3 online marketplace solutions for new businesses [+ successful strategies]
Mariam Ispiryan • Sep 22, 2022 • 15 min read
If you’re thinking about selling online, you probably want to strengthen your brand’s online presence—or maybe you’re just invested in sales growth. Either way, building a web store instead of joining a popular online marketplace like Amazon, Facebook Marketplace, or Etsy will help avoid high commission fees.
Contrary to popular belief, building a web app doesn’t have to be a struggle. With no-code app builders, you can design and develop custom online marketplaces that are responsive, dynamic, and secure. And you don’t need a tech background.
By the end of this article, you’ll be empowered to make an informed decision for your business, learn how to create an online marketplace, and pinpoint strategies to help your online business succeed.
Table of contents:
Turn your spreadsheet data into a powerful online store.
With Softr, you can create any web app you need. No tech background, no code, no hassle.
What is an online marketplace?
An online marketplace is a virtual shopping hub that allows consumers to purchase goods from different sellers. These virtual hubs can sell one type of service or product, such as jewelry and related items, or various products ranging from personal care to groceries and auto supplies. Online marketplaces can be
- Business-to-business (B2B): companies selling products or services to other companies
- Business-to-consumer (B2C): companies selling products or services to customers
- Peer-to-peer (P2P) or consumer-to-consumer (C2C): individuals selling products or services to peers
4 examples of top online marketplaces
There are many online marketplaces entrepreneurs can use to scale their businesses. The top four platforms (Amazon, Walmart, Etsy, and eBay) have successfully marketed themselves as the go-to option for online shoppers and have maintained a strong image in the consumer’s mind. Here is a list of the top four common global marketplaces:
Amazon
Amazon is one of the biggest marketplaces in the world. You can buy anything you need and, in many cases, get it within the same day.
Source: UX Collective
Amazon’s consumer-focused approach helped them establish the brand as one of the most used online marketplaces in the world. No matter where consumers find themselves on the website, there are triggers like the one-click purchase button and same-day delivery options to make Amazon their primary choice.
Walmart
Walmart started as a retail store. Their online store has become one of the most important in the USA.
Source: TopCashback.com
Walmart is associated with reliability and convenience. This company has successfully marketed its products as an affordable option for US consumers, and the numerous locations all over the country have made this retail store a household name.
Etsy
Etsy is one of the most popular online marketplaces for C2C sales. People from all over the world can post and sell their products to other customers.
Artists tend to be the target market here. Etsy is a marketplace where creatives can find unique or handmade items to craft their pieces or add to their collection. Because aesthetics are important on this platform, listings with beautiful and captivating images get the most attention. Because aesthetics are important on this platform, listings with beautiful and captivating images get the most attention. Some top digital products to sell on Etsy are wallpaper, printable invitations, planners, and checklists.
eBay
eBay is one of the first popular online marketplaces. Users can buy clothes, appliances, electronics, and art from other sellers.
eBay has been around for over 26 years, and is a marketplace known for its simplicity. The sellers on this platform tend to be people who want to quickly market an item without creating a unique website to attract or maintain customer interest. eBay is also commonly known for its bidding system that makes sellers and buyers determine the price of a product.
The benefits and potential disadvantages of online marketplaces
Online marketplaces can be a great solution for promoting your brand, increasing sales, and reaching more customers. However, to get users to discover and buy from your online marketplace, you may need to come up with a different marketing strategy and incur additional costs. You can also plan sales automation to effectively build a scalable sales pipeline for your agency.
To help you make an informed decision, here are some benefits and drawbacks of launching your own online marketplace.
Benefit #1: Maximized customer reach
When a business owner decides to sell products online, they gain the potential to reach people across the globe. And once you optimize your marketplace for SEO purposes, potential customers will be able to find you in just a few clicks. Google scraping will help you to find and place specific keywords in your web app content based on the search intent of your potential customers. That way, when someone searches where to buy your products or services online, you can appear among the top results.
Benefit #2: Reduced operational costs
Having a physical store means that you need to hire employees to stock shelves, handle monetary transactions, clean the storefront, and pay for the rent or mortgage of the store. With an online business your monthly expenses are significantly reduced. You would still need to pay for storage and the license to host the platform, but it’ll be less expensive and more scalable.
Benefit #3: Scaled business operations
Another benefit to using an online product or service marketplace, is that businesses that sell online enable the owners and employees to live anywhere and manage the operation remotely. When you partner with a company to manage deliveries and get a warehouse manager, you won’t need to be physically involved in growing and managing operations. Your business becomes much easier to scale.
Benefit #4: Extended operating hours
Unlike a brick-and-mortar company, an online marketplace is always open. Shopping at an online store means that customers aren’t limited to standard business hours—they can shop anytime from the convenience of their homes. Combined with a well-designed marketing strategy, you can get potential customers to see an ad, click, and buy in a very short timeframe.
Benefit #5: Enhanced consumer experience
An online marketplace makes it easier to tailor the shopping experience to each one of your customers and improve overall customer satisfaction. That’s because you can use your customer data to build a personalized user experience. For example, if after analyzing the data, you discover that certain users shop for cat food every 3 weeks, you can use that info to send them a reminder some days before they run out.
For example, you can let customers choose when they’ll be home to receive a package, if they want to be contacted by phone, text, or email in case of any issue, and what to do if the product they want runs out of stock.
Disadvantage #1: Website costs
Online marketplaces and other forms of eCommerce websites are not perfect. While the operating costs of having an online store are usually lower than a physical one, you’ll need to make an initial investment to get your website up and running.
The associated costs of building a website usually involve hiring a technical team to develop and maintain the platform and paying for hosting and domain permissions. All of which can cost you thousands. To reduce business expenses, you can look into a no-code web app builder like Softr to cut your development costs down to a max of $165 per month depending on the plan.
Disadvantage #2: Warehouse and inventory management costs
If you’re selling online, you’ll need to pay for a warehouse and hire someone who can manage deliveries and inventory. Brands can bypass the in-house inventory upkeep route and opt for wholesalers to manage the products themselves. An example of an inventory-free online marketplace would be dropshipping, where you pay other platforms to build your product on demand.
Disadvantage #3: Building consumer trust from scratch
Gaining customer trust is difficult in the beginning when you don't have an established customer base to target or resell. The lack of face-to-face interaction can be a barrier to gaining customer trust when your company is new, particularly with so many scams on the internet. To build trust, you can:
- Include social proof
- Launch a marketing strategy that fosters brand awareness
- Provide customers with additional resources and tools
- Establish a direct support contact to answer their questions.
1. Softr
Softr is a no-code web app builder that lets you create powerful online marketplaces and any other form of online application in a few minutes.
Softr is not a dedicated online marketplace builder, but a no-code web app builder that uses your Airtable or Google Sheets information and transforms it into a custom online store. This is a truly no-code app with a zero-learning curve. Softr comes with pre-built building blocks that allow users to choose and edit their:
- Fonts and colors
- Element styles
- Backgrounds colors
- Logos
- Header and footer
- Call to action (CTA)
- Hero
With this solution, you also have access to several features like a built-in form builder, SEO optimization options, a native integration with Stripe and ability to add payment solutions such as PayPal, Buy Me a Coffee, and Gumroad.
You can also choose from numerous templates to kickstart your web app design without any hassle. For example, you might find the freelance marketplace or the property listing template particularly useful.
However, if you’re looking for an online marketplace that has inventory management in different locations or that lets you accept multiple source payments, Softr isn’t the right choice for you.
Turn your spreadsheet data into a powerful online store.
With Softr, you can create any web app you need. No tech background, no code, no hassle.
2. Shopify
Shopify is an eCommerce builder that lets you manage orders and inventory from different warehouses all in one place.
Source: Capterra
Shopify is one of those brands that’s slowly becoming a common noun. People are starting to change the sentence “I need to set up my online store” to “I need to set up my Shopify”.
This platform lets you create, host, and manage an online store. It can process payments, distribute products across different channels, and manage multiple inventory locations.
Since Shopify is a SaaS company, they’re responsible for maintaining the software. That means that you don’t need to worry about site errors or bugs that you’d otherwise have to handle yourself.
However, Shopify won’t give you customization freedom. That means you can’t make major changes to your website look and feel unless you hire a web designer. Shopify also charges a fee for each sale that you make. The transaction fee is determined by your plan, so if you choose the advanced plan, you'll be charged less per sale than if you choose the basic plan. Finally, Shopify doesn’t give you complete control over your SEO.
3. Kreezalid
Kreezalid is great for users who want a dedicated eCommerce website builder but don’t want to customize and edit every detail of the layout.
Kreezalid is a no-code eCommerce website builder that allows non-technical users to build a functional online store. This platform comes with pre-built marketplace templates that allow you to rent or sell digital products or services. Kreezalid also offers to build the marketplace for you if you don’t feel like learning how to do it yourself.
But Kreezalid does have a steep learning curve caused by a UI/UX design that’s not intuitive. Users also complain about product limitations like not having the inventory automatically updated after a sale. Finally, pricing changes as you grow making Kreezalid less scalable.
Business strategies for selling on marketplaces
If you’re planning on building an online marketplace to sell your products, you need to have a strategy in place to support that decision. Here are a few ways to improve your chances of owning the next successful virtual business:
Put the customer first
Outline your buyer’s journey and identify all the moments your customer is directly or indirectly exposed to your brand. Then, run focus groups or a customer survey to define how they’re perceiving your company and what their expectations are. Plan to match your brand experience with customers’ expectations.
Leverage social proof and user-generated content (UGC)
The internet can be an intimidating place, it’s your responsibility to get customers to trust you enough to make a purchase. A great way of doing that is by using customer quotes and UGC.
Befriend SEO
Make your online store SEO-friendly. Users that search for “places to buy X product” are ready to make a purchase and are willing to pay whoever can solve their needs. And having organic traffic directed to your website is essential to business growth.
Come up with a pricing strategy
It’s crucial that your products are priced correctly. You don’t want to set them too low and lose money just to get people to buy, or too high and lose potential customers. You need to find a sweet spot that works for your web store launch. Try doing some research into how your competitors are pricing similar products to get a better understanding.
Offer a differentiating factor
You should give potential customers a reason to make purchases in your shop, as opposed to your competitors’. Make your products stand out by offering discounts, free shipping, or coupons awarded when shopping on your online marketplace. Many top brands like Amazon and Flipkart follow the same practice.
Come up with a promotion strategy
Like any other product launch, you need to promote it. If you’re working by yourself or with a marketing team, you should set some time to work on the marketing strategy to define how and where you’ll attract customers. Some examples are using influencers, setting a pay-per-click ad campaign, or placing billboards.
6 steps for online marketplace success
In order to build an easy-to-use online marketplace, you should follow some steps to research, execute, and launch your website. Here are the steps you should take:
Step #1: Conduct market research
The first step is to research your target market to validate your idea and define if they’re willing to buy your products or services. Since this step is all about research, you should also discover what high-performing brands in your niche are doing to stay relevant and successful. Try looking into marketing trends in the retail sector to consider how to use them in your business.
It helps to know which product categories perform well on other sites. Information about product categories can help you know which products to potentially upsell to consumers at a later time, and in return, increase online sales on the eCommerce platform.
Step #2: Define your eCommerce business model, plan, and strategy
Just like you would with any other type of business, you should determine your
- Business model: how you’ll be making profit
- Business plan: a document that contains the strategy to make the model work, expected revenue, and market share
- Business strategy: a step-by-step action plan to make the business model work in detail
Step #3: Choose the hosting platform and build your online store
Once you’ve validated your idea and come up with a viable business plan, you can start building your online marketplace. The steps will vary depending on the platform you choose, but if you’re using Softr, here’s what you need to do
- Create a Softr account, and duplicate the template of your choosing
- Review the page settings and user groups
- Rename your app and connect to your domain
- Edit colors, fonts, and group names
- Connect your marketplace to your preferred database (Airtable or Google Sheets)
- Adjust your database block settings
- Add the building blocks that you need and features like forms to allow other sellers to become service providers
- Preview the app and test some functionalities like the sign-up/sign-in authentication
- Publish your app
Turn your spreadsheet data into a powerful online store.
With Softr, you can create any web app you need. No tech background, no code, no hassle.
Step #4: Launch your online marketplace platform
This is when you finally get to launch your website and allow real customers to use it. It’s a good idea to see this first launch as a pilot where you’ll gather feedback from users, do A/B tests (more on this below!), and come up with an enhanced customer experience supported by your web app.
Step #5: Do A/B testing
Online sellers should use A/B testing—randomly getting users to use one of two UX alternatives—to know which pages perform best on their website. A big part of online retail success is a friendly UI/UX. When you do A/B testing for product pages with new customers, you can get insights on which one works best based on data analytics. You can also test sales copy and announcements of new products to see which version consumers respond to best.
Step #6: Act upon feedback
Whether your brand is business-to-business (B2B) or business-to-consumer (B2C), it’s important to gather feedback in every step of the creation and execution process. If one tactic isn’t working, be flexible enough to change things up until you find a solution. Also, ensure you always keep track of your analytics to adjust as needed.
Should you build an online marketplace?
Online marketplaces are a way of improving your customer reach, reducing operational costs, and becoming more scalable. But doing so also means that you’ll incur warehousing and website costs, and you’ll need to create an online customer base from scratch. However, with Softr, the costs of building and maintaining the website are significantly reduced.
If you’ve decided to build your own online marketplace, you should:
- Research the market to validate your idea
- Define your business model, plan, and strategy
- Determine the hosting platform
- Launch your online store
- Run A/B tests to gather feedback
- Makes changes based on customer feedback
Every platform has its own benefits and pitfalls, so if you’re an entrepreneur or small business looking for design freedom, zero learning curve, and SEO-friendliness, Softr will make you feel right at home.
Turn your spreadsheet data into a powerful online store.
With Softr, you can create any web app you need. No tech background, no code, no hassle.
Frequently asked questions about online marketplaces
These are some of the most popular marketplace businesses: - Amazon marketplace - Facebook marketplace - MercadoLibre - Airbnb - eBay - Walmart marketplace - AliExpress - Etsy
There are different types of online marketplaces, the most common include: - Business-to-business (B2B): companies sell solutions to other companies like Amazon Business. - Business-to-consumer (B2C): companies sell solutions to individual customers such as Walmart. - Peer-to-peer (P2P) or consumer-to-consumer (C2C): third-party sellers offer their services or products to other consumers like Etsy.
