The 5 Best E-commerce Marketplaces for South African Businesses
So you’ve got an amazing product that you’re ready to sell online.
Maybe you’ve been at it a while, but you want to expand the availability of your product into new platforms.
Either way, you’re at a crucial decision point.
What’s the best e-commerce marketplace for your business?
There are tons of options out there, and it can be hard to determine what’s best for your business.
There’s even the option of committing fully to manufacturing and never running your marketplace.
In this article we’re going to go over the 5 best, most reliable, options you should consider first.
But first, let’s get some terminology out the way:
What is an E-commerce Marketplace?
An e-commerce marketplace is any place online where you can list your products for sale.
The two major kinds of marketplaces you should be aware of are your e-commerce marketplace (usually your site) and third-party marketplaces.
Your site is the most valuable tool you can invest in, as we’ll explore below, but it can be expensive and time-consuming to get off the ground.
Third-party marketplaces operate on a monthly fee or commission basis in exchange for allowing you to host your goods on their platform.
The advantage is that you have access to an existing customer base and infrastructure, as well as their trusted brand name.
Which you choose is largely up to you, but we recommend starting with:
1. Your Website
If you haven’t got an e-commerce business for your website already, you need one
If you do, and we’re preaching to the choir here, feel free to skip to the next point.
Having your e-commerce ready website is among the best marketing investments you can make for your business.
Why is this?
Why should we reinvent the wheel when other businesses already have perfectly functional marketplaces for their own?
Well, there are two main reasons.
Firstly, you’ll save costs over the long term.
Third-party marketplaces always charge some form of commission or fees.
As your business grows it becomes more and more economical to pay web hosting and infrastructure fees yourself, rather than paying them a percentage.
Secondly, it’s invaluable for marketing.
Having your site enables you to set up analytics, which can revolutionise your marketing game.
Analytics lets you get a much clearer idea of who your customer is, what they want and how best you can serve your products to them.
They also let you use strategies like remarketing to website visitors over social media, which can be a powerful tool for creating sales.
You’ll never have access to analytics over a third party marketplace, though they might use some of these techniques themselves to try to drive up sales if it benefits them too.
Ultimately, however, the best marketplace you can have is the one you build yourself.
Over time you’ll be the person that knows your customer best.
You’ll be the one who knows what they want, and how best to provide it to them.
Having a boutique experience tailored towards these customers will always give you higher returns than a third party, with their own goals and motivations.
That being said, once you have a website it is worth looking into third party sites.
If for no reason other than reaching a broader target audience, that you might never reach on your site.
Takealot is one of the largest South African based e-commerce marketplaces, with a user-base of over 1,8 million people.
If for whatever reason you can’t afford to start your marketplace, they’re a great place to start your e-commerce journey.
They offer services to handle all the aspects of setting up and selling your product online, from inventory management to shipping and logistics.
This makes them a great entry point for people with no existing experience or infrastructure in the field.
If you have a strong product or a well thought out niche, it’s an excellent place to start growing your customer base.
Takealot charges an R300 per month subscription fee, and a percentage of any successful transactions made over the platform ranging from 4 to 18 per cent depending on the product category.
Also, they charge fulfilment fees depending on the weight and size of the goods, and storage fees on overstocked goods.
All of this can make them quite pricey over the long term, which is why we’d still recommend investing in setting up your infrastructure long term.
This also makes them a somewhat less desirable option for existing e-commerce businesses with their own logistics chains in place.
Who Should Use Takealot
If you’re a new e-commerce business looking to get started selling with minimal hassle, Takealot may be the marketplace for you.
They’re also a premier choice for manufacturing-based businesses with no interest in running their marketplace.
Facebook shops are a relatively new entry in the market with amazing potential.
They let you import a catalogue of your products onto Facebook and create a dynamic shop.
Consumers can either purchase goods directly through the Facebook platform, or you can redirect them to your site to complete the checkout process.
This makes it a great add-on for any business’ strategy, letting you leverage their huge user base to expand your business’ following.
Facebook Shop Features:
The best feature of Facebook shops is the ability to dynamically draw in your website’s products using a Facebook Shopping Catalog.
This lets you use the Facebook algorithm to automatically remarket and target the right consumers.
That’s not to say you need a website to use the platform, Facebook also lets you set up your product catalog inside their platform itself.
You have to handle things like logistics and inventory management yourself, but it’s a great way to reach a huge existing audience or expand your potential customer base.
Facebook Shop Fees:
When using their platform to make sales, Facebook charges 5% per shipment or $ 0,40 (R6,5 at the time of writing) on shipments $ 8,00 (R131 at the time of writing) or less.
Otherwise, standard Facebook advertising costs apply in showing your website-linked catalog to consumers.
This makes them a very economical option, but you need to consider that you need to budget for things like shipping costs.
Who Are Facebook Shops For:
If you’re a new business looking for a light-weight platform that will let you start listing and selling products, Facebook shops are a great way to start and get your foot into social media marketing as a bonus.
If you’re an existing business looking to expand your customer base, Facebook shops are also a great platform for reaching new people and directing them to your online store.
It has something for everyone, and it’s worth checking out at least for most businesses.
PriceCheck is South Africa’s largest e-commerce PPC marketing platform, which functions as a kind of e-commerce marketplace for comparing the prices of products.
Users typically either browse the site looking for deals on categories on products, or use the site to compare prices on a specific product from different retailers.
This makes them a great platform for businesses competing on price or value, and a great way to reach certain customer bases.
PriceCheck’s main draw is the ability to directly compare your business’ prices to the competition.
This makes it a great platform for businesses competing on price, for example by importing known brands at a reduced cost, or value offering, e.g. a new business that offers a product of the same quality as existing ones but with a lower price.
PriceCheck works on a PPC model where they charge a minimum of R 2,20 for each user redirected to your website from theirs.
You can elect to bid higher amounts for more visibility on the platform, so the costs are scalable.
The disadvantage is that you have fewer means of controlling how many of these clicks result in sales.
Who is PriceCheck For:
If you have a business with an incredible value offering, that you know will attract price-sensitive consumers, make sure your business is listed on PriceCheck.
It’s a great platform for showcasing specific kinds of products to the right consumers.
However, because of the price-focused nature of the site, it doesn’t work as well for high ticket or luxury goods.
Bidorbuy is an e-commerce marketplace and internet auction platform that lets users and companies list products for sale on their site.
You have the choice between pricing your goods at a standard rate like any other platform or setting up an online auction where users bid on individual items.
It’s a similar business model to eBay, but for South Africans.
Bidorbuy’s main feature is allowing boutique and highly niche businesses to have access to a large marketplace where they can sell their goods.
Normally it might be challenging to cover the costs of such a business in addition to creating your marketplace, especially when you’re just starting, but Bidorbuy allows you to leverage their existing platform to reach a large existing audience.
They have some built-in support for shipping and logistics, but the main responsibility falls to you in selecting and managing these areas.
Bidorbuy charges a variable commission on each sale made through their platform, based on the product’s category.
The fees range from 2,5% to 8,75% to a maximum of R5 000.
This is not including shipping costs, which you are responsible for.
Who is Bidorbuy For:
If you’re starting a boutique or highly specialised business, and you need a place to start selling your products, Bidorbuy is for you.
It lets anyone get started selling their products with minimal red tape and a very reasonable fee structure.
As your business grows and gains an audience you would want to migrate to a personal site, but it’s a great platform for starting.
We hope this helped you decide on the best e-commerce marketplace for your business.
- Your e-commerce site will almost always perform the best long term
- Use Takealot if you want to delegate most of the logistics and admin.
- Facebook shops have a little something for everyone, especially new businesses.
- Pricecheck is a great platform for price-sensitive categories.
- Bidorbuy is a great starting point for highly niche or boutique business ideas.
Whatever you choose, be sure to commit to a good digital marketing strategy from the start. It’ll pay great dividends down the line.
This article was brought to you by Syte. We’re e-commerce digital marketing specialists obsessed with driving up your bottom line. If you’d like to get in touch with us, feel free to reach out with the form below.