What company do you think of when you hear the word marketplace? Let me guess - was it Amazon? A lot of people default to an Amazon experience when they think of a marketplace, but there are so many different kinds of marketplaces. You have marketplaces for booking, digital goods, professional services, physical goods, resale or recommerce, B2B, the list goes on and on and on.
Even though these marketplaces are all selling different products and delivering them in different ways, at a fundamental level they are all the same.
Let us share an example.
Fundamental Marketplace Functions
Every marketplace, whether is it Uber connecting drivers with riders or Amazon connecting buyers and sellers, has these requirements:
Let’s walk through a few very different marketplaces to show this in action.
Marketplace Functionality is the Same, the Buying Experience is Unique
The job of any marketplace is to facilitate sales between those offering goods or services and those who want those goods or services. In each of these marketplaces, the seller might be called something different - a driver, a developer, a freelancer, a manufacturer - but they have to go through the same marketplace steps. The way the offerings are displayed may also be unique - Uber has the buyers (aka the riders) send out requests that the drivers accept instead of the other way around - but there is still a listing of services.
Where marketplaces can differentiate themselves is on the buying experience and workflow operation. Marketplace operators need to think through questions like: How are buyers going to find your product? How long will it take to ship? How is your good or service delivered? Are you going to offer discounts?
Should you Build or Buy Marketplace Technology?
Because of this shared base functionality across all marketplaces, there is no need to build a custom marketplace platform. Necessary marketplace functions are available out of the box in multi-vendor marketplace platforms, enabling marketplace operators to focus on their differentiators instead of the underlying technology.
Think of it like this: if you wanted to build a new ecommerce store, you wouldn’t start building from scratch. You would use an ecommerce platform like Shopify or BigCommerce to quickly validate your business and focus on curating products.
Some marketplaces may be so nuanced that they actually do require customization. In these cases, using a multi-vendor marketplace platform as a base will allow the marketplace to remain agile and benefit from much of the needed functionality without having to build their entire marketplace custom. Marketplace intellectual property (IP) should be reserved for buyer experience and workflow operations, not on the backend technology.
The Future of Marketplaces
With multi-vendor marketplace platforms offering a quick approach to launching online marketplaces, the unbundling of large marketplaces will continue and more marketplaces will enter the fold.
Retailers, brands, and B2B businesses will build their own marketplaces to take advantage of post-purchase monetization and cross-selling opportunities with complementary products. Soon, every company will have a marketplace component.
Nautical Commerce’s multi-vendor marketplace platform can host any type of marketplace model. If you’d like to learn more about launching or scaling your online marketplace with Nautical, schedule a call with one of our marketplace experts!