Online Marketplace and Its Business Models for eCommerce

Online Marketplace and Its Business Models for eCommerce

eCommerce Marketplace

An eCommerce marketplace is a website that will be solely owned by a marketplace operator who allows the third-party vendors to use their portal to display and sell their products and services to their targeted buyers. For each transaction happened on the marketplace, the operator will be getting a commission. The marketplace has a simple business cycle that benefits all the parties involved, which becomes the slogan of its success. There are a variety of marketplace business models for varied products and services. To name a few:

B2C and B2B Business Model

The online marketplace works well for both B2C (business to customers) and B2B (business to business) models. In B2C, the customers would be the end-user, e.g., Amazon, whereas in B2B other businesses get services or products from the supplier, e.g., Alibaba.

Online Marketplace for On-Demand Local Services

It is a model with which the marketplace operator can link skilled individuals or groups to get hired for specific on-demand local services. This is a unique business model that will work better and give return if planned and processed accordingly.

Drop shipping

Drop shipping is also an amazing marketplace tactic to get business done without having the burden of inventory and allows the operator to tap into the power of the supply chain. It lessens certain risks in holding inventory by giving the entire process of delivery to the drop shippers and getting paid for connecting the business.

SaaS Model

Nowadays, Software as a Service (SaaS) products have a lot of traction.  A SaaS-enabled online marketplace is a model that combines the characteristics of both models where marketplace dynamics tied to SaaS products. With this model, businesses can monetize the SaaS component through a subscription or the transaction through a fee. Although not every SaaS will become a marketplace, more of them (even the very niche ones) will emerge.

eCommerce Mobile Apps

As mobile becomes the sixth finger of this generation, mobile apps become big businesses nowadays. The mobile app marketplace is a ready-to-use solution for eCommerce. It will be beneficial as many rely on mobile phones to get things done.

A Unique Business Model

Many online marketplaces (such as ebay, Flipkart, etc.) have proved that it will work for all business types. It depends on how we make use of it to achieve our business goals. Before owning one, it is advisable to do market research and setting business objectives to take your marketplace on a productive path.


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