We are in the middle of the fourth industrial revolution and it is vital for products or services should be online and easily accessible to consumers across the globe! Consumers across the globe purchased $2.86 trillion on the web in 2018, a huge increase from $2.43 trillion in 2017.
As a retailer of different products and brands, an effective way for you to get a piece of the online market is by using a marketplace website. They account for 50% of global online sales.
They serve as an intermediary between customers and companies. They may offer products in the B2B (Business to Business) and B2C (Business to consumer) sectors. Examples of well-known marketplaces are Amazon and eBay.
As a marketplace website owner, you can choose a revenue stream that works best for your business, vendors and sellers. However, it is important to define the flow between the vendor and the client. You also need to define how are payments made and how commissions will be structured. PayPal and Stripe are two very common payment methods.
The four main types of marketplaces are:
- Vertical marketplaces – offer products of the same type from different vendors.
- Horizontal marketplaces – offer different products that have similar characteristics.
- Global marketplaces – have no limitations and sell all kinds of products from different suppliers.
- Hybrid marketplaces – offer their own products as well as products from other companies while providing a platform for participants to complete transactions.
It is also advised that the marketplace be specific category and build up clients before expanding in other categories. You want to be a market leader, start smaller, then build out.
There are various advantages to a marketplace website, some of which include;
Value proposition
Marketplaces give companies a wonderful opportunity to handle their supply and sales that doesn’t require any initial investment in a physical store.
A scalable business model
A marketplace requires less financial risk than an ecommerce store as it doesn’t need to invest in inventory, and they are likely to expand quickly.
Analysis
Marketplace owners can track their sales with accurate metrics. For example, an owner can see which products and services are in demand and know which vendors are most preferred.
Not sure where to get started when it comes to building your marketplace? This is something best left to the professionals! Our team of developers have extensive website experience and have successfully built 150 websites for clients across the globe in the last six months alone, several of which have been marketplace websites.
View one of our latest Marketplace websites here to see what all the fuss is about – https://www.nuovashowroom.com