Online marketplaces represent the primary type of multichannel ecommerce platforms where product and service information is provided by third parties. In an online marketplace, there are typically three involved parties, that is – a marketplace owner (or a marketplace operator), vendors (or marketplace sellers), and buyers (or customers and consumers). In a typical marketplace scenario, marketplace owners attract vendors and buyers for trading on the platform, buyers shop and buy products, the operator processes payments, and retailers or wholesalers fulfill and deliver orders.
Examples of the most prominent online retail marketplaces include Amazon, Taobao, and eBay. Although Amazon had long been a trailblazer and a role model for all other marketplaces, the rise of Alibaba group with its subsequent adjacent businesses in logistics, payment systems, and mobile commerce set a unique precedent for the industry and steered the online business into a totally new direction.
Even though there are different marketplace taxonomies, experts generally categorize marketplaces by the business model, such as business to business or B2B, consumer to consumer or C2C, business to consumer or B2C, and direct to consumer or D2C.
Further below, we’ll be mainly talking about B2C or business to consumer marketplaces, where the marketplace customers are mainly consumers as opposed to businesses (for information on B2B marketplaces, see the previously published piece The Ultimate Guide to B2B Marketplaces.