Alibaba's mobile wallet, Alipay, changed the online shopping experience for customers in China. Alipay had to tackle two major pain points; long checkout times and limited payment options (someone help, please, you're killing us)!
Before Alipay, customers had to input payment information each time they made a purchase! A super time-consuming process (remember those days?)!
That in itself discouraged many from shopping online! So much typing and re-typing and re-typing, sheesh!
That in itself discouraged many from shopping online! So much typing and re-typing and re-typing, sheesh!
Alipay solved this problem by allowing customers to store their payment information in their app. Now they can make purchases with a few clicks from their mobile devices (now we are talking).
Alipay also expanded the payment options available to customers. Alipay started offering a range of possibilities; bank transfers, credit and debit cards, and online payment services (the world is your Oyster).
Expanding payment options allowed customers to choose the most convenient payment method. And the most secure. Alipay was reducing friction in the purchasing process (no more waiting in long lines like at Walmart, please)!
The app's widespread adoption in China demonstrated how important it is to solve a real problem in an online marketplace.
The app's widespread adoption in China demonstrated how important it is to solve a real problem in an online marketplace.
Find and fix! How do you find a problem to solve with your online marketplace? We'll set out a plan today and narrow down on a few items (once you know the tricks, it ain't as hard, so stay tuned).
Often, solving issues for users includes one of three essential items:
- Offering more convenience (think 7-11 convenience store)
- Offering better prices (pull out your dollar bills)
- Offering better quality products (top-notch stuff
Create Your Own Marketplace Fast
- Launch your own marketplace niche fast
- Easily connect your own domain name
- Create your own categories quickly
- Create custom fields specific to your requirements
Create an Online Marketplace that Is More Convenient
One way to solve a real problem in your online marketplace is to focus on convenience.
Convenience can mean streamlining your buying process to make it as easy and efficient as possible for your users to purchase. But there are a variety of ways convenience can be improved:
- Streamlining the buying process by simplifying navigation
- Offering more convenient payment options
- Allowing for effortless order fulfillment
- Offering same-day delivery
- Offering a greater variety of products
By winning in any one of these areas, you can experience the following:
- Increased customer satisfaction
- Improved customer loyalty
- Improved competitive advantage
- Improved customer retention
Yes! Hear the ding of emails arriving in your inbox as orders multiply. With the taste of freshly brewed coffee, watch as golden five-star reviews pop up on orders!
Ensuring your online marketplace provides convenience is like walking into a one-stop shop (a.k.a; almost like a "Walmart") where everything is under one roof. You get everything you need right on the spot now (now being the key to convenience).
Ensuring your online marketplace provides convenience is like walking into a one-stop shop (a.k.a; almost like a "Walmart") where everything is under one roof. You get everything you need right on the spot now (now being the key to convenience).
Why is convenience essential:
- 69% of people surveyed stated that they are less likely to make future purchases from a retailer if their online purchase does not arrive within two days of the promised delivery date (Voxware)
- 97% of consumers report that they have abandoned a purchase due to the inconvenience (Marketing Charts)
- 52% of consumers feel that convenience plays a significant role in at least half of their purchasing decisions (Steps)
- 81% of shoppers desire a seamless, uninterrupted shopping experience across all their devices (LinnWorks)
- 76% of shoppers impulsively bought items through social channels because the purchasing process was simple (Tiger Pistol)
E.g., Amazon, in their online marketplace, ensured convenience by implementing one-click ordering. Previously, there was too much hassle (you are making me tear my hair out)! Too many steps to complete a purchase previously.
Amazon recognized the pain and introduced the one-click ordering feature!
Amazon recognized the pain and introduced the one-click ordering feature!
Time for you to be the doctor for your marketplace. Let's prescribe some action steps to improve convenience in your online marketplace:
- Identify the pain points (you're the doctor)
- Evaluate the impact of each problem (as the doctor, is it a big deal?)
- Prioritize based on their potential impact (is this cancer or a wart?)
- Remove friction points in the journey (make the doctor visit easy)
- Streamline the checkout process (streamline the treatment process)
- Minimize the number of clicks to complete a purchase (Amazon prescription)
- Offer multiple payment options (choose the easiest treatment)
Offer Lower Prices with Higher Value than Other Online Marketplaces
Focusing on a better price or pricing strategy is another way to solve a problem. Price is a significant factor consumers consider when purchasing!
Better pricing comes in all forms:
- Discounts
- Promotions
- Loyalty programs
- And plain simple lower Pricing!
Solving pricing in your online marketplace is like baking a cake! Just as the right ingredients and the correct amount of each ingredient are vital for a cake, finding the right balance of value and competitive prices is critical.
Solving pricing in your online marketplace is like baking a cake! Just as the right ingredients and the correct amount of each ingredient are vital for a cake, finding the right balance of value and competitive prices is critical.
And pricing can be tricky! Don't give up, however! You'll want to keep experimenting till you get it right.
Why?
- 60% of consumers surveyed stated that discounts and coupons have become increasingly important (Vericast)
- 60% of global online shoppers prioritize e-commerce pricing as the primary factor that impacts their purchasing decision (Prisync)
- 90% of online shoppers take time to hunt for the best online deals (e.satisfaction)
- Every 10 minutes that's how often Amazon changes its prices (ah, what?) (Dynamic Pricing)
- 80% or more of Americans believe that the ability to compare prices from various merchants is crucial (Pew Research)
Alibaba had its pricing strategy. Alibaba Group's penetration pricing strategy offered its products at a lower price than its competitors. Primarily to gain a larger market share (think of a drooling tyrannosaurus rex eating up everything in its path).
Alibaba had its pricing strategy. Alibaba Group's penetration pricing strategy offered its products at a lower price than its competitors. Primarily to gain a larger market share (think of a drooling tyrannosaurus rex eating up everything in its path).
This strategy aims to attract cost-sensitive consumers and gain a large customer base. Once the company has established a solid customer base, it can gradually increase prices to increase its profit margins (boil a frog strategy).
The use of penetration pricing by Alibaba Group was particularly effective in the early stages of the company's growth. Penetration pricing was a good part of what helped establish the company as a dominant player in the Chinese e-commerce market.
By offering its products and services at lower prices, Alibaba won market share. Many were drawn to the company's value proposition of low prices and a vast selection of products.
By offering its products and services at lower prices, Alibaba won market share. Many were drawn to the company's value proposition of low prices and a vast selection of products.
Want to focus your marketplace on better pricing?
- Identify the main problem you'll solve is better pricing for buyers
- Develop a unique value proposition that positions you as "price first"
- Partner with suppliers and manufacturers to secure the best prices (they got to be in on it)
- Encourage buyer engagement through special promotions, loyalty programs, and user reviews (e.g., see Uber Rewards program)
Offer Better Quality Than Other Online Marketplaces
Or your online marketplace might focus simply on providing better product quality.
Quality can mean:
- Verifying product information and specifications
- Monitoring customer feedback
- Working with sellers to improve product standards
Improving quality for your online marketplace can mean:
- A better user experience for customers
- Increased customer loyalty
- Less replacement for faulty items
Experience fewer sweaty shirts as you have more repeat sales! Stop banging your head against the wall (get rid of your bruised forehead) because of having to provide so many refunds! Feel the joy of attending to your emails because of customer relating their great experiences.
Experience fewer sweaty shirts as you have more repeat sales! Stop banging your head against the wall (get rid of your bruised forehead) because of having to provide so many refunds! Feel the joy of attending to your emails because of customer relating their great experiences.
You'll raise the bar for excellence until you rival those Olympic high jumpers!
Quality does matter:
- 5.2% is how much product quality has declined since 2018
- 51% is how high consumers ranked the quality/value of a product over the price (First Insight)
30% of items purchased through the internet are returned, whereas physical stores only see a return rate of 8.89% (Medium) - 20% of the returns are caused by the product being damaged.
- 90% of customers are inclined to spend extra money on products that are produced by a brand they trust
E.g., EarthLite, a company that sells massage-related products, built its company on a foundation of high-quality products. Marketing them as handmade with eco-friendly materials, superior to what you might find elsewhere.
By promoting their products as quality handmade products, Earthlite solved a real problem in the massage-related retail market.
By promoting their products as quality handmade products, Earthlite solved a real problem in the massage-related retail market.
Namely, low-quality massage products; made with hazardous materials! EarthLite differentiated itself from its competitors.
The company's focus on product quality has helped attract customers who value performance and sustainability. 
Want to focus your online marketplace on product quality?
- Gather feedback on what customers are looking for in terms of product quality
- Implement strict product quality standards
- Select products to ensure they meet a high standard
- Reposition your brand
Closing Summary
Solving a real problem in your online marketplace requires focus. By focusing on items such as convenience, better pricing, or product quality, you can solve real problems out there.
Solving a real problem in your online marketplace requires focus. By focusing on items such as convenience, better pricing, or product quality, you can solve real problems out there.
Think about:
- What other factors affect your purchasing decision as a consumer?
- Are you willing to pay more for better product quality?
- What other problems do you feel online marketplaces can still address?
