The year 2021 was the peak of the development of online shopping and delivery, due to which many sites were transformed into online platforms for sales. The popularity of such sites is growing, so business representatives are more often asked: how to build a marketplace app?
Marketplace — what is it and why?
The marketplace does not simply serve as an online store with online payment and delivery capabilities but also helps to link many suppliers and buyers. Simply put, it is a marketplace on the Internet with its own characteristics and rules. Why build a marketplace app? It’s an attractive business idea because of the following possibilities:
- Increased profits as a result of increased customer flow;
- Because of the variety of products and services, a large audience is reached;
- Several options for monetization;
- Savings on retail and warehouse space rentals;
- Quick resolution of disputes between seller and buyer due to strict regulatory framework;
- Increased trading opportunities for the company, as not only goods and services can be exchanged on marketplaces, but also advertisements.
The above is only a small part of the advantages of online marketplaces. It is not for nothing that so many people have recently appeared who want to create their own marketplace.
Build a marketplace app, where do you start?
Setting goals, objectives, and analytics
This stage includes:
- Determining what the product will be, what consumer problems it will solve, its main idea, and features.
- Deciding whether it will be products or services, and defining the niche. To do this, you can study the frequency of search queries using SEO tools.
- Analysis of the target audience. It is important to consider that the marketplace has two categories of target audience: sellers and buyers. You not only need to find out who is part of your target audience but also conduct research, and surveys, to understand what kind of product they need.
- Analysis of competitors: who they are, their chips — which ones to borrow, and which can be implemented better.
- An analysis of ways to monetize the app and choose the most appropriate one.
You can do the analysis yourself or hire an experienced business analyst.
Identify the participants in the future project and the type of relationship between them. According to the classics, there are three options, but we’ll give you one more bonus:
- B2B (business-to-business) marketplaces, where companies buy goods and equipment from manufacturers. Examples: Alibaba, madeinchina.com.
- B2C (business-to-consumer) marketplaces, in which businesses are suppliers and individuals are buyers. Examples: booking.com, AliExpress.
- C2C (customer-to-customer) marketplaces are where users exchange services: they order today and can fulfill them tomorrow. Examples: BlaBlaCar, Airbnb.
- Bonus: C2B (customer-to-business) — marketplaces in the format of freelance exchanges, where companies look for contractors for business tasks.
Designing and forming a clear product image
Important decisions are made in this step: how the app will look, and what happens when clicks or section selections are made. It is important to remember that the design of the project should be unobtrusive, simple, and understandable for the user. And it is desirable to have minimal functionality:
- For buyers: an elaborate filter and search system, easy registration; and browsing information about sellers.
- For sellers: easy creation of new offers of goods and services, the system of management of private and public information.
- For everyone: customer support service, live chats, rating and feedback system, profiles for buyers and sellers (2 types of interface), convenient payment system.
- At the end of all the decisions, you need to prepare design documentation, which will set out all the principles, so that developers know in what direction to go.
Design and development of the marketplace app
Once a clear image of the product is ready, it’s time to move on to creating an MVP to build a marketplace app in the future. The MVP carries the idea of the product for its subsequent refinement.
The design needs to be created thoughtfully, in detail, and functionally. But there are two approaches to developing a marketplace. Each of them is convenient, but you can choose depending on your goals.
You can save money and use a ready-made platform or templates, but this is not the most reliable option. But it is easier to implement. Or build a marketplace app from scratch. Yes, it’s more expensive and takes a bit longer, but it gives a way of translating unique ideas. There is more freedom here. To get help at all stages of building a marketplace app, you will have to involve people from outside. The following specialists will be needed:
- A UX/UI designer will help ensure that the user has the best possible experience with the marketplace. It is important to focus not only on beauty but also on usability.
- Front-end and back-end specialists, or full-stack, for software development. Here, the duration depends on the required functionality, its complexity, and the size of the team.
- A competent tester will be needed to fix bugs and guarantee the quality of the product. Without a tester, you can’t build a marketplace app. Some business owners may think it’s easier to do it themselves. But an outside expert will guarantee quality and save time in building a marketplace app.
The cost of this step is easy to calculate by the number of hours since many developers have a fixed rate per hour. Development is a costly but important step; the main thing is to choose the right specialists. You can do this in several ways:
- Search for freelancers on special exchanges. It is relatively cheaper and easier to find such workers, but such specialists do not go into business processes; they need a clear task. Some people find this method unreliable, plus the work of freelancers must be constantly checked.
- Creating your own development team from scratch is the most expensive and time-consuming method, but it allows you to be in close contact with your developers and make changes at any time you want. Another issue is the difficulty of hiring and selecting really suitable employees. This includes increased tax burdens.
- Turning to a development studio. The best solution, regarding cost and speed, is to build a marketplace app. The only difficulty is the right studio, which will not only provide high-quality development but also competent project management represented by an adequate project manager.
- Keep in mind that you will need the developers’ services not only once because you will need to make updates and upgrades to ensure a stable service.
Developing an IT product is always expensive and time-consuming, and you should be ready to invest a lot of money. When planning your budget, leave a reserve for future revisions and a marketing campaign. Having invested all the money in the first release, you run the risk of not having funds for the next ones. And since the app is new, you will need a large investment to attract users. Sometimes this amount reaches half or more of the total investment.
Finding buyers and sellers
You can make yourself known on social networks, on your blog, in similar subject communities, or through the media and opinion leaders in your field to attract buyers.
The mechanics of finding sellers are similar, but it is better to focus on competitors and look for sellers with high ratings and good reviews.
Thinking through a marketing campaign before launching a marketplace
It’s important to effectively announce the product before it goes to market.
Product launch and further promotion
After the launch, you are left with setting up analytics to track metrics and promoting the marketplace to expand your target audience: publishing to the media, using competitors’ ideas, or launching marketing campaigns.
Creating your own marketplace is not such a difficult task, but there are nuances to it. It is noticeable that these steps on the way to the finished project can be applied to any product. All that is needed is knowledge, skills, and enough funding to implement it. It is important not to stop at building a marketplace app; it is necessary to constantly make improvements, relying on the opinions of buyers and sellers to automate the work and popularity of the web service.
Mistakes when building a marketplace app
- Adding ideas as you build a marketplace app. Our advice: Don’t try to make the product perfect and don’t add new features endlessly. You’ll only delay the launch. Save your ideas for the next release.
- Choose tools and a team in a hurry. You have a long time to collaborate with this team. So take your time when choosing a contractor, study their previous projects, and how they work.
- Launch without testing. Starting to build a marketplace app and planning a large-scale effort? Test the niche first. Does this marketplace need the idea that much? Even if you realize there is little demand, at least you can think of a campaign in advance to create that demand.
- Attract customers after the launch. To build a marketplace app that will be successful in the future, you also need: to look for partners; negotiate for test periods; select contractors for promotion. And by the time it is launched, you will already have a pool of users. The sooner people start using your service, the sooner it will begin to bring in profits.
Build a marketplace app. What’s the bottom line?
When you build a marketplace app, a lot can change in the process: the marketplace niche, the platform, and even more so, the timing and cost. There’s also the possibility that the marketplace will end up being a completely different service. And that’s okay.
Your own marketplace for business is a very promising project. But developing it will require many resources — time, effort, and finances. And if you are serious about realizing it, then there is nothing impossible because to facilitate its development, you can always turn to professionals. They will optimize costs, meet deadlines, and create the marketplace as you imagine it.