What Every Brand Needs to Know About 3P Marketplace Solutions in 2025

In 2025, the way brands used to sell on 3P marketplaces has transformed and a prominent shift from 1P to 3P has been observed. Statista reports that In 2024, over 61% of all product sales on Amazon came from third-party sellers, not Amazon itself. Not only on Amazon, other marketplaces are also experiencing the similar model shift. This clearly indicates that the brands find this model more profitable and reliable compared to the 1P model. 

But, the point to remember is that managing a 3P brand requires a lot of expertise, agility, and time and expert-driven 3P marketplace solutions because the competition is getting fierce. So, I have put my 10+ years of experience in this 3P marketplace management guide to acknowledge you with what worked for me. From the basics like what it is to advanced concepts including proven strategies to boost sales, I have mentioned everything in this guide. So let’s get into this and explore together. 

What Is 3P Marketplace Management and 1P? 

Marketplaces like Amazon marketplace and Walmart marketplace have two primary selling models; First Party (1P) and Third Party (3P). In the first party model, you sell the products directly to the retailer. Depending on the demand, the retailer places the order of specific products in a specific quantity at specific rates and you have to fulfill the order. Then, the retailer owns the inventory, sets the pricing and sells the inventory to the customers. Concisely, in this selling model, you’re a supplier to Amazon. 

Contrarily, in the 3P model, you directly sell your inventory to the consumers on the marketplace with a Seller Central account. You hold the responsibility to manage the inventory, set pricing, and fulfill the orders. If the case is with Amazon, the order fulfillment can be done via two methods; Fulfilled by Amazon (FBA) where Amazon deals with your logistics or Fulfilled by Merchandise (FBM) in which you handle shipping yourself. 

1.Higher Profit Margins 

In the 1P model, brands sell their products to the retailers at wholesale prices i.e. 30% to 50% lower than the retail prices. Once the retailer owns the inventory, the brand has little to no influence left over how it’s priced, promoted, or discounted. Additionally, businesses pursuing this model also deals with: 

• Trade deductions and chargebacks
• Delayed payments and inconsistent purchase orders
• Unilateral pricing decisions that can erode brand value

On the other hand, in the 3P model, brands can sell their product at retail prices. All they need to pay is for the  marketplace fees i.e. typically 10% to 20%. This margin difference makes the 3P model more profitable. 

2. Access to Real Time Data

In my opinion, the most underappreciated perk that 3P model offers is the access to real time data. As a third-party seller, you gain access to: 

• Sales performance by SKU
• Advertising metrics (ACoS, ROAS, TACoS)
• Keyword-level traffic and conversion rates
• Customer behavior insights (return reasons, reviews, etc.)

With the help of these insights, you can make informed decisions, optimize the listings, test new products, or make adjustments in your campaign. In the 1P model, the access to real time data is limited, which makes scaling challenging. 

3. Full Control Over Brand Execution

“Your Brand, Your Rules” 

That’s what I believe in and a majority of business owners also think the same. But, this control is only possible with the 3P model. You control:

• Listing content (titles, images, A+ content, bullets)
• Advertising strategies and keyword targeting
• Inventory planning and restocking
• Pricing and promotional calendar
• Customer service and return policies (in FBM)

This level of control helps you maintain brand consistency, protect premium positioning, enforce MAP policies, and respond quickly to the market feedback.

How to Manage Fulfillment and Inventory Efficiently in 3P Marketplaces?

In the 3P model, the orders fulfillment and inventory management is the cornerstone. A miss can step down your brand and managing it efficiently can pump up your overall revenue. Whether it’s Amazon, eBay, Walmart, Noon, or Zalando, you need to stay in-stock, avoid overstocking, consistent delivery on time, and balance your inventory across all channels. 

All these factors directly impact your brand’s revenue, visibility, and customer satisfaction. Missed fulfillment SLAs, frequent stockouts, or excess inventory not only eat into profits but also damage marketplace rankings, affect Buy Box eligibility (where applicable), and hurt your long-term credibility. Here’s how to get fulfillment and inventory right.

Should You Use Marketplace Fulfillment (e.g., FBA, WFS) or 3PLs?

One of the most important decisions brands must make in a 3P model is whether to outsource fulfillment to the marketplace itself or rely on a third-party logistics provider (3PL).

Marketplace Fulfillment (FBA, WFS, etc.):

• Offers fast shipping, trusted delivery, and Prime/Pro/Plus badge eligibility
• Hands off storage, shipping, and customer service
• Charges platform-specific fulfillment and storage fees
• Limited flexibility in bundling, branded packaging, and cross-channel orders

3PL Fulfillment:

• Offers more control over packaging, branding, and multi-channel fulfillment
• Can be more cost-effective for larger or non-standard SKUs
• Requires integration with marketplaces and proactive inventory syncing
• Ideal for DTC + Marketplace hybrid models

I would suggest going ahead with a marketplace fulfillment option if fast delivery is non-negotiable. But, if you need branded packaging, bundling, and fulfillment across multiple from a central location, consider opting for 3PL fulfillment. There’s also another way where you can choose a hybrid approach. The hybrid approach allows you to use FBA/WFS for fast-moving SKUs and 3PLs for niche items, international orders, or overflow inventory. 

Which Tools and KPIs Help Monitor Inventory Turnover and Sell-through?

The following list of tools and KPIs will help you monitor inventory turnover and sell-through:

Tools: 

• Inventory Planner
• Skubana
• SoStocked
• Netstock
• Crisp
• Cin7
• Relex Solutions
• Katana MRP
• DEAR Systems
• SellerCloud
• Amazon Restock Inventory Report
• Walmart Inventory Insights Dashboard

Key Inventory KPIs

• Sell-Through Rate (STR)
• Inventory Turnover Ratio
• Days of Inventory (DOI)
• Stockout Frequency
• Backorder Rate
• Excess Inventory Value
• Gross Margin Return on Inventory Investment (GMROI)
• Aging Inventory Percentage
• Fill Rate
• Lead Time Variance

How Can You Avoid Overstock, Stockouts, and Storage Fees Across Channels?

The following strategies have helped me avoid the issues of overstocking and stockouts: 

1. I use historical sales data, market trends, and customer behavior to predict future demand accurately.
2. I use softwares like Inventory Planner and SoStocked that automates inventory tracking, provides real-time visibility into stock levels, and sends alerts for low stock.
3. I like to keep my warehouses organized by implementing FiFo (First In, First Out) systems. 

How Should Brands Run Advertising Campaigns Across 3P Marketplaces for Profitable Growth?

Gone are the times when brands used to generate enough profits just from organic visibility. According to Helium 10, Amazon alone has nearly 2 million active sellers so the competition to secure the top spot is really strong. Platforms also favor pay-to-play visibility but not every advertisement campaign rewards you. Brands need to be strategic while running ads on marketplaces instead of just randomly pressing the “launch” button. 

What Ad Types and Promotional Formats are Available Across Marketplaces?

Here are the most common formats across leading platforms:

Marketplaces	Ad Types and Promotions
Amazon	Sponsored Products, Sponsored Brands, Sponsored Display, Coupons, Deals
Walmart Marketplace	Sponsored Products, Search In-Grid Ads, Buy Box Banners, Promotions
Target+	Roundel media placements, Sponsored Display, Target Circle offers
eBay	Promoted Listings Standard, Advanced Ads (CPC), Coupons
Instacart / Kroger / CPG Retailers	Sponsored Products, Boosted Placement, Offline Attribution Ads
Shopify Marketplace / DTC Hybrid	Meta Ads, Google Shopping, Klaviyo Email, Onsite Banners

How Do You Structure Paid Campaigns by Funnel Stage?

After staying in the 3PL marketplaces management business for over a decade, I have concluded that playing a blind game doesn’t reward at all. You need to plan the campaigns strategically by using the real market insights and your consumers’ behavior. I always enforce on mapping your campaign based on the customers’ journey. How? Here’s basic campaign structuring based on the customers’ journey: 

Top of Funnel (TOFU) – Awareness

• Ad Goal: Reach new shoppers unfamiliar with your brand
• Platforms: Sponsored Display (retargeting), Display Networks, Social Ads
• Tactics: Competitor targeting, category targeting, audience lookalikes

Middle of Funnel (MOFU) – Consideration

• Ad Goal: Re-engage warm leads, reinforce value props
• Platforms: Sponsored Brands, Retargeting Ads, Video Ads
• Tactics: Branded search terms, product comparison, bundles

Bottom of Funnel (BOFU) – Conversion

• Ad Goal: Convert high-intent shoppers
• Platforms: Sponsored Products, CPC Ads, Buy Box Bidding
• Tactics: Exact match keywords, branded defense, promotional overlays

How Do You Manage ROAS, ACoS, or CAC Across Different Platforms?

The benchmarks to analyze the effectiveness of the ad campaigns are platform-specific such as: 

• Amazon: Focus on ACoS (Ad Cost of Sale) and TACoS (Total ACoS)
• Walmart: Optimize for ROAS and On-Site Conversion Rate
• eBay: Track ad-attributed sales vs. non-promoted sales growth
• Target+ & Roundel: Use CPM and view-through attribution
• DTC (Meta/Google): Measure CAC, ROAS, and blended CPA

How Do You Optimize Listings and Brand Pages to Maximize Sales Conversion?

Heard that “first impression is the last impression”? 

This rule is actually true when it comes to consumers making buying decisions. And in the 3P model, your product content is the first thing your consumer interacts with. It’s often your only chance to communicate value before they scroll to a competitor. 

Whether you are on Amazon, eBay or any regional marketplace, high-converting listings make all the difference as it directly impacts the click-through rate (CTR) that influences the brand’s visibility and ultimately your revenue. 

What are the Essential Elements of a High-Converting Product Listing?

However, the formats of product listings vary from platform to platform but the core structure of a high-converting product listing remains the same. I have cracked the code to write high-converting listings and here it is: 

Element	Best Practices
Title	Include brand, main keyword, size/color/variant, and key feature. Keep it readable.
Main Image	High-resolution, clean background, product centered, mobile-friendly.
Gallery Images	Show product in use, close-ups, size scale, lifestyle context, and USPs.
Bullet Points/ Feature List	Call out benefits, not just specs. Use consistent formatting for skimmability.
Product Description	Longer-form copy that tells the story, explains use cases, and builds emotional value.
Ratings and Reviews	Highlight social proof. Quantity, quality, and relevance all matter.
FAQs/ Q&A	Answer common objections or buyer hesitations.

How Do You Align Product Content with Platform SEO Requirements?

Marketplace SEO is mostly misinterpreted with web SEO but the fact is that they both are unique. Each platform has its own algorithm and ranking priorities, but the general rule is: 

Here is what you need to consider: 

SEO Area	What to Optimize	Why It Matters
Keywords	Use high-volume, high-relevance search terms in titles, bullets, and backend fields	Determines discoverability in search results
CTR Metrics	Optimize main image and title for scroll-stopping clarity	Click-through rate influences keyword ranking
Conversion Rate	Ensure listings convert after being found	High CVR helps maintain organic rank
Content Freshness	Regularly update listings with new reviews, visuals, and answers	Active listings are prioritized in some marketplaces
Review Integration	Encourage positive reviews and handle negative ones	Active listings are prioritized in some marketplaces

Platform SEO Tip Sheet:

• Amazon: Indexes title, bullets, backend keywords; prioritizes sales velocity and CTR
• Walmart: Keyword presence in title is critical; fewer characters allowed; trust and price matter
• eBay: Title and item specifics matter most; seller reputation influences visibility
• Target+: Focuses more on content compliance and internal merchandising than on keyword match alone

How Can You Monitor Sales and Performance to Make Data-Driven Decisions?

“Data is the new oil” and it’s damn true. You can simply turn out your data into revenue generation resources. How? By monitoring and interpreting it strategically. For 3P marketing solutions that bring results to the table, you need to think beyond just launching SKUs. A deep insight into what’s working, what’s not working and then doing tweaks accordingly makes all the difference. The point to note is that each platform has its own reporting structure, latency, and attribution logic, but what’s common in all is:

• Knowing what metrics matter
• Consolidating insights across marketplaces for clear decision-making

Now in this section I’m spilling all the secrets that high-performing 3P brands adapt to generate staggering revenues. 

What KPIs Matter Most for 3P Performance?

These are the core metrics every 3P brand should monitor across platforms and fulfillment models:

KPIs	What It Tells You
Sell-Through Rate (STR)	How fast inventory is selling vs. stock on hand
Conversion Rate (CR)	How many product page visits convert into orders
Return Rate	% of units returned; highlights product or CX issues
Buy Box Ownership (if applicable)	Share of sales vs. competitors on the same listing
Sessions & Page Views	Traffic volume and visibility health
TACoS / ACoS	Advertising efficiency metrics, especially for Amazon and Walmart
Out-of-Stock Rate	% of time a product is unavailable for sale
Contribution Margin per SKU	Profitability after ads, fees, and fulfillment costs
Geographic Sales Split	Sales performance by region or fulfillment node
Ad-Attributed Sales vs Organic	Revenue contribution breakdown (to manage dependence on paid media)

What Reporting Tools Can Consolidate Data Across Marketplaces?

Here are some of the best tools to consolidate data:

1. Crisp: Real-time sales + inventory analytics across retail and marketplace platforms
2. Domo / Looker Studio: Custom dashboards using data piped from Seller APIs
3. Helium 10 Profits + Keyword Tracker: Amazon-specific but powerful for keyword + revenue monitoring
4. Intentwise Analytics Cloud: Combines Amazon ad, retail, and DSP data
5. DataHawk: Multi-marketplace reporting with financial and ad performance views
6. Pacvue Commerce: Combines media, sales, and operations across retail media channels
7. ChannelAdvisor / Feedonomics: Ecomm data aggregation + performance sync for global brands
8. Supermetrics: Pulls marketplace, ad, and analytics data into spreadsheets or Looker
9. Snowflake / BigQuery: Data warehousing for brands using internal BI teams
10. Amazon SP-API / Walmart API: Direct API access for custom dashboards

How Do You Expand Your 3P Brand Across Borders and Marketplaces?

You’ve established your brand in your region and are doing pretty well but what’s next? Definitely, taking your business and then revenue to the next level. To do so, you need to introduce and then expand your business across borders and marketplaces. Now, this section will acknowledge you how you can do so: 

How Do You Choose Which Marketplaces to Expand into (US, EU, MENA, Asia)?

The foremost step that’s going to impact everything is the selection of a marketplace. Before directly jumping and investing your all in a random marketplace, BE STRATEGIC. Here’s the exact and brief roadmap: 

Step 1: Analyze market demand

Step 2: Select the platform

Step 3: Study competitors pricing

Step 4: Set the pricing

Step 5: Comply with the region-specific tax and regulations 

How Do You Localize Listings and Maintain Brand Consistency Globally?

When expanding your business to international markets it’s necessary to align your listings to their local norms. But while doing so, it’s important to not compromise your brand’s identity. You need to equilibrate the balance between listings localization and brand consistency.

• Go beyond direct translation. Use culturally relevant phrases, images, and value propositions that resonate with local buyers.
• Adjust lifestyle imagery to reflect regional norms (e.g., climate, fashion, cultural context).
• Include local units of measurement and currencies.
• Ensure the listing’s content complies with the regulations.  

How Should Brands Strategically Manage and Scale Their 3P Operations?

Once your business reaches the growth plateau, scaling is the way to experience the hike. However, managing and scaling the 3P operations requires a lot of vigilance. One mistake of yours can hurt your growth and set your business back. So in this section you’ll find which 3P marketplace solutions your business needs to generate revenue. 

Should You Build an Internal Team, Use an Agency, or Partner With an Exclusive Seller?

Expanding resources is the first thing you need to do when you plan to scale your business. Now, there are three options: 

1. Building an internal team 
2. Using an agency 
3. Partnering with an exclusive seller 

Each comes with its pros and cons. Here I’ve enlisted them to help you decide what aligns best with your needs. 

1. In-House Team

Pros: Full control over strategy, data, and brand experience.

Cons: High fixed cost, longer ramp-up time, and requires multi-functional expertise (ads, content, operations, compliance).

2. Marketplace Agency 

Pros: Flexible contracts, platform expertise, faster speed to market.

Cons: May lack long-term brand ownership or incentive alignment.

3. Exclusive 3P Seller (Managed Retail Partner)

Pros: No overhead, inventory risk taken by partner, aligned incentives for sell-through, rapid execution.

Cons: Requires clear agreement on brand control, pricing, and marketing.

How Do You Ensure Pricing, Catalog, and Content Consistency at Scale?

Inconsistent listings, broken variation structures, and price violations can damage brand equity and consumer trust.

• Centralized Catalog Management: Use PIM systems or marketplace integration platforms (like ChannelAdvisor, Salsify, or Zentail) to manage product data across channels.
• MAP Enforcement Tools: Use tools like Wiser or TrackStreet to monitor pricing as it allows to protect value perception.
• Listing Hygiene Checks: Conduct monthly audits of key listings to catch outdated images, mismatched specs, or poor customer Q&A management.
• Approval Workflows: Set clear internal or partner-side processes before any changes to copy, pricing, or imagery go live.

Bottom Line 

All in all, despite the fact that the competition has surged, brands who are clear on their long-term goals and know how to execute them rightly can still make huge profits (I’m generating the same). The above guide includes all the 3P marketplace solutions; from what 3P is to how to scale, I have discussed all. But, if you are a 3P business owner who wants to keep their eyes on production only, outsourcing your 3P marketplace management is still an option. 

If you opt for this, production will be your only concern. 3P marketplace management companies deal with everything including managing the inventory to shipping and then handling the customers queries as well. So, if you are in search of such an option, Prime Retail Solution has been doing this for 3P businesses for so long. Want to know how me and my team can make 3P marketplace management a breeze for you? Book a free consultation call right now and let us show you how we can help you not only manage but scale your business. 

FAQs 

Q1: Is 3P more profitable than 1P in 2025?

Yes. 3P sellers keep retail margins, avoid chargebacks, and gain full pricing control. Contrarily, in 1P Amazon dictates the terms and decides the profit margin. 

Q2. What tools help manage 3P inventory across channels?

1. SoStocked
2. Inventory Planner
3. ChannelAdvisor
4. Amazon Restock Reports

Q3. FBA vs. 3PL: Which is better for 3P brands?

Use FBA for fast-moving SKUs needing Prime eligibility. Use 3PLs for branded packaging, bundling, and multi-channel fulfillment. Many brands use both.

Q4. How can I reduce stockouts and overstock in 3P?

Use demand forecasting tools, set alerts for low stock, track lead time variance, and bundle slow movers to clear excess.

Q5. What’s the best way to scale a 3P brand across marketplaces?

Start with high-demand regions, localize listings (not just translate), use MAP tools to protect pricing, and centralize your catalog management.