For small brands, competing in a crowded digital space might be overwhelming. It is not impossible, but it requires a lot of clever strategizing and creative input while always fighting for user attention against big brands with wide presences and user bases. Making your brand bigger through marketplace creation is an efficient solution.
For instance, imagine how many small second-hand sellers are there online, and compare it with Vinted which is a brand name of a now global second-hand marketplace with US$5.4bn valuation. According to the words of Vinted’s CEO, Adam Jay: “Few European companies have built a marketplace of Vinted’s scale and our ambition is far bigger.” This indicates that the marketplace approach is a good way to enter into a much less competitive space.
The marketplace model allowed Vinted to create a huge brand, grow it quickly, and enter a space with very few competitors. This blog post will consider the reasons to opt for marketplace app development services in detail and why this move works so well for growing brands. In the end, business categories that land themselves well for marketplace mobile apps will be discussed.
Reasons Why You Should Consider a Mobile App For Your Business
Having a small brand often takes you in the direction of niche marketing, content creation, and service excellence. However, when it comes to marketplace app development services, the growth is about reaching a wider audience with a growing selection of products and focusing on macro-trends. For instance, with a marketplace, a shop can easily grow to thousands of merchandise without incurring any inventory costs. Simply having more goods means more browsing and more options equals more repeat customers. If you provide services, customers actually feel at ease if they know they can easily switch providers on the same platform. With that one-place approach, your brand gets more traffic and more visibility than any small or personal brand would. So, naturally, your marketplace will rank higher on Google search results.
Returning back to macro trends, for a small brand it might be difficult to follow a particular trend consistently. Marketplace app development services often help you diversify your offering so that whether one trend is down, there is another one that will generate network effects. At a certain point, marketplace brand growth becomes constant and relatively stable.
Why Mobile App Development is Crucial for Growing Brands?
Since the key to marketplace brand growth is scale, catering seamlessly to large numbers of users and sellers is not possible manually. Online marketplace app development services are defined as professional solutions for creating multi-seller platforms that include the following services:
- UI/UX design,
- scalable and reliable backend,
- payment integration, and
- architecture that caters to administrators, independent sellers or service providers, and users.
In global e-commerce, it has been observed that customers’ behavior is mobile-first. As such, if to compare conversions from a mobile browser and a mobile app, the mobile app experience wins. The exact percentage varies depending on the industry from 94% in retail to 233% in entertainment. However, even if it was only 5%, the marketplace is about large quantities, and converting 100 users or 105 can make a huge difference due to a network gain, increase in visibility, and compounding effect. So, for example, a 5% conversion would translate into 5–10% more revenue this month, 20–25% more over the year, and potentially double your earnings within three years. Overall, marketplace mobile app development is essential for growing brands as it is directly linked to conversions, visibility, and revenues.
Business Categories That Must Have a Mobile App
Getting a marketplace app is not a recipe for every business, but many business categories are great for the marketplace model. Yet, when it is a must-have for your business, you often have to look for the best marketplace app development services. In the table below, there is a list of these business categories with an explanation for why it just has to have a mobile app.
| Business Category | Why a mobile app is a must? |
| Clothing | Fashion is driven by visuals and scrolling and swiping are favorite user’s interactions for that. In addition, this category has one of the highest impulse purchase rates and it is best prompted with push notifications |
| Beauty and care | Most of the sales in this area are done through product discovery via tutorials on social media. Yet, there is a challenge of keeping a user loyal, so a mobile app takes care of loyalty programs, personalizations, and reminders. |
| Groceries | People often realize they need food when they are not around a laptop. And, overall, for convenience’s sake, users are more comfortable with an app: scheduling, reordering, keeping lists, authenticating with a delivery person, and tapping on the app for tips or ratings. |
| Service marketplaces | Any help around the home or garden is location-sensitive, and it just makes more sense to use mobile capabilities such as location. It is more convenient for service providers as well – while completing one job, they might get notified about the job nearby. Taxi services cannot be imagined with an app. |
| Second-hand and reselling used items | In this category, users have to submit a lot of product photos or videos. And it makes much more sense to use a phone camera directly instead of transferring photos to a laptop. |
| Wellness | Users have to manage their routine actions like counting calories, steps, or physical activity. Integrations with wearables and sleep patterns are also a mobile-only approach. |