The internet is an endless system of products waiting to be bought. More and more shoppers are searching online for the things they need and want, and it’s quickly becoming the popular way to browse and shop.
According to Internet Retailer, by the year 2020, online sales are expected to reach $532 billion and there will be about 270 million active online shoppers. Most of this shopping is expected to take place on mobile devices, like tablets and smartphones.
What does this mean for online retailers? A simplified, convenient, ecommerce marketplace could be the future of the retail store. With 80% of the current population already having made an online purchase, the popularity of online shopping is steadily on the rise.
Online retailers who haven’t yet embraced the ecommerce marketplace are missing out on an opportunity for a very powerful business model.
What is a Technology Ecommerce Marketplace?
If you’ve ever been to a website like eBay, Amazon, or Overstock, then you’ve entered the world of an ecommerce marketplace. An ecommerce marketplace is a website that customers can use to browse and purchase items from a variety of vendors.
The ecommerce marketplace runs similarly to what an in-person marketplace would. Sellers sign up to sell their goods and set up a section within the marketplace location to sell. Then, customers visit and purchase items from one or more sellers. The ecommerce marketplace is an online version of this concept.
One area that is still somewhat new is the technology ecommerce marketplace. This, as you can guess, is an online marketplace that focuses on selling only technology products and services from third party vendors. Although there are a few available, most ecommerce marketplaces focus on a wide variety of products to sell, possibly because this can attract a wider variety of sellers and buyers. None of them are doing so great, as the global biggies have a major technology/technical category already, and they are quite ahead of the curve in many ways.
This is not to say that a technology ecommerce marketplace is doomed for failure. In fact, just the opposite is true. Our world is becoming more technologically advanced than we’ve ever seen in the past, and online shopping statistics prove it.
Just as online shopping is rapidly gaining popularity, so is online shopping specifically for technology products. Books, clothes, and electronics are the top three items online shoppers search for and purchase.
So, a technology marketplace platform, with a different concept and theme is what I have decided to build next in my array of start-ups.
A Powerful Business Model
A technology ecommerce marketplace is different than other popular marketplaces. Although it might seem more difficult to come out ahead of ecommerce marketplaces that sell just about everything (really, is there anything you can’t find on Amazon or Overstock?), it actually is a very powerful business model to have in this technology-driven era.
A sole-technology ecommerce marketplace business model is fairly new territory to the ecommerce world. Most marketplaces focus on more than one category of products. In doing so they reach more buyers and sellers, typically, than a single product category can. Even Newegg, which used to sell only electronics at low prices, has now expanded to clothing, health, toys, and other products.
Competition isn’t much in the way of a technology ecommerce marketplace. However, in 2016, every generation is using technology and the online sales of electronics is gaining popularity as customers prefer to compare prices and features on the internet as a way of convenience. And, yes, a good part of technical and tech products are already sold on the other global marketplaces already.
More importantly, online technology sales are on the rise. DHgate, an online marketplace for goods made in China, sees 40% of its total sales from technology products alone. For example, eMarketer says that computer and consumer electronics products is the product category with the most online sales and it will be the category to have the most increased number of sales by 2018.
A Successful Technology Ecommerce Marketplace
In the internet world of already-successful ecommerce marketplaces, what will make a technology ecommerce marketplace stand on its own to become successful?
- An ecommerce marketplace can be one of the slowest-growing online business models because it takes time to build a strong seller and buyer relationship. In fact, this type of business can take as long as three years to grow and become successful. If there’s particularly slow growth within the first few months, it isn’t necessarily cause for alarm. However, you can consider tweaking your business model to try out new forms of advertising and promotions to attract more buyers and sellers.
- Smart spending habits focused on the long-term. As with almost any business, spending too much in the beginning to try to propel your business forward at warp speed will do nothing but leave you broke more quickly without enough revenue coming in. Budgeting for a technology ecommerce marketplace should involve as little money up front as possible and more money later as the business grows with more sellers and buyers.
- Keep it focused. Since a technology ecommerce marketplace is focused on one product category, it’s important to keep technology the focus. To start out, it might be wise to focus on one or two types of technology, like smartphones or cameras, rather than trying to bring in sellers from every category. This will allow the marketplace to start off small and focused, with more room to grow later.
- Make it mobile. 51% of mobile app users use apps while shopping in stores. Why? It helps them price-compare and check out details and reviews of the products they’re interested in. The technology category is one of the most popular to price-check through mobile technology because of the large price tags electronics can have. Creating a simplified mobile app for a technology ecommerce marketplace can provide valuable help to potential customers and drive sales if it has fairly unique products and unbeatable prices.
The Future of the Retail Store
Ecommerce marketplaces are being pegged as the retail stores of tomorrow because of the rapid rise in online shopping for almost every product category. Even the risk of shopping for clothing online doesn’t deter a lot of shoppers who like to browse and purchase online, as clothing is one of the top three online purchases.
A technology ecommerce marketplace can provide value to a customer that a brick-and-mortar store cannot compete with, especially if it goes mobile. Customers can read reviews of products they’re interested in right at their fingertips, view detailed descriptions, and even watch videos of the working product. And, buyers can view products from a variety of retailers and sellers for a vast selection. Retail stores simply cannot compete with the convenience of a technology ecommerce marketplace which has all the latest bells and whistles.
The technology ecommerce marketplace also has less cost to an owner. There is no inventory to maintain, no retail employees to pay, and the marketplace profits from advertising and fees for products sold. Much of the overhead costs are the responsibility of the seller rather than the marketplace owner.
The growing number of customers who prefer an online shopping experience for convenience and price will surely continue to utilize the power of the technology ecommerce marketplace far into the future.
A technology focus on the ecommerce marketplace can pave the way for a new frontier in online shopping. As shoppers continue to find convenience and value in online shopping over in-store shopping, the ecommerce marketplace is bound to grow exponentially in the next few years.
Consumer electronics, one of the most popular product categories for in-store and online shoppers alike, and other technology products should be the focus of a strong ecommerce marketplace that, so far, has been somewhat of a missed opportunity. A technology ecommerce marketplace business model has a lot of benefits to both its owner and its customers and is sure to become the future of the brick-and-mortar technology store.
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