Online Marketplaces in E-Commerce: Strategy, Comparison, and Success Factors

An online marketplace is a digital platform on which you, as a seller, can present and sell your products or services. It is a virtual marketplace that brings buyers and sellers together and enables them to interact and conduct business with each other.

On an online marketplace, you can display your inventory, present product descriptions, set prices, and process transactions. In return, you pay the platform listing fees and/or sales commissions. Buyers have the opportunity to search for products or services, compare them, and purchase them. The marketplace acts as an intermediary and often also provides tools for payment processing and shipping. An online marketplace is therefore something like an online shop – with the difference that many more sellers offer their products there. Sometimes it isn't immediately clear to the buyer with whom they're entering into a contractual relationship. Amazon, for example, is also active as a retailer on its own marketplace.

Examples of well-known online marketplaces are Amazon, eBay, and Etsy. These platforms enable individuals and companies to offer their products to a large audience and reach potential customers all over the world.

What Is the Difference Between an Online Marketplace and an Online Shop?

At first glance, an online marketplace and an online shop look similar – in both cases, you as a consumer buy products via a website. The difference lies in the business model and the role of the platform operator.

In a classic online shop, a single company sells its own products. It owns the product range, is responsible for warehousing, shipping, and customer service, and acts as the contractual partner with the buyer. On an online marketplace, by contrast, the operator only provides the platform – the products come from many different sellers. The contractual partner isn't the marketplace itself, but the respective retailer listed there. Hybrid models such as Amazon are an exception, as Amazon acts both as a marketplace for third-party sellers and as a retailer selling its own products.

For you as a seller, this means: on a marketplace, you use the ready-made infrastructure and the reach of an established platform – but you pay commissions for it. With your own shop, you bear all the costs and responsibility yourself, but you retain full control over your brand, margin, and customer relationship.

What Types of Online Marketplaces Are There?

Not every marketplace is the same. To set up your strategy correctly, it helps to categorize them:

• Horizontal marketplaces: They offer an extremely broad product range across many categories. Classic examples are Amazon, Otto, Kaufland, and eBay. Here you can find everything from books to power tools under one roof.
• Vertical marketplaces: They focus on one industry or product world. Zalando and About You for fashion, Wayfair for furniture, ManoMano for DIY, Douglas for beauty.
• B2B marketplaces: Platforms such as Mercateo (Unite), Amazon Business, or Wucato target commercial buyers. Here, different criteria matter – invoice payment, framework contracts, technical data sheets.
• C2C marketplaces: Platforms such as eBay Kleinanzeigen or Vinted bring private buyers and sellers together. Only marginally relevant for most manufacturers and retailers.
• Niche and maker marketplaces: Etsy for handmade items, Avocadostore for sustainable products, Reverb for musical instruments. Smaller reach, but highly qualified target groups.

Choosing the right type of marketplace is crucial for how efficiently you sell – more on that later.

Online marketplaces have continuously evolved and have become a significant part of e-commerce. Here are the most important developments:

Growth and diversification: Since eBay came onto the market, the principle of online marketplaces didn't really change significantly for a long time. Only with the success of the Amazon marketplace did a strong development in terms of size and variety begin. There are now marketplaces for various industries, such as retail (e.g., Amazon and Otto), fashion (e.g., Zalando), electronics (e.g., Conrad), furniture (e.g., Wayfair), craftsmanship (e.g., Etsy), and many more. This enables sellers to be active in different niches and reach their target groups.

Improved user experience: Online marketplaces have invested a lot of work in optimizing the user experience. Through user-friendly interfaces, personalized recommendations, ratings and reviews, as well as simplified payment and shipping processes, they have made shopping more convenient for buyers. This also applies to the listing options for manufacturers' and retailers' own products.

Rise of B2B marketplaces: In addition to B2C marketplaces, B2B marketplaces have also developed strongly. These platforms target companies that offer goods and services to other companies. B2B marketplaces facilitate business between suppliers, manufacturers, and retailers. These are often also wholesalers (e.g., Rexel) that are transforming their business.

Introduction of new technologies: Online marketplaces use advanced technologies such as artificial intelligence (AI) and machine learning to offer personalized recommendations, fraud detection, automated customer support systems, and other features. AI-powered product searches, automated translations, and visual search have long been standard. These technologies improve the efficiency and user experience on the marketplaces.

Internationalization: Many online marketplaces have expanded their reach globally. Sellers can now offer their products worldwide and reach customers in different countries. Platforms such as Kaufland are expanding across multiple European countries – with one click in the backend.

The evolution of online marketplaces has lastingly changed e-commerce and opened up new opportunities for sellers and buyers to connect and do business with each other.

To give you an idea of which platforms might be relevant for you, here are the most important marketplaces in the German market – with their strengths and typical positioning. Specific fee rates and conditions change regularly, so you should always check them directly with the respective provider.

Amazon – The Undisputed Market Leader

Product range: generalist with a focus on electronics, books, household goods, fashion

Strengths: largest reach in the German market, sophisticated advertising options (Sponsored Products, DSP), Fulfillment by Amazon (FBA)

Weaknesses: high advertising pressure, intense competition, strict algorithms that can quickly suspend accounts

Anyone who wants to sell successfully on Amazon can hardly avoid Sponsored Ads and professional ACoS monitoring. Tools such as Adference or metoda help with the management.

Otto Market – The German Quality Marketplace

Product range: fashion, furniture, household goods, electronics

Strengths: high purchasing power of the target group, lower advertising pressure than Amazon, focus on quality and sustainability

Weaknesses: strict requirements for product data, application process for new retailers

Otto is particularly suitable if you sell clearly positioned brands with high-quality product data. Anyone who works cleanly here benefits from a higher conversion rate at comparatively lower advertising costs.

Kaufland.de – The Fast-Growing Marketplace

Product range: broad generalist range from groceries to electronics

Strengths: comparatively low fees, easy international expansion into several European countries with one account

Weaknesses: less brand awareness than Amazon

Kaufland.de (formerly real.de) has grown rapidly since its takeover and is considered an attractive alternative or complement to Amazon – especially for price-conscious product ranges.

Zalando – The Fashion Address

Product range: fashion, shoes, beauty, lifestyle

Strengths: pure fashion focus, Zalando Fulfillment Solutions (ZFS), strong European presence

Weaknesses: application process, high requirements for logistics and product data

Zalando relies on a curated brand pool. Anyone selling fashion or lifestyle products and operating professionally can hardly avoid this platform.

eBay – The Classic with Special Strengths

Product range: broad, with a focus on automotive, electronics, used items

Strengths: flexibility (fixed price and auction), low entry costs, large reach for pre-owned and specialty items

Weaknesses: less algorithm-driven than Amazon, less premium advertising image

Other Relevant Platforms

• About You – fashion and lifestyle with a younger target group
• Douglas – marketplace in the beauty segment
• MediaMarkt/Saturn – electronics marketplace with strong brick-and-mortar integration
• Etsy – handmade, vintage, and individual products
• ManoMano – DIY, home improvement, garden
• Avocadostore – sustainable products
• Mercateo (Unite) – leading B2B marketplace in the DACH region

Advertising on online marketplaces is highly relevant and can offer sellers and brands a variety of benefits:

Increased visibility: Through advertising on an online marketplace, sellers can highlight their products or services and achieve greater visibility. This is particularly important in highly competitive categories where a large number of offers compete with each other. On Amazon, a large share of all sales runs through what is known as the Buy Box – without targeted advertising, it's difficult to become visible there.

Targeted audience reach: Online marketplaces have extensive data on the interests, behavior, and purchasing habits of their users. This allows sellers to target their advertising at specific audiences and reach potential customers with a heightened interest in the products being sold.

Sales growth: Through advertising, you as a seller can naturally increase sales. When products are prominently placed and promoted, they have a greater chance of being discovered and purchased by buyers. However, you should always pay attention to efficiency: advertising can eat up your gross margin. On Amazon, for instance, you should keep an eye on the ACoS – the Amazon Cost of Sale.

Brand building and awareness: Advertising on online marketplaces offers the opportunity to increase brand awareness and perception. Sellers can communicate their brand identity, build customer trust, and develop long-term relationships with buyers. For example, you can include discount cards in your parcels so that customers order directly from you next time.

Competitive advantage: In competitive markets, targeted advertising on online marketplaces can give sellers a competitive edge. Through eye-catching ads, special offers, or other promotional activities, you can stand out from the competition and encourage potential customers to buy your products.

Measurability and optimization: Advertising on some – unfortunately not yet all – online marketplaces allows you to measure and analyze the success of your campaigns. By evaluating clicks, conversion rates, and other metrics, you can optimize your advertising strategies and use marketing spend more effectively.

It's important to note that advertising options and guidelines can differ from platform to platform. You should carefully review the advertising options and policies and ensure that your campaigns comply with them. Tip: on Amazon, tools such as Adference or metoda can help.

The combination of both worlds – often called a multichannel or hybrid strategy – is the most economically sensible way for most manufacturers and retailers. Your own shop serves as the brand and margin center, while marketplaces deliver reach and new customer acquisition.

Which split is right for you depends on the maturity of your brand, your logistics capacity, and the level of competition in your category. Three setups come up particularly often in our projects.

Three Typical Strategy Models

1. Marketplace-first (startups, new brands): fast market entry, testing product-market fit, generating initial revenue. Risk: you build on someone else's ground. So always with the plan to add your own shop later on.
2. Shop-first with selective marketplaces (established brands): your own shop is the flagship. Marketplaces handle secondary ranges, seasonal goods, or surplus stock. Popular among mid-sized companies.
3. Full multichannel strategy (scaling): own shop + several marketplaces + possibly international platforms. Requires clean data, a central PIM system, and interfaces that manage everything.

Experience shows that multi-marketplace retailers achieve significantly higher revenues than pure single-channel providers – provided their processes are under control.

To be successful on online marketplaces, there are several important factors to consider. Here are the key components:

High-quality products: Offer products that are of high quality, meet customers' needs, and stand out from the competition. Product quality is decisive for the customer experience and customer satisfaction. Please note that the volume of products on marketplaces is very large, so you only have a good chance with the best reviews.

Competitive prices: Make sure your prices are competitive and offer a good value-for-money ratio. Price comparisons on the marketplace can help you keep an eye on your competitors' prices and set appropriate ones. Repricing tools automate this process and help you win the Buy Box.

Compelling product descriptions: Create detailed and appealing product descriptions that clearly communicate the benefits, features, and uses of your products. Customers must have enough information to make an informed purchase decision.

High-quality images and media: Use high-quality images and other media to present your products in a visually appealing way. Images should be clear, well-lit, and taken from different perspectives to give customers a comprehensive impression of the product. So-called feature images are now also common, where customers are shown the benefits of the product via overlay text.

Customer service and reviews: Provide excellent customer service that responds promptly to customer inquiries and issues. Positive reviews and customer feedback are crucial to building trust with potential customers and strengthening your credibility. Only sellers with good reviews generate above-average revenue.

Search engine optimization: Use relevant keywords and tags in headlines, bullet points, and the rest of the product description to improve your visibility in the marketplace's search results. Good search engine optimization (SEO) can help your products be found more easily. Optimization on online marketplaces is usually easier than on Google & Co.

Stock levels: Make sure you continuously manage and communicate your stock levels correctly to ensure that products are available and can be shipped on time. Out-of-stock situations are punished by the algorithm with a loss of visibility – and are difficult to recover from.

Marketing and advertising: Use the advertising options on the marketplace to promote your products and increase their visibility. Targeted marketing activities such as ad campaigns, discounts (e.g., coupons), or promotions can help you reach potential customers. There are marketplaces such as Amazon where you can do most things in self-service. There are also platforms that implement your requirements internally.

Continuous optimization: Regularly analyze your sales data, customer feedback, and market trends to optimize your sales strategy. Identify areas where there is room for improvement for your products and make appropriate adjustments.

It's important to note that success on online marketplaces takes time, patience, and continuous effort. Thorough planning, strategic thinking, and close monitoring of the market are crucial to prevailing against the competition and achieving long-term success.

Are you planning to get started or want to professionalize your existing marketplace strategy? This sequence has proven itself in our projects:

1. Product range and platform analysis: Which of your products are actually suitable for marketplaces? Which platforms fit your target group, margin, and brand positioning? An honest range analysis saves a lot of money later on.
2. Profitability calculation per marketplace: Calculate before listing how much of your sales price remains after commission, advertising, logistics, and returns. For some products, a marketplace simply isn't worthwhile.
3. Clean up and centralize product data: Every marketplace has its own data requirements. Anyone who manages this in Excel loses. A PIM system is the foundation for all further steps.
4. Prepare imagery and content: main image, lifestyle images, feature images, videos, A+ content on Amazon, brand shop on Otto – the requirements are high. Plan time and budget for it.
5. Clarify logistics and fulfillment: Ship yourself or use FBA, ZFS, or a service provider? This decision has a massive impact on margin, delivery times, and reviews.
6. Define your advertising strategy: No visibility without advertising. Define ACoS targets, plan budgets per platform, and work – where possible – with tools that automate day-to-day operations.
7. Establish monitoring and optimization: Reviews, ranking positions, stock levels, return rates, advertising costs – you have to keep an eye on all of this continuously. Anyone who only checks in once a month loses money.

Product Information Management (PIM) and Digital Asset Management (DAM) systems play an important role for online marketplaces, especially when it comes to managing and presenting product data and digital assets for many products. Here are their main functions:

PIM Systems (Product Information Management)

Centralized data management: PIM systems enable sellers to manage all relevant information about their products in one central location. This includes product descriptions, technical specifications, prices, availability, and more. By keeping everything in one flexible system, you can deliver your data to the marketplace in a tailored way.

Data standardization and cleansing: PIM systems support sellers in standardizing and cleansing their product information to ensure consistency and accuracy. You make fewer mistakes and thereby reduce costly returns.

Product catalog management: Sellers can create, update, and manage their product catalog. This includes adding new products, updating information, and removing unavailable products. With a PIM, you can show your product catalog completely and up to date on online marketplaces.

Multilingual and international support: PIM systems enable the management of product information in different languages (including translation) and help sellers offer their products on international markets. This means you can easily become active in neighboring countries because you can feed data into automated translation.

DAM Systems (Digital Asset Management)

Management of digital media: DAM systems support the organization and management of digital assets such as product images, videos, graphics, and documents. These media are often used to display products on online marketplaces. This way you always know exactly which asset belongs to which product. With our enterprise Digital Asset Management solution TESSA DAM, you can, for example, automatically place the Amazon ASIN in the file name.

Metadata management: DAM systems enable the assignment of metadata to digital assets for efficient search, categorization, and filtering. This makes it easier to use the assets on different platforms and channels.

Versioning and rights management: DAM systems manage different versions of digital assets and allow access rights to be assigned to different users. This is important to ensure that only authorized content is used and that brand integrity is maintained.

Integrating PIM and DAM systems into online marketplaces enables efficient management and presentation of product data and digital assets. This ensures that consistent and accurate information is provided, that the product presentation is appealing, and that potential customers are convinced. It also makes it easier to update and distribute product information across different channels and improves the efficiency of sales processes on online marketplaces.

From our project work, we know the classics. If you avoid these, you have already won a lot:

• Too many platforms at once: better to play two marketplaces properly than six half-heartedly.
• Poor product data: incomplete attributes, missing images, wrong categories – this costs visibility and revenue.
• No own profitability calculation: anyone who lists blindly only notices after months that no money is left over.
• Advertising without strategy: campaigns without ACoS targets and without reporting burn through budget.
• No plan B: anyone who sells exclusively on one marketplace is sitting on a powder keg.
• Underestimating customer service: a bad review can undo weeks of good work.
• Ignoring international requirements: language, tax topics (OSS), product safety (GPSR) – all of this has to be in place before you sell across borders.