[Editor’s note: Rithum is here to help you navigate through the COVID-19 crisis. Tophatter is one of many marketplace resources available to ensure those impacted by any restrictions can still get their products out to the public.]
Diversification is the key to e-commerce growth. Selling on a breadth of marketplaces will be far more impactful than optimizing for depth on a single marketplace. However, diversification comes with its challenges. It’s important to understand a marketplace before you invest resources into onboarding a new channel.
Discovery marketplace Tophatter is known for its fast-paced auctions, but that’s not the only thing that makes it different from other players in the space. Below are three things you need to know about Tophatter before you become a seller.
The Discovery Model Means Less Regulation
Most shoppers use Tophatter as a way to pass the time, scrolling through it like they scroll through their social media accounts. Listings that capture the shopper’s attention or where the value is clear, sell best. Through bidding and setting reminders, shoppers decide what they want to see more of on the platform. It’s simple, what performs well in the auctions, is scheduled for auctions most often.
Due to this unique model, Tophatter does not need to regulate their marketplace as strictly as others. Of course there are guidelines about what can be sold, but far fewer than other platforms. Take, for instance, health & safety products: hand sanitizer, paper goods, nonperishable foods, and more have been selling well in auctions, as shoppers ultimately decide the final selling price. Increased interest for products adds more competition to the auctions.
The Auctions Create a Lower Barrier to Entry
When starting on a new platform, it can be difficult to get your products seen. Whether rising to the top of search results or spending resources on ad and marketing budgets, getting impressions is tough. Tophatter’s feed format is designed to keep people scrolling. On average, shoppers spend 5-7 minutes in the app during a single session, which is much longer than other platforms who optimize for a frictionless path to purchase.
Tophatter is an auction for both buyers and sellers. Buyers bid on auctions to win products. Sellers set bids against other sellers to get placement on the homepage. On some marketplaces, sellers with the deepest pockets win, but on Tophatter anyone can win simply by listing a unique product. This means, all products garner impressions without you spending extra time on the perfect keyword strategy. Getting into each auction in the main feed is simple. After uploading your products, sellers place a small bid called a Scheduling Fee Bid (or SFB in Tophatter parlance). Think of SFBs as payments for shelf space.
Discovery Shoppers vs. Utility Shoppers
People shop for different reasons. Sometimes they are looking for something very specific: a part to fix their car, AAA batteries, their favorite shampoo. This is utility shopping and it’s best done on marketplaces that optimize for it: Amazon, eBay, Walmart, etc.
Then there is discovery shopping. Discovery shopping is what made the American mall what it was in the 80s and 90s. It’s what powers TJ Maxx and HomeGoods to continue to grow as other physical retail shrinks. Discovery shopping is the act of shopping without having a specific purchase in mind, shopping for fun, or shopping to discover something you didn’t know you wanted. Tophatter is chiefly a discovery platform, so it’s important that sellers approach selling on it differently.
Discovery shoppers are usually buying something they want, not something they need, so they are bargain shopping. They want to feel like they got a deal. To perform well, listings should show the value or discount shoppers could get. Creative approaches like bundling items can help sellers move volume and shoppers feel like they scored a great deal.
Expanding to new marketplaces can be intimidating, but each marketplace comes with its unique strengths. If you know how to approach it, you can accelerate your business to new heights.
Blog post by Austin Henggeler, Director of Sales & Account Management at Tophatter
