It’s a really good time to consider building an online marketplace for your business going by the success of Airbnb and the like. Not just that, a marketplace model offers a significant degree of scalability because it can be built to suit a variety of industries, say automobile trading, fashion industry, manufacturing, and so on.
With innovation catching on at a fast pace in the field of building and running marketplaces, let’s take a look at a few questions which you may have before taking the plunge into developing an online marketplace for your industry.
Set the goal upfront
Before you consider making the decision to invest in developing your marketplace, you should consider the why, what and how of doing so.
- Analyze and understand why you are looking to create a marketplace in the first place.
- What competitive advantage are you looking to achieve?
As a business owner, if you are moving from brick and mortar and diverting those efforts into developing an online marketplace, ensure that you understand the nuances of how a business operates in the online space. Identify the clear differences that the online space offers. Carry out enough research and groundwork on the working of the online model to be able to tactically analyze the market demand in order to provide an appropriate service mix.
As you make progress in understanding the online realm of business, it dawns upon you that the real challenge lies in choosing service providers for onboarding on your platform. Since this is not a straightforward process and is rather dependent on soft parameters such as trust and efficiency, you need to be quite attuned to customer demands and satisfy the demand with the right kind of service providers. You can read some tips on our blog on building a cost-effective marketplace solution.
Define the strategy/approach
The next step is to identify what it is that you are planning to build. Are you leaning towards an industry-focused approach or do you want to showcase several products across multiple industries? It is in this context that good subject matter expertise comes in handy. Only if you are clear about this can you actually figure out how to build your marketplace platform.
- Do you have the right coding talent or are you looking to hire a development team?
- Are you equipped with any amount of entrepreneurial experience to handle the business model of an online marketplace?
With these questions, you will be able to derive answers that define and drive the strategy for building on your initial idea.
Validate your idea
While software development is a crucial element determining the success of your marketplace, it is not the sole element that drives the success of your marketplace. Pooling in all your resources for its full-length development may not seem like a great idea. It is here that a Minimum Viable Product (MVP) does the trick.
During the initial phase of the project, your main goal should be to develop and launch an MVP as quickly as possible. This step is important in assessing and validating your marketplace for what it’s worth without having to spend big bucks and huge capital right at the outset. The learning process only takes shape once you have something to offer your users, so it’s important to get to that point as early as possible. Your first product needs to have just enough features to be able to solve your users’ core problem.
Having gotten a clear picture of how to prepare yourself before delving into building an online marketplace, take the next step and reach out to us to understand where you are in your journey. Our team of marketplace experts is equipped to take you through every step along the way and help you launch and run a successful marketplace that is technologically viable and also built to generate marketing revenue.