


An online marketplace benefits both businesses and customers. It keeps businesses visible 24/7/365 and provides a safe shopping space for customers. Customers meeting sellers virtually is how most shopping is done now. And this trend is here to stay.
Businesses benefit from platforms where they:
Buying habits fundamentally changed during 2020. Online is safer.
It still is. That is why demands for marketplace development has skyrocketed.
Online marketplaces give customers a safe place to wander virtually and buy safely.
Is designing a marketplace difficult? Yes.
Be wise. Follow in the footsteps of today’s online marketing giants. They started by launching a Minimum Viable Product (MVP).
Many of today’s giants, such as eBay, Kickstarter, or Etsy, began their successful business journeys by first opting for a marketplace MVP development. They heeded valuable user feedback and kept improving and fine-tuning their products to meet customer expectations. They are now billion-dollar businesses.
Learn how to create an online marketplace. In this article, we help you pave the way to a successful launch and get your first customers to register on your platform.
Remember a marketplace is not difficult for experts who have already designed and developed marketplace.
They have the roadmap. They have the right expertise
Marketplace MVP development gives startups an opportunity to validate their market ideas fast with minimal upfront investment.
Globally, there are hundreds of marketplaces. Users can buy almost anything. They choose the amount, payment option, and delivery terms.
Should you give up your idea of starting a new marketplace?
No.
Find that special something your marketplace can do better than existing competitors do.
This is where MVP development helps. An MVP tests the waters to find out what users prefer and want.
An MVP is a ready-to-use piece of software. It contains core features to help you find out if your business idea appeals to users and solves their perceived pains better than any other available solutions.
When starting MVP development, your startup gets:
One size does not fit all: customer needs vary greatly. So do the types of online marketplaces. Before you start any marketplace MVP development, make sure you identify your target market and envisage a relevant solution for them.
Below are several types of online marketplaces to help you set up criteria for your solution.
Certainly, marketplaces can combine different features to some extent.
Last but not least. When expanding, many marketplaces switch to the hybrid model. Hybrid marketplaces share characteristics of different categories, e.g., make it possible to sell both locally and globally. However, when planning a marketplace MVP, you must have a narrow focus on a specific type of marketplace. Expand to other categories only after your initial marketplace offer wins a stable user base.
A marketplace MVP is a practical way of finding out more about your avatar. Startups face this fact fast. They see which ideas work, which don’t, and which need improvement.
Benefits of launching an MVP include:
Reducing all ideas to the core lets present software for startups quickly. Startups get feedback from early adopters fast and present a new version of its product quickly.
An MVP contains absolutely necessary functionality. Nothing more. Nothing extra, nothing fancy. This keeps development costs in line and results in robust software. (What you want to achieve with a reliable software development company.)
It might turn out that part of the software should be redeveloped to cater to actual needs. As long as an MVP is simple, making changes is relatively easy and affordable.
MVP development keeps development costs low helping startups “stay in the game”.
Not sure how to build a marketplace?
Use the tried-and-true MVP approach.
An MVP is a safe, relatively low-cost way to verify a business idea. Instead of aiming high—and missing—with an expensive launch of fully fledged software, a business targets a basic version aimed at solving a narrowly defined user problem. The business gets a response from the market. Based on user feedback, the business refines its idea and works on its next launch.
Rinse and repeat.
A good MVP helps product owners get to market quickly and build a sustainable business for less. How do you launch a good MVP for a marketplace?
Here are tips to help you do this:
Determine one key action people need to solve one of their problems. Decide how you are going to stand above your competitors (e.g., enable sales in local currency). Make a feature list. The feature list for your MVP for a marketplace lets users accomplish this key activity. Narrow your focus to one important action your target audience wants to do.
Flexible software development is crucial for startup survival. Requirements might change after you find out important details about user needs or habits. You need a development team that can work with changing requirements and launch features users want, even when this means reworking part of a program.
Clear, transparent communication decreases development time and costs. On one hand, you articulate your expectations ensuring the development team understands what it is developing and why. On the other, the development team provides detailed reports on the work they do. This ensures you get what you expect, when you expect it.
It could take time before a sustainable business is possible. Many startups invest considerable time and effort building a marketplace users recommend to their friends and colleagues.
To succeed, ensure you have these two roles on your project covered by reliable people:
This balances both the technological and marketing sides of startup development.
Where to save:
important note. For initial success, a marketplace can be simple but it absolutely must be reliable. Do not take shortcuts to save money on testing, poor design of app architecture, or quality of the source code.
Follow these tips to build a safe, reliable marketplace MVP users will want to try and keep using.
Now let’s focus on the technical side of the question “How to create an online marketplace?”
Developing an MVP for an online marketplace includes five steps.
For optimal success, be wise and include all five.
Some steps can be done simultaneously when using Agile development.
Here is the five-step path on how to create an online marketplace:
At the discovery stage, there is laser focus on project goals. The team does a deep dive into project details to help a startup determine requirements and a precise budget range.
During the mapping stage, the product owner and development team plan a detailed roadmap. When the development path is ready, work on the project starts.
The design stage is done separately but with both UI and UX designers working in sync. UI designers prepare layouts of the app screens and different visual elements (e.g., icons, buttons, etc.). A UX designer is needed when user flow is not clear and ensures users intuitively understand how a marketplace MVP works.
The code development and testing stage is a series of iterations during progress on the code. Software developers program source code for present and future functionality. Software engineers work simultaneously on different parts of the system to make rapid progress on the project. When a section of source code is complete, QA engineers check it and send it back for improvement if required.
Also, performance testing becomes crucial when rapid user-base growth is anticipated. It ensures software can withstand user influx.
After the codebase of an MVP for an online marketplace is ready, functional, and stabilized, the development team deploys it on the production server and/or publishes the app in an app store.
The development team works continuously on one Sprint after another to deliver the software. At the beginning of each Sprint, the team sends the product owner a plan on estimated Sprint activities. At the end of each Sprint, the product owner gains access to the finished part of functionality and a detailed report on work completed.
This is where an important project stage starts. The development team supervises software ensuring no downtime, bugs, or flaws spoil user experience. They provide needed system updates and enhance security.
Also, once the MVP is available, focus on paying attention to user feedback and adjusting it to user recommendations/requirements. Analyze user feedback and introduce changes to functionality. Make an assumption, introduce a new feature, or change existing one, get user response. With every new added feature, repeat the process until a perfect solution is ready.
There are three main options for startups when building an MVP for an online marketplace.
Startups can:
The best choice depends on a startup’s managerial and engineering background and available budget range. Still, if there is little-to-no experience, it seems wise to choose software development for startups with an experienced software development company. Startups benefit from an established workflow and accumulated expertise. Faster to the finish line. Fewer headaches.
These two show how an established company decreases an MVP’s time to market:
MyCarrier startup founder envisaged an MVP for an online
marketplace for shippers and logistics companies. Shippers find
the best prices for less-than-a-truck loads by communicating
directly with carriers. They can also use MyCarrier
functionality to book and track their shipments.
Logistics companies optimize
delivery costs by managing shipment
deliveries from one place. They can also automate sharing
required information. This increases the level of services
without extra workload.
The IT Craft development team ensured timely delivery within a
tight timeline. After six months of intensive work on software
development, an MVP was launched. The carrier portal was ready
nine months from the project start. This made it possible for
the startup to find its first clients among big transportation
companies. With new clients, the startup focused on product
improvement and delivery of new features.
With Upwedding, IT Craft helped launch an MVP for an online
marketplace for wedding services. Finding the best-suited
wedding service provider can be exhausting. A young USA couple
learned this from their own first-hand experience. They wanted
to create their own marketplace for other soon-to-be-married
couples. Potential customers find providers, evaluate their
offers, and negotiate the cost. All using the Upwedding
platform.
For service providers, the service
offers an opportunity to
publish their services and market them to potential
customers.
They can include client feedback. Also, the service makes it
possible for vendors to see the net income of their
offer.
The development team designed all algorithms to ensure complete
pricing transparency freeing vendors from tedious calculations.
This made flexible pricing in the system possible.
All successful MVPs for marketplaces contain unique, killer features differentiating them from their competitors.
As long as they serve the same purpose—providing a safe space where customers meet sellers—startups need the same or similar functionality when they build a marketplace MVP.
All marketplace MVPs required functionality for three groups: two primary user groups— buyers and sellers—plus administrators to supervise system activities and help both user groups when needed.
An MVP for an online marketplace needs the following functionality:
For you very best chances of success, remember a mobile-first approach for a successful marketplace MVP. Users prefer online shopping from their smartphones. Ensure they can do it without stress.
Further reading: What Does Marketplace Website Development Cost You in 2021?
Service promotion must start long before actual MVP development.
There are free and paid methods. Startups use both.
What about measuring effectiveness? Unfortunately, metrics for marketplace MVP success are not set in stone.
Still, the following metrics can display the signs that strategy must be reconsidered:
It is crucial to decide on a pricing strategy in advance.
Pricing options can be divided into two main groups:
The main sources of revenue for marketplaces.
Rates and their combinations can vary for different user groups (e.g., no membership fees and higher transactions for small businesses vs. membership fees and lower transactions for large businesses). This creates a balance for everyone.
Online marketplaces are businesses at scale. They encourage users to be active and sell more through the platform. Fees and commissions are an effective instrument for client retention.
The best time to start working on an MVP is now. Establishing a successful, sustainable, online marketplace takes time. The sooner you determine what you want, the faster you get started.
An MVP is usually followed by a series of forays trying to find out what users really need. The result of the first attempt might not be as mind-boggling as anticipated. Listen and learn from user feedback, correct your assumptions—then start again.
Think in advance about these two crucial points:
A business survives only when it has a stable base of paying clients. Seriously consider why people would choose your service over any competitor. Also, consider monetization (premium features? ads and promotion? transaction fees?)
You can do it on your own. You can hire an in-house team or order single development activity from different freelancers. Or you can find an experienced, reliable software development company and benefit from an established, efficient, predictable workflow.
Over the past 20 years, IT Craft has been helping startups succeed—and succeed greatly.
IT Craft will also do it for you. This is why IT Craft is an ideal partner for startups that strive for a successful MVP marketplace launch:
Development teams consist of experienced professionals who keep improving their skills. A special R&D department tries new technologies ensuring your project is based on a relevant tech stack and a prolonged software life cycle possible.
Development teams have helped many startups launch MVPs for their marketplaces. They know where possible pitfalls occur and how to eliminate them. Developers and DevOps help optimize resource consumption ensuring lower maintenance bills. Also, developers design flexible architecture to ensure scalability when the startup gets traction.
IT Craft has 300+ engineers of various specializations. It is easy to find the right team who can take over the project. The company estimates the scope of work then discusses project details with its client. As soon as they both sign the contract, the IT Craft designated team starts working. No time wasted.
A dedicated project manager and a business development manager are responsible for smooth workflow. They provide timely reports on all project activities. They always stay in touch with the client and respond swiftly within business hours to client’s questions.
Every project includes post-release guarantee support. Every marketplace startup enjoys
1 – 3 months of support when the same development team efficiently fixes bugs and flaws in their source code at no extra cost for the startup.
Contact us to schedule a consultation.