Niche vertical marketplaces
Why fit in when you were born to stand out
Niche vertical marketplaces - where operators serve the needs of a specific audience - are the hottest commerce trend of 2021. Here’s why you should be paying attention.
While we see potential in both horizontal and vertical markets, it’s the niche-specific marketplace model that represents an incredible opportunity to drive growth through market differentiation and operational footprint expansion
– Jason Wyatt, Managing Director, Marketplacer.
In 2020, $2.767 trillion was rung up in sales by the world’s top 100 online marketplaces, more than half of all global ecommerce sales. As businesses look to replicate this success, the digital marketplace sector is heating up. For good reason. Marketplaces give operators the mechanism needed to offer customers a larger and richer selection of products, without having to increase on-hand inventory, logistics support or even outlay significant amounts of capital.
To avoid competing with established industry behemoths such as Amazon and eBay, smart operators are eyeing up the potential of the niche marketplace. By avoiding the broad, vague offerings of sites that sell everything and anything, niche marketplaces focus on a narrow set of products based around a hobby, a community, or a single retail category. The advantages are manifold.
With fewer competing stores and marketplaces in any given niche, it is easier to become an authority and carve out a chunk of the pie. Niche sites also know a target market inside and out, making it easier to solve (and evolve) customer needs and meet their demands. For example, with a narrower product range operators can devote time to delivering a quality customer experience that speaks directly to their consumer. Ultimately, this personalisation manifests as a trusted, meaningful community. And when it comes time to get the word out, it’s easier to reach out and market to a well-defined target audience.
The niche marketplace opportunity is ripe in Australia. The past few years have seen numerous marketplaces quickly launch and realise success.
Providoor, an online marketplace launched in just 5 weeks, delivers chef-prepared meals to the doorsteps of eager Melbourne foodies. They are now forecasting $1.5m a week in orders, less than a year after launch.
Global Sisters have changed the lives of thousands of woman and democratised entrepreneurship with the launch of a marketplace specially for female-led micro-businesses.
SurfStitch scaled to reach a 300% increase in new vendors, selling over 500 brands, in just a few months to become a leading coastal lifestyle platform.
Myer launched their marketplace, seamlessly integrated into their existing eCommerce site providing customers with a curated range of higher-end local and international brands.
The common bonds that tie each of these marketplaces are twofold.
- They all found their unique space in the crowded ecommerce landscape, and
- Each leveraged the Marketplacer platform to get to market quickly and seamlessly.
Determining the marketplace strategy that works best for your customers, and your new or existing business, requires careful consideration. As the leading marketplace platform provider, Marketplacer can assess your business, market segments and the fit of a marketplace to ensure your solution has both profit and growth potential.