A marketplace is a place where different vendors can come together in order to sell their wares or services to a focused customer base. The primary function of a marketplace owner is to attract the right buyers and the right vendors to effectively drive sales through a unique multi-vendor online marketplace- vendors get a central location to benefit from lower cost advertising, enhanced product visibility, increased customer loyalty, and enhanced sales revenue. By combining all the elements of the business, a marketplace provides an environment for sellers and buyers that can be controlled by a singular decision maker. Sellers who are new to e-commerce or small business marketing may find it difficult to navigate the process of creating a marketplace. However, for experienced professionals and those with existing online businesses, finding the right location is easy. Marketplace software makes the entire process of setting up and maintaining a marketplace smoother by automating tasks that used to require more time and attention.
The first step in setting up a marketplace is defining your market. Research potential markets online and research your competitors. Take notes on what features you’d like to see in your marketplace, like services like escrow and reporting, as well as how you’d like to receive payments from your vendors. Remember that the services offered by your vendors will impact your bottom line and they should be considered when formulating your marketplace.
In addition to potential markets, consider your industry and which online marketplaces would be most appropriate for your type of business. Service categories include finance, insurance, banking, and legal services, but there are many other categories of service providers that would benefit from your marketplace. Freight management and inventory management are ideal categories because they will directly impact your service sales. Consider what services you currently offer or would like to offer in online stores and remember to include them in your research.
Once you’ve determined your service and product categories, the next step in setting up your marketplace consists of choosing the most appropriate online stores for your category. If your product or service offers a high level of convenience, it may be best to start out with an online store that is very similar to an online bank or other financial institution. This is known as offering a “bank-like” experience for your customers and will give you a leg up in terms of market share before you’ve even begun building your own store.
When selecting which online stores you will run your marketplace on, take into account factors such as compatibility and SEO functionality. Some marketplace platforms offer both free and paid services that are compatible with a number of different formats, while others are limited to specific formats. As your business begins to grow, it’s likely that you’ll want to add other types of marketplaces as well, but if you’re focusing initially on just one type of storefront, it can often be most convenient to stick with one of the free or paid platforms until your company has grown quite large. Both free and paid marketplaces have the potential to expand quite rapidly, and by focusing initially on just one, you can get a feel for whether or not the service is right for you.
The final step in setting up your own marketplace involves choosing a marketplace hosting company. It is possible for many webmasters to operate their own marketplace independently from a third party. For example, many website builder tools allow website owners to manage their own websites, and marketplace hosting companies typically provide a backend interface to simplify the process. However, if you are planning to run your own marketplace from scratch, a backend service can simplify the process greatly. These services also usually offer technical support should you encounter any problems. Finding a reputable and reliable host is extremely important, because your online store’s functionality could depend on the stability of the server it’s hosted on.
