The trend behind selling goods and services is changing. People are moving towards online platforms to buy goods and services instead of offline. So, it makes sense that you want to list your business on the top-rated virtual marketplace. Basically, an online marketplace is a virtual store where individuals buy and sell goods and services. Online marketplace platforms for selling goods and services are run and operated by third parties. These virtual marketplace owners take a part of the sales profit in exchange for listing the businesses and products on their website.
Online marketplaces are a great source for businesses to reach out to a whole new area of customers. Both B2B and B2C businesses can find an adequate amount of audience in their area. All they need to do is find the best B2B online marketplace and B2C virtual marketplace. In this article, we will go through everything there is to know about virtual marketplace, why they are so popular, and how your business can benefit from using them.
Types of Virtual Marketplace
Mainly, there are only 3 types of virtual marketplace online, including:
- B2B Online Marketplace
- B2C Online Marketplace
- P2P Online Marketplace
Here’s a thorough breakdown of these marketplaces.
1. Business-to-business Marketplaces
In B2B marketplaces, wholesale suppliers sell goods and services in bulk to other businesses. These marketplaces allow the sellers to list, showcase, and sell their products and services to a larger audience. The best part of using a B2B online marketplace is that they don't have to maintain their own eCommerce platform. Business owners can list their businesses at a small amount, without any upfront investment in web development, eCommerce, and Marketing.
B2B online marketplace owners make money by subscription fees, a commission from every sale, or by charging listing fees for products, services, and businesses.
2. Business-to-Customer Marketplace
Business-to-customer online marketplace, also known as B2C Marketplace sells products and services directly to the customers. The best example of these marketplaces are:
- Facebook Marketplace
Similar to B2B virtual marketplaces, B2C marketplaces charge a commission or charge a subscription fee for listing products, services, and businesses.
3. Peer-to-Peer Marketplaces
Peer-to-Peer marketplaces, also known as customer-to-customer marketplaces. The aim of these marketplaces is to allow customers to interact with each other. This allows customers to sell and purchase goods and services. Ride-sharing platforms and house-swap or room rental services are the best examples of peer-to-peer marketplaces.
These marketplaces allow sellers to promote their products or services which is one of the ways how the marketplace owner earns profits. Other income sources can include subscription fees, listing fees, and other third-party ads.
Why Are Virtual Marketplaces So Popular?
During the Covid-19 pandemic, several years' worth of online shopping records were broken. Just based on the numbers of monthly visits, Amazon, eBay, and Etsy are 3 of the top 5 most popular virtual marketplace in the U.S.A. Amazon had an average of over 2 billion monthly visits, while eBay had 689 million and Etsy had 238 million.
Traditional retailers have come to understand the benefit of a virtual marketplace. The reason is simple, it helps retailers in selling their products and services to the exact customers who need them. Plus, traditional retailers are not the only ones profiting from virtual marketplaces. The above-mentioned marketplace list includes Etsy, which sells boutique items, more than often they're an artisan and handcrafted items. These items are made by small businesses and shops and they can sell products online without building an eCommerce platform for themselves.
The popularity of online marketplaces is all based on the convenience offered by the consumers. Browsing products in an online store cuts down on the time that you need to invest during offline shopping. Plus, during online shopping, you get your products and services delivered to you. Several social media platforms today are now offering online shopping to customers. The online shopping platform offered by social media platforms is B2C platforms.
With online shopping, buyers can reach out to vendors and inquire about their products and services. Similarly, businesses can run ads on social media platforms to reach out to new customers. Customers can purchase almost anything, ranging from general products, home decor, art, and even small groceries. Plus, the virtual marketplace often provides the consumers with verified product and business reviews which leads to informed purchasing decisions.
The online shopping convenience is also carried forward to the transaction itself. When making an online purchase, potential consumers can pay with payment services such as Apple Pay, Google Pay, PayPal, or any other online payment service. Based on the type of virtual marketplace, the payment methods often vary. To finalize the purchase of a product or service, there’s a need for minimum clicks.
Advantages of Virtual Marketplace
So why should you list your business on a B2B online marketplace? What are the advantages of a virtual marketplace and how it can help in boosting revenue? Regardless of what product or service you’re selling, you can find an online virtual marketplace with your target audience. You can tap into these markets easier with marketplace vendors that help you get started as well as support your business as it grows.
1. Ease of Use
Before you can sign up for a B2B online marketplace, you can measure the success by mentioning how many products, and businesses an online marketplace has listed. The first and foremost benefit of using a virtual marketplace is how easy it is to list your product, services, and business. Most B2B online marketplaces offer you a simple sign-up process. Online marketplaces often provide a superior level of vendor support to help you with the sign-up process. This can include setting up your store, listing items, and any more support than you need. Let’s take Amazon, for example, they have a huge level of support for businesses who want to set up shop.
2. Higher Level of Trust
When you list your business on a highly rated virtual marketplace, you can take advantage of a certain degree of trust and reputation of the platform. When a business is allowed to set up its profile on a reputed platform, its potential customers can trust the platform. B2B online marketplace offers a different type of trust, compared to B2C online marketplaces.
Since businesses and consumers already trust these platforms, they know the quality of products and services listed. Let’s take another example, this time Airbnb, as customers already trust Airbnb, renting your property via Airbnb makes more sense than setting up their own website.
3. Built-In and Focused Marketing
If you don’t have the expertise, promoting and then selling your products can be challenging. You can spend a month’s budget in a week if you don’t know how to use Google Ads. It can be hard finding the right marketing channel for your product and services. By listing your business and all you have to offer on a B2B online marketplace, you can take advantage of the marketing efforts of the marketplace.
When you sell via an online marketplace, the marketplace operator tries bringing in customers via their online marketing efforts.
Disadvantages of Virtual Marketplace
It’s not just the upsides of listing your business on the virtual marketplace. There are also some disadvantages of using a virtual marketplace. Here are some drawbacks of using a virtual marketplace:
- High-web traffic is a good option, but the huge amount of brands and products on the marketplace make it harder to stand out of the crowd.
- The benefits of a virtual marketplace don’t come free. While some virtual marketplaces offer economical subscriptions, some specialized marketplace offers expensive subscriptions.
- Virtual marketplaces have their own rules on what you can list and what you can’t. There are comprehensive guidelines on how many products you can list and how you can list them.
Future of Virtual Marketplaces
Virtual marketplaces have changed the retail part of most businesses. Customers can purchase almost everything that a consumer can think of. Virtual marketplaces also allow businesses to reach out to their ideal target audience and sell to more customers.
Tags: Virtual Marketplace, B2B Online MarketPlace, Online Virtual Marketplace, Online B2B Marketplace