Online Marketplace Tools & Software Comparison

What is Marketplace Software?

Marketplace software allows users to create and manage e-commerce solutions that host goods or services from multiple providers. With relatively little effort, a marketplace can be created - following a similar principle as Amazon or eBay. The tools usually simplify the entire process of generating, hosting, and long-term organization of such a commerce solution. They provide design features, communication tools, shipping options, and other functions that are centrally important for building or operating such a business. Basically, online marketplace software resembles traditional shop systems. The main difference is that the latter usually only provide offers from one company and not those of multiple traders or producers.

Good online marketplace software brings the following features or benefits, among others:

• It allows users to create, host, and organize an e-commerce website that unites multiple sellers of goods or services.
• It provides commission options, through which operators of a marketplace can earn profits from the sales of participating traders.
• Online marketplace software includes payment tools, shipping features, and other e-commerce necessary features or allows these to be added via integrations.
• It provides contemporary security and/or encryption features and ideally supports users in complying with applicable e-commerce regulations.
• It enables or simplifies communication with participating providers and end customers.
• It brings together a large number of companies and thus a large number of customers in one place.
• It offers the opportunity to market the products offered directly via the platform or using plugins, integrations, etc.
• Ideally, it can be flexibly scaled - also in terms of price.

How does Marketplace Software work?

Marketplace software is similar in its basic functions to other e-commerce software but allows multiple traders or producers to sell their goods or services on one platform. This means there are usually design functions, product organization features, payment and shipping options, marketing tools, and other typical features of conventional shop systems. Owners or operators of online marketplace software do not need to keep any inventory themselves, they just have to maintain their marketplace and ensure that other companies use it. Of course, marketplace providers can also sell their own products on the platform. By adding additional traders and their offers, operators then have the chance to supplement their selection appropriately. Since multiple traders are hosted and therefore probably many different end customers use the marketplace, operators should have a strong support network that covers all parties. Customer service in two directions is sometimes required. Functions that reduce the associated effort are often directly on board with online marketplace software.

What key advantages does marketplace software provide?

Among other things, marketplace software offers smaller companies the opportunity to operate e-commerce on a scale that would not be possible based solely on their own operational prerequisites. For example, production companies with a smaller range of goods can generate more reach for this by joining forces with other producers or traders who distribute complementary products on a marketplace or offer them the opportunity to offer their range there. End customers then get such a large selection on the marketplace that would not be achievable for the individual company. With a clever concept or a niche idea, it can even be worthwhile to build a marketplace without providing products yourself. A lot of work will have to be put into convincing companies to participate in such a platform, but the end operation is in some places much easier and cheaper than selling goods or services yourself. The procurement of appropriate products, the maintenance of the supply chain, the organization of the assortment on site, the packaging, the shipping, and some other central factors of e-commerce are eliminated for pure operators of a marketplace. This of course also means generally lower costs. The company that provides the marketplace only has to maintain the platform itself and not distribute and manage the listed products with perhaps a lot of personnel. Marketplaces can also - partly due to the low costs - be easily scaled as needed. If a large number of companies want to offer products or services on the marketplace, it is much easier to organize this than to buy and sell inventory yourself.

Software for Online Marketplace: What are the typical features?

The following functions are typical for online marketplace software.

• Search function: With a multitude of providers or goods and/or services usually represented on a marketplace, a simple, effective search is a big advantage. Even with the big marketplaces, i.e. Amazon and eBay, the search function is usually preferred over browsing in the categories.
• Trader pages: Traders should be able to build their own pages through the marketplace software, where they can offer all their products and/or provide important information, such as telephone number, email address, etc. If the pages can be branded, this helps end customers to easily recognize brands of interest to them, which in turn makes participation in the marketplace more attractive for traders.
• Easy registration: Third-party provider should be able to easily open a new account on the marketplace and list their products there just as easily. Complex procedures always scare off sellers – regardless of the industry – and are often a central reason when it is decided to switch to another marketplace.
• Adapt to customer preferences: The opportunity for traders to customize their products or services offered on the marketplace as well as their personal pages helps them to create a purchasing experience tailored to their customers and their brand goals. This is very important for many potential participants in marketplaces.
• Trader Dashboard: A trader dashboard makes it easy for traders to track sales, profits, and other data generated by the distribution of their goods or services on the marketplace. Using this data, which is best presented in an easily understandable format, traders can instantly see the status of their presence on the marketplace and make quick and easy adjustments as needed. Dashboards are often also hubs for customer communication.
• Support functions: Marketplaces are used by both traders and customers, both groups always have questions, concerns, or problems. With a robust support hub, marketplace operators can satisfy both sides equally.
• Product recommendations: Marketplaces can be confusing and difficult to navigate - especially when not looking for something specific. Product recommendations make it easier for customers to find what they like or need. These recommendations are optimally data-based - among other things based on the visit or purchase history. Such personalization also makes it more likely that visitors will actually make a purchase.
• Reviews: Reviews from real customers have great persuasive power in e-commerce. Visitors to marketplaces often already expect to find corresponding comments. Modern marketplace software, therefore, almost always has review features on board or lets them be added.
• Commission opportunities: Owners of a marketplace are generally given the opportunity to generate income through commission with their marketplace software. Some marketplaces allow different models here. In addition to percentage calculations, fixed prices (for example 1 euro per sale) can also be determined for the participation.

Marketplace Software Comparison: What types are there?

Many marketplace softwares are offered as standalone platforms. However, there are also plugins that can be linked to content management systems or shop systems. Especially among these extensions, marketplace software open source is often represented. Companies can use this marketplace software for free. The standalone applications usually have to be paid for. In addition, the systems differ in their orientation. No software solution is perfect for all different types of marketplace ideas. There are specialized applications available for the distribution of goods, services, or digital products. At the base, it is segmented into B2C or B2B marketplace software. The market also offers special C2C platforms. With these, for example, ad portals, like eBay classifieds, can be switched. C2C marketplaces not only serve to sell physical products. It is also possible to offer private services. Most online marketplaces have a lot of requirements in common. For example, such platforms usually have to offer customizable user pages, reviews, and dashboards in their range of functions. But there are also other functions that are more specific to the respective type of marketplace. For instance, marketplaces that deal with rentals or services have an integrated booking calendar that is usually missing in software for the distribution of goods. The type of marketplace software is always a very important factor for the selection of a suitable system. Ideally, interested parties should resort to a special solution for their industry. Of course, all necessary functions to support the specific marketplace idea and the business model should always be present.

What should you pay particular attention to when choosing a marketplace software?

A careful marketplace software comparison is very important. After all, the marketplace that is ultimately based on the chosen system will probably be a central aspect of your own business activity. Ideally, it generates a lot of revenue. In order to find the best marketplace software for your own purposes, interested parties should primarily take a close look at the following conditions of the solutions that might be suitable for them.

• The focus of the software: Do I need a system for B2C, C2C, or a B2B marketplace software, should goods or services be sold, is it about digital products - are there perhaps one or more special solutions for my industry?
• Expandability of the software: Can the solution grow with my business, does it offer analytics tools that help me to expand, can the software be extended by plugins or individually - keywords "API", "marketplace software open source" and "headless"?
• The provider company's pricing model: Can I really make money under the conditions offered, are the prices within my budget, does the price-performance ratio match?
• The services included in the software: Does the software provider offer hosting, server monitoring, automatic updates, data backups, support, etc. – do I get all the support I need?
• The company's references: Is it an experienced software company that is possibly responsible for many marketplaces in my industry, are there parade examples, can the provider offer me long-term securities?