Marketplace Development in 2021

Marketplace development is changing quickly and constantly – much like the entire industry it serves. The year 2020 brought record-breaking numbers for online marketplaces. Marketplace development didn’t just grow in size, but also in sophistication and vendor/customer expectations. The limitations to entry and competition are also growing very rapidly. 

What is a marketplace?

Marketplaces are a subset of eCommerce. But marketplace development projects are very different from most eCommerce projects. In marketplace applications, there are many vendors and the app owner usually behaves as an intermediary between them. The marketplace is a digital version of a traditional marketplace, where people gathered to buy and sell goods and everyone could be either buyer or seller.  Marketplace helps sellers and buyers to find each other, facilitates their transactions, and generates revenue through marketplace fees.

Types of marketplaces:

First of all, if you need to enter this marketplace, you need to select the type of marketplace and define end-users. There are businesses to clients, business to business, and peer-to-peer marketplaces.  Let’s find out more about each marketplace type in more detail. 

Business to clients:

Business to client marketplaces serves small businesses and individuals. In this type of marketplaces, some offer products like Amazon; others offer services like TaskRabbit.

Business to business:

There is also Business to business marketplaces, which means sellers and buyers sell and buy wholesale products. The list of business-to-business marketplaces includes websites like RapNet that sell diamonds and Alibaba.

Peer to peer:

In this type, both buyers and sellers are individuals. One example of peer to peer marketplace is Airbnb that provides apartments and houses for rent. 

What are the benefits of marketplaces?

The main advantages for marketplace business are the following:

• An additional channel on which to advertise and sell your goods or services;
• Marketplaces require lower marketing costs than others;
• More opportunities for international sales;
• Marketplaces are very convenient;
• You can improve brand image and builds client loyalty with marketplace development;
• You can get independent reviews and opinions on your products or services. It will make them more attractive;
• It is easier to find new business partners with the marketplace;
• They work 24/7 with no limits.

Building a Marketplace Platform:

Many of us may want to start our own marketplace or develop a separate service for an existing business. To develop a marketplace website, you will need to select if you should do it from scratch or you want to use a ready-built marketplace website.

Writing code from scratch:

If you have the necessary expertise or access to a team of specialists, then writing code from the scratch is best for you. In this type of marketplace development having access to the code, no third-party software, and licensing are the main benefits. But this approach takes a great time at least three months. Because developing a marketplace platform that deals with all transactions smoothly is no easy task. So this extra time is a major drawback because it is often very essential to develop a marketplace as soon as possible.

Building a marketplace using open-source software:

Using build software will offer you a time advantage compared to developing from scratch. Today all marketplace software has basic functionality features. You can quickly install features to the set. This process will also be a lot cheaper to develop than the previous option. Time is also important here. It will take at least a month before you can launch your marketplace. Also, it’s difficult to find top open-source software that is simple and easy to customize. Updates and maintenance can also be an issue. For example, if a software creator doesn’t give updates on legal requirements for payments, your team must handle it.

 Minimum viable marketplace:

When you launch a new marketplace, you’ll want to first launch a minimum viable product to check your assumptions about your marketplace idea. Minimum viable product is the simplest version of your marketplace that doesn’t necessarily add that many features. It focuses on addressing the main problem you want to solve. Today, you have marketplace platforms that allow you to develop marketplace websites with drag-and-drop tools. In this way, you can easily set up a minimum viable product and test your marketplace. 

What marketplace features should you include?

As I have mentioned earlier your minimum viable product marketplace doesn’t require that many features. You can install them on as you grow. If you develop your own marketplace website, you need to build more features as you grow your website. Many marketplace website builders provide ready-built features.

Simple Login Process:

Both buyers and sellers must be able to create profiles. Their functionalities differ a bit. On the login page, sellers must have a way to write a description about themselves or their businesses and their offers. On the other hand, buyers might require profiles with some basic information about themselves. This login feature is essential for matching your customers’ expectations and keeping their user experience at the top.

Convenient Buyers Page:

Another basic feature for getting the maximum user experience is a simple but yet fully functional buyer’s page. The design of the cart page is essential for users not to waste much time on basic functions. The delivery, details on price, payment options, as well as all special offers and discounts must be easy to reach.

Security:

Security is the main consideration for you as the owner of a marketplace platform. Basically, you’re dealing with your users’ personal and payment information, your marketplace needs to be secure. 

Listings:

Any marketplace development needs listings. Listing is a method for sellers to tell buyers about their offers. Your listings should have to be highly developed. But a simple way to buy and sell services and products is also good.

The Right Payment Gateway:

As we all know that, online transactions are much easier and quicker to make purchases. But there are some security risks too. It is very important to implement a safe and secure payment gateway to your marketplace and offer other payment options as well. 

Search engine:

In the end, buyers need to have a way to look at what sellers are providing. That’s why your marketplace requires some type of search engine that users can use to search for products and services.

How do you scale a marketplace?

Here is some guide to help you grow your marketplace quickly:

• Focus on the side of supply or demand. It is harder for your business. If you can handle the weak point, the strong one will be even more effective;
• If you want to extend your business, it’s very important to find and work on a specific niche, even if your marketplace is horizontal. Offer as many items as possible;
• Work hard on improving transparency, review, and rating systems as well as insurance to build a client’s trust;
• When introducing new features, focus on one at a time;
• Don’t change your strategy too fast, because the results might be just around the corner;
• Define and target the most valuable users first, as they can influence others;
• Build a community around your marketplace. Make events and host meetups;
• Protect the uniqueness of your offering or find it if you don’t have it.

Marketplaces development – challenges for 2021:

While some challenges have been around for pretty much forever, there are also a lot of new trends you should know in order to be truly ready for marketplace development. You should pay special attention to them when you get into marketplace development in 2021.

Content and community are your top priority:

It is very important to provide vendors with all kinds of perks. In a more specific way, it is about providing them more value for their money (and data). One way to do this is by giving them the proper tools to take care of their content. As we all know that, each year the value of engaging SEO-ready content keeps growing. This includes the ability to SEO tools, reviews, and more that make it simple for ambitious vendors to rank higher both in Google SERP and your own internal results.

Data privacy:

Marketplaces are able to target their prospective customers with better ads and content and increasing conversions with the help of data. But this enables them even more responsible for making sure that the confidential data about their vendors and customers are safe. 

Mobile:

The mobile channel is becoming very important day by day with more conversions being made locally. It is done by targeting mobile devices with ads about local vendors. 

To sum up, marketplace development needs both time and resources. But only working with a reliable development team ensures a decent result. That’s why; finding good web developers with relevant tech expertise is the best way to successfully launch a marketplace.