What is E-commerce Marketplace?
The E-commerce marketplace or the online e-commerce marketing is a place or a website where one can find different brands of products coming from multiple vendors, shops or person showcased on the same platform. The marketplace owner is responsible for attracting customers and the processed transactions, while the third party vendors deal with the manufacturing and shipping. Online Marketplace streamlines the production process through one simple portal, where the manufacturers sell their products directly to the consumers, therefore avoiding the stagnant process of stocks holding. This kind of supply chain management is usually referred to as the “Dropshipping” method.
Types of Online Marketplace
There are different types of e-marketplaces based on different business models or their method of operation – These are the following e-marketplace
Benefits of Marketplace Ecommerce
Benefits for Buyers
Benefits for Sellers
E-Commerce Marketplace Challenges and Solutions
• Seller and buyer retention – While the most important challenge has always been to attract buyers and sellers to trade in the e-commerce marketplace, the second next crucial problem is to make them active users of the platform for a long time.
• Connecting buyers with relevant sellers- This process plays an important role in engaging the buyers and sellers to the Marketplace. To solve this issues the platform owners should use different methods like tracking buyers and sellers behaviors driven on-site search system, personalized emails based on the algorithms, auto filling sellers account, providing handy and user friendly navigations, etc.
• Buyers trusting the sellers – Trust between the buyers and the sellers plays a very critical role in achieving a conversion. To build the trust, the platform owners have to fall back on traditional way of feedback giving it a digital twist. Features such as ‘Testimonials’ – which will speaks volumes about the authenticity of the product and the buyer, an actionable ‘Rating’ system- where everybody can easily rate the products, sellers and the services, or Social Proof- since customers don’t trust machines, they trust people and experiences, this can make a great impact in socially proving your testimonial and ratings through people who have used it.
• First Impression is the best impression- This proverb is true to its truest sense when it comes to eCommerce Marketplace. It is very important to provide the best user experience to your customers on any device through which they are accessing your platform. Easy to understand and access application would prompt your customers to keep coming back to you.
• Price competition can pose a problem- In large marketplaces, price competition can pose a huge problem. Vendors can choose to compete for the lowest price, which may serve the customer but could end up earning lower profits for both the marketplace and the vendor.
• Quality assurance can also be an issue – Marketplaces may not always have control over the quality of products or timeliness of delivery. One way to combat this is to establish a review system, allowing consumers to give feedback on specific third-party sellers and products. Some marketplaces like eBay will move the seller down in search results or downgrade their account due to negative reviews, while other sites like Amazon leave it up to the consumer to penalize a vendor based on poor reviews. The right enterprise software platform can help you manage these aspects of quality assurance.