Over the last decade, the popularity of marketplaces has grown exponentially. 70% of UK shoppers regularly shop online, with more than 50% of them using marketplaces, so it’s definitely something for your company to consider. Whether you’re thinking of joining a marketplace to grow your business, or you’re thinking of creating your own – you need to do your research. Some business owners are reluctant to join a marketplace, as they believe the competitive environment to be a threat. In reality, competition is not something to fear – it helps us strive to be the best that we can be.   

What is a marketplace?  

By definition, a marketplace is a system of buying and selling in competitive conditions. In the online sense, it’s a type of e-commerce website where product or service information is provided by multiple third parties.   

If you’re looking for an Adobe Commerce agency to design, develop and manage your online marketplace on the Magento platform, Ad Lab’s team of specialist website developers can help.  Ad Lab is also an accredited Google Partner and can help get your website the recognition it deserves.

Why are marketplaces so popular?   

In recent years, marketplaces have shown healthy signs of growth, and no signs of going away. In just 3 years, Amazon grew from $1 billion to $10 billion in sales.  

There are many reasons why marketplaces are as popular as they are, but three significant things to consider are the range of choices, B2Bs and millennials.  

When browsing marketplaces, consumers have an endless number of products to choose from. Instead of searching for a specific branded item, like many shoppers would have done a decade ago, now, they tend to search marketplaces for more generic terms, like ‘high heels’ or ‘wallet’. This allows them to browse thousands of different items, compare prices, specifications, and choose an item that perfectly suits their needs, even if it’s from a brand that they have never heard of, and would never usually choose. For this reason, marketplaces are great for helping new, undiscovered businesses get their products out to the public.  

Since the start of the COVID-19 pandemic, B2Bs have woken up to the fact that they need to get in touch with their clients digitally. Most B2B owners are highly experienced in what they do, but often use old-fashioned, traditional means of marketing and contacting clients. With face-to-face interaction limited, businesses had to adapt, finding new ways to grow and interact with customers. By joining marketplaces, B2Bs can reach more buyers, increase sales and enhance their efficiency.  

Another reason for many marketplaces’ success is millennials. Millennials are very comfortable using the internet, largely because they’ve grown up surrounded by it. Over 90% of millennials buy personal goods from marketplaces, instead of directly through stores, and millennial business owners also make use of marketplaces for B2B purchases. 

 If you’re looking for an Adobe Commerce agency in Greater London to take your business digital, Ad Lab is happy to help. We have teams of expert London website designers, Adobe Commerce developers and Google Ads specialists who know how to help your business thrive. Our team also specialise in third-party software integration with Magento, as well as platform migrations.  

What are the pros and cons of marketplaces?  

If you’re still not sure whether joining or creating a marketplace would be good for your business, take a look at the facts and figures. In 2019, 50% of all online sales were hosted on a marketplace, contributing over $2 trillion in total revenue, and it’s forecasted to be $7 trillion by 2024.  

Joining a marketplace, like Amazon or Alibaba, is simple and convenient. You can start offering products instantly, and don’t need to worry about payment options or shipping. It adds credibility to you as a seller and will allow your products to be seen by thousands of shoppers.  

However, like with everything else, there are some sacrifices that you’ll need to make to join a marketplace. You will lose sight of your customer data, including their preferences and search behaviour, making it harder to develop a crucial relationship with your clients. Most marketplaces will take a percentage of commission for every sale, as well as charging any joining or listing fees.  

How to get around limitations 

The most effective way to get around marketplace limitations is to create your own. Ad Lab, an Adobe Commerce agency in London, has teams of expert website developers who will help you create the perfect marketplace on Adobe’s eCommerce platform, Magento.  

If you’d prefer to join an existing marketplace, there are some strategies that you can apply to help avoid limitations and grow your brand. For example, many businesses choose to offer a limited range of products on marketplaces, and have their full range available on their own website. This gives new and returning customers a reason to explore your site directly.  

If possible, continue to do your own shipping for marketplace orders. This allows you to include leaflets, notes and directly communicate with customers. You can also make them aware of promotions on products bought directly from your store. This will entice new customers to your business’s site, as well as giving returning customers a reason to stay.  

What to consider when creating your own marketplace  

If you do decide to create your own marketplace, it’s important to consider the architecture. There are a few main questions you need to ask yourself:  

How many data streams will you need? Are you just offering your own product feeds, or feeds from other companies too?  

Will you be using one or multiple eCommerce systems?  

How many payment platforms will you be using?  

Will you use one or multiple shipping methods? Will you have multiple warehouses?  

Once you have figured out the basic structure of your marketplace and have a clear understanding of your target audience, you can start consulting with a Magento agency in Essex, who will turn your vision into a reality. Ad Lab’s specialist team of website designers in Essex and London will work with you to create a modern, user-friendly, bespoke eCommerce website, with stunning UX and UI design throughout.   

We can also help integrate the Magento platform with ERP, WMS and CRM systems, or any other third-party software, to help your business run smoothly. For example, integrating Magento with NetSuite eliminates the need for any manual data entry tasks, enabling you to save time while increasing your business sales, and Magento Pipedrive CRM integration increases workflow efficiency, enhances customer data analysis and improve cross-selling and upselling.

Speak with our friendly team today, by calling 01279 655187 or emailing [email protected].