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In 2021, the global e-commerce market was estimated at $14.30 trillion. The experts predict it will reach $58.74 trillion by 2028. Now one-third of worldwide shopping purchases are made on online marketplaces such as eBay, Alibaba, or Amazon.

Devox Software has helped many businesses reach their key business goals with the help of top-notch digital solutions. Being a renowned web development company, we cover a full cycle of online marketplace development. In this article, we share insights on how to build a marketplace website.

Why You Need to Build a Marketplace Website

A marketplace is a web platform where various sellers display their products. They connect sellers and buyers, facilitating transactions. Marketplace websites have many advantages and are beneficial to all participants.

Benefits for Founders

Firstly, owning a marketplace is profitable. However, revenue is only one of the reasons. Here are other advantages: 

  • Revenue. Marketplaces are flexible in choosing a revenue model. You can select any that fits your market niche best. Further, we discuss the monetization options in more detail.
  • Investor interest. Investing in a marketplace is a perfect way to get a passive income. For example, Uber has raised $25.2 billion in funding by the end of 2021.
  • Scalability. Good marketplaces grow at a high pace. Soon after launch, you will need to add new sellers to boost sales. The more reliable and well-known vendors are, the more users they attract. At the same time, a large customer base encourages more sellers to join your platform.
  • Reduced financial risks. Owning a marketplace doesn’t mean you have to manage inventory. Problems and expenses with warehousing, logistics, and reclamation stay with the sellers.
  • Vendor loyalty. As a rule, the business goals of the marketplace’s owners overlap with the sellers’ goals. Brand onboarding manuals and a simple order management system reduce marketing expenses.

Benefits for Buyers

To be a success, a marketplace should be attractive to buyers in the first place. They love marketplaces for the following reasons:

  • A broad range of products. Marketplaces offer a wide range of products with convenient ranking in price and features. Finding a specific product among the thousands of alternatives is no problem.
  • Trusted platform. Marketplaces inspire more trust than independent firms. They accumulate multiple reviews and are interested in involving reputable vendors.
  • Discounts. Online marketplaces can offer various promotions due to large sales volumes.
  • Convenience. The customer is only one or several clicks from buying a product.

Benefits for Sellers

Why the e-commerce businesses should choose marketplaces for their operations? They have their reasons as well:

  • Reduced cost of promotion. There is little need to invest in advertisements, as marketplaces SEO. Furthermore, marketplace brands become more recognizable with time and attract more customers.
  • Better search ranking. Marketplaces occupy positions at the top of search engine results. It is more difficult for ordinary online stores to achieve the same results.
  • Complex analysis. Marketplaces track sales with intuitive dashboards and accurate data for proper business analysis. For example, they range of products and sellers, enabling grounded business decisions.

Marketplaces come in all shapes and sizes. They sell goods, services, events, and intangible products like NFT art. In general, marketplaces differ by products and participants. Let’s have a closer look at how a marketplace works.

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Types of Online Marketplaces

Online marketplaces vary in how they present products and to what audience they appeal to. Specialists divide all online marketplaces into three main groups: vertical, horizontal, and global.

Vertical marketplaces represent multiple vendors within the same niche. Examples include platforms like Uber, Airbnb, and Netflix.

Uber is limited to the sphere of passenger transportation. Airbnb tends to offer accommodation and related services only. And Netflix is a guru of video content. In all three examples, the niche is narrow compared to Amazon and AliExpress.

On the contrary, horizontal marketplaces engage in commerce within one industry. Etsy, a famous handmade market, is a good example. It covers different categories such as jewelry, toys, clothing, etc.

The third type, global marketplaces, sell everything to everyone. Well-known examples are Amazon, eBay, AliExpress, etc.

Another classification of online marketplaces involves the types of participants:

  • B2B marketplaces offer products and services for other companies: wholesale dealers, tenders, partnership nets, etc.
  • B2C marketplaces aim at individual buyers. Two of the largest global marketplaces, Amazon and AliExpress, belong to this type.
  • C2C (sometimes called P2P – person-to-person) marketplaces connect individuals. A similar principle is implemented on eBay and Airbnb.

Each type of online marketplace has its peculiarities. The following section describes what features we should use and how to make a website like Amazon or other successful marketplaces.

Key Features of Marketplace

Your online marketplace popular must be convenient for buyers. Everything presented here should appeal to users as much as possible and encourage them to order. The features listed below will assist in creating a marketplace that is likely to succeed.

Registration and Authorization

There are two primary user roles in a marketplace, buyers and sellers. Each one has a particular profile type.


The profile for a buyer usually contains personal information, e.g., names, shipping addresses, contacts, and passwords. These profiles are also supplied with easy-to-check order history and wish list features.

The latter allows customers to save preferred products and share their lists with friends and family. In the end, it will increase user engagement and promote sales.

Another winning option is to apply predictive analytics to provide customers with the best options for their taste. This tool also boosts the promotion of ads to make them more effective.


Upon legal verification, sellers enter their business information, including tax information, etc.

A log-in process should be simple but secure for buyers and sellers. As an option for buyers, add fast and easy log-in via social media accounts such as Facebook, Google, or others.

At the same time, login security is crucial for sellers as a marketplace is part of their business operations. Multifactor authorization may come in handy here.

Due to the vast array of products on a platform, an advanced search feature is a must-have for online marketplaces.

For example, Amazon lists more than 12 million products. An advanced search feature ranks the goods with specific criteria in each category. For example, TV sets are ranged by screen resolution, diameter, and technology. The set of criteria will differ when selecting a notebook or headphones.

Furthermore, sellers must provide as many details as possible, so the customers can make a conscious decision. Besides, good descriptions are also helpful for search engine optimization.

You can use autocomplete forms, error corrections, and seller category recommendations to provide more details.

What’s more, customers often rely on ratings and reviews while making purchases. To prove the reviews are honest, implement an IP address check and allow reviews only from registered users.

Besides, ratings and reviews help sellers to improve their products. For example, Amazon has a Feedback Manager where sellers see feedback for 12 months. Hence, they can react to the reviews or ask buyers to remove incorrect reviews.


One-click ordering feature is a game-changer in online commerce. It boosts user-friendliness of a marketplace and, thus, sales. Customers enter their billing, shipping, and payment information once. After that, they press only one button every time they want to make a purchase. It replaces a set of actions like specifying payment and shipment information.

Buyers place chosen products to the shopping cart before the purchase is completed. They need to view and modify the order specs, like the number of goods or their charaterisctics, or delete some items. The shopping cart should show the total price, including shipping prices, additional fees or discounts, payment methods, etc.

Also, your customers should be able to choose the best delivery option. The platform may provide prices for each option depending on the stock system, shipping zones, and delivery period.

Payment process also should be as convenient as possible. Minimize the number of required fields, create prominent calls-to-actions, and show that payments are secure. Consider specific region payment preferences instead of using only one option.

Mind the fact that for sellers, payment info is used for reconciliation reports. Reporting is an integral part of the admin panel for sellers. Let’s have a better look at the latter.

Admin Dashboard and CRM

Administrators need a report panel to manage shipping and payment methods, listings, filters, categories, and so on. The integrated Customer Relation Management system enables sellers to view their sales reports. Such reports include a fulfillment status, item details, messages from the contact forms, and more. 

Customizable notifications about orders, refunds, and reports will help sellers in their work. At the same time, reconciliation reports will ease sellers’ accounting and ensure there are no inconsistencies. 

How to Make Market Websites?

The marketplace website creation is a complex task. Years in the web development market allowed us to refine an algorithm on how to make market websites. It ensures that the project will remain within the deadlines and the budget.

Stage 1. Discovery

Discovery is an initial and fundamental stage of development. It helps to determine the outlines of your marketplace. You should conduct a market research as well as determine monetization model, and development platform.

Market Research

Market research helps to define a niche and, hence, a type of marketplace. Pinballing between several market segments means you lose the appeal to the target audience. Moreover, niche marketplaces give users more personalized customer experience.

To define which type of users you should focus on, consider what your consumers truly want, their habits, and their fears. Consider the following factors: age, gender, location, education, occupation, interests, pains, etc. Remember to consider the strong and weak points of your company, as well the opportunities and threats in the market (SWOT framework).

Knowing your audience and key objectives for your business will make a solid basis for your future marketplace success.

Monetization Model

Choose a suitable revenue model. The best option is when it corresponds to the needs of vendors and buyers. The alternatives are:

  • A commission cuts a part of each transaction made through your platform. Airbnb or Fiverr are good examples of this model. 
  • A listing fee is a sum a vendor charges when they publish each item on the marketplace. For example, Etsy, using the commission model, charges a fee for posting new listings.
  • A subscription fee is a model in which a participant pays monthly or yearly fees to access your platform. Examples of such revenue models are Netflix and Spotify.
  • An advertising fee presupposes promoting items on your marketplace by third-party advertisers. For customers, ads are often irritating. Thus, the ad-based marketplace revenue model is more suitable for a niche market.
  • The lead generation business model refers to a business that makes money by generating leads for other companies. Take HomeAdvisor, for example, as this website generates paid leads for vendors.
  • Premium membership gives users access to extra features and exclusive content like Amazon Prime does.

As you can see, a revenue model type depends on the business goals.

There are no restrictions for your choice aside from the results of market reports. You may also use a few models simultaneously. For example, a commission, advertising fee, and premium membership can be combined if required.

Marketplace giants use the same approach, offering additional services for their marketplaces. Amazon presents Amazon Web Services, Amazon Go, physical stores, and more.

Development Platform

While creating a marketplace, you may buy a ready-made solution or build marketplace website from scratch. The final choice depends on your budget, time, and growth plans.

By all means, custom software development better serves specific needs than ready-made products. Tailored solutions are flexible and scalable. You can always add new functionality when required. Besides, with customized software, you will not have to pay for the functionality you will never use.

Nevertheless, deciding to build your custom platform, you should determine the tech stack, including programming languages, database management systems, frameworks, etc.

Also, you need a team to complete the task. If you have no expertise in programming, you will need to recruit developers, designers, and quality assurance engineers.

However, you’ll spend much time hiring and managing the team. Often it is more feasible to hire an outsourcing product development team.

Partnering with a software product development agency, you get an autonomous team that understands your end goal and how to achieve it. Our outsourcing web development team covers both front-end and back-end development. You will get convenient and user-friendly web solutions without setting up an entire web development department in your office.

Stage 2. UI/UX Design

User interface (UI) and user experience (UX) are crucial for marketplace websites since they take care of every step the user makes.

The former focuses on visual elements that allow users to interact with the website. The latter creates a structural design that users encounter anywhere along their customer journey. 

As we noted above, marketplaces must be designed with the user experience in mind—the user, whether a buyer or a vendor, should feel comfortable. Thus, the only possibility is to create a persuasive UI/UX design with the help of market research.

A significant role in UI/UX design strategies belongs to innovations. Try a new method to display an item or offer a faster, safer way to pay.

In general, UI/UX design should be aesthetic, simple, and trustworthy to attract and retain the users within the platform as much as possible.

Stage 3. Prototyping and Development

A minimum viable product (MVP) has the least possible features to attract early users and start the feedback-learning cycle. An MVP is not about offering extensive features and earning money. It’s about validating your idea, finding potential users, receiving feedback on the product you build, and constantly improving it.

The difference between a prototype and an MVP is that prototyping tests an idea’s viability, whereas the MVP focuses more on learning.

Uber, Airbnb, and many other companies made MVPs and built on them later. Now, they are among the most renowned businesses worldwide, not least due to the structured web development approach.

Stage 4. Full-cycle testing

Full-cycle testing of the marketplace website requires a group of QA experts. They test each feature separately at the development stage. And then, they conduct the final full-cycle testing at the closing stages of marketplace platform deployment.

The testing team begins with a high-level analysis of the website under test. Then they proceed to plan the strategy and methods.

Real-time product validation and bug detection start when they create test cases and set up the test environment. After the testing is finished, the results are well documented.

Moreover, testing identifies faults but can not prove that the product is defect-free. Testing lowers the likelihood that the application problems will remain undetected. All tests are carried out to ensure the application functions according to the requirements.

Testing is crucial to the product’s quality so that a customer can comprehend the whole picture of the product quality. Also, it keeps control over development and budget.

Finally, testing reports, along with MVP reviews, enable data-based managerial decisions.

Stage 5. Launch and Maintenance

After launching the MVP, you process user comments and get ideas for improvement. As a result, you may need to alter your concept to satisfy the actual market needs.

Furthermore, the maintenance includes supporting marketplace security and updates.

A software update, being a significant part of the maintenance process, is one of them. Outdated versions increase the risk of security breakthroughs. Automatic updates allow you to make the process more efficient.

One more thing to care about is timely and correct backups. The inability to access a website means business disruption, so this criterion is highly important. Backups contain the data on your website and restore them if the site is down.

Moreover, these days, consumers do not wait for slow marketplaces to load — they quit. Hence, adding site speed tests to your marketplace maintenance will help you flag problem areas like demanding plugins or large files.

The last but not the least thing to care about while creating a marketplace is promotion. You will need a team of experienced SEOs and content experts to increase traffic. To attract new leads, they develop traffic pages, refine a semantic core, analyze metadata, etc. 

As you see, building a marketplace is a complex process. It requires a team of various specialists. Indeed, the length and cost of the project are immensely influenced by the scope and business objectives. But what exactly are the price and period of the development?

We prepared a range of approximate estimates for you that vary depending on the size of the project.

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How Much Does It Take to Develop a Marketplace?

There is no set cost for creating a web application like an online marketplace. Depending on the number of features, their complexity, and the desired time-to-market, the total will range from around $37,000 to around $190,000. The table below shows an estimate of the cost for each stage of web application development.

It is a common situation when the whole project is developed by one team. The development process benefits from a proper documentation workflow and fewer misunderstandings.

Devox Software offers a team of top-tier specialists in custom web development. We build future-proof and innovative solutions to promote your business growth. We offer a broad array of professional web development services with a holistic approach.

To illustrate how we create marketplaces, have a look at the case study below.

Activeplace. How We Combined Wellness Social Network with a Marketplace Feature, and It Worked

ActivePlace is a social platform dedicated to wellness issues. It was developed from the ground up by our team. The functionality required a massive combination of social media, marketplace, and blog features. The team made all elements work smoothly to together provide a seamless user experience.

ActivePlace connects three groups of users: individuals, mentors, and businesses, each possessing a personalized functionality

Any users receive access to the wellness community to discover active experiences and advice. Mentors can use the platform to promote their professional services and personal branding. Businesses can sell their products and services through a marketplace facet. They boost corporate branding by writing a corporate blog or launching online events.

As there were no similar solutions on the market, the team needed to perform profound research on the array of features for each type of user: feed, navigation, search, articles, community interests, achievements, and so on.

The project started with the research stage, where the business idea of ActivePlace was validated for future success. Furthermore, an in-depth analysis identified the overall requirements and core functionality.

Once the analysis was completed, the team went over to building the software architecture. It included the final prototype and mockups for further development. At the stage of coding, design documentation was converted into a full-fledged application, followed by QA tests.

At the launch stage, the client developed a marketing strategy. It attracted target users and increased the visibility of the marketplace.

As a result, challenged by the unique project idea, the team managed to design and build a marketplace website from scratch. Currently, ActivePlace is used by 1,000+ users, mentors, and businesses and receives good reviews.


Online commerce, and marketplaces, as its integral part, are evolving at a break-neck speed. If everything is arranged properly, they engage more and more investment and give incredible revenues. 

Depending on the business goals, there are two ways to create a marketplace platform: use a template or order a tailored solution. As development comprises several stages and requires specific expertise in marketing, programming, and promotion, the process may be difficult.

We developed numerous e-commerce solutions such as web showrooms, online stores, and marketplaces. Experience and devotion to what we do make us a reliable partner for long-term projects. We take on even the most complex projects and deliver digital solutions in time and within budget.

If you have any questions and have a marketplace development project in mind, please, contact us. Our skilled specialists will gladly discuss your ideas for further implementation.