We have made a shift to the online world in many aspects of our lives, both personal and professional.
People use the Internet for communication, socializing, and fun, while businesses are marketing and selling their products online to potential buyers who go online in order to browse and shop.
The world of online retail has grown a lot in recent years, with the so-called marketplaces taking the spotlight.
What Are Online Marketplaces?
Utilizing the term from real life, an online marketplace is as similar to the actual physical marketplace as it could possibly be. With its own unique perks, of course. Essentially, it’s an e-commerce platform that gathers a bunch of different sellers and connects them with interested buyers. Checking the feedback and product reviews as well as interacting with the sellers and other buyers are all things made easy on this type of online platform.
You have all heard of eBay and probably use it for purchases and maybe even sales. This is one of the first online marketplaces that has actually put the whole practice into action. Basically, you have a lot of vendors with their shops all in one place for the users to browse and connect with. It’s possible to look for specific products across the board from all vendors available or focus your shopping on a specific vendor in particular.
Different Types of Marketplaces
When it comes to the online market nowadays, it’s so saturated that it’s possible to categorize existing marketplaces into categories, based on their approach to the available goods as well as the way they present these goods to their target audience. We can differentiate between three types of online marketplaces nowadays: vertical, horizontal, and global.
Vertical marketplaces focus on available products from a range of different sources online. Their purpose is to guarantee that a specific product/service is valid.
Horizontal marketplaces also bring together a range of different products but these markets typically have some common characteristics to make them more niched. They often feature data showing why their choice of goods is the best.
Global marketplaces sell all sorts of products/services from all over the world, allowing users to check for and find the best price on their own.
Growing Popularity of Marketplaces
More and more people tend to go online in search of products/services they need, which is precisely why online marketplaces have gained so much popularity in recent years. After all, modern online marketplaces offer a range of different goods that can satisfy many of the buyers’ demands quickly, easily, and efficiently.
We have already mentioned eBay, but there are other popular marketplaces today, such as Amazon, Flipkart, Walmart, Alibaba, and so on.
If new marketplaces want to succeed and compete with the mentioned retail giants online, it’s crucial that they meet the most important requirements. These include:
- Minimized selling/buying friction which allows for better liquidity of the entire buying/selling process.
- Trustworthy behavior, complete transparency with their actions and policy, and ease of access to product/service/company information.
- Effective mechanisms that help solve emerging issues quickly and proactively, such as conversational AI for instance.
Online Marketplaces Are the Present and the Future
There are many reasons why online marketplaces have become so popular and are getting more traction every day. But it all comes down to convenience and shopping experience.
Thanks to the convenient aspect of shopping online from the comfort of one’s own home, buyers enjoy the experience and thrill of purchase without any negative aspects of it such as crowds and shopping rushes during the holidays and sales.
In this day and age, people lead busy lives and usually have to balance family, home, and work. The fact that they don’t have to get ready, go out, spend time in the shop, and waste time in the waiting line makes online marketplaces the superior form of retail.
Improving this experience is a constant goal for many existing marketplaces. Also, more and more brands are jumping on the bandwagon in order to provide their own audience with that same improved experience.
It’s true that brands and marketplaces will face more pressure in the future as they do their best to stand out from the crowd. The much-needed creativity will also have to be combined with simplicity, user-friendliness, and utility. In that respect, we can hope to see a further evolution of marketplaces that go beyond the typical buyer-seller relationship, gradually turning into comprehensive hubs that provide a range of different solutions and suggestions to the buyers in order to make their experience as complete and satisfying as possible.
The future of marketplaces is looking bright with a more holistic approach as the new competitive standard. Even if we’re not there yet it’s only a matter of time until brands and current marketplaces will start implementing the changes in their modus operandi.