Marketplaces, or Matchmakers, grab all the attention in the platform world because the B2C/C2C examples are so famous (e.g., EBay, Uber, AirBnB, and Angie’s List). But B2B marketplaces are much harder!
Marketplaces seek to create new business relationships between buyers and suppliers who were previously unknown to each other. Their value proposition is to make it easy for buyers to search for qualified suppliers and for suppliers to receive qualified leads or RFQs.
Because businesses do not add new suppliers as easily as consumers do, B2B marketplaces have an especially challenging task.
For Marketplace clients, I often end up addressing one, or more, common issues:
Beating Google and Amazon
If a marketplace is going to drive buyers to its site, it better have better content than Google and Amazon, because that is where everyone starts!
Solving the “Chicken and the Egg” Dilemma
Marketplaces are “poster children” for this problem. Buyers need a rich selection of suppliers to be motivated to search and suppliers need a critical mass of buyers to list their offerings. I help clients implement a variety of adoption and pricing strategies to try to overcome this “Catch-22”.
Creating Recurring Relationships
Once a buyer and supplier find each other, what’s to stop them from going off-platform for all subsequent transactions? Product design and value-added services must address this issue.
Marketplaces must decide which additional services to offer: payment, financing, credentialing, aggregation, etc. and in what order.
The marketplace world is starting to settle on variants of one pricing model, but there are still many nuances to sort through.
Marketplaces help buyers by decreasing search time and effort to find suppliers and help suppliers by reducing sales costs. Marketplaces help buyers find goods and services, share assets, or perform crowdsourcing.
Here are some examples of B2B marketplaces: