How To Create a Marketplace App

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Why should you consider how to create a marketplace app? According to statcounter.com, the number of mobile users from October 2017 to October 2018 was 48.2%, as opposed to 47.78% desktop users. Mobile applications are attracting more and more people. So many startups won’t even create a desktop version of their projects, and instead will start with a mobile app.

AliExpress, Amazon, eBay, Etsy, Shopper, Uber, Airbnb, TripAdvisor – creating a marketplace app like these is likely your dream if you are reading this article right now. This is a brief outline of what you need to know in order to create a mobile app.

WHY BUILD A MARKETPLACE APP?

The world’s most influential media Forbes concludes that: “Marketplace startups are eating entire industries. The companies tend to challenge the status quo of industry sometimes finding great success.”

As reported by Statista, retail e-commerce sales have grown incredibly fast, reaching $2.8 trillion in 2018, and are expected to increase in the future, as shown in the figure below.

statista-ecommerce

DEFINE THE PRODUCT

Before creating your own application, you should know more about online marketplaces. For example, marketplaces can be either vertical or horizontal.

Vertical marketplaces include goods or services of one type that are different from sources.

Horizontal marketplaces combine different types of product and service offers.

horizontalvertical

There are three basic models of online marketplace applications:  customer-to-customer (C2C), business-to-customer (B2C) or business-to-business (B2B).

online-marketplace

In order for your marketplace app to start making a profit for you, consider its distinctive features, because competitiveness is important in the world of popular applications. Start by analyzing the marketplace applications that you are aiming to compete against. Determine what features and specialties they contain. Read users’ comments to determine what they liked in these applications and what they did not like. This can give you hints of the features to choose for your application.

It is also necessary to select your target audience. What category of consumers will your application be focused on? Perhaps there is a specific age criterion.

IDEA

Conceptualizing the idea or purpose behind the app is one of the most important steps in creating your application. It could be an application of sales, like Wish, it could be for used goods only, or it could even be a service platform. Think about the categories of items for sale. Will it be a specific type of product or a mix of several categories?

MUST-HAVE FEATURES

If you experiment with the most popular online marketplace applications, they will all differ one from another. But they also have common features, which are preferable to implement first and foremost, because they will affect the competitiveness of your application.

Simple Login Process.

Each person has to sign up or log in an application before a purchase can be made. Now, many applications support social media account integration. That helps people to log in two clicks without any extra effort. It also allows people to share appealing offers from your marketplace application with their friends on social media.

Reviews and Ratings.

Everyone likes having information about products and services, especially, when it is a review from a real and experienced person. Of course, the feedback cannot always be positive, but this is necessary for  accuracy.

Wish List Button.

The ability to bookmark any item a person wants to buy later is very useful. It helps a buyer to view, identify all the necessary items from the list quickly or to receive a notification that the product is available.

Thumb-Friendly Zone.

Compare the layout of the buttons, and the location of banners with other applications. This will help you create the design for your application. The User Interface (UI) should be designed so that a person can use the application comfortably either with one hand or two, whether left-handed or right-handed.

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Analytics.

Analytics will show you the most popular items or services sold via your application, as well as what attracts people to it. It can also show users’ reclaimed functions from your application.

In addition, the following features can be found in all other marketplace apps: multiple payment options, language support, push notifications, search, sorting by price, rating by users, location-based functionality, and personal profiles of sellers and buyers. You’ll more than likely need to add these to your application in order to create a competitive product.

To decide what features to include, divide them into three groups: “must have”, “desirable” and “can add later”. This can help you plan your budget if you choose custom app development. If you are going to create your application via an app builder, then you should learn about the builder’s functionality. Make sure you are able to implement all the features you need in your project.

HOW TO EARN MONEY WITH A MARKETPLACE APP

Last year, Amazon’s net profit was $.03 billion USD. Uber’s net profit was $6 billion USD and Alibaba’s was – $8.42 billion USD

There are different ways to profit from a marketplace application. An example is a commission on sales, like for Uber, Airbnb and eBay. You can set a fixed amount of money or charge a percentage fee from each purchase. In such a scheme, sellers pay the service only when they have a sale. Sellers, in their turn, have an opportunity to place their ads on popular resources.

Another way to make money is the “freemium model”. It provides advanced functions to a user for money. For example, a brand representative can place ten products on your app for free. For an additional fee, he/she will be able to expand the range or increase the position of the store or a specific product in the search results.

A paid subscription is when a user gets access to all capabilities of the site for a fee for a certain period of time. There are membership fees that vendors pay to trade on your appб, which can be one-time, monthly, or yearly.

Marketplaces can also take money for linking sellers with potential customers, who are interested in getting the particular services.

HOW TO CREATE A MARKETPLACE APP

Using an app builder and custom development are two ways to create a marketplace app. Both have their pros and cons, as shown below.

 

Pros

Cons

Mobile App Builders

save money

launch easily

on-the-go updating

feature limitations

information leakage possible

shared ownership

Custom Development

your exact set of features

reliable support service

add features at anytime

proper security

high costs

takes time

 

Before starting your project, weigh the pros and cons of both options. Keep in mind the list of features you would like to implement in your application while choosing between an app builder or contacting a software development company.

MOBILE APP BUILDERS

There are many builders for creating mobile apps. If you have not searched yet, you might consider BuildFire or Appy Pie.

Buildfire has the following prices:

buildfiremonthly

Yearly prices are a bit cheaper than monthly fees. You can also create your own plugins and even sell them to other users.

In addition, Buildfire has a calculator where you can compare how much will it cost to create an application with this app builder versus a software development company.

Appy Pie allows you to create your application in three steps:

  1. Customize your application as you want, and don’t forget about the name of the application;
  2. Drag and drop the features you need;
  3. Publish the application.

This can be done both for iOS and Android. Appy Pie can also convert a website to an app, build Windows application, and provide custom development.

Here are the prices for monthly plans using Appy Pie:

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In addition, you can save money by purchasing a yearly or lifetime subscription.

CUSTOM DEVELOPMENT

If you decide to turn to professional developers, then you should determine determine where you want your developers to be located. If you are happy to control the development process from a distance, then you can choose a company from anywhere in the world. If your prefer in-person communication with developers, then look for companies in your region.

Study the ratings and reviews of development companies, and check out their sites and portfolios. You can contact a company representative and ask questions, including their experience in developing similar applications. Explain clearly what you expect at each development stage, ask for quotes, request a preview, and make an appointment if you think you’ve found the right company to work with.

HOW MUCH WILL IT COST TO DEVELOP A MARKETPLACE APP?

The cost of a marketplace app depends on the number of features that you want to include. The more time it takes to develop the application, the more expensive it will be. That is why it is better to divide the list of features you want in your application into three groups and to choose only the most important features first. Don’t forget that the interface and design are key factors that attract users.

The approximate cost of a marketplace Minimum Viable Product (MVP), calculated by VironIT analyst, is given below:

 

Marketplace App MVP

iOS

Android

Mobile Development Technology

Back-end Development

Admin Dashboard

UI/UX Design

Quality Assurance

Project Manager

Total:

$9,000 – $11,000

$4,750 – $6,500

$2,000 – $2,500

$3,000 – $4,500

$2,100 – $2,700

$1,400 – $1,500

$22,250 – $28,700

$10,250 – $12,250

$4,800 – $6,500

$2,000 – $2,500

$3,000 – $4,500

$2,300 – $2,900

$1,500 – $1,900

$23,850 – $30,550

These prices are approximate, because they depend on the features that you include.

A little hint: If you want to reduce the cost of the project, you can develop an iOS and an Android app simultaneously, and the total cost will be less than developing two completely separate apps.

WE ARE READY TO HELP

If you’ve weighed the pros and cons of the three ways and you’ve chosen custom development, contact us. The VironIT team will consult with you on creating a marketplace app based on your specific needs.

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