A peer-to-peer marketplace model seamlessly connects the buyer with the seller, which is why it is so popular. It is enough to look at the best P2P business examples - Amazon, Aliexpress, and Etsy - to be convinced of this.
Investing in peer-to-peer marketplaces has become a global trend. PwC predicts that the share of the sharing economy will reach $335 billion by 2025. Participating companies will grow by 2,133% over 12 years. In comparison, those using the traditional operating model will only increase revenue by 39.6%.
Want to know more? Dinarys is ready to discuss the possibilities and ways of creating a peer-to-peer marketplace with you.
What Is a P2P Site?
A peer-to-peer or decentralized network is a communication model in which the participants have equal rights and opportunities. Unlike the conventional client/server model, where the first makes a request and the second fulfills it, in the P2P network model each node acts as both a client and a server.
P2P systems can be used to anonymously route network traffic, massively parallel computing environments, distributed storage, and more. A site built on this technology is called a P2P site. It is a fantastic e-commerce platform as it is very reliable, highly scalable, and profitable, thanks to commissioned sales, affiliate programs, and advertising tools.
In short, it is a platform on which small traders or vendors can display their products as if they were on the window of a large supermarket.
Ultimately, a P2P marketplace can help you generate profits from items you don't own by using the power of digital commerce and granting other vendors the capability to operate online. It is all about helping to bridge the gap. The vivid real-life examples of this approach that may inspire you, include the following:
Uber - the globally renowned ride-sharing company that makes profits by coordinating independent taxi journeys without having to invest in the trips or the vehicles themselves, focusing on management and peer-to-peer connection capabilities.
Upwork - the freelance platform that displays the profiles of a plethora of professionals, perfectly bridging the gap between keen job seekers and employers, while the platform owners themselves aren’t directly working with anybody.
Airbnb - the hugely renowned accommodation platform that helps both short- and long-term home seekers conveniently stay in one of the 4.5 million properties available across the world using an intuitive website (while Airbnb creators don’t really own any of those properties).
What Is the Difference Between a P2P Website and an Online Store?
An online store is a multifunctional stand-alone platform that supports online sales. Typically it is owned by a single owner who determines prices, availability of products and services, and also deals with its maintenance.
An online store is often created for buyers of goods from one seller. The P2P marketplace is for both buyers and sellers, and they can even swap roles there.
On a peer-to-peer marketplace, you are not the only website owner. You only connect buyers and sellers by providing a place to trade. They can trade for money or exchange products on a barter basis, negotiate payment and delivery methods themselves.
This is why a P2P marketplace is also sometimes referred to as a two-way marketplace. This is a godsend for small companies since it frees them from a lot of tedious operations.
Benefits of a P2P E-commerce Platform
Such e-commerce solutions give a business a lot of privileges:
You don't have to worry about marketing to get more users. This will be done automatically by buyers and sellers of P2P sharing platforms if they are attractive enough. After getting a good service, users will recommend using the platform to their acquaintances.
For online retailers, geographic barriers are one of the major constraints on growth. In the case of a peer-to-peer market, you don't have to worry about delivering the product to a remote location. The seller will take care of this. You just need to offer him a reliable selling platform.
You don't have to look for suppliers to attract more customers. Your users will be both buyers and sellers, and you only need to control the processes. And you can make good money out of this!
Unlike an online store, a peer-to-peer marketplace is easier to develop and maintain. The design of such a site is simpler, there are fewer full-fledged functions than is required for an online store.
What to Consider Before Creating a Marketplace Website?
If you are convinced of the promise of a two-way trading platform, it is time to consider some important aspects.
Pay attention to what you are looking for and what products can satisfy your customers' needs. You must learn to listen to them. Study reviews and work on weak points. Make the platform user-friendly and see how it boosts your business.
The perfect balance between buyers and sellers
You must design your policies and functions to suit both groups of users. Only then will your platform become popular and you will become successful.
The transaction system is the backbone of the trading platform. Therefore, you should invest well in the security of the payment platform.
You should only enable the necessary features that will be useful to users and can set you apart from the other competitors.
A well-selling site will have more users, traffic, and popularity. Formulate marketing strategies that will be appealing to users.
How to Build a Peer-to-Peer Website
Ideally, the marketplace website builder should adhere to the following algorithm.
Choosing the perfect technology
Choose the technology stack that's perfect for your business goals. It may either consist of a number of specialized technologies and tools (including plugins, editors, programming languages, libraries, etc.) or it may be limited to a single ready-made marketplace creation platform. Extremely popular e-commerce platforms like Shopware, Magento, Shopify, and others provide excellent out-of-the-box opportunities while they also scale properly and grant ongoing support.
The involvement of some extra tools, including certain advanced capabilities, may also be required. For example, use AI-powered chatbots to communicate with users, or big data to accurately collect additional data about users.
In any case, first, you need to build a marketplace website with static functionality and then add other customizations. Dinarys is a recognized expert in e-commerce marketplace development using these platforms. Contact us if you are looking to build and set up a sturdy, feature-rich, flexible marketplace solution without going far or spending much.
Enabling smart options
After the installation of the prototype, the choice of the aesthetic design of the site is made. At this stage, decorative elements and rendered content are added. Then a mock-up is created to convert static designs and functions to dynamic ones.
Try to make your site unique and valuable to your users at the same time. For example, you can turn on smart search filters or other smart features to help you browse products that the maximum number of users are looking for.
The level of user experience you offer will determine the fate of your trading platform in the global marketplace. Even if all the smart functions are available, but they are difficult for users to understand, they are totally useless. Make a simple and interactive user interface with the most understandable functions and features.
Adding an entertainment element
When developing, don't take the typical approach that might seem annoying to today's generation of users. To make the site more useful to customers and gain popularity, you need to think about adding a unique and interesting component.
For example, you can add a game component to engage the user in the process, add graphics or thank you notes to add value to your website.
Defining a development approach
Once everything is completed, you can start developing the website, taking into account customer feedback and suggestions. There are three ways to do it.
Custom development gives you complete freedom of function choice. You can choose technology, platform, and even control the process to be sure of the quality. This is the most cost-effective and scalable approach.
Ready-made solutions are the perfect choice for those who want to build a marketplace platform immediately. With this approach, the functions are not chosen by you, the solutions will not be unique, but will save you lots of time.
With this approach, you don't have to worry about the development phase as the SaaS provider will take care of that. Development is faster and you don't need a serious tech team. Despite the high speed, security issues and complex setup are considered as some of the disadvantages.
If you opt for custom development, you need to contact the development team or hire a third-party software development company.
While both have definite advantages, the latter is considered the best solution because the experienced company knows exactly how to build a P2P network. It will always have solutions to problems that can be encountered in the development process. In addition, experienced professionals can help you to win the competition with some out-of-the-box ideas.
Testing and deployment
It is important to thoroughly test the p2p marketplace model before presenting it to users around the world. And here there are two options: check the site yourself with the help of testers or invite a developer company.
An experienced software development company will likely have dedicated tools to help you perform effective automated site testing. They research the product on a variety of devices to make sure nothing is interfering with customer growth.
Essential Elements and Features Your P2P Website Must Have
A P2P marketplace development project with a settled plan and outlined workflow requires a properly functional and general UX “filling”. This includes a bunch of features and capabilities that every convenient marketplace must have. Let’s take a look at some essential instances.
Authorization and user profile
Starting from the top, the implementation of user accounts begins with convenient authorization. Rapidly signing up and logging in with one's Facebook and/or Google account is almost a requirement these days – it saves time for customers and connects their social media accounts to their marketplace accounts from the get-go.
On top of that, two-step verification (e.g., sending a code to the user's telephone number) is a necessary security measure today, which helps protect account credentials and restrict unauthorized access by attaching a phone number to the profile.
Furthermore, we advise adopting some form of specialized verification, particularly for vendors. It may be especially significant if you want to create your own online marketplace website that distributes services by officially qualified providers. Uber, for instance, demands drivers to provide a series of documentation proving their identification and driving expertise.
Keep in mind also that both parties involved in the marketplace collaboration - vendors and buyers - should be able to create new user accounts with different functionalities fast and simply. The overall user interface (UI) for customers and sellers should be different, as the information that these categories of users must provide and work with also differs.
Obviously, a buyer doesn't need sales analytics dashboards and all the e-commerce functionality. Alternatively, vendors require more specialized elements on top of usual profile descriptions and navigation through offers.
The essential elements to implement for both interfaces in the marketplace include ratings, ordering histories, purchases/sales completed, and contact information.
The product listings functionality enables users to add product positions to the marketplace and interact with these products in a variety of ways. In particular, a vendor should be able to conveniently add and remove positions, edit descriptions, customize prices, publish/unpublish and completely delete product items. Customizable listings are a great feature that lets vendors emphasize their brand attributes more and personalize their services the way they see fit.
In turn, customers should be able to search listed product items, comment on them, review and rate them, categorize them, and add preferred product items to the favorites or wishlist. Providing convenient search filters is always a great idea (both for customer and vendor search).
Search and filters
The overall search functionality of your marketplace deserves separate attention. Search is the essential part of the website’s whole navigation and UX. This is where detailed filters cannot be overestimated - they help users search stuff by categories, industries, price range, major characteristics, and other specifics.
Auto-filling options and recommendations also help smooth out the UX. For this, many software providers today implement smart searches. A search backed up by some basic AI powers can offer relevant recommendations and automatically fill the search with proper wordings based on individual customer histories of purchase.
Buyers need a convenient way to immediately make a purchase online via the most fitting digital payment tool. At the same time, vendors may also need online payment capabilities for a number of purposes (for receiving payments for products sold, to pay for dropshipping and delivery services available in the marketplace, etc.).
For this, a selection of payment processing gateways must be present. The most widely used and demanded digital payment systems today are Stripe, Google Pay, Apple Pay, and PayPal. These are all well-established gateways that guarantee proper security and swiftness of online payments. Add your local popular banking system integration(s) on top of that to provide utter payment convenient for local users.
In terms of P2P, you may also consider integrating an escrow service - its goal is to help complete payments only after successful product delivery, granting an extra level of security and satisfaction for customers.
A checkout page - the environment where buyers are taken to complete their product order - must be simple yet flexible. A user should be able to easily fill out all the necessary information, pick the payment/delivery/contacting method, and finish up the procedure without any extra questions.
For this, the universal recommendation is to implement dynamic tips and auto-filling functionality, pointing users to available fitting options. Pack up all the options that make up more than several positions into dropdown menus. All this should make most customers’ lives easier when shopping online via your marketplace.
It is crucial to elaborate the system of notifications in order to complete orders on time and keep everyone in the marketplace up-to-date. Customers want to know when goods they're monitoring are available or out-of-stock when the price for them drops or spikes up, when the shipment status of their purchase changes, as well as when special offers of some sort are there.
Sellers, on the other hand, need to be notified on receiving new orders to pack them up and send them timely. Thus, handy notifications for direct messages and other forms of communication must also be introduced.
Users can be notified and updated in a variety of ways:
- Via email, provided they specified the address during registration or user profile filling.
- Via pop-ups - system notifications that work in the marketplace backend and pop up nonchalantly for all users.
- Via instant messages - messages with updates can be sent via messengers, such as WhatsApp and Viber if a user specifies the number attached to them and disables messaging restrictions.
- Via push notifications - consider this “advanced” type of notifications that appear even on the blocked screen of the user’s mobile device provided the user gives permission to get such notices.
More features for buyers
To set the bottom line for the necessary online marketplace features, consider these buyer-only capabilities as well:
- Wishlist - a separate user cabinet section where one may store and view products that they like but may wish to buy in the future is a must for any product-packed marketplace.
- Purchase history - individual history of purchases available in the buyer’s cabinet helps users keep track of their orders, get some extra info when they need it, and manage personal finances.
- Booking tools - if your marketplace gathers booking opportunities, like Airbnb or Aviasales, make sure to also implement a convenient booking interface.
More features for sellers
Marketplace vendors should also get certain tools and features focused on managing and analyzing sales:
- Vendor’s dashboard - a specialized unified dashboard should help vendors see how things are looking for them on your marketplace in general, indicating incoming messages and orders, as well as statistics (various types of statistical and analytical interfaces and tools can be implemented).
- Analytics - a separate analytical space in the user profile will come in most handy for sellers to track metrics, check various statistical readings, analyze tendencies, and watch overall sales numbers by segments/seasons/etc. (advanced analytics can be achieved with specialized tools).
- Dispute resolution functionality - in any environment that connects service providers and customers, certain disputes may arise, the possibility of which you should timely consider and cover with solutions - enable users to open disputes where buyers may specify their complaints and vendors may answer to them accordingly (keep in mind that a platform owner must resolve disputes based on the marketplace’s Terms and Conditions).
Summary: Peer-to-Peer Marketplace Development
So, the question is how to create an online platform? Of course, there are tricky things like payment processing and confidentiality. You will also need to learn how to resolve arising disputes and constantly monitor them if you want to maintain your reputation and get more regular customers.
To develop your application, it's best to partner with a trusted outsourcing company, such as Dinarys. Contact us with any questions about how to build a marketplace website, and we will help you to accurately assess the cost and development prospects of your trading platform.