We have visited the marketplace at least once, although this term may be unfamiliar. Any custom e-commerce development company is engaged in creating such a business model because it has many advantages.
What is a marketplace, and how does it differ from an online store?
The marketplace structure is very similar to an online store since there are blocks with goods and the ability to add products to the cart, where you can make a purchase. However, the main difference between these e-commerce options is that different sellers can trade on the virtual platform. It happens as follows:
- The business owner registers on the marketplace after signing a special agreement. And to prevent any inaccuracies and problems, they should read the terms of trade on such a virtual platform;
- After registration, the seller must prepare information about their products in XML format. There must be accurate names, photos, descriptions, and everything else needed for the sale. It is worth remembering that some types of goods may require permits. Once uploaded, everything that the seller is going to sell will appear on the virtual platform;
- Some marketplaces require you to top up your account, only after which buyers can see its products. There are often situations when, with a zero balance, products are not displayed on the marketplace, so it is impossible to wait for purchases;
- As product cards appear on the marketplace, customers can add the product to the cart and place an order. When payment for a purchase is received, the seller must pay a small commission to the online platform itself. The rest of the amount goes to their banking accounts. Many marketplaces offer secure transactions to buyers, meaning the money the buyer sends goes into the seller’s account once the purchase is successfully received. If the product does not fit and is returned to the seller, neither party pays the shipping nor the commission.
What are the advantages of marketplaces?
Digital commerce in a marketplace is convenient for the owners of such trading platforms and buyers. The former receive their percentage of each purchase, and the latter do not need to spend money on creating an online store website, promoting goods, and finding an audience. And this is only part of the advantages of the marketplace. The benefits also include the following options:
- It’s easy to start on the marketplace. You need to understand its main nuances. This e-commerce option is also suitable for those new to online trading;
- virtual trading platforms set pretty high requirements for content, and it becomes an incentive for sellers to demonstrate products from the best side, take high-quality photos, and carefully approach the description;
- high traffic, especially if the marketplace is already promoted and popular.
We must remember that marketplaces also have some disadvantages. One of them is high competition since there are virtually no restrictions on selling similar goods by other sellers. But it can also be solved with competitive prices and service.