This is a guest post by Jake Rheude. Jake is the Director of Marketing for Red Stag Fulfillment, an ecommerce fulfillment warehouse that was born out of ecommerce. He has years of experience in ecommerce and business development. In his free time, Jake enjoys reading about business and sharing his own experience with others.
Selling on online marketplaces gives ecommerce businesses reach, but it also makes operations less forgiving. A seller can win the listing, then lose the customer through a stockout, a late package, a weak returns process, a hacked account, or a product page buyers cannot find.
The ecommerce challenges below are not abstract. They show up in the work sellers repeat every day: protecting data, keeping customers loyal, managing price pressure, forecasting inventory, improving marketplace SEO, and handling fulfillment without bleeding margin.
In this Process Street guest post, you’ll be looking at seven online marketplace seller challenges and practical ways to solve them. Every investment in solving a problem can generate real ROI by keeping existing customers around and making it easier to attract new ones.
Make your way through the following sections to get clued up:
- The definition of ‘online seller’
- The 7 biggest challenges for sellers on the online marketplace
- How Process Street can help you succeed on the online marketplace
Let’s jump straight in.
The definition of ‘online seller’
An online seller is somebody who uses digital means to sell products, goods, or services to buyers locally or internationally. Online sellers usually use an online marketplace to reach wider audiences, and many also use fulfillment companies so goods can reach buyers quickly.
If you’re unsure whether you are an online seller or not, think of it this way: If you’re actively selling on sites like Amazon, Walmart Marketplace, eBay, Etsy, TikTok Shop, Depop, or Rakuten, either as your main source of income or as a side hustle, you’re an online seller.
The 7 biggest challenges for sellers on the online marketplace
Although the challenges online sellers face can differ due to what is being sold, several challenges hit nearly every marketplace seller.
These include:
- Data security
- Customer loyalty
- Unexpected price increases
- Economic uncertainty
- Stockouts and inventory overload
- SEO mastery
- Returns, refunds, and fulfillment
Get out the antacids because I’m starting with the big stuff: data security.
Challenges online marketplace sellers face #1: Data security
Technical issues can harm your store, marketplace account, and reputation all at once. Sellers need to keep ecommerce platforms, payment systems, fulfillment tools, support inboxes, and admin accounts protected because a single compromised login can quickly turn into customer fraud, refund abuse, data loss, and marketplace penalties.
The risk is not theoretical. IBM’s 2025 Cost of a Data Breach Report puts the global average cost of a data breach at $4.44 million. For a marketplace seller, even a smaller incident can create chargebacks, lost listings, customer churn, and days of operational cleanup.
You can reduce the risk by treating security as an operating process, not a one time software purchase. Require multi factor authentication for admin accounts. Limit user permissions. Review access after contractors or employees leave. Keep ecommerce, warehouse, and support tools updated. Document how incidents are reported, who can approve refunds, and how customer data is handled.
If you’re managing your own website, close the basics first: SSL, payment security, account recovery, backups, fraud monitoring, and plugin governance. Dedicated tools such as Egnyte governance, Fortinet, and Mimecast Incydr can help, but the biggest win is making security work repeatable.
Some ecommerce platforms offer their own privacy protections and purchase security, which may be a good reason to switch if your current stack leaves gaps you cannot reliably manage.
Challenges online marketplace sellers face #2: Customer loyalty
The adage of it costing up to five times more to acquire a new customer than it does to keep an existing one remains true. But when you sell on someone else’s marketplace, it can help and hurt.
For example, small brands on Amazon can get in front of many more eyeballs than they would on their own. High quality and affordable products can be rewarded through positive reviews and featured placements, further boosting access to customers.
However, when someone starts getting incorrect orders from other sellers, or packages are consistently delayed, the customer may leave that marketplace. You could suffer because of how someone else sells.
What ecommerce brands need to do is have their own channel to push people toward. If someone buys from you on a marketplace, why not include a coupon in their package that gives them a deal redeemable only on your website? If you run marketing and ad campaigns, send users to your pages instead of those on a marketplace.
Provide customer service directly through your channels and agents when possible too. That way, customers associate a positive experience with your brand directly. The same goes for blogging and dynamic emails from your own accounts, which can give users helpful tips and hints to better enjoy what they’ve bought.
Safeguard your future by treating a marketplace as just one channel, and referring customers to other channels that are unequivocally yours.
Challenges online marketplace sellers face #3: Unexpected price increases
All ecommerce companies face growing changes and price hikes.
There are some standard cost increases around warehouse space, last mile delivery, payment processing, returns, and marketplace fees. Current logistics pressure is still real: CBRE’s industrial and logistics reporting shows how warehouse markets, vacancy, and rent trends keep changing by region. At the same time, tariffs, fuel costs, and supplier shifts can introduce greater costs on goods and raw materials for ecommerce brands.
If you target younger audiences, you’ll also face pressure from advertising and creator costs. Influencers, paid social, retail media, and marketplace ads all compete for the same buyer attention. The IAB reported that US digital ad revenue climbed to nearly $300 billion in 2025, which is a useful reminder that more sellers are paying to reach the same customers.
Address these challenges by reining in weak efforts and doing customer research. Review customer information to see what they’re buying and why. Then cut underperformers, adjust loss leaders, and reuse strong content across channels, such as social posts in email.
One important process is to walk through the entire customer journey to see how it works, and if you have unnecessary steps or outdated content. Highlight reviews and customer ratings, keep relevant information easy to find, and make it as easy as possible for customers to buy.
Challenges online marketplace sellers face #4: Economic uncertainty
Economic uncertainty changes how buyers behave, how suppliers price goods, and how much risk you can carry in inventory. This applies to ecommerce and online marketplace sellers as well as mom and pop stores.
First, prioritize customer retention. Bain’s loyalty research found that increasing retention by 5% can increase profits by 25% to 95%, and the principle still matters for marketplace sellers: the cheapest customer is usually the one who already trusts you. Keep those customers happy with rewards, responsive support, clear policies, and reliable delivery.
In terms of tariffs, supplier volatility, or shipping disruption, review your suppliers. Look for areas to strengthen your relationships or find alternatives if current partners become too expensive. Consistent business is good for them too, so see where you can create a mutually beneficial relationship.
And, at the end of it all, double check your money makers by asking the following questions:
- Can your core products be improved?
- Can your processes related to these core products be improved?
- Are there flaws to remove or complaints you can address?
Don’t spread yourself too thin with new markets, products, or divisions before your main sales options can run on their own. It’s tempting to expand, but new products can come with R&D, marketing, customer profile, and operating expenses that put you at greater risk.
Challenges online marketplace sellers face #5: Stockouts and inventory overload
Stockouts and inventory overload are tough issues with a potentially easy solution.
You can only sell what you have, and customers now expect fast, accurate shipping as the default. That leaves less room to backorder products or rely on long lead times that give you enough space to resupply after orders come in.
With this in mind, invest in inventory management software for small businesses that gives you accurate counts at a moment’s notice. Most solutions integrate with ecommerce platforms, so you’re not having to do a lot of coding and manage data on multiple fronts.
Give yourself an even better advantage by picking up a warehouse tool that analyzes your inventory and purchase history. These solutions can make predictions on inventory levels you’ll need and look for trends up or down in your supply curve. You might be able to save on inventory costs by ordering less during traditionally slow times, while the systems give you minimum levels for reorders to avoid going out of stock on your best sellers.
Challenges online marketplace sellers face #6: SEO mastery
Marketplace SEO gets harder every year.
Search is no longer just a keyword game. Sellers need product data that marketplaces can parse, pages that buyers can understand quickly, reviews that build trust, mobile experiences that work, and content that answers the questions people ask before they buy.
Start with your product data. If you sell through Google surfaces, study Google’s guidance for product structured data and keep titles, descriptions, pricing, availability, return policies, and shipping details accurate. If you sell on marketplaces, treat each listing as its own search asset. The title, attributes, images, FAQs, and reviews all help determine whether buyers find and trust the product.
Mobile matters too. Google’s mobile first indexing guidance explains that Google primarily uses the mobile version of a site’s content for indexing and ranking. That means your product pages, carts, policy pages, and support flows need to work cleanly on phones.
The old advice was to chase voice search forecasts. The better advice is simpler: answer questions the way buyers actually ask them. If a customer asks how sizing works, when the package arrives, whether returns are free, or how a warranty claim works, your product page and support content should answer plainly.
Here’s a question to get you started in this SEO and content retrofit: If a customer read your terms, FAQ, or product page on a phone while comparing three sellers, would they understand what to do next?
Challenges online marketplace sellers face #7: Returns, refunds, and fulfillment
Online shoppers want a positive experience, but they also want returns and refund policies they can trust.
The NRF and Happy Returns 2025 Retail Returns Landscape estimated that 19.3% of online sales would be returned in 2025. It also found that 82% of consumers consider free returns important when shopping online. Returns are not a side issue. They are part of the buying decision.
You’ve got a few ways to ensure you go about returns, refunds, and fulfillment the right way.
First, you need to have a returns policy that is clear and fair. Don’t make people keep broken or damaged products, and own up when you make a mistake. Work to make things right. You can either replace products or provide a refund.
After that, you need a returns policy that fits the customer experience.
For example, if you made the mistake, don’t charge the customer to return the product. Give them a paid slip for a common carrier. If they’re returning because it isn’t what they wanted, then it’s okay to charge them for this, but you need to be clear about that beforehand. Make your restocking or other fees apparent and tell people how the process works when they contact you about a return.
Finally, you need to get your warehouse in proper order.
If a customer returns an order because it’s late, incorrect, or damaged, that’s on you. Look at your workflow to see where you can mitigate these risks. Introduce warehouse tools that double check order accuracy as your team picks and packs. Audit packaging and filler to ensure it will protect goods in transit. Review your policies to ensure you get boxes to the carrier in time for the proper delivery.
If you don’t have the expertise, capital, or time to manage some of these concerns, then think about outsourcing. Generally, you’re going to see similar costs for outsourcing and self fulfillment actions. The savings come in from reduced error rates, better delivery times, cheaper shipping, and building costs if you rent your warehouse.
After reading my pieces of advice, hopefully you’re now better prepared for tackling your seller related challenges head on.
Now, let me take a second to quickly talk about processes.
As an online seller, there are a ton of recurring processes you complete so your products are bought and those buyers receive their goods. These essential processes are undergone every day.
Considering everyday processes are so important, you should be using dedicated business process management software to help with those endeavors.
Process Street helps you take control of those processes, giving online marketplace sellers a way to document recurring work, run it consistently, and prove the right steps happened.
How Process Street can help you succeed on the online marketplace
Process Street is a Compliance Operations Platform that turns recurring work into documented, automated workflows. Sellers can use Docs to keep procedures, policies, and operating standards governed, Ops to run the work, and built in AI to monitor execution, flag risk, and improve processes over time.
For an online seller, that matters because the same operational problems repeat constantly: access requests, order reviews, product launches, customer support, refund decisions, newsletter production, warehouse checks, and customer journey improvements.
For more information, watch the video below.
Process Street can help with everyday processes and the processes you need to undergo for tackling the aforementioned challenges head on.
For example, in terms of data security, if a staff member requests temporary access to restricted data, use the Privileged Password Management Template to ensure that data leaks don’t occur because access was granted casually or forgotten later.
Click here to get the Privileged Password Management Template.
Meanwhile, newsletters are a great way to increase loyalty from customers. Process Street’s Creating a Newsletter Template will help make sure you’re establishing and sustaining customer loyalty properly with useful content.
Click here to get the Creating a Newsletter Template.
Remember earlier when I said that relooking at the customer journey was crucial? The Customer Journey Map Template makes it easy to refocus on an already established customer base, and make sure their journeys and actions are the ones you want them to take.
Click here to get the Customer Journey Map Template.
For inventory reviews, the Inventory Management Checklist gives your team a structured way to compare stock records with counted stock, investigate discrepancies, and approve adjustments before inaccurate inventory data turns into a stockout.
Click here to get the Inventory Management Checklist.
To boot, there’s also an ecommerce processes template pack so your store can be truly successful, and a logistics management template pack, ensuring your supply chain is perfected.
For other free, ready made templates, check out Process Street’s extensive template library.
With the advice I’ve provided and the free templates courtesy of Process Street, you’re ready for the challenges that present themselves to you as an online seller.