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- A Complete Guide to the Digital Marketplace
Moving digital has been the buzzword ever since the pandemic hit in 2020; it’s no coincidence that several of today’s most valuable companies are digital platforms. Having an online marketplace offers a level of resilience to withstand and overcome many traditional business challenges; however, just having an online marketplace is not a guarantee of success. This infographic looks at the biggest drivers of success for online marketplaces and the different marketplace models that have emerged to drive higher RoI opportunities for the platform.
A Complete Guide to the
Digital Marketplace
Successful online marketplaces need:
A key differentiator – either in the offering or the distribution mechanism, to stand out and compete with the Amazons and Ubers of the world.
The platform should be easy enough for sellers to quickly set up and start selling, and powerful enough to provide the capacity to carry out multiple transactions at scale.
Top 5 Most Valuable Companies
THEN and NOW
Digital marketplace companies account for half of
world’s top 10
most valuable companies in 2022.
Four out of the five
top companies are
digital marketplace platforms
Digital marketplaces place the responsibility of inventories, logistics, product pictures and descriptions, and pricing to the market
seller instead of the owner.
It also enables small companies – such as the once start-up online bookseller Amazon – to extend their reach and potential market almost overnight, without big upfront costs.
75% of business executives think digital marketplaces are successful because of the convenience to customers.
In 2021, online sales on B2B marketplaces increased 17.8% to $1.63 trillion. The reach of B2B marketplace is 2× that of B2C.
The Digital Marketplace Models
Tenets of a
Digital Marketplace
Ease of doing business, frictionless interactions and transactions.
Economies of scale where a business gains cost advantages due to the scale of operations.
The E-commerce Model
Company A offers its products and services to customers online.
Customer views and selects based on their need.
Customer checks out using their desired automated payment mechanism.
Marketplace 1.0 Model
Model 1.0 allows bundling of products and services with that of your partners.
Thanks to the ability to bundle your products and services, you as a provider can expand your portfolio and invite more customers to your platform.
Customers can compare exclusive offers and finally complete the deal using any automated payment mechanism.
Marketplace 1.0 can be a B2C or a B2B
Marketplace 1.0 can also be a B2B2X model
Example of Marketplace 1.0 B2B2X Model
A mobile service provider features a health monitoring app on their marketplace platform. The app is owned by a healthcare company.
Marketplace 2.0 Model
Aka "marketplace-as-a-service" model where you "digitally enable" your partners by giving them a marketplace of their own. You configure your core products in an as-a-service model, by default, on the marketplaces you sell.
In addition to the above two marketplace features, your partners enjoy greater visibility.
Lastly, your partners gain all the necessary tools to build their marketplace and expand their network of customers.
Example of Marketplace 2.0 Model
A transport provider (like redbus) decides to offer an instance of its digital marketplace, as-a-service, to its insurance partner and by default bundles its services on the marketplace of the insurance company.
Key Features of Marketplace 2.0
Variety Built-in
The 2.0 model supports B2B, B2C, and B2B2X models and allows for tailored workflows.
Personal Touch
Keep things on-brand with your
personalized logo, theme and custom domain.
On-the-go management
Manage, monitor and customize your
marketplace whenever and wherever you want.
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