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Crafting a Marketplace App to Bridge Buyers and Sellers

Korovkin Vitaliy

Dec 15, 2023 • 4 min read

The evolution of marketplace app development has changed the way we shop, offering significant convenience to those seeking to purchase products or services online.

This transformation is largely attributed to the internet, which has simplified transactions, allowing customers to easily find and have their desired items delivered directly to their homes at competitive prices.

For example, in the previous three years, Amazon has seen its revenue soar from $386 billion to a staggering $554 billion. This remarkable growth highlights that the opportunity to launch your own marketplace app is still ripe with potential.

However, the journey to develop a successful marketplace app requires considerable resources and in-depth knowledge. If you're seeking guidance on how to build a marketplace app, you're in the right place.

What is an online marketplace platform?

Unlike conventional online stores, an online marketplace serves as a digital intermediary, offering a platform for independent sellers to showcase their products and services.

These platforms vary widely in terms of size, range of products, and marketing strategies. Used technology and prices are influenced by geographical location and purpose.

What is a marketplace app?

A marketplace app functions as a mediator, bridging the gap between sellers and buyers. It's designed to facilitate effective cooperation, connecting these two groups.

Online stores, like this Coffee store that Webmil developers created, typically limit their offerings to their own products and services, maintaining full control over various aspects such as product range, pricing, delivery options, and payment methods.

In contrast, when considering how to create a marketplace platform, it's important to recognize that a marketplace provides a venue for various sellers to list their services and products, coupled with an integrated payment system.

Ten steps to build a marketplace app

Marketplace app development involves thorough research and risk assessment. It's not just about perfect coding, but understanding the whole process is key to creating a successful marketplace app. Here are the key steps to keep in mind:

Step 1: Know your audience

The initial step in crafting a successful online marketplace app revolves around grasping the user activities within the marketplace. This comprehension is crucial as it shapes the nature of your marketplace, its operational mechanics, and the offerings for users.

Let's explore the types of activities encountered in different eCommerce marketplaces:

Product marketplaces: These platforms primarily cater to buyers and sellers, with sellers listing and buyers purchasing various products.
Service marketplaces: These attract freelancers, vendors, and professionals offering services, and employers seeking specialized skills for specific tasks.
Project marketplaces: Aimed at investors and project initiators, these platforms involve financial contributions for projects with potential future returns.
Hybrid marketplaces: These cater to a diverse user base by combining features of the above categories, engaging guests, employers, vendors, buyers, and sellers.

Step 2: Structuring your marketplace app

A vital aspect of marketplace app development is establishing a robust structure, which is influenced by various factors and aligns with your overall business strategy. When laying the groundwork for your marketplace, setting clear business objectives and strategizing accordingly is essential.

To structure your marketplace, answer the questions:

Who are your Users?

Understanding your potential users and their expectations is key to refining the platform's user interface. The nature of user activity will guide the marketplace's functionality and offerings.

What Services will be Offered?

This critical consideration dictates the marketplace's overall structure. For instance, Airbnb and eBay, while both being online marketplaces for auctions and accommodations, differ significantly in appearance and functionality.

Step 3: Selecting a monetization model

Your marketplace can adopt various monetization strategies, including:

Commission-based earnings
Subscription fees
Listing fees
Featured listings
Advertising revenue

It’s also important not to overwhelm your users with too many paid services.

Step 4: Identifying the end users of the marketplace app

Marketplace apps differ in functionality based on their intended end-users, as follows:

Product/service provider app: This version is for vendors aspiring to gain recognition and customer reach. It typically includes vendor accounts with product and order management, instant notifications, and report generation capabilities.

Customer app: Focused on providing customers with a range of products or services and the ability to secure the best deals. Features may include product information, promotion details, easy checkout processes, and multiple payment options.

Administrator app: Designed for those managing the operational aspects of transactions, earning revenue through service fees.

Step 5: Designing the essential features

Regardless of the type of marketplace app, the following panels are necessary:

Administration panel: Manages product inventory, payment processes, order management, client databases, seller commissions, user registrations, item categorization, and review management.

Seller/merchant panel: Allows sellers to set up shops, import products, manage inventory, and sell through the marketplace.

Buyer panel: Enables users to browse stores and products, add items to a cart, make payments online, and leave reviews.

Step 6: Choosing a suitable tech stack

Collaborate with a solution architect and software engineers to select the best technologies for your project, considering:

Programming languages like Ruby, PHP, JS, and Python.
Mobile development platforms (Android - Java, iOS - Swift, cross-platform - React Native).
Front-end technologies (Angular, React.js, HTML5, CSS), and back-end development (Node.js).
Payment systems (Stripe, PayPal), and other tools for analytics, marketing automation, infrastructure, and databases.

Step 7: Prototyping and documentation

This stage involves creating a marketplace prototype from scratch to clarify end-user application utility. It requires detailed interaction descriptions within the product's functionality to evaluate the value proposition. Additionally, assessing the business potential of the idea and preparing detailed project documentation is crucial.

Step 8: UI/UX design

The design team develops screens based on predefined goals, target audience, and approved functionalities, ensuring compliance with the chosen design concept.

Step 9: MVP

Minimum viable product (MVP) is a raw representation of your future marketplace. It’s an important step in the development process, during which you can see how your project works with only the necessary features implemented.

A minimum viable product can help with gathering bug reports and revising based on feedback for further debugging and design improvement. Usually, the MVP phase sets the trajectory for the project's subsequent development stages. The MVP development includes coding, testing, and launching phases.

Step 10: Scaling

After successfully launching, focus on scaling and expanding your marketplace by:

Targeting multiple platforms for broader accessibility.
Enhancing app functionality with innovative features based on user feedback.
Implementing a growth-oriented marketing strategy, understanding your audience, and utilizing relevant channels for consumer attraction.

Final thoughts

Creating a successful marketplace app is a complex but achievable goal. It demands a deep understanding of the market, a skilled development team, and a commitment to innovative solutions for optimal operation.