What is a Marketplace?

Traditionally, marketplaces are a space where sellers and buyers converge to offer and purchase products.

When Amazon first launched its online marketplace in November 2000, the idea of third-party vendors congregating on a website to present products to consumers was still very much a novelty. These days, marketplace sales account for 62% of the global online retail sales. In 2020 alone, about $2.67 trillion was spent on the world’s top 100 marketplaces.

As global marketplace giants such as Alibaba, Amazon, eBay, and Etsy make continued efforts to increase their market share, the relevance of online marketplaces will become even more apparent to potential vendors and businesses alike.

Manufacturers underestimate the potential of marketplaces.It’s not just about offering products, but creating a self-reinforcing ecosystem through a holistic experience of products and services for customers.

– Alexander Graf, CEO, Spryker

Marketplaces offer immense growth potential for businesses within B2C and B2B industries. By adopting a marketplace model, companies have the opportunity to scale at a much quicker pace while reducing risk. Gartner predicts that by 2023, 15% of medium-to high-GMV digital commerce organizations will have deployed their marketplaces, thereby creating an entirely new digital ecosystem.

For organizations with an existing traditional e-commerce platform, a digital marketplace could be the next step in accelerating customer acquisition and increasing revenue.

Marketplace Definition
Marketplaces enable several vendors and potential customers to connect on one platform, offering a diverse selection of product and material sources from more than one geographical location.
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