Marketplaces: different types and amount of control

Quality of experience/marketing

If you want to ensure the quality of your service or product, then you’ll have to have some control over this. When you simply connect supply and demand — but don’t take an active position over the quality of goods that are being traded (say, food, gadgets, or sports products), then you might be a great ‘matchmaker’ (such as Craigslist is), but you won’t be able to guarantee a certain level of quality (of the product, delivery times, customer service, etc.)

Data capture

Another important factor for maintaining a level of control are data capture and business intelligence. Take, for example, one of our clients that was thinking about starting an e-commerce platform on WhatsApp and Facebook. Though that would be a very smart decision in terms of ease of use, and removing the entrance barrier for people to download a dedicated app, our client would also give up a lot of data points. As 3rd parties enter your ecosystem, you will often lose ‘eyes’ on data that’s valuable to you. Building a standalone marketplace or e-commerce, therefore gives you control over more data, such as traffic, conversion, ad budget ROI, and other factors.

Commission, delivery and usage costs

Lastly, you might want to evaluate how much control you want over commission, delivery and usage costs that your marketplace actors have to pay (or receive). For example, in a ‘free for all model’/matchmaker, suppliers set their delivery costs and may choose to increase or decrease that number, at any moment. This gives them the opportunity to seize the spotlight with discounts, ‘hot deals’, and other tempting offerings — which is all great — but also induces the risk of end-users being scared away because of high additional costs, when ordering their product.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store