E-Commerce and Market Place Industry

E-commerce & Marketplace, Similar But Not The Same

The online shopping industry in Indonesia grows rapidly for now. Based on the results from a number of research institutes, an average of one Indonesian buys what they want through the marketplace almost three to five times a month. Purchasing activities through e-commerce are also crowded. Indonesian can spend 15% of their monthly income on shopping via e-commerce.

However, before talking further about the data, do you already know what’s the difference between marketplace and e-commerce? Both are often considered to have the same meaning in our daily conversation. In fact, there are big differences between the two of them.

We used to hear people say that e-commerce refers to the marketplace. This is not 100% correct. Simply put this example inside your mind. E-commerce is a situation when sellers and buyers interact directly. However, interaction in e-commerce is made through online systems. Mapemall.com is an example of e-commerce. This online store site only sells goods that are distributed using Mitra Adi Perkasa (MAP) retail network. Consumers still have the freedom to choose the items they want to buy. But, their choice is limited to certain brands that already have established a partnership with MAP. For example, Converse sneakers that are sold through Sports Station. For your information, Sports Station is one of so many MAP retail networks. E-commerce doesn’t provide places for other online store owners who want to sell their products. In e-commerce is also no bargaining process because the prices listed are already a fixed price.

The marketplace is almost similar to e-commerce. This is from the utilization point of view. Customers just need to click the item they want to buy, make a payment, then sit back until the ordered item arrives. Like a traditional market, consumers can meet with a variety of sellers. Some of them sell vegetables, meat, basic needs, even sneakers. In a traditional interaction between sellers and buyers is made directly between them. But, interaction in the marketplace is made through the internet or other online media.  Marketplace is a website that provides places for the online store or business that selling so many products. Through the marketplace, consumers can find various types of goods they want from various online stores. Through the marketplace, consumers are no longer ask about product specifications. This is because the marketplace website has already provided enough information and also details of each product are being promoted. It also makes it easier for the seller. Because what the buyer only needs to do is just click the buy button to continue the transaction.

  • Pro and Cons

After all, the marketplace and e-commerce still exist. Because both of them do have their own benefits and weaknesses point.

For consumers, searching for products in the marketplace can provide many benefits. First, the marketplace can provide not only a variety of products but also prices. Just like in traditional markets, many sellers offer the same items. Sellers compete with each other by lowering their product prices in order to attract customers. In a marketplace, the price bargaining process can not be done directly like in traditional markets. However, with the competition between sellers, indirectly, consumers can make their own bargaining process by finding sellers who offer cheaper price.

Things like that can’t be found in e-commerce. Because there are no other sellers on the e-commerce site. Thus, direct competition that creates price competition does not occur in e-commerce.

On the other hand, e-commerce has its own advantages. The return process can be more right on target. The reason is, buyers interact directly with sellers, unlike in a marketplace that needs to pass a verification team from the marketplace itself. Items sold in e-commerce can also be guaranteed for its authenticity. Because, as has been explained before, the products sold in e-commerce are official products from the sellers. But, nowadays, that advantage can also be found in the marketplace. In fact, there are marketplaces such as JD.ID or Blibli.com that only sells authentic products. Or, marketplaces like Tokopedia has also released features that guarantee the authenticity of the products are being sold.

However, in the marketplace, there are many drop shipper who is sometimes quite annoying. The price they charge sometimes is above normal. The stocks from drop shippers are not available sometimes, and they don’t update it. In the marketplace, there are so many fake sellers. They dare to offer much cheaper prices. At the same time, they offer to make a transaction outside the marketplace. Victims who have been provoked will be asked for additional transfers. Therefore, all marketplaces always suggest that transactions should be carried out in the marketplace system.

So, with all of those benefits and weaknesses, which one do you choose? Just remember, each buyer has their own preferences.