eBay is the most successful online auction marketplace platform. The latest earning figures of eBay prove that this platform has gained tremendous growth in recent years. Initially, eBay was started as an auction website where users buy and sell products through this marketplace platform.
But since it has taken growth and become a multi-billion-dollar eCommerce platform that holds millions of users and allows both consumer-to-consumer transactions and also business to consumer transactions.
Let us have a deep look at how to create online marketplace website like eBay and business models and let's find out how eBay works as this will help you to reap the rewards of high traffic volumes to your own marketplace platform.
" In 2018, 1.8 billion people worldwide purchased goods online. In the same year, global retail sales amounted to 2.8 trillion USD and also the projections have shown a growth of up to 4.8 USD in 2021. "
Although there are several auction marketplace platforms available, eBay still has its own place and standard among the audience. The reason is mainly because of how eBay works and how it handles its users.
There is significant importance in knowing how eBay works. It has a perfect business model that facilitates sellers and buyers to enjoy all benefits. Let us get into detail about the eBay business model.
Initially, sellers will get registered themselves with the eBay platform and will start posting their listing on the platform. They will be allowed to add product images, give descriptions to products, and many more.
Some listings are auction based where the product will be sold to the highest bidder. But some products are not auction-based as the product will be posted with the 'buy it now' option. Whoever pays can buy the product.
Through available payment gateways, buyers can pay for the product and can buy them. It applies to bidding also. The highest bidder will pay and get the product.
eBay marketplace also offers shopping tools like a shopping cart where buyers can temporarily store their favorite products and can buy them later. Buyers can keep track of their purchase history and can even save their searches. This is how eBay works and this has made the platform a well-known marketplace globally.
eBay is quite successful because of its revenue model. Every marketplace should have a perfect revenue model that will help in making good money and will help to survive in the market.
Likewise, eBay business models work well with selective revenue models. Take a clear view of eBay's revenue models.
Listing fee – although eBay doesn’t charge any listing fee with fresher, after few transactions, eBay starts charging fees from sellers. Sellers need to pay a fee for products they post on the platform.
eBay online marketplace also supports sellers to get their products listed on the main page and will help them to get more visitors to their product page that will help them in better conversion.
Transaction fee – on all successful transactions, sellers need to pay a transaction fee to eBay. Since there are millions of sellers, an infinite count of transactions occurs every day.
So eBay gets better revenue by charging a transaction fee on all product selling that happens within the platform.
Insertion fee – a non-refundable insertion fee is charged on sellers when they open a bid for an item they have posted for sale.
Each seller may post several products for bidding and for each product they need to pay the insertion fee to start the bid.
Advertisement – being a reputed online classified marketplace, eBay allows third-party advertisers to post their ads on the home page and earns money through advertisements.
Last year eBay earned $1.2 billion through advertisement alone.
Planning to build a marketplace like Ebay from scratch is very complicated and tedious process. So, if you want to kick start your online ecommerce business without any intervention and delay, there are many readymade solutions which pave a better and budget-friendly way to become a successful entrepreneur.
Create your own auction website like eBay to make your buying and selling process under one roof.
According to your business model and your time limit you can select either to build it from scratch or even you can prefer to go for a readymade software to run an ecommerce business like Ebay. Whatever the choice is, there are a few important factors you need to prioritize.
By keeping the above mentioned factors in mind you can succeed in your ecommerce business just like Amazon or Ebay.
We might wonder how much it will cost to build a website like amazon or Ebay. Here we need to find out what are the essential features that amazon or Ebay holds to run successfully. And this will determine the cost for building the same. The features that will set the cost for your website are listed below.
All the above features will affect the cost to develop a website like Amazon or Ebay.
The readymade marketplace is purposely designed to compete in the challenging market. The functionalities developed in the readymade marketplace will be similar to the functionalities found in the leading eCommerce portals like eBay.
The cost of the software perfectly matches your budget and in a quick period, you can launch your online store. So for any start-up or mid-level businesses, the readymade marketplace is highly recommended.
These are the revenue streams through which eBay works and earns well. Some sellers find this to be costly but the reputation eBay has will compensate for your spending with this platform as you will get more visitors and buyers to buy your products.
Creating an eCommerce online store, it’s time for you to move on analyzing your requirements and budget to kick-start your online selling journey.
Create your free account to unlock your custom reading experience.