Selling Jewellery Online in South Africa – Part 1: eCommerce Platforms

Selling products online has become a whole lot easier over the last 10 to 15 years, but the possibilities available can feel overwhelming. In this series, I’ll walk you through the various eCommerce options and explain their pros and cons so you can make more informed decisions about how you approach digital, and how you can leverage it within your business. It’s helpful to think about each category in terms of physical marketplaces:

Online presence is a form of real estate.
As in any retail experience, your real estate accounts for a majority of your sales. Some would have a stand-alone store in a shopping district; others may have a store inside a mall. Some may have a kiosk inside the mall; others may have direct sellers inside other stores. Each piece of real estate comes at a different cost because it allows you access to a certain amount of foot traffic. The same goes for digital, for example:

  • Stand-alone store = your website
  • Store in a mall = eCommerce platforms
  • Kiosks = online marketplaces
  • Direct selling = marketing channels such as social media

Each category requires a different level of expertise, and investment in money and time to make it worth your while. You may want to look at a combination of a few, others may want to double down on one, but clarity comes from trial and error. Thankfully with most digital options, we can track sales and work out the ROI on our efforts to get a more accurate cost per purchase and see if it’s going to be worth pursuing in the future.

We’ll start by exploring the ‘store in a mall’ choices best suited to South African jewellers:

Online selling platforms: Pros and Cons

PROS: Selling platforms allow a storeowner to be less invested in the digital space but still tap into traffic already generated by the platform, similar to what you would get in a mall. These platforms do their best to secure visitors who have intent to shop and are open to browsing around and looking for products and deals. They are a great way to drive proof of concept or dip your toes into the water to get a feel for eCommerce because you don’t need too much technical knowledge to get started, and you’ll have a digital presence up and running in no time. You won’t need to know any code, or pay for an eCommerce website design or hosting, or purchase a domain. The platform handles everything digital; all they need is your products to be added to their database.

CONS: While these platforms take the strain out of marketing and bring you a steady stream of potential buyers, you’re not the only retailer in this space. Ease of use also means a lower barrier to entry. Your competition may undercut you, or optimise their listings to outrank you, grabbing the lion’s share of views and sales. You’ll need to be vigilant in what your niche is doing on each site and create comprehensive product pages that entice users so that you get preference in search results. Selling platforms are by no means a set and forget system. There will be work involved in getting your products online, managing orders, physical shipping, matching your digital inventory to physical stock on hand and more. Also, each platform has their own specific requirements, so it won’t be a copy and paste exercise should you want to expand into other platforms.

So what are your options in South Africa? Local retailers and smaller traders have several options when it comes to selling via 3rd party services, namely:

TakeAlot
TakeAlot is South Africa’s largest eCommerce platform; it sells both the products it buys in, as well as 3rd party service providers’ stock. A dedicated marketing team secures high-quality local traffic every day, and this is where it stands head and shoulders above other platforms. The site spends millions each month to secure this traffic and converts them into sales for the platform and individual sellers. If you are the only provider of a specific product, you may have free reign on the category and capture the majority of the sales. If not, you’ll have to share the same listing of the product and have to compete on price. TakeAlot also takes a percentage of each sale, so you will need to factor this into your margins. Selling with TakeAlot will require either high volume sales or high margin products if they are moving a little slower since you have several fees you need to cover, namely:

  • Success/Referral fee: 10.0% – 18.0%
  • Fulfillment fee: R32, but depending on the size of the order and weight, it can change.
  • Monthly storage fee: 0 – 60 000 cm3 will cost up to R24

Depending on how much stock you keep with them, how many sales you make and the size and weight of your products, it can set you back on a range of fees. To list your products with TakeAlot, you need to sign up with them, and their marketplace team will guide you through the process.. If you’re looking for a step-by-step guide on how to set up a marketplace account with TakeAlot, you can find one here.

BidorBuy
Bidorbuy is a South African based eCommerce platform that has been in operation since 1999. Bidorbuy has built up a trusted brand locally over the last two decades, leading to around 1.89 million visitors a month according to Similarweb, making it one of the larger local eCommerce sites, behind TakeAlot, Raru, and Loot. Their audience comprises 88.97% South Africans, which makes targeting local buyers a lot easier. To list on Bidorbuy all you need to do is register an account and either upload your products manually or use one of the CMS integrations they have available to bulk upload products to the site. You can leave your listings static or pay for advertising and premium spots on the site to try and encourage sales. Once you secure orders, the success fee for jewellery is 8.75%, excluding VAT or 10.06%, including VAT.

eBay
eBay Inc. is an American multinational that has been around since 1995. As a multi-regional and multi-category site, traffic is a toss-up and a free-for-all. You can list your products and they will display in the pricing of the region the buyer is in, and you can get orders from all over the world.

Note: To be listed as an international seller on eBay you must have a PayPal account and be PayPal verified, offer PayPal as the option, earn 10 feedback points as a seller and make a sale in 90 days.

eBay allows sellers to list up to 200 listings each month for free. If you list more than 200 products you’ll incur a listing fee and you’re also charged for adding one of your 200 free products into additional categories at a fee of $0.35 per listing, however Jewellers can list for free if the starting price of the product exceeds $100. eBay offers product listings as well as auction listings which start at a fee of $1, depending on the duration of the auction or the type of listing you want to run. eBay manages your payments, and buyers can use a variety of methods such as credit, debit, and gift cards, Apple Pay, Google Pay, PayPal, and PayPal Credit, and the balance will be settled with you in your local currency.

Etsy
Etsy is another US-based marketplace and has been running since 2005. Users from all over the world can create a store on the site and compete with one another for traffic and sales. You can create your store on the site and try to leverage off internal traffic, but many sellers promote their store outside Etsy to try and drive direct sales. Etsy also has an advertising platform built into it that sellers can use to promote their products and try to reach more buyers. As is the case with eBay, you can get orders from a range of locales, but will have to deal with international shipping in some cases. Etsy charges per listing and it costs around R3.40 to list a product on the marketplace, which will remain active for up to four months or until the item is sold. Once the item is sold Etsy will take a 5% free on the sale price including the delivery price you have set.

Note: Listing fees are billed in USD so your back account needs to be set up to settle in forex.

If you accept payments via Etsy payments they will also collect another 4.5% + R8 payment processing fees. Etsy allows you to accept payments in credit and debit cards, PayPal, Google Wallet, Apple Pay, and Etsy Gift Cards. These funds are processed by Etsy Funds and then deposited directly to your bank account in your local currency, no matter how or from where the buyer pays.

Localized SA
Localized is a new website trying to replicate the eBay/Etsy model in South Africa. Launched about a year ago, it’s still in its formative stages and does not have much inventory. This can be seen as an advantage to sellers as their products would get more views and share of the platform’s traffic. Additionally, since the site only focuses on local traffic and retailers, you won’t need to deal with the hassle that comes with international trade. Jewellery can be listed under the fashion & accessories category but after speaking to the team, I can report that they are open to creating a Jewellery specific category for sellers who sign up and list enough inventory. Jewellery sellers listing on Localized will effectively establish the market for this niche and will be the only ones servicing the traffic hitting the site, making it an easy place to stand out and capture more of their audience. Products will remain in your possession, and as orders are filled their inventory management team will let you know and arrange collection for the buyer.

Hello Pretty (and Hello Man)
Hello Pretty is another South African based platform from Cape Town. It’s a little more established than Localized but focuses primarily on designer products and artisanal tastes. It’s carved out a niche for itself locally when it comes to handmade products and one of a kind items and it’s often where local shoppers find themselves online. The site is also more fashion-centric than others, so buying intent is higher, but that does mean you will have more competition for attention in search results or browsing categories. Once signed up, you will have a storefront page with all your products, your social media contacts and users can message you form the site to request custom designs or if they have other requests.

Hello Pretty claim to have processed over R20 million in sales through their platform, and allow sellers to create a store on their site for free. The free store does still charges the following costs:

  •  5% fee per transaction
  • 15% commission
  • R10 payout fee (when you make a sale which covers bank charges)

They also have a tiered subscription that allows you to unlock more features on your shop starting at R49 per month.

Selling-Jewellery-Online-article-2

Not really recommended for jewellers:

Gumtree or OLX
Classified sites get tons of local traffic each day as retailers and individuals post ads on it regularly, but it’s an unregulated free-for-all. The traffic is majority local, but across a spectrum of LSMs so you will have a lot of unqualified traffic hitting your listings. It can put your products in front of thousands of customers with little to no cost, but the frantic pace at which these platforms run means no time for verification, and your ads are pushed continuously down the feed by new listings. You will need to continually republish and refresh ads to remain relevant or pay to keep your ads on top of applicable categories or search results. The site does not profile users and only connects advertisers with buyers, some will waste your time, others may be scams, so you’ll need to be vigilant about the leads you acquire through these platforms. Since these classified sites are strictly advertising platforms you will need to do some manual work, in checking out the buyer, processing the order payment and shipping the order yourself.  In some cases, you may use the platform to attract leads that you bring into the store and complete a face-to-face sale.

PriceCheck (requires you to have an eCommerce website)
This is a local shopping aggregator that pulls in millions of South Africans each month looking to comp shop, and compares prices across various retailers in the system. Buyers here are looking for the best deal so you’re unlikely to successfully sell high-end handmade jewellery on this site. Sellers are also required to have a compatible eCommerce store that can supply product feeds directly into Pricecheck. As is a price comparison platform rather than an eCommerce platform, they do not handle purchasing or order fulfilment. All they do is redirect traffic from their internal search results to product listings that mention you as a supplier, which are then diverted to your store/website for the order to be fulfilled. Pricecheck can send you high-quality traffic with strong buying intent, but they do charge a fee for each conversion. This works on a cost per click basis, and sellers will need to upload an advertising budget in a prepaid model. The price of each click generated from Prichecheck to your site can vary, but tends to be around R0.10.

In summary, eCommerce platforms are a simple and easy way to get started
Creating a presence inside these platforms will require some work, but they do reduce the barrier to entry for non-technical users or those looking to avoid the complications of running a website of their own. It naturally has its limitations, but depending on how you’re willing to embrace its use, you can turn it into a worthwhile exercise and source of online revenue.

Ready to go digital?
This article was contributed by nichemarket. We believe in South African entrepreneurs and hope to be a part of their success stories by providing a free digital platform for local business owners to advertise their goods and services as well as a host of digital support services. Our goal is to help local businesses take advantage of online marketing and create a strong online presence. Our marketing agency division provides web development, business and eCommerce consultation and digital marketing support for local and international SME’s and start-ups.   Should you wish to explore eCommerce or digital marketing solutions for your business, feel free to contact us at info@nichemarket.co.za or complete our contact form and we’ll get back to you.

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