With the world going digital the marketplaces are expected to skyrocket in the coming years with analysts predicting that the digital marketplace will account for 40 percent of the global retail market. Despite the massive growth and success seen among digital marketplaces, some buyers and seller acquisition and retention challenges remain. The chicken and egg problem has stopped being a solely philosophical dilemma and is a common term in the business and e-commerce world. To put it simply, the chicken and egg problem describes the situation when the owner of a new marketplace is torn between attracting two equally essential sets of users to his platform: the buyers and the sellers. The main challenges to retaining customers are ensuring that enough sellers address their needs and eliminating the sometimes large distances between buyers and sellers.
Onboarding vendors on your marketplace should be the first step of your marketplace project once your platform is ready. Attracting a substantial number of vendors and adding their catalogs to your marketplace will probably determine your platform’s success and make it attractive for buyers. A great marketplace is nothing without great vendors. Acquiring buyers and growing a quality seller base – these two pillars ensure stability and growth.
It’s hard to please the customer these days:
- A wide choice of products
- Competitive pricing
- Amazing features
- Great customer support
- Fast and affordable shipping
- Quality vendors registered to add their constantly updating catalogs
Customer acquisition is the first step in your eCommerce marketplace development. Get to know your customer and engage them as quickly as possible. For instance, if it is a business, think about their work line and why their employees are most likely to choose you to buy a service.
Look for some patterns
- Where do your customers search when they’re buying products like yours?
- What are some ways to attract them on social media or the Internet?
- How likely are your customers to use an eCommerce marketplace?
Once your platform is ready to fully function, with every feature set up, open the marketplace to your business and attract buyers and vendors to use it. It is time to start marketing and alert your potential users, most vendors for the first time, about your marketplace. Integrate all the resources out there. Choose a platform for reaching out – plan out how you can present yourself to attract more customers. Digital marketing can work wonders when it comes to promoting your marketplace on other platforms where your potential customers and B2B partners are spending their time.
Highlight the benefits of your marketplace
Define the value proposition of your platform. Not all vendors are familiar with the marketplace concept. To ensure that you are an excellent opportunity for them, prepare your sales pitch, thoroughly explain your marketplace’s business model, define the benefits of being on a marketplace. Look for that one feature that best fits your industry and your potential buyers’ and vendors’ most essential needs and profiles. Use every channel possible to deliver the news to your target public.
Reach out to your vendors. This point is critical because your platform could not live without activity. See the quick checklist below for some practical actions you can take.
Make a list of vendors. Pitch them via email, directing them to your marketplace. Keep it short and make your exceptional offers highlighting the company’s voice and principles. And follow up. Analyze the open rate to approve your email marketing later.
Take your phone and start dialing those who haven’t replied to your emails. Reaching your target vendors via phone is a great way to feel what interests people most. Optimize and adapt your sales pitch based on your experience.
Provide a High-level Customer Service
Set out your marketplace vendor policy. While buyer expectations, brand, catalog, performance, and values come first, attention to such important aspects as product scope, prohibited items, shipments, and returns for goods marketplaces and service delivery for service marketplaces are also highly important. Fees and payments — for instance, which payment methods vendors use and what their costs are etc. Offer help with the onboarding, provide a help-guide, and an interface to contact you and get the support they need.
PR and Marketing
Announce the launch and communicate about it to attract even more vendors. Go to events, get to know your vendors, engage with them. Don’t miss a social networking event to promote your marketplace, launch promotions, conduct SEO/SEA. Once onboard, it could be interesting for you to gather comments from both vendors and buyers and ask for some adjustments on the platform according to their mentioned needs thus raising the engagement rate.
Have a forward-looking approach
Providing quality products and services and maintaining client expectations — word of mouth and successful case studies can be a great promoter. The road to progress for any new marketplace undeniably has its foundation in quality vendors. The process takes time. Launching and maintaining today’s marketplace can be exceptionally demanding. Plan and adapt to changes and make your marketplace great by outstanding customer service, policy, and smart solutions.
The chicken and egg problem is a common challenge for any online marketplace platform and on-demand startup. Even the most distinguished names faced it in their early days. They succeeded because they managed to bring real value to the early adopters and had all the creativity and the flexibility needed to grow as a leading marketplace. Each e-commerce website is unique, and so are the challenges it faces and the solutions that help resolve them. For starters, you may use the strategies offered in this article, and over time you will find your way to kickstart your platform and attract new users.