Online Marketplace pitfalls to be aware of

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For young retail organizations, online marketplaces such as Amazon and eBay can be a significant boon to their eCommerce operations. Merchants can sell their goods and services through these websites to reach a significantly broader audience. If shoppers have never heard of a retailer, they are less likely to visit that company’s website. Conversely, they may stumble upon that merchant’s Amazon store.

Online marketplace pitfalls to be aware of

Operating in such a marketplace does have its drawbacks, however. A pressing issue for retailers is that they have to play by the rules of the marketplace or else risk getting taken down. Even subtle misunderstandings may result in a merchant’s store being forced off the online marketplace, which can cost retailers a significant chunk of revenue.

Even subtle misunderstandings may result in a merchant’s store being forced off the online marketplace, which can cost retailers a significant chunk of revenue.

Multichannel Merchant recently spoke to some Amazon sellers about some of the pitfalls of operating on the site. Jordan Malik, founder of FindSpotter, noted how quick Amazon was to take down an Amazon store that may have allegedly been selling counterfeit merchandise because a few customers thought it was suspicious and reported it. Oftentimes, legitimate businesses delivering products at highly competitive prices suffer as a result.

Another issue that gets a number of merchants in trouble is trying to remarket or upsell to customers. In the eyes of Amazon, anyone that makes a purchase from an Amazon store is still a customer of the online marketplace, Amazon is simply lending the shopper to the retail brand in question. Trying to contact or reengage the consumer in the future is against Amazon’s rules and can get an Amazon store taken down.

Other potential problems could arise because of shipping complications. For example, if the carrier damages an item or delivers the product late, merchants may take the blame. This could also affect retailers using the Fulfillment by Amazon service (FBA) – Amazon might improperly package an item or send a product to customers that was expired, resulting in negative feedback and complaints.

Getting back online

Fortunately, Amazon will generally work with merchants to get their Amazon store back online and resume eCommerce operations. However, if an account is suspended, it may take months to get it back and retailers will have to make a strong business case to Amazon.

An online marketplace can give new retailers access to an immense audience, but at the same time, it’s crucial for retailers to realize they are playing by someone else’s rules and make the appropriate adjustments to stay online. eCommerce software that keeps up with changing marketplace requirements is an asset for retailers who are juggling multiple sales channels at once.

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