless they specifically search for their seller-id. This causes frustration and dissatisfaction. I do not expect you to disclose your ranking secret sauce, but it would be good if you would communicate some of the factors you use to rank similar or identical products. It would encourage sellers to improve on those factors.

Lack of Awareness of Promotional Opportunities

Sellers come to your marketplace to sell, and as a consequence earn money. When you offer them paid opportunities to promote their products on your website, it seems logically twisted to them.

Some would go as far as to label it a "scam." You certainly shouldn't profiteer from your partners, but in most cases ensuring that the promotional opportunities are seen as collaborative might just be a matter of effective communication.

Few Sellers Realize that the Image Sells the Product

In ecommerce marketplaces, I sometimes see such poor quality product images that I would like to call them "repulsive" at best!

Some sellers just do not have an aesthetic sense. Seller-education will help.

Stock-Outs and Other Inventory Problems Repel Customers

Because the backend systems of sellers may not be enterprise strength, they run into lots of problems. Few sellers on your marketplace are exclusive to you. As a result, the most common backend problems are linked to the seller's inability to reconcile sales / returns on multiple platforms. You should ensure that you follow industry standards in terms of your open APIs and dashboards. In this way, sellers will be able to integrate you into their backend software.

Delays Hurt Sellers a Lot as Buyer Remorse Sets in

Small sellers are often not sensitive enough to deadlines and time constraints. Often, selling on ecommerce marketplaces is just a side activity for them. What makes this worse is that this category of sellers also generates the maximum number of customer service requests. You need to find a way to identify such high maintenance sellers and make them shape up rapidly.

Pricing Is Not as Trivial as Some Sellers Think

I have heard many sellers rue the "fact" that pricing has turned into a spiral to the bottom. While this may have been partly true some time ago, today it is possible for the tech-enabled seller to price intelligently.

What that means is being aware of the prices at which others are selling the same / similar goods, and pricing only a little lower. And one does not need to be the lowest-priced seller. You should certainly communicate the fact that barring exceptions, it is not the one's that are selling at a loss that are making all the sales.

The above is just the starting point. The best way to expand this list would be to talk to some of the sellers who have recently abandoned you. If you find recurrent themes, you would know what to do.