How to create an online marketplace
How to create an online marketplace
An online marketplace is where a transaction between multiple buyers and multiple sellers are moderated on a single online platform. A marketplace operator/ admin processes these transactions on a regular basis. It is essentially an aggregator. Ola, Uber and Flipkart are good examples of online marketplaces. An online marketplace works well only at scale and getting to scale should be the first priority for any startup. Here are a few steps to create an online marketplace.
A niche sector that the entrepreneur is familiar with needs to be picked. Opportunities for connecting buyers and sellers online in a field can be spotted, be it designers, web developers, or other service providers. However, if any of these markets are being considered, firsthand experience/ expertise is recommended. An entrepreneur needs to tap into his background, education and experiences to create an online marketplace which would disrupt the existing market.
An online marketplace would require a hosting service. Subscription to an existing web-hosting service would be ideal as they have the servers, services and connections available for reasonable monthly fees. The servers are preconfigured to resist hackers. Frequent backup of data ensures that no data is lost. Several hosting services should be researched to determine the fee structures and available services. It is essential to ensure that it enables with AWS cloud hosting for performance at the highest levels.
Build an MVP
The front end and the back end of the portal needs to be integrated based on the requirements like location, language, payment integration, delivery, shipping etc. along with admin friendly features.
Building a minimum viable product can start off with wireframe or preparing a blueprint to check the way the app will look like on a phone. Wireframe would not be functional in themselves but it could help in the initial visualisation while explaining the idea to mentors, investors etc. The are multiple ways to build a wireframe i.e., it could be built by the entrepreneur himself, outsourced to programmers or even by hiring a company that specialises in this. Due to the significant costs involved in hiring a company, it is preferable to build the wireframe in-house. Swift in Xcode can be used if the latest Mac OS is available as it is free. This would also help gain credibility if pitching the idea to investors. However, it can be time-consuming and difficult for a beginner with no coding skills. Due to the emergence of sites like Upwork, it is possible to hire overseas programmers to help build the wireframe. However, it might take some time to convey the idea to programmers who have no idea of the product to be developed. If capital is not an issue, hire professional companies to create them. However, it would cost upwards of Rs. 1 lakh to hire a standard company to do the job.
Marketing the new portal is essential to ensure a steady stream of visitors. Digital marketing campaigns like search engine optimisation (SEO), search engine marketing (ads search, Google Adwords, Display Ads, Remarketing etc.) and email marketing would help reach out to a significant number of potential visitors. It is essential to create a buzz around the new portal, hence all marketing mediums need to be explored.
Challenges faced by new marketplaces
The sufficient number of buyers and sellers must register with the online marketplace, else if there are insufficient buyers and sellers, the site won’t take off. Scaling to this level requires time and effort and sustained parallel work on advertisement and marketing along with the creation of the portal would ensure that subscription of the new marketplace.