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Difference between Amazon and Amazon Marketplace
Amazon and Amazon Marketplace are two independent but related entities within the Amazon ecosystem. Read this article to find out more about Amazon and Amazon Marketplace and how they are different from each other.
What is Amazon?
Amazon is a multinational technology corporation and one of the world's largest online retailers. Jeff Bezos founded the company in 1994 as an online bookstore but quickly expanded into other product categories and services. Amazon has grown to be a prominent participant in a variety of areas, including e-commerce, cloud computing, digital streaming, artificial intelligence, and consumer electronics.
Key Aspects of Amazon
E-commerce Platform − At its core, Amazon is an e-commerce platform that allows customers to purchase a wide selection of things online. Books, gadgets, apparel, household goods, toys, and other stuff are available through the company. Customers can shop for products on Amazon's website or via its mobile app.
Amazon Prime − Amazon Prime, a subscription-based service, is one of the company's most significant offerings. Amazon Prime members receive a range of benefits for a monthly or annual fee, including free two-day shipping on qualifying purchases, access to streaming services such as Prime Video and Prime Music, unlimited cloud storage for images, exclusive offers, and more. Amazon Prime has made a substantial contribution to customer loyalty and retention.
Third-Party Marketplace − Amazon has a robust third-party marketplace known as Amazon Marketplace in addition to selling its own products. Independent sellers, small enterprises, and brands can use this platform to list their products for sale on Amazon. Sellers are in charge of their merchandise, price, and delivery, while Amazon is in charge of the platform, payment processing, and customer support infrastructure. The Marketplace has given millions of seller’s access to a massive worldwide customer base.
Amazon Web Services (AWS) − Amazon Web Services, or AWS, is the company's cloud computing division. AWS, which was founded in 2006, offers a comprehensive suite of cloud-based services such as processing capacity, storage options, databases, machine learning, analytics, and more. Businesses, startups, and governments use it extensively to host apps, manage data, and economically scale their operations.
Kindle and E-Books − With the debut of the Kindle e-reader in 2007, Amazon revolutionized the publishing sector. The Kindle allows customers to read digital books (e-books) on a portable device. Amazon's Kindle Store includes a large range of e-books, and the business has also built Kindle apps for numerous platforms, allowing customers to read on smartphones, tablets, and PCs.
Artificial Intelligence and Machine Learning − Amazon invests substantially in artificial intelligence (AI) and machine learning (ML) technology to improve customer experiences and optimize operations. AI and ML are utilized in product suggestions, personalization, fraud detection, logistics optimization, and speech recognition (Alexa).
What is Amazon Marketplace?
Amazon Marketplace is an online platform that allows third-party retailers to list and sell their products alongside Amazon's own inventory. The Marketplace, which was launched in 2000, has played an important role in extending Amazon's product range and giving businesses of all kinds chances to reach a vast worldwide client base.
Let’s see how Amazon Marketplace works −
Third-Party Sellers − Third-party vendors can sell their products on Amazon Marketplace to millions of Amazon customers. Individual entrepreneurs, small companies, manufacturers, merchants, or brands are all examples of sellers. Sellers can advertise new or used products and set their own prices, but Amazon does apply certain criteria and restrictions to ensure a uniform customer experience.
Product Listings − Sellers publish product listings on Amazon Marketplace, describing the things they want to sell. Product titles, descriptions, images, and other relevant details are included in these entries. Each seller is responsible for handling and maintaining their listings correctly and up-to-date.
Order Processing − When a customer places an order for a product featured on the Amazon Marketplace, Amazon processes the payment on the seller's behalf. The vendor gets notified of the order and is in charge of completing it. Amazon provides tools and resources to help vendors manage their orders more effectively.
Customer Service − While Amazon manages customer support for orders fulfilled by Amazon (FBA), sellers handle customer inquiries and resolve issues with orders fulfilled by themselves (MFN). Amazon provides tools and guidelines to assist merchants in properly managing customer support.
Seller Performance Metrics − Amazon Marketplace sellers pay Amazon a variety of fees to use the marketplace. Referral fees (a percentage of the product's sale price), fulfilment fees (if utilizing FBA), and other optional service fees may be included. In exchange, Amazon gives vendors access to its massive client base and sophisticated infrastructure, which can help them improve sales and revenue.
Global Selling − Amazon Marketplace allows sellers to sell on Amazon regional markets around the world, expanding their reach beyond their native country. This allows vendors to reach out to overseas clients and grow their business abroad.
Difference between Amazon and Amazon Marketplace
The following table highlights the major differences between Amazon and Amazon Marketplace −
Characteristics |
Amazon |
Amazon Marketplace |
|---|---|---|
Product Selection |
Sells products directly from its own inventory and various departments. |
Allows third-party sellers to list their products alongside Amazon's offerings. |
Pricing Control |
Full control over pricing. |
Sellers have control over their pricing within certain guidelines. |
Seller Identity |
N/A (Amazon sells its own products). |
Independent sellers, businesses, and brands. |
Product Listings |
Amazon lists its own products. |
Third-party sellers create their listings. |
Ownership |
Operated and owned by Amazon Inc. |
Operated and owned by Amazon Inc. |
Inventory and Fulfillment |
Manages its inventory and fulfills orders for products it sells directly. |
Sellers are responsible for their inventory and can choose Amazon's fulfillment services (FBA) or self-fulfill orders (MFN). |
Revenue Sharing |
Retains revenue from products it sells directly. |
Takes referral fees and other charges from third-party sellers for using the platform. |
Fulfillment Options |
N/A (Amazon handles its own fulfillment). |
Sellers can choose Fulfillment by Amazon (FBA) or fulfill orders themselves (MFN). |
Global Selling |
Amazon sells globally through its regional websites. |
Allows sellers to expand their reach by selling on Amazon's regional marketplaces worldwide. |
Conclusion
In conclusion, Amazon is a retail giant that sells its products directly to customers, whereas Amazon Marketplace is a platform that allows third-party vendors to sell their goods on the same website.
While Amazon retains control over the products it sells and the overall customer experience, the Amazon Marketplace allows smaller businesses and sellers to access a larger audience.
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