Valeriia Timokhina / 22nd October, 2016

How to create an online marketplace MVP

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Creating an online marketplace is a very beneficial business today. For many brands and vendors it is a great and inexpensive way to create awareness and attract customers. With the convenience and increased use in technology, clients are able to easily browse through your products and services from the comfort of their homes.

You probably have heard about some of the online marketplace leaders such as Amazon, Ebay, Airbnb and Etsy. They are all great services that prove that going online can be very attractive and successful as they stretch across many areas in business.

An MVP (minimum viable product) is a way to test and launch your product with the minimum features and expenses possible. By starting off this way, you can begin attracting potential customers and continuously expand your online marketplace.

So you’ve got the business idea. The next question is, what do you do with it? You may still have some doubts, but in the meantime you should consider setting up your MVP as soon as possible. Why’s that? This will put your idea to the test by validating if people are interested in the first place.

Eastern Peak posesses hands-on expertise in building on demand apps and online marketplace development. See our Marketplace portfolio and recent case studies.

How to create an online marketplace?

The process of creating an online marketplace will take some time in regards to attracting customers and giving them something to offer. The learning process for understanding what your clients prefer and how to expand your marketplace will also take time, so it’s better to start sooner than later.

In this case, starting off with minimum viable product version to test things out and growing steadily would be better than establishing large, complex (and highly expensive) web platform that no one wants or needs.

Read also:
Creating an MVP that can get your startup funded

What features should you include in your online marketplace MVP?

To start, you should stick to the basics establishing functionality and your vendor tools. With an easy approach, customers will have an easy time navigating across your site and you will learn if individuals are interested in what you have to offer.

After learning your users’ behaviour, you can then focus on improving your product. In addition to the presentation and functionality of your website, the functions of your back-office is also very crucial. A comprehensive report of knowing what your users need will allow you to study and enhance your marketplace at a later stage.

The following MVP features are what we consider to be the core of your future product:

  1. Personal profile (with basic settings facility)
    • User’s profile:
      Your MVP can include a more simplified version of a user’s profile. When the profile is complete, it will contain useful information about the user and help to define the customer’s preferences.
    • Vendor’s profile:
      It’s better to represent a full-functioning vendor’s profile in your MVP. This is the vendor’s chance to showcase their product or service and to introduce it to its potential customers.
  2. Activity history
    • For a user:
      Allowing your users to access their activity history can help them to easily navigate across products that they have viewed in the past and might have decided to buy.
    • For a vendor:
      Being able to track all the activity on your web page is important in understanding your target users’ interests and needs.
  3. Messaging system
    • For a user:
      A messaging system allows your users to interact with you and to give them the opportunity to share their thoughts or to ask questions about your products.
    • For a vendor:
      You will establish a sense of trust from your users and directly discuss about resolving any issues.
  4. Searching feature
    • For a user:
      A searching feature allows users to navigate easily and conveniently through the pages of website.
    • For a vendor:
      This feature can save you time by searching for specific products or links instead of browsing for long periods of time.
  5. Reviews and a reference system
    • For a user:
      Having a section for reviews provides the users with a sense of reliability about your product. Your users will be comfortable knowing that others have tried and tested your product or service.
    • For a vendor:
      This section can give yourself the opportunity to voice your experiences with your customers and to create more online presence and build a trusted buyer-seller relationship.
  6. Payment system
    • For a user:
      A secure payment system will allow your users to handle the exchange right then and there, all in one place.
    • For a vendor:
      Having a secure payment system will save you time and give you a breakdown of all transactions and receipts.
  7. Back-office reports, metrics, and statistics
    • For a vendor:
      Keeping an eye on the breakdown of your back-office reports can give you an upper hand when it comes to understanding your areas of strengths and weaknesses.
      Your online marketplace MVP must include this feature.

What additional features can be added later?

For users:

  • Product Comparison
    Opportunity to compare products alongside each other can be very attractive for the users. Having a good comparison system on your online marketplace is a great competitive advantage over other e-commerce platforms.
  • Sharing on Social Networks options
    Allowing your users to share and post links directly from your site can promote your business by connecting to their network.
  • Pop-up notifications
    Users may not always be aware of all the functionalities of your site. Having pop-up notifications can help bring attention to certain areas and create reminders.
  • Wish list
    Having a wish list can remind users of what they want or need. You can incorporate this information to cater your web page to meet some of their needs.

For vendors:

  • B2B interface
    Having a B2B interface will improve efficiency and enable you to grow and scale to meet market demands and vendor’s needs.
  • Comprehensive reports and forecasts
    You will be able to easily measure and evaluate your campaigns, effectiveness of sales, inventory, customer sales and customer engagement. A lot of this behind-the-scene data can add great value for future insights.

General features:

  • Version for mobile devices
    It can be implemented through creating a mobile app, responsive web design or other options.
  • Rating system
    You also can create a rating sytem for vendors and users to encourage the most active ones. The policy of the ranking is up to you but remember that rating system can be a great tool to increase user engagement.

To learn more about pros and cons of mobile solutions for your website we recommend you this article:
Do you need to develop a mobile app when you already have a mobile website version? Mobile App vs Mobile Website comparison.

In addition to this list, it’s also important to know about other factors as well.

Things to keep in mind when creating your online marketplace MVP:

  1. Keep your expenses low

    Give yourself some time to grow. Start off small and keep your spendings to a minimum so that you can develop your marketplace after getting some feedback and attention from customers. There’s no need to spend big and rush into it before knowing if your idea will sell.

  2. Tighten your focus

    Since you will be limited in resources at the beginning, you should narrow your business efforts. You can begin building traction in smaller segments and then continue to expand into bigger markets once you’ve accumulated safe feedback.

  3. Engage your users

    In order to create a lasting impression, you need to interact with your users through your product or website. What can you offer them? How will you make their lives better? Why do they need your product and what good reason do they have to tell their friends about it? Properly engaging your users will help market itself.

  4. Take your time but know when to adjust

    It should take around six to nine months to pick up some speed after establishing your marketplace. Sometimes even this can be too quick and it could take much longer. You need to develop both buyer and seller communities, and we all know this cannot happen overnight. However, if a lot of time passes and you still do not get the results you’re looking for, it could be time to reassess your model or business plan.

Here are some reasons why you should not use ready templates for your MVP:

Collecting valuable insights
It may seem easier and logical to dive through endless templates and pick one that is already made. However, this may hold you back in the future. Why? Templates simply do not provide a back-office function for you to monitor metrics and get statistics regarding your end users’ and vendors’ behaviours, needs, and goals. In terms of your MVP, this information is necessary because it will provide you the insight you need for your product’s growth and for future investors.

Focus on your business goals
Developing your marketplace from scratch may be a good idea because it gives you the possibility to construct things exactly as you want it. You can develop your business idea and construct it to your needs from the very beginning. There will be no need to go back and re-do the entire website template to fit your new business model once you’ve begun to grow.

Scalability
Last, but not least important. Your product will definitely grow larger and larger in the future implementing more complicated functional and adding new services. The ready MVP templates doesn’t suppose this opportunity for future growth of your marketplace.

See our Marketplace portfolio and On-demand economy apps case studies.

With this, we recommend reaching out to software development companies who can help you build your personal MVP. There are specialists who are ready to listen and help you develop your ideas and put them directly into the market. Explain to us your idea and we’ll provide you with a fair estimation. With your project’s clear vision, we’ll then discuss your development plan every step of the way until you’re satisfied in moving forward. Our experienced developers are looking forward to taking on the mission of bridging your ideas into action.

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