Should You Choose a Shopping Cart or a Marketplace for Your Online Business?

You have a killer product, proof of concept, and a growing fan base. So why are you still asking customers to direct message or email you to place orders? Your business can’t scale that way.

If you sell online, you need a sales platform — period. An online sales platform is your golden ticket to the world of e-commerce, with shopping carts and marketplaces being the most prominent and influential options.

Shopping carts and marketplaces both work to make e-commerce possible by accepting payments and distributing order information to merchants, payment processors and fulfillment centers. Despite these similarities, each option impacts your business differently.

A Tale of Two Platforms

To start, let’s review your options. A shopping cart is a piece of software that makes online shopping possible (e.g., Shopify). Meanwhile, a marketplace is an e-commerce website that enables third-party sellers to list and sell their products (think Amazon.com).

Both approaches are effective. A shopping cart is an independent entity that consumers can use to access your store as they would any regular domain such as Macy’s or Apple. Of course, with great power comes greater responsibility. When you opt for a shopping cart, the pressure of letting people know about your awesome store falls squarely on your shoulders.

A marketplace, on the other hand, can jump-start your e-commerce business. Think about how easy it is for a new merchant to start selling on Amazon. While the startup process is simple, keep in mind that you have limited control over your product listings and overall branding. You’re also competing with thousands of other brands trying to get a piece of the market right along with you.

How to Know What’s Right for Your Business

Once you’ve weighed the differences between shopping carts and marketplaces, you’ll want to think carefully about which specific platform is the best fit for your business. Use these three strategies to determine your pick:

1. Do your research.

Ask around. Some people will swear by one shopping cart or marketplace, while others will run for the hills. Once you’ve gathered that feedback, look for patterns. Do the people who love Shopify have similar business structures to your company? If so, you’ll likely be happy with Shopify, too.

2. Consider your bandwidth.

Marketplaces can be ideal for companies that are just getting started because they typically come with lower overhead costs and at least some “grandfathered in” traffic. Shopping carts require a more hands-on approach, but they're significantly more flexible and better at scaling along with your business. Look for the most straightforward and doable option for your business.

3. Don’t limit yourself.

You never want to put all your eggs in one basket — that’s the first rule of e-commerce! Try picking a marketplace and a cart and using them in tandem to see where each one thrives. Choose as many shopping carts (e.g., Shopify, Squarespace, OpenCart, Weebly) and marketplaces as your bandwidth will allow. The more options you can consider, the merrier.

Shopping carts and marketplaces are both handy e-commerce tools. Still, they're different enough that it’s worth spending time to assess the right route for your business. Do your homework, consider feasibility for your structure, stay open to trial and error, and you’ll find the perfect platform for your business.

Jan Bednar is the CEO and founder of ShipMonk, a technology company reimagining third-party shipping logistics.