5 Tips to Successfully Set-up Your Online Marketplace
by Jase August 16, 2018
5 Tips to Successfully Set-up Your Online Marketplace

Building and growing an online marketplace is no easy task. We’ve put together 5 tips and considerations to help you grow a sustainable and profitable marketplace.

Create a robust platform

A house is only as strong as its foundation and this is true of a marketplace and the platform on which they’re built. Here are a couple considerations to help you get started:

- Buyers need to be able to search for products, easily. Read and write reviews. Plus, payments should be a breeze.

- Sellers are concerned with ease of adding their products, inventory management, and ability to be found. - Security and privacy — Never have these two words been more important. Any platform you build should be secure, customers’ personal information protected, and vendors limited to how much data they can mine from your users. - Scalability and performance — If Amazon’s store can go down on Amazon Prime day, you should have performance as a key requirement for your marketplace. On the biggest shopping days of the year, will your servers scale? Make sure your platform is fast. - Payments — How will buyers pay for their transaction, how (and when) will sellers be paid? What about refund policy? Your marketplace needs to have the backend systems in place to manage the complexities of payments. Pro tip: launch only in USD because working with multiple currencies is a big challenge.

It’s easier to plan for and build a platform that has everything you need from the beginning than to make drastic changes later on and disrupt the activity in your marketplace. Make sure your marketplace is built to your business requirements. Your best bet — Own your marketplace. Hire an outside team, or your own team to build and manage your marketplace. The last thing you want is a third party vendor closing down, or worse, changing the terms and leaving you high and dry.

Sellers first

blog marketplace 1

When you first open your marketplace to the public, it’s easy to get carried away and place all your marketing focus on buyer acquisition. While at some point, you will need to pivot and market to buyers, it’s important to focus on building a solid base of quality and trusted sellers. Once they get up and running, they can contribute to your marketing efforts by becoming advocates of your marketplace.

Vet and screen your sellers well, and focus on the ones who share your ecosystem’s vision and values. This way when the buyers do start to visit, they’ll want to stay because of the quality of the products being sold.

Consider Apple’s App Store. Imagine if it first launched and there were no apps? Users would quickly see there’s nothing of value and leave. Apple’s approach was to focus on the number and quality of Apps it had. Even today, they focus on App sellers and how much money they make with the App Store.

Curation, curation, curation

blog marketplace 2

Never underestimate the power of content, especially content that is in the right place, at the right time. Anything can be bought and sold online, it’s important to offer some sort of customer care to make your potential buyers feel that as an online marketplace, you get and support them.

There’s no better way to do this than with content curation. And it doesn’t have to be as daunting as putting together something like Amazon Recommendations if you’re just starting out.

Enable Customer Ratings in your platform, and showcase all the products that have the highest ratings. This would allow you to reward your best sellers.

There’s a reason Spotify is dominating the music industry — It’s their amazing playlist and song curation. People are overwhelmed by choice, if you make it easy for them to shop for products they love, they’ll keep coming back.

Leverage your partners and existing community

blog marketplace 3

Regardless of how niche or how broad your marketplace is, chances are that there are some existing partners, affiliates, and communities that you can tap into to help spread the word. Don’t be shy to reach out to existing user groups on Facebook and other sites, and let them know about your marketplace.

Offer special discounts, product placements, or other incentives to get them in the door. Once they’re on your platform, give them something for free in exchange for their email address. It will make it easier to build a list for remarketing and email campaigns. There’s a good reason most commerce sites ask you for email!

Reach out to other like-minded online communities who already have a large membership and offer to partner with them. Offer them a free storefront on your budding marketplace, in exchange for cross promotion or exclusivity.

Your marketplace is a community 

blog marketplace 4

It’s important to give your users on both ends of the spectrum a place where they can virtually “hang out” outside of buying and selling. Nurture a community within your marketplace by creating a content strategy that helps foster their success and collaboration. The more relevant it is, the more shares you’ll get and the more engagement you’ll get from your community.

Many marketplaces have areas for both sellers and buyers to discuss. Sellers can discuss with your product team about improvements to the platform or other vendors on tips and tricks.

Whereas buyers would find value discussing the products you sell, how they use them, and what other products/categories they’d like to see. Amazon owns IMDB, Goodreads, GameSparks and a bunch of other content/community sites. The discussions and rituals on how people shop and use their products are almost as important to buyers as the purchase themselves.

Thoughts

Building an online marketplace is a lot of work. Because you’re managing relationships and needs of both buyers and sellers the amount of work and complexity you have to deal with is exponentially increased. By properly spec’ing your marketplace, working for both buyers and sellers, you’re setting yourself up for success.

Looking for more insights on how to create and grow your marketplace, check out our free eBook ‘Building an Online Marketplace

Ready to transform your business?