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Stand alone e-commerce site versus 2 sided marketplace

Hi All, How do you evaluate the pros and cons of developing a stand alone e-comemrce site versus a real marketplace with buyers and sellers for a possible niche category. I am thinking mobile app.

For the former there is inventory management etc. What should I be thinking about?

And are there of the shelf tools I can use to build the latter (marketplace) since I am not an engineer?

Thanks

9 Replies

Vineet Rastogi
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Vineet Rastogi Entrepreneur
B2B: Cashless Marketplace! HealthCare ! Give me your surplus inventories NOW!
Hi Noopur, Are you contemplating - managing your own e commerce business? In that case, either of them is a good option. Depends on your USP. However, if you have to sell your services to your clients, standalone e comm sites would be more liquid and every time, you shall be able to cash-in your efforts in small installments whereas, in the marketplace model, your bet will unfold right in the end and its anybody's call. And that risk-reward analysis, its purely your domain, based on your SWOT.. Join us FREE..Membership Fee is waived for first year!!! We help you trade prosperously on cashless platform -BIZpaye! *Vineet Rastogi* Co-Founder, Director & CEO BIZpaye India. www.BIZpaye.in +919820449982 Connect via Linkedin *Visit our Facebook page* Have a look at how BIZpaye works in small animated file *# More Customers # More Sales # More Profits #* We arrange systematic multilateral tie-ups and transactions amongst various types of entities who are in the business of selling goods or services through an exciting business development model capable of generating local, national & international sales for you through our cashless platform. If you are any business or a professional , please immediately send me the list of your surplus / perishable / underutilized / slow moving / stuck / even seconds' inventory asap. I may have some good options. Collaborate we must !
Chris Taylor
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Chris Taylor Advisor
Director, Channel Marketing at Yuneec USA, Inc.
Noopur - can you share a little more information about what you're selling?

Ecommerce Site: there are lots of tools and services to let you create a site without a huge amount of difficulty. You have to drive the traffic to it for people to see your product or service. Minimal cost for the infrastructure but there's obviously a cost to drive traffic.

3rd Party Marketplace: you're taking advantage of traffic the marketplace is driving. You'll pay some fee to the marketplace for that traffic. Usually the marketplace will have the tools/services to create your presence.

Your Own Marketplace: not sure if you really mean creating a new marketplace from scratch. Attracting others to sell similar or related offerings? The challenge here is the balance of buyers and sellers. If you don't have enough sellers/products, buyers won't see the value. If you don't have enough buyers, sellers won't see the value. And you're back to having to drive the traffic.

Many businesses will have a standalone ecommerce site but still have a presence in a marketplace that is relevant to their business.

Don't know if that helps but maybe a little more detail about what you're selling might help everyone give feedback. Good luck whatever route you take.
Jerry Kavesh
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Jerry Kavesh Advisor
CEO 3P Marketplace Solutions
Noopur

I'm not clear as to your intent as these are two very different models.

Are you looking to develop your own Marketplace or trying to evaluate selling your products on your own ecom site versus selling on a Marketplace?



Noopur Pandey
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Noopur Pandey Entrepreneur
Product Leader
Sorry guys should have been clearer.

1. Selling products on my own e-commerce site

2. Creating my own marketplace sorta like Etsy and others and getting buyers and sellers together for a niche (s) category of products.

Totally understand the traffic issue but from the outside latter does not have inventory hosting and other issues which 1 has. Both have traffic issues right. What should I be thinking about for both?
Noopur Pandey
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Noopur Pandey Entrepreneur
Product Leader
I am super impressed with this one !

http://fortune.com/2015/04/16/spring-raises-25-million/
Sujit Hemadri
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Sujit Hemadri Entrepreneur
Nobody
For a marketplace to yield you good returns you have to consider multiple categories instead of a niche one. For a niche category, it is easier for you to identify both buyers & suppliers within a fairly quick time. So, that can be a standalone one. Hope that helps.
Rufus Casey
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Rufus Casey Entrepreneur
Maker of Things
I disagree; my 2 cents is that a marketplace for a niche would work better with less categories- the narrower the niche the better. After recently re-reading Peter Thiel's Zero to One, his advice would be to dominate a small market then expand sideways.
Can you think of any ways to get a seller to recommend your marketplace to their customers? If so, the same might hold true for asking buyers to recommend their other favorite sellers. This would help with growth and has a 'network effect' of each new buyer or seller adding value to all the others and the marketplace in whole. If you're simplifying the buy/sell process, perhaps all involved could justify a per transaction cost, like the business model Spring uses in the linked Fortune article.
Noopur Pandey
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0
Noopur Pandey Entrepreneur
Product Leader
Thanks Rufus! I do like the spring model and yes I agree with your thinking :-)
Daniel Berger
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Daniel Berger Entrepreneur
Owner at MCC CODE
Hi Noopur,

Both Ventures have enormous potential;

A marketplace will require extensive resources and development as well as substantial funding and staffing on many areas; so it really is a question if the infrastructure is there.

A Solid eCommerce site would be an easier path and even a good launcher for a future MarketPlace, creating a brand name for the your business will be essential. And a future migration of your well known products to a MarketPlace would serve as a catapult for that.

My two cents is to start with an eCommerce site and see where it takes you


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