Marketplaces are continuing to grow with big industries getting onboard such as Intel and Hallmark. These big enterprise companies are a strong indication of how important marketplaces for the future. What about for the little guys that are just starting out and trying to get their feet wet? Don’t worry there is enough to go around.
As you determine what industry you want to base your marketplace around, it is important to understand the bigger picture of things. Don’t go into it and think “Oh I will create this and become a millionaire.” If that is your mindset, you definitely are doing it for the wrong reasons. Choose something you are passionate about and will be manageable for you. Trying to tackle the big guys right off the bat will put you in a deep hole going into it. Start small but think big when it comes to your marketplace. Let’s find out 4 important reasons why starting small is best for long-term success.
1. Start With Specific Location.
Just like any big marketplace, you have to start somewhere. Airbnb started in New York while Uber started in San Francisco. Both of these marketplaces were new to the market and quite frankly were not popular among the public. The idea of sleeping in a stranger’s home or jumping in the car with someone you did not know was a scary thing.
No matter what industry you are targeting, be sure to start in a specific location. Ideally, you have done your research and tested where the demand is. Once you have figured that out, go for it. Get your brand name out there and start making connections in your targeted city. This will help give you an idea if you need to expand into other cities and even countries. Gauge the interest as you go but don’t jump the gun to expansion too soon. Explore your options and when the time is right, venture into new geographic locations.
2. Offer Different Pricing Points.
Everything has a price and for some, it comes at a higher or cheaper expense than others. Whether you are a product or service marketplace, you must provide different pricing points. How else will people get a chance to try your marketplace out? Sure you can offer a 5 or 7-day trial, but what really can people get from that? Let users get comfortable with what you are providing and really gauge whether they want more of it. Offering the free version will, of course, have limited functionality but a good way to reel your customers in.
Once your product has been tested by the consumers, the ball is now in their court. Do they need to purchase an upgraded plan with more functionality or are they okay with what is being offered? It’s important for your team to keep in contact with these customers and help guide them down your sales funnel.
With your paid plans, offer different levels. A good place to start is with free, low, mid, and high price points. This will allow users to fit their budgets while getting what they feel is the best bang for their buck. Limit functionalities in your free model and as the price gets higher, open those functions up. The higher pay customers will get access to everything while taking key ones away can help distinguish your plans.
3. Make Your Process Simple.
Nothing is more painful for a consumer than having trouble finding the signup or checkout button. The evolution of people have become the “right now” and whichever is the most convenient or efficient way of getting things done. Why work harder getting on a train that has limited stops and can be very unreliable when you can simply book a Lyft from where you are? No need to walk a few blocks to the next train stop, when you can book it all in the palm of your hands. While things would be a different story if Lyft’s UI was unreliable and glitchy, but they have done a well enough job to gain the trust of its users. Simply open the app, set your pickup location and destination, and you’re all set.
Just like any of the successful marketplaces they have made their signup and onboarding processes seamless. Don’t make yours super complicated but rather just enough for the users to get started. Start with getting a name, form of payment, and address if it is a product based marketplace. Other than that, it’s all you need for the initial signup. Leave the rest as an option for users to customize and insert more information into their accounts. The less time they spend signing up, the more time they have to browse around in your marketplace.
4. Concentrate On Growth.
While you are starting out small, this will help you manage all your users and create better relationships with each user. If you are growing too fast, you will be sacrificing your customer service which in turn can lead to people leaving your marketplace. It’s important to keep growth in mind but at a rate that is suitable for your team.
Your business will grow if you are actively engaged with your community. Don’t expect your marketplace to grow itself once you have gone live. It takes a tedious effort and promotion to your team’s end to get users to join. Even if you have this wonderful marketplace, you will need to spread the word.
The first thing you must do is create your buyer personas. Once you have done that, figure out where they spend the most time. Is it on social media, watching tv, or just browsing the web? Your job as a new marketplace is to concentrate on the growth and how you can build momentum.
Here’s a short list to get you started with your growth process:
- Building your email lists.
- Concentrate on building your SEO.
- Get active on social media.
- Offering promotions and content to engage users.
- Run webinars and offer free ebook downloads
While this list is just a sample list, there are plenty of other ways to help grow your marketplace. Get creative and try to do something that helps you stand out from your competitors.
As you continue to put your focus on growth, just remember where you came from. All the hard work you and your team has put together can go away in an instant. Nurture relationships with every user and customer on your platform to provide the best possible experience. With a well-oiled marketplace, the sky’s the limit.
Do you have any stories to share about the success of your marketplace? We’d love to hear what bumps you have hit along the way and how you were able to overcome them. Give us a shout on social media.