A Beginner's Guide to Marketplaces: How They Work and What You Need to Know About the Top Platforms

Contents:

• What are the advantages of listing on marketplaces?
• What can be sold on marketplaces?
• Who sells goods on marketplaces?
• How logistics, storage, and delivery of goods are organized on marketplaces?
• What types of marketplaces are there?
• Top marketplaces in Russia?
• Briefly: what you need to know about marketplaces?

What are the advantages of placing on marketplaces

Let's start with the technical aspects. Unlike other online sales channels, marketplaces offer the lowest entry barrier for entrepreneurs. This makes them an attractive option for budding entrepreneurs, allowing them to easily begin selling without significant initial investment. As a result, marketplaces are an ideal solution for those looking to quickly enter the market and start generating income. Here are a few reasons why this is important: First, it improves your website's visibility in search engines. Optimizing content for SEO helps attract more targeted visitors, which, in turn, increases the chances of conversion. Second, high-quality content that matches user queries increases the time spent on the page. This positively impacts the site's position in search results. Third, the use of keywords and proper text structure make information more accessible and understandable for readers. This improves the user experience and encourages visitors to return to your resource.

It's important to remember that SEO isn't just about technical aspects; it's also about creating valuable content that answers your audience's questions and needs.

• When selling on a marketplace, you don't need your own website. All sales are handled through the marketplace platform. The seller only needs a personal account, which many platforms provide for free.
• Less costs for promotion, marketing, and advertising. Many sellers only need free on-site SEO optimization to successfully sell on a marketplace. However, due to intense competition, the picture is changing: some sellers are including on-site advertising and using paid services to analyze sales.
• The marketplace handles delivery for an additional fee.
• Products can be sold to customers throughout Russia and even abroad.
• Marketplaces are convenient for buyers. It's easier to place an order there than in an online store. A couple of clicks in the app, and the goods are on their way to the customer. No need to wait for order confirmation or a call from a manager.

The second reason sellers choose marketplaces is the steady growth of these platforms in the e-commerce market. According to Data Insight, the top 10 online stores by revenue are as follows:

Four of the top ten positions are occupied by marketplaces. MegaMarket demonstrated the largest growth in sales, increasing by 417% compared to last year. The rating leaders also continue to show positive results, albeit at a slower pace: Wildberries grew by 73%, Ozon by 103%, and Yandex Market by 57%. These data confirm the growing popularity of marketplaces as an effective platform for online sales.

Almost all marketplaces, except MegaMarket, have seen a decrease in the average order value. This is due to the dominance of everyday goods on the platform. Nevertheless, the online sales market continues to grow in 2023, increasing by 2.6 trillion rubles. The four largest players — Wildberries, Ozon, MegaMarket, and Yandex Market — accounted for 81% of the segment's overall growth, underscoring their significant influence on the development of the e-commerce market.

Marketplaces are one of the fastest-growing e-commerce segments. Selling on marketplaces is more convenient than running your own online store, making them particularly attractive to sellers. A user-friendly interface, high traffic, and wide audience reach mean that more and more sellers are choosing this format to sell their products.

Marketplace trading training at Skillbox provides a unique opportunity to master effective sales and product promotion strategies in online commerce. The course includes practical exercises that will help you gain a deeper understanding of popular platforms. You will learn all the steps: from choosing a niche and creating product cards to optimizing advertising campaigns and analyzing results. The training program is designed for beginners and experienced sellers looking to increase their income on marketplaces. Join Skillbox and gain valuable knowledge for successful online trading.

• The "Marketplace Manager: Advanced Course from Scratch" profession will give you an in-demand and promising qualification, allowing you to collaborate with both novice sellers and large companies, and earn upwards of 60,000 rubles right from the start, all without leaving your home.
• The "Quick Start on Marketplaces" course will teach you how to select promising products for sale, develop a strategy for entering marketplaces, and understand how to sell to stay profitable.

What Can Be Sold on Marketplaces

Any product can be sold on marketplaces, as long as it complies with the current legislation of the Russian Federation. These laws include, in particular, the Law on Consumer Protection and regulations governing the distance selling of goods. Below is a list of product categories that are subject to prohibition:

• alcoholic and alcohol-containing beverages;
• medicines;
• weapons and ammunition;
• pyrotechnics;
• medical products.

All goods are subject to sale. Beginning sellers often have questions about choosing a product. Data Insight provides a chart showing the popularity of various product categories. This can help in deciding which products to offer on the market.

The diagram demonstrates the differences in popularity of product categories across platforms. On Wildberries, clothing, footwear, and accessories are in greatest demand, while on Ozon, home goods dominate. Office supplies, books, and CDs remain the least popular categories. These data highlight the importance of considering the specifics of each platform when selecting product categories for successful sales.

Choosing the most popular product for your business isn't always the best solution. In highly competitive niches where major players already exist, significant investment is required to enter the market. It's important for sellers to identify a product that straddles the line between high demand and low competition. The optimal option is to choose a niche with a large market capacity and a minimal number of competitors. This will allow you to successfully develop your business and secure your place in the market.

Searching for products manually or randomly is practically impossible. This is where marketplace analytics services come in handy. These specialized tools allow you to effectively analyze demand, study competitors' offerings, and determine optimal product prices. Using such services significantly simplifies the process of finding profitable products and helps you make informed business decisions.

There are many services, such as MPStats, Moneyplace, and HunterSales, that can help you choose profitable products for sale. These tools are ideal for market analysis and choosing products that can generate profits throughout the year. Using data from these platforms, you can optimize your product range and increase your income.

There is an alternative strategy that involves short-term trading, but using significant volumes. This approach allows you to quickly respond to market changes and profit from short-term price fluctuations. Short-term trading requires attentiveness and the ability to analyze market trends, which makes it attractive to experienced traders looking to maximize their financial results.

The following methods and tools are ideal for achieving this goal.

• Trendy or "hyped" products. Demand for such products appears out of nowhere, and then falls tenfold forever. Examples include simple-dimple toys, hoverboards, and, for example, spinners.
• Seasonal products. They are actively sold for a couple of months a year. These include, for example, products for gardening, swimming, fishing, and seasonal sports.
• Holiday products. New Year's trees, Valentine's Day gifts, and candy for March 8th.

By choosing this product, you assume certain risks. If you don't sell the product on time, you may end up with some left in stock. In the best-case scenario, you'll be able to sell it next season, but in the worst-case scenario, it may remain unclaimed forever. It is important to carefully analyze the market and forecast demand in order to minimize potential losses and effectively manage inventory.

Read also:

A marketplace manager plays a key role in the modern A marketplace manager is a business manager who ensures the effective placement and promotion of products on online platforms. Their primary responsibilities include inventory management, sales analysis, and developing strategies to increase product visibility. A marketplace manager must be proficient in analytical tools, knowledgeable about the specifics of various platforms, and the ability to adapt content to user needs. A marketplace manager is essential for businesses, as they can significantly increase sales and improve the company's image. A competent specialist helps optimize product listings, set up advertising campaigns, and manage reviews, which directly impacts conversion and customer loyalty. To become a marketplace manager, you should study the basics of online marketing, master the specifics of working with various platforms, and develop analytical skills. Experience in sales or e-commerce is an added advantage. Every year, the demand for specialists in this field is growing, which opens up excellent prospects for career advancement.

Who sells products on marketplaces

It is possible to trade on marketplaces with various legal statuses. In most cases, registering as an individual entrepreneur is not required; self-employed status is sufficient. This simplifies the process of doing business and makes it accessible to a wider range of people.

The main categories of sellers include various market segments, each of which offers unique products and services. These include wholesalers who supply large volumes of products; retailers offering goods to end consumers; specialized sellers focused on specific niches or product categories; as well as online sellers who sell through online platforms. Each of these categories plays a vital role in shaping the market ecosystem, making goods and services accessible to various consumer groups.

• Brand distributors. These are companies that have received the right to sell brand products from brand owners. They purchase them wholesale and sell them on marketplaces. The share of such sellers is the highest across all platforms.
• Manufacturers. The second largest segment of sellers. These are sellers who sell goods of their own production.
• Brands that trade directly. The difference from the previous category is that they do not necessarily manufacture the goods. They can order them from factories and plants, but sell them under their own brand.
• Other sellers. As a rule, they buy goods from various suppliers and sell them at a higher price on marketplaces.

According to a study by Data Insight, a significant portion of active sellers on marketplaces are individual entrepreneurs. As of early December 2023, 82.5% of sellers on Wildberries and 75% on Ozon were self-employed. This underscores the importance of individual entrepreneurship in e-commerce and online retail platforms, where sole proprietors occupy leading positions among sellers.

From October to December 2023, the number of self-employed sellers on the Ozon platform increased significantly, rising by 22%. Meanwhile, growth for other seller categories on Wildberries and Ozon averaged 6%. This indicates a growing interest in self-employment and attracting new sellers to online trading platforms.

How logistics, storage, and delivery of goods are organized on marketplaces

Sellers choose marketplaces to be able to sell their goods with delivery throughout the country. All marketplaces have a network of pick-up points, parcel terminals, and courier services, which significantly simplifies the delivery process. Organizing a similar logistics system for a regular online store is often an overwhelming task, which makes marketplaces more attractive for businesses.

Marketplaces employ three main fulfillment schemes, which represent a complex of operations including storage, packaging, assembly, and delivery of goods to the end customer. These schemes ensure efficient management of logistics processes and help sellers optimize their sales on e-commerce platforms. Choosing the right fulfillment scheme can significantly impact customer satisfaction and overall business performance.

• FBO, or out-of-stock fulfillment. The seller packages and labels the goods. The seller then ships a large batch of goods to the marketplace warehouse. When the buyer places an order, the marketplace's employees assemble it and deliver it to the customer. This scheme is suitable for high-volume products. However, if the products remain in the warehouse for too long, the seller will incur storage fees.
• FBS, or out-of-stock fulfillment. The goods are stored in the seller's warehouse. After an order is placed, the seller assembles, packs, and labels it, then ships it to the marketplace warehouse. The marketplace then handles delivery to the buyer. This model is effective for testing demand hypotheses and selling low-turnover products. It is suitable for high-margin products sold in small quantities.
• DBS, or seller-directed sales and delivery from the warehouse. In this case, the product does not enter the marketplace warehouse at all. The seller stores, assembles, and packs the order, and also delivers the product to the buyer. This model is suitable for high-value and large-sized products.

Fulfillment classification is a standard practice in e-commerce. In this article, we examine the various fulfillment models in detail. The following table shows the names of these models on popular marketplaces, as well as the sizes of commissions for fulfillment services in 2024.

Some marketplace sellers prefer not to handle the logistics, packaging, and storage of their own products. Instead, they outsource these processes to fulfillment companies. In this model, the contractor takes on all tasks: they store products in their warehouse, collect orders, and organize their delivery to the marketplace warehouse. This allows sellers to focus on other aspects of the business, such as product range development and marketing, and reduce the costs of maintaining their own warehouse space and logistics processes. The use of fulfillment companies is becoming increasingly popular among sellers looking to optimize their operations and improve sales efficiency on marketplaces.

What types of marketplaces are there?

There are three main types of marketplaces, which differ depending on the roles of the seller and buyer. The first type is B2C (business-to-consumer), where companies sell goods and services directly to end users. The second type is B2B (business-to-business), where transactions occur between companies, allowing them to exchange goods and services. The third type is C2C (consumer-to-consumer), which implies that individuals can sell goods to each other through marketplace platforms. Each of these types of marketplaces has its own characteristics and target audience, which makes them important tools in e-commerce.

• C2C. Sellers and buyers are individuals. An example of a C2C platform is the Avito classifieds.
• B2C. Sellers are companies, sole proprietors, and the self-employed; buyers are individuals. B2C includes the marketplaces we discussed in the article: Yandex Market, Wildberries, Ozon.
• B2B. Sellers and buyers are companies or sole proprietors; business representatives. For example, Alibaba is a B2B marketplace: product manufacturers sell their products wholesale.

Marketplaces are classified as vertical and horizontal depending on the range of products they offer. Vertical marketplaces specialize in a specific product category, such as electronics or clothing. Horizontal marketplaces, on the other hand, offer a wide range of products from various categories. This classification helps users find the products they need more easily and simplifies the shopping process.

Vertical marketplaces focus on products in one or several related categories. For example, Lamoda offers exclusively clothing, shoes, and accessories. In contrast, horizontal marketplaces cover a wide range of categories, including clothing, electronics, home goods, and more. This diversity allows users to find different types of products on a single platform, making horizontal marketplaces more versatile and convenient for shoppers.

Top Marketplaces in Russia

According to the Data Insight agency, this marketplace occupies a leading position in the market. It offers a wide range of products, with the main categories being clothing, footwear, and home goods. A versatile approach to sales and a variety of products make it attractive to both buyers and sellers.

Wildberries is one of the largest online retailers in Russia, offering a wide range of products, including clothing, footwear, electronics, and home goods. The platform was founded in 2004 and over the years has established itself as a reliable store with a high level of service and fast delivery. Wildberries is actively expanding its logistics network, enabling it to deliver orders quickly throughout the country. Users appreciate the user-friendly interface of its website and mobile app, as well as regular promotions and discounts, making purchases more profitable. Wildberries also offers a return policy, adding confidence to its customers. Every year the company continues to expand its range and improve the quality of service, which makes it one of the leaders in the Russian e-commerce market.

• Commission size: 2–25% — depends on the product category.
• Who can work: individual entrepreneurs, LLCs, self-employed.
• Delivery models: FBO (internal name — FBW), FBS (internal name — “Marketplace”). They are also testing the DBS “Vitrina Express” model — the seller delivers goods within 30 minutes to 4 hours.
• To register, you need to pay a security deposit of 10,000 rubles, the account will be activated in 3–4 days.
• Pros: a large number of buyers, a promoted platform.
• Cons: paid registration, a complex system of commissions and penalties, sellers' accounts are often blocked.

The company ranks second in the Russian market. This is a universal online store that does not focus on any one category of goods. Being the oldest marketplace in Russia, it has been successfully operating since 1998, offering a wide range of products and a user-friendly interface.

Ozon is a leading Russian online shopping platform, offering a wide range of products, including books, electronics, clothing, and home goods. Since its founding in 1998, Ozon has been one of the first online stores in the country and continues to expand its services, including delivery and a marketplace for third-party sellers. The platform provides a user-friendly interface and actively implements new technologies to improve the shopping experience. Ozon also offers loyalty programs and special offers, making shopping more rewarding and enjoyable.

• Commission size: 4–15% — depends on the delivery model.
• Who can work: individual entrepreneurs, LLCs, self-employed.
• Delivery models: FBO, FBS. RealFBS — delivery by the seller, it has three logistics schemes: Standard — orders are assembled within up to a month; Comfort — orders are assembled within up to eight hours; Express — orders are assembled within half an hour.
• Registration takes place on the Seller Ozon website. You need to provide a phone number, email address, enter the verification code from an SMS, fill out the form and accept the terms of the offer. The documents required for individual entrepreneurs are OGRNIP, INN, and passport. For LLCs — the charter, INN, and an extract from the Unified State Register of Legal Entities. For the self-employed – Taxpayer Identification Number (TIN).
• Pros: Marketplace loyalty to sellers, good internal analytics system, quick response from customer support.
• Cons: High competition, tight delivery deadlines, large delivery and early withdrawal fees.

The fastest-growing marketplace on the market is "Market." It sells electronics at the highest level, making the platform an ideal choice for buying and selling. With its user-friendly interface and wide selection of products, Market attracts both buyers and sellers, ensuring a high level of satisfaction and favorable conditions for all participants.

Yandex Market is a popular online shopping platform in Russia, allowing users to compare prices, read reviews, and choose from a wide selection of products. The platform combines offers from various online stores, allowing shoppers to find the best deals and attractive discounts. Thanks to a user-friendly interface and filters, users can easily find the desired products by category, brand, and price range. Yandex Market also offers delivery services and the option to pick up products at pickup points. With this platform, shoppers can make informed decisions based on ratings and reviews, making online shopping safer and more convenient.

• Commission size: 3–22.5% — depends on the price and category of the product, and the operating model.
• Who can work there: individual entrepreneurs, LLCs, self-employed.
• Logistics schemes: FBY, FBS, FBS-Express, DBS. FBS-Express works like this: the seller collects the order within an hour and transfers it to Market, which delivers the product to the buyer within 1–2 hours.
• To register, you need to: register a Yandex ID (an account for all Yandex services), indicate your name, contact information, email, store name, and product category.
• Pros: many services in Yandex overlap, so products are actively promoted; Transparent commission system, easy access to the platform.
• Cons: limited warehouses, lower sales volume than market leaders.

This joint project between Sber and M.Video is the newest marketplace in this segment, launched in April 2021. The platform is classified as a general online store and demonstrated impressive growth in the number of orders in 2023, almost tripling. The most popular product categories among buyers include smartphones and accessories, furniture, and footwear. This marketplace is actively expanding its product range and improving its user experience, which contributes to its successful promotion in the market.

"MegaMarket" is a modern shopping mall offering a wide range of goods and services. We provide a convenient shopping experience, offering products from well-known brands and local manufacturers. At MegaMarket, customers can find everything they need: from groceries to household appliances and clothing. We strive to create a comfortable shopping atmosphere where every customer can quickly and easily find the right product. Our goal is to satisfy our customers' needs, so we constantly update our assortment and run promotions, making shopping more profitable. "MegaMarket" is your reliable partner in the world of shopping.

• Commission size: 0.5% - 22.5% - depends on the price of the product. For new sellers on the platform, there is a promotion - a 1% commission on the sale of any goods for three months.
• Who can work: individual entrepreneurs and LLCs. For the self-employed, the FBS and DBS work models are available.
• Work models: "Storage + delivery from MegaMarket" (FBO), "Delivery from MegaMarket" (FBS), "Delivery from the seller" (DBS). There is also a “Pickup from Store” (C&C, P&C) model - the seller collects the order and hands it over to the buyer in their retail store (available only for individual entrepreneurs and LLCs).
• To register, you need to fill out a form: indicate the seller’s personal data, product category, store name.
• Pros: flexible rates, active advertising and promotion of the marketplace, sellers have few competitors.
• Cons: sales turnover is lower than that of competitors.

Briefly: what you need to know about marketplaces

• A marketplace is an electronic platform for selling goods on the Internet.
• To work on marketplaces, you do not need your own website, the platforms themselves attract buyers.
• Advantages for sellers: market growth, the ability to sell throughout the country, no delivery and Do not maintain your own warehouse.
• You can sell any goods on marketplaces unless prohibited by law. You can view the current list on the marketplace's website or order through the chat operator. Selling services is prohibited on these platforms.
• The most popular universal marketplaces in Russia are Wildberries, Ozon, Yandex Market, and MegaMarket.
• There are three main sales schemes on marketplaces: FBO (selling from the marketplace's warehouse), FBS (selling from the seller's warehouse with delivery by the marketplace), and DBS (selling and delivering from the warehouse by the seller). Everyone is trying to please the client, so more and more express delivery schemes are appearing - from 30 minutes to 4 hours.