Travel & Tourism

What Is an Online Marketplace?

An online marketplace is an eCommerce portal where multiple vendors come on a common portal to sell products or services. This eCommerce model is also called the multi-vendor eCommerce website.

Different vendors/sellers register on the multi-vendor site where they upload, display, and sell their products or services. The sellers pay a commission to the marketplace owner for using the readymade platform and its other services which may include customer support, logistics, etc. The portal and its policies, transactions, etc. are managed by the marketplace admin/operator. 

What Type Of Online Marketplace Platform Are You Aiming At?

The very first thing you need to do is to decide what kind of buy and sell platform you want. Is it supposed to be an online marketplace for sellers? A B2B, B2C, or P2P marketplace platform development? Are you wondering how to build a marketplace app, that is a cross-platform solution?

Before you get to the development process, we recommend you create the business plan for your online marketplace platform which would answer the following questions?

What industry should it work for? Is it a unique product or are there competitors already?

Whom is it created for? What does my project have to offer? How will it solve my customer’s pains?

What marketing + distribution techniques will work the best to create an online marketplace that would be on everyone's lips?

How can I monetize the project? What are the possible ways to earn money on it?

If you’re targeting to build a shared economy app or B2B/B2C marketplace app, you might find the detailed steps to go in the article on launching a scalable online marketplace platform.

How To Build A Marketplace: 4 Stages Of The Development Process?

So, your idea seems to have real potential. It solves existing problems, there is a market for it, and even the possibility of earning money. However, don’t hurry to approach investors yet. You first have to figure out how to launch a marketplace website.

1. Build a marketplace prototype and test the idea

First, you need to get the idea out of your head and make it visual. This can be done with a prototype, which is a sketch or a simplified model, of what you are going to build.

Here’s a small tip: a prototype along with technical requirements will be useful when you start developing your product. So, it sometimes makes sense to hire a professional to create an online marketplace prototype of high-quality. However, you can also do this yourself. If you decide to do it by yourself, read our extensive guide on prototyping. It explains everything step-by-step so that you can successfully build your own prototype, even if you have no relevant background.

The prototype is the best way to present an idea to a co-founder or first employee, generate interest from your first users, and attract early investments.

2. Prepare the project documentation

Though this may seem to be a monotonous task, creating detailed project documentation will save you plenty of time and money in the marketplace website development process. It doesn’t matter if you hire in-house developers or a dedicated team - the documentation will be a clear roadmap for them.

This stage helps ensure that everyone correctly understands the goal and functionality of the product they build.

3. Build a marketplace website MVP

After preparing the prototype and project documentation, you are now ready to start developing the product, or the minimum viable product, to be exact.

A minimum viable product, or the MVP, is a product with just enough features to attract early users. The main idea behind the MVP is to get the application into the hands of the target audience as soon as possible. After releasing the MVP, you will rely on user feedback and must be ready to make steady improvements.

Sometimes the MVP reveals a sad truth – that the assumptions you made during the market analysis are false, and the idea wasn’t as brilliant as it first appeared. You now have a chance to change the direction slightly and adjust the idea to meet the real needs of the market - or give up. In the latter case, early failure means cheap failure.

4. Grow your online marketplace user base

The dream scenario for each small business is that, upon releasing a marketplace app, you immediately gather thousands of users, both suppliers, and customers. Unfortunately, you can’t rely on such a happy coincidence. That’s why you should start growing your user base long before the online marketplace is built. This is how you can attract your most loyal customers.

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• This site is never involved in any transaction, and does not handle payments, shipping, guarantee transactions, provide escrow services, or offer "buyer protection" or "seller certification"