B2B marketplaces are having a bit of a moment, aren’t they? Around the world, innovative founders are building new marketplace platforms that connect buyers and sellers across nearly every industry and add unprecedented value to their business transactions.
A report by Gartner and Mirakl estimates that 70% of existing enterprise marketplaces will be engaged in B2B transactions by the end of 2024. Meanwhile, another piece of research by Mirakl finds that 75% of B2B companies are actively developing their marketplace strategy – but that doesn’t mean that three quarters of your peers are out there building their own marketplaces. Sure, a lot of them are, but many don’t have the desire, requirement or resources to do so.
For these sellers, a ‘marketplace strategy’ isn’t about building a new marketplace. Instead, it refers to the approach taken to selling their products or services via an existing third-party marketplace platform. One of the biggest challenges faced by this set of sellers is identifying the right B2B marketplace on which to sell.
How can you tell which marketplace has the potential to take you to the top and which is going to be a massive flop? By reading the rest of this blog post, that’s how. Here’s what you should be looking for in a B2B marketplace.
1. An end-to-end service
It’s no longer enough for a marketplace just to connect your business with potential buyers. In order to get the maximum value from your marketplace strategy, you need to choose a platform that provides an end-to-end value proposition.
Fortunately, marketplaces like this are increasingly easy to find. As the B2B marketplace space matures, more and more of these platforms are recognising the benefits of becoming full-service platforms that bring new and unique benefits to you and your buyers at every stage of the transaction.
“A successful B2B marketplace should offer value to customers from the beginning of a transaction until the end,” says Ilias Sousis, CEO and Co-founder of Wikifarmer. “This means a 360º platform that offers digital services such as ordering, financing, logistics, quality controls and post-sales servicing.”
2. Exposure to a new group of active buyers
There’s no point spending the time finding and registering with a marketplace and listing all your products or services if the platform is unable to introduce you to a significant pool of new, relevant and active buyers.
Before deciding on which B2B marketplace to sell, make sure to take a close look at the number of participants on each side of the platform. If there are too many other sellers on the marketplace, competition will be fierce and you may end up not selling very much. On the flip side, if there are many buyers and very few sellers, it may be a sign that the marketplace has a poor vetting and onboarding process – resulting in your business being exposed to the wrong kind of buyers.
Marketplaces worth their salt will have the right balance of supply and demand, and a strategy to maintain it.
3. Signals of reputation and credibility
This comes down to one very simple question: do you trust the marketplace?
The best marketplaces are those that respect the tradition of relationship-building and trust in the B2B sector, but with new marketplaces cropping up every day, it can be hard to know who to trust from who’s just trying to make a quick buck.
If you’re unsure, there are a number of things you can do. Speak with the marketplace about their vetting and onboarding processes – if they’re letting any old Tom, Dick and Harry onto the platform, it might raise concern for their credibility. If they seem cagey, indirect or misleading in any of the conversations you have with them, pause for a moment and ask yourself what they might be hiding.
Don’t forget to check their feedback on a review gathering platform like Trustpilot, Google or G2. If lots of other sellers have had significant problems with the marketplace in the past, it’s probably best to steer clear.
4. Seamless payments and checkout procedures
When you sell your goods or services on a B2B marketplace, you want to have the peace of mind that your business is protected against risk and that any money you’re owed will make its way to you quickly. In discussions with potential marketplaces, make sure to find out about the credit and fraud risk protection they have in place and when you can expect payouts to happen.
Make sure to work with a marketplace that places a lot of value on the checkout as a whole, because a poor buyer experience at this point has the potential to scare off any new customers you were hoping to wrangle. Signs of a marketplace that understands the value of the checkout are those which offer trade credit options for buyers, fast payouts for you, tight security and plenty of clever signals to put buyer worries at ease.
5. A marketplace that understands your pains (and solves them!)
In order to make sure you have the best experience with your new marketplace partner, you want to find a platform whose team are experts in your industry. They need to understand the unique pains and challenges that your business faces so that they can provide a platform tailored to those needs.
As Alex Collart, Managing Director at Outvise, puts it: “Marketplaces must have a clear USP (unique selling proposition), differentiated from competitors and addressing a real pain point.”
6. Added value which cannot be found elsewhere
What does the marketplace bring to the table which you don’t already have? The whole point of your marketplace strategy is to make it easier, faster or cheaper for you to sell your products to a wider pool of buyers.
If the marketplace isn’t offering some kind of added value that keeps you coming back to the platform, there’s nothing stopping you from connecting with buyers and then taking your business elsewhere to avoid the fees. This is called disintermediation and it’s a marketplace founder’s worst nightmare. So, any founder who knows what they’re doing will be offering value in the form of financing, logistics, shipping, on-platform marketing or other complementary services in order to avoid it.
“The biggest mistake a marketplace can make is making the marketplace the goal in itself,” says Minck Hermans, COO of Vonwood. “The marketplace is a means to an end, so keep your eye on the ball of adding value to buyers and sellers.”
7. High quality user experience
Having grown up with the internet at their fingertips, Millennial and Gen Z buyers have been spoiled for choice, convenience and speed when it comes to e-commerce. Now, they expect the same when buying stock, materials or services for work.
“[Marketplaces must provide] a good user experience on an intuitive, seamless, and user-friendly platform,” says Julia Heineking, Head of Marketing at CheMondis. But how can you know if a marketplace offers the user experience (UX) your buyers demand?
Test the navigation and searchability of the marketplace, review the complexity of the onboarding process, and assess how intuitive the checkout is. Everything should be fast, smooth and simple.
8. Deep industry knowledge
“[Successful marketplaces] understand their industry vertical and adapt to its needs and the requirements of buyers. Customer Success people with knowledge of the market [are essential],” says Jan Klawer, CMO and Co-founder of 1-2-Taste.
Many founders and other marketplace leaders agree that the deep industry knowledge within their teams is foundational to their success. Make sure to choose a partner that invests in training their team and has tailored their marketplace for both your industry sector and the idiosyncrasies of B2B.
Want to take your understanding of B2B marketplaces to the next level? There’s a lot more where this came from. Check out more of the resources on the B2B Marketplaces Knowledge Hub today.
