The world of eCommerce is growing every day. In fact, it is important to change with the world. In today’s time, you have to keep striving to do more and do better. Having an online marketplace is that ‘doing better’. I am sure you know what I mean.
When it comes to understanding the purpose of building a marketplace, there are numerous reasons. However, to start with, increasing your business’s reach is certainly the first one. In this blog, we will look at the reasons why marketers want to build an eCommerce marketplace. Moreover, also a few other aspects that will help you have a better understanding of the setup.
Let us go forth and start with understanding what an eCommerce marketplace is all about.
What is an eCommerce marketplace?
An online marketplace or eCommerce marketplace is a platform. Further, where more than one seller comes to sell their goods. In fact, there can be as many sellers as the admin wants to have on the platform. Further, the sole owner of the marketplace is the admin who has everything under his control. For instance, ‘who will sell?’, ‘how long will he sell?’, ‘what products are up for selling?’, and more.
Now, you know what an online marketplace is all about. Let us go further at understanding the reasons to build one.
Why should you build an eCommerce marketplace?
To expand your business
There is nothing wrong with having a single-seller store online. However, expanding the business is certainly on everyone’s mind. There are various ways of doing so. First, build your marketplace using a Multi seller Marketplace module. Second, go ahead and sell on an already-established marketplace like Amazon, eBay, or Etsy. Both the options have perks but we’re talking about the former option here. Therefore, the first reason is that when you build an online marketplace, you expand your business.
To generate more revenues
- The most basic reason to have any business type is to earn more and generate revenues. When you build a marketplace using a Multivendor Marketplace Extension, you get 3 basic revenue models. Further, they include:
- Product Listing Fee: The fee that the sellers pay for listing products on the platform. In fact, the admin can decide how much the seller has to pay for which products.
- Membership on the platform: The second revenue model is that of the subscription plans. Here, the admin creates several membership plans for the sellers to choose from. Hence, the sellers choose a suitable plan from those options and sell on the platform. Once the subscription plan is about to expire, they get the notifications to renew the same. Thus, the sellers pay a fee for the membership plans.
- Commission: The admin earns Commission on every order that the seller gets. Further, he decides which seller will pay how much commission. In fact, it can be fixed for all sellers or percentage-wise for the sellers. The process of commission is as follows:
- The seller gets an order that he completes.
- The entire amount of the order is credited to the admin’s account.
- Further, the seller sends the payout request to the admin.
- Last, the admin deducts the commission and sends the rest of the amount to the seller.
- Therefore, these are the ways the admin earns income or generates revenues on an online marketplace.
To target a wider audience
A wide audience certainly means more sales. Thus, there’ll be more revenue. Every marketer wants to have a lot of customers on their platform. When there’ll be several sellers selling different kinds of goods, customers will keep coming back. In fact, they will spread the word to others as well. All you have to do is allow them to have a great experience shopping on the platform. Moreover, enable them to review and rate the sellers as well as the shopping experience.
Available for Prestashop,Opencart and Magento.
In the End
So, these are the reasons why building an online marketplace is worth it. What do you think of the idea? You can easily build a platform using the marketplace module.
Knowband is offering the multi vendor marketplace along with Mobile Apps for the same. How cool is that? You are building a whole e-Commerce business from scratch with Knowband.