Big business websites such as eBay and Amazon, and more recent markets like Airbnb, are proving the value behind this industry.
For some numbers on online marketplace performances, in 2016 they racked in over $1 trillion in total revenue. That number is expected to grow four-times in size by 2020, meaning over $4 trillion in sales across Ecommerce marketplaces.
Naturally, such lucrative opportunities have created a lot of curiosity about what it takes to create a Magento marketplace. The curiosity is well placed too. If you have an effective idea in mind, then building an online marketplace is a viable way to conduct business — all it takes is taking the right steps.
To that end, here’s our brief guide on creating a new Magento marketplace with educational resources containing everything you need.
What is Magento and Why is it Good for Ecommerce Marketplaces?
First things first, Magento is the preferred choice for building an Ecommerce marketplace due to its user-friendly performance, high customization options, and powerful features that enable virtually endless selling possibilities.
Studies show Magento is the most popularly used Ecommerce platform in the world, hosting websites for more than 250,000 merchants. Additionally, the platform is supported by over 150,000 trained web developers, and maintains a helpful and responsive community of users.
While it’s true there are other effective ways to create effective Ecommerce websites, such as WordPress’ WooCommerce, Magento is uniquely designed with the tools to create a high-performing online marketplace—making it one of the easiest and most cost-effective methods around.
To install Magento’s current version, find the download at this link and follow the “How to Get Started” instructions there.
For more information on using Magento for the first time, check out our comprehensive Magento guide for beginners here.
Installing Marketplace Extensions
Perhaps the greatest feature Magento provides is its compatibility with third-party developer software that extend the features of the platform. Technically, this implies someone with the knowhow could program their own Magento extensions, though for most this won’t be the case.
Instead, those users are be able to find in-house and third-party extensions on Magento’s website, and from other developers. Many Magento extensions are free, but those capable of empowering an effective online marketplace tend to require payment.
But keep in mind, finding which extensions will best meet the needs of your online marketplace takes some good research. These extensions consist of the code that will power your Magento marketplaces’ key functions, so it’s important they’re carefully selected.
For more thorough information on how to find great and reliable extensions, check out our guide on the topic here.
3 Crucial Parts of Building an Effective Online Marketplace
While there are many components of an effective online marketplace, the following are three key areas that make or break a business.
1. Setting up a Lucrative Online Marketplace
Establishing your online marketplace isn’t easy, but with the right idea and resources, it’s something any determined entrepreneur can do. A marketplace’s creation takes a few steps, and we’ve detailed them thoroughly for you in this short guide here.
But for a quick run-down, creating an effective online selling environment for vendors to sell, and consumers to browse, requires:
• A well-planned marketplace model that demonstrates actual value
• A great Ecommerce platform and powerful tools (which we’ve touched on above)
• Ensuring a speedy and effective online environment for selling and buying
• Officially launching your marketplace and ensuring it continues to grow
But, even after all the components come together and your marketplace goes live, the job won’t be close to finished. Maintaining a successful Magento marketplace requires thorough monitoring across the board, and diligent action to keep its online performance competitive.
Meaning, building an online marketplace requires a commitment to its health throughout the entire lifespan of its operation—not a simple task. However, with this industry’s exponentially increasing value, the lasting efforts of online marketplace creators have the potential for incredible returns.
2. Creating a Diverse Vendor Base
When you look around an online marketplace, like Amazon, you’ll notice that many different sellers are utilizing the platform.
Likewise, for your Magento marketplace to succeed, you’ll need to build a vendor base that offers shoppers products to browse. This process also requires a few steps which we have conveniently detailed for you here, but here’s an overview.
• Provide options for suppliers to easily manage their products, access product descriptions, images, and more from their website’s front-end.
• Establish selling fees for vendors using your platform, whether through a fixed global rate or a business-to-business basis.
• Allow vendors to effortlessly manage customer and shipping orders to save time, reduce costs, and keep frustration at a minimum.
Making your Magento marketplace enticing for vendors to use takes some time and care, but every little convenience helps overall. Just think of the online services you use yourself, and the reasons why you choose it over the many similar ones that are undoubtedly out there. By approaching your own store from a user’s perspective like this, you’ll be able to find ample areas for improvement.
After all, in order to thrive as an online marketplace, it must attractively cater to both sellers and shoppers alike.
3. Nurturing a Community
After your Magento marketplace goes up, and you’ve attracted some vendors to sell their wares, it’s time for community building.
To keep your website’s economy active and customers happy, a strong community is necessary—both on and offline. We’re covering the main points now, but click here for our full guide on building a Magento marketplace community.
• Elevate brand awareness by creating a distinct tone-of-voice and personalizing your marketing channels, from e-mail to social media, to the content of your Magento marketplace itself.
• Advertise the unique advantages of your online marketplace, it’s niche, and how it sets itself apart from competitors.
• Make the most of social media to amplify marketplace awareness and draw in a higher volume of potential customers.
• Offer additional value in the form of informative blogs, engaging discussions, featured stores and stories, and other points of relative interest. Allowing your community to contribute to this content through comments and forums is another great way to drive their engagement.
When your community begins to gather steam, and conversations start forming, stay on the lookout and study their behavior. By tracking the data of what works and what doesn’t, you can amplify your marketplace outreach and intensify its performance.
Always pay attention and use your website’s data to continue enhancing marketplace content, functions, and community engagement for best results. Simply enough, by staying alert and following trends within your website and its industry, your marketplace will naturally thrive all the more.