A guide to marketplace

A guide to marketplaces

Not too long ago, the marketplace was a purely local affair. Artisans and farmers brought their goods to the local marketplace to be sold. But when the marketplace moved online, it shattered the very notion of local and global. You’re now able to buy anything and everything with just a few clicks, and vendors have unprecedented access to a global audience.

 

An online marketplace is a type of e-commerce site that connects those looking to provide a product or service (sellers) with those looking to buy that product or service (buyers). These buyers and sellers may have had trouble finding each other before, and thus the marketplace creates efficiency in an otherwise inefficient market.

 

  • 1. Marketplaces aggregate many sellers and their inventory
  • 2. Marketplaces include a transaction element
  • MARKETPLACE TYPES
  • TWO METRICS FOR ANY MARKETPLACE
  • 1. GMV (Gross Merchandise Value
  • 2. Take Rate
  • SELECTING THE RIGHT MARKET
  • 1. High fragmentation
  • 2. The buyer/seller relationship: monogamy vs. playing the field
  • 3. Higher frequency
  • 4. Total Available Market (TAM)
  • 5. Transactional: being part of the payment flow
  • SUCCESS FACTORS: HOW TO WIN AGAINST THE INCUMBENT
  • 1. Lower the take rate
  • 2. Go vertical
  • 3. Develop a 10x better product
  • 4. Unique inventory
  • MARKETPLACES AND NETWORK EFFECTS
  • SEEDING, GROWING, AND SCALING A MARKETPLACE
  • STAGE 2: GROWING A MARKETPLACE
  • STAGE 3: SCALING A MARKETPLACE
  • FINDING THE RIGHT BUSINESS MODEL FOR YOUR MARKETPLACE
  • NEW MARKETPLACE TYPES
  • MARKETPLACE METRICS
  • MARKETPLACE TOOLS
  • WORKING WITH INVESTORS
  •  
Industries: Market Places
Language: English
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Authors: Docent Ecommerce

Document type: Research Study

Publication date: 10-10-2015

Number of pages: 56

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