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Should you run your eCommerce business on Amazon, Etsy or WooCommerce?

Amazon and Etsy are a great, low impact, place to dip your toe into the eCommerce waters, but if you have long term plans, running your own store will ultimately become more profitable and give you more flexibility. Here, I dig into what you might want to consider, around some key topics:

Fees

Amazon and Etsy both charge percentage fees to retailers, ultimately based on the amount of the sale value. This is a great way to start selling without upfront costs, but as your business grows, you’ll eventually find yourself thinking twice about the amount of fees you’re paying.

You’ll need to do the math here (and have a look through the comparisons below), but you could be saving a lot of money on transaction fees, payment processing fees, and commission.

Customization and flexibility

Etsy and Amazon are ready-made in many ways, but don’t allow for flexibility and scalability when it comes to adding features and creating more nuanced eCommerce experiences.

For example, early in your business, you may not be 100% sure if subscriptions or memberships will be right for your business, so you may not want to go with a “subscription-only” platform that rules out the option of memberships down the line.

WooCommerce leaves you with the freedom to decide as your business grows. It’s a flexible and customizable option, running on WordPress, which has thousands of trusted extensions.

From subscriptions to bookings to memberships and new payment methods, you can extend your store as your budget allows through the many WooCommerce extensions available.

Freedom

As the comparison below describes, using WooCommerce (or a similar bespoke platform) rather than selling exclusively on Etsy or Amazon allows you to take your business into your own hands.

For sellers used to doing their own manufacturing, promotion and accounting, this isn’t a big leap: it’s part of being in business.

If you’re ready to take on the challenge of promoting your own product, WooCommerce will give you greater freedom to experiment or change up the full eCommerce chain: from promotion to shipping, customer service and more.

Learn more about email marketing and conversion rate optimization for WooCommerce stores.

Full Platform Comparison

Fees

Etsy listing fees are $0.20 USD. Listings are active for four months or until they sell. When you sell an item, there’s a 5% commission on the transaction and around 3% + $0.25 for payment processing fees.

Amazon seller fees range from around 7% – 15% and these costs are greater if you use Amazon for warehousing and shipping your goods through the Fulfilment By Amazon programme. Clearly, this cost has to be weighed against the convenience, staffing and total cost of ownership needed to replicate these services in your own business.

At its most basic, WooCommerce software is entirely free and where there are any costs, you have total control over choosing your solution or provider.

All in all, a small but successful WooCommerce store will be looking at monthly costs starting at around $55, but with complete control over those costs and the ability to replace or change any of the elements above.

If you were to say the fee for the platforms is an average total of 10% of sales (and this is probably low), and you expect to sell more than around $600 in a month, your own store becomes a viable option. Before then, it may be possible the costs of running your store may outweigh the benefits, so it is worth thinking about the scale of your operation, or at least the amount of time it may take you to hit this tipping point.

Shipping

Etsy offers tools for shipping labels, calculated shipping and shipment tracking.

Amazon offers similar, but additionally, sellers have access to full warehousing and handling through Fulfilment By Amazon. An important note here – Fulfilment by Amazon is truly amazing. I have used it myself, and despite the slightly finicky setup, once you’re up and running your customers will really love the ability to get one day shipping from a trusted carrier.

You can even use FBA for products sold through your WooCommerce store or over the phone. You can book through the shipping individually or there are also programmatic ways of hooking this to your systems. (Get a developer).

Also, for stores selling internationally, using a fulfilment centre abroad is a neat way to get around individual customs forms. You do the customs work when you send your batch to the Amazon warehouse (provided it is a product type the warehouse will accept), and then the individual products get sent straight out to your customers upon purchase – no delays.

In addition to gaining promotion within Amazon and speedy delivery, FBA also gives you the chance to benefit from a gift-wrapping service, which can make the difference to “just-in-time” customer buying decisions at Christmas and other major holidays.

WooCommerce, on the other hand, can work with almost any shipping setup and, even better, can be made to integrate with existing shipping setups including Fulfilment by Amazon (this integration is now only available in North America owing to new rules from Amazon regarding their API).

There’s also a shipping method baked into the initial WooCommerce setup, called WooCommerce Shipping which works with USPS and Canada Post. The possibilities are almost endless and there’s always a developer on hand to help you customize.

Payment Handling

Etsy allows payment by Etsy itself, PayPal, mail or “Other”.

Amazon stores multiple cards for customers. Customers can also use Gift Vouchers and Gift Cards to pay for an order.

WooCommerce has a full suite of Payment Gateway Extensions for you to choose from, as well as plugins to work with tokens, invoices, purchase orders, gift certificates and more. There’s even an exciting development from WooExperts, Pragmatic, who have developed a crypto payment gateway with Coinbase. This is a great example of how flexible and innovative WooCommerce can be.

Promotion

Etsy does a large amount of content marketing and social promotion for its sellers. The customer shopping on Etsy is fairly uniform and the platform uses this to leverage marketing for all its sellers. Etsy provides value-add for its sellers in terms of promotion.

Amazon, on the other hand, has a wider customer base and so allows sellers to promote using Products Ads and the occasional paid promotion on events such as Prime day. Amazon is also notable for not particularly pestering its signed up customers with promotional emails. Amazon sellers benefit from a huge amount of digital “footfall” or traffic to the main Amazon site, but still need to get a bit more involved in their own product promotion.

WooCommerce store owners have promotion in their own hands. WooCommerce is the platform for those who are ready to go it alone and pursue their own marketing and promotion strategy. There are some great WooCommerce integrations for promotional tools and insights, such as Facebook and Google Product Feed.

Subscriptions

Keep customers coming back for more. Subscriptions are a great way to build a sustainable recurring income and a loyal customer base.

Etsy allows its sellers to manage some limited subscription offerings in the crafty space but subscriptions are rarely offered through Amazon.

WooCommerce, on the other hand, provides an amazing suite of customizable subscription options. Allow users to switch subscriptions, add extras, change billing dates and then, if that sounds like too much work for you, automate the billing, shipping and even the fulfilment.

There are also neat add-ons like Gifting for WooCommerce Subscriptions which enable customers to purchase subscriptions for others!

Take a look at the interface below:

Front-end “Public” view

This basic subscription example uses the WooCommerce standard theme: StoreFront.

Back-end logged-in-customer view

For logged in customers, the My Account page offers an opportunity to manage billing details, addresses and much more.

Subscribe All the Things

For super advanced users, there are some exciting developments in WooCommerce Subscriptions. Subscribe All The Things (SATT) allows customers to go through a normal store and turn a basket of products into a recurring subscription. This is currently in development over on GitHub, so if you’d like some help to use it, find an expert.

The plugin author, Brent Shepherd, recommends Silicon Dales along with Saucal and Mindsize as WooCommerce-focused agencies with particular experience with subscriptions. (Disclosure, I work at Silicon Dales!)

Here it is in action – allowing customers to build their own subscription:

SATT Subscription Builder Page

Users can add to existing subscription, or choose the billing cycle on every individual item – just look at this cart page:

SATT Subscription Builder Checkout

The cart page for Subscribe All The Things shows each item in the subscription and an individual cycle for each product. Changing the quantity of items changes the subscription Total.

Again, this is an advanced use of a plugin not released through the WooCommerce Extensions Store just yet. It is still being tested and developed, but has proved popular with Silicon Dales clients as the kind of extra functionality they just can’t get on other platforms.

Bookings

Enabling bookings in your store is easy with WooCommerce. Etsy and Amazon aren’t really set up to handle sellers taking bookings, whereas sellers using WooCommerce can really change up their business model to include services, events, and accommodation bookings to help entrepreneurs really leverage all their skills and resources.

Memberships

For those businesses with a really strong community aspect, WooCommerce Memberships offers a powerful way to monetize content, accreditations, and training. At this point it’s also probably worth pointing out that paid training courses can also be offered through a WordPress website via Sensei.

Both memberships and training on WooCommerce are sophisticated ways to monetize your business which aren’t supported in a particularly meaningful way on Etsy or Amazon.

If you’re starting from scratch with memberships or training, it’s worth looking into WooCommerce in the first instance to get the most from your business model.

In conclusion

Amazon and Etsy are terrific platforms with few barriers to entry for budding retailers to start to immerse themselves in the exciting world of online retail.

However, if you want flexibility, and to increase your share of the profits, WooCommerce makes an excellent choice as an eCommerce software, giving you complete control, and the ability to scale up to thousands of products and orders every month.

Most retailers are able to leverage marketplaces like Amazon, Etsy and eBay at the same time as growing online stores which run on WooCommerce – to take advantage of the footfall offered by those platforms while maintaining independence and flexibility.

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