Custom Marketplace Development is a saturated market. However, it is steadily growing across a variety of industries. In the graph below, you can see the global trends from 2019 to 2029.
Therefore, starting your own e-commerce marketplace in a growing market is a good bet. Since the market is highly competitive, it is essential to choose the right strategy. In this post, the three most efficient marketplace strategies are suggested. They vary depending on your budget, your idea’s uniqueness, and the technology level you want to incorporate.
Overview of Marketplace Development Strategies
The three strategies are:
- Using a SaaS marketplace platform like Shopify or Sharetribe;
- Using a ready marketplace platform with open code like CS-cart;
- Coding a marketplace from zero with a marketplace app development company.
For strategy 1, opting for a SaaS marketplace platform means you subscribe to a ready-to-use software plan. So all you pay is the subscription fee, and you often have some trial period. On Sharetribe, the costs when you are building your marketplace are often much lower than when you actually launch and run your marketplace. This allows maximum control of app building costs. Once you run your marketplace, there are also transaction fees.
Cost considerations aside, using a SaaS marketplace platform comes with limitations. You can use only out-of-the-box features, plugins that exist for this software, and your app’s performance will be constrained by the software’s performance.
For strategy 2, using an open code platform means you buy or pay monthly fees for an actual code which you have to host yourself and you can modify it as much as you need. It gives you the flexibility to either host it on your own server or opt for a cloud solution. There is a great deal of customization possible. You don’t get charged for transactions, but you do pay additionally for hosting.
For strategy 3, you opt for a development team to create your marketplace from scratch. This case often takes up more time and costs upfront. However, here you are not restricted by any platform limitations. Also, you are not locked into using certain programming languages. Among other things, this option is often a go-to option for custom enterprise marketplace development.
Using a SaaS Marketplace Platform
This strategy is often (but not always) the best choice for an MVP (Minimum Viable Product). You can set up things quite quickly, and the upfront costs will be the lowest. Let’s assume that your digital needs are typical for a marketplace:
- selling goods or services,
- inventory management,
- handling payments,
- managing the blog for your marketplace,
- email campaigns,
- social media integrations, and such.
Then, using a SaaS marketplace platform is a way to go. Shopify is also an option here, and it supports additional tools not available with Sharetribe. For instance, with plain Sharetribe you cannot create custom personalized quizzes to tailor product recommendations. RevenueHunt offers a Product Recommendation Quiz for Shopify. Overall, if you want to do MVP iterations testing different features, the SaaS marketplace platform might limit what you can do. In some cases, MVP iterations you would like to execute might be completely impossible.
Importantly, when you want a mobile marketplace app, this is where the limitations of SaaS marketplace platforms are felt most strongly. Below are the stats worthy of consideration.
This indicates that mobile app commerce sales are expected to account for 62% of overall sales in 2027.
And let’s look at the simple quiz-based mobile shopping experience below.
This would be an almost impossible challenge for a SaaS marketplace platform.
Using a Ready Marketplace Platform with Open Code
This strategy involves a middle ground between a SaaS platform and a custom market from scratch. On the one hand, you need technical skills to hire developers. On the other hand, you get a codebase to customize rather than develop from scratch.
The biggest bonus of this strategy is almost unlimited customization possibilities.
So, basically, you get a good balance between a pre-made solution and the freedom to modify whatever you need. Here you can achieve great UI/UX customization, embed any personalization quizzes, and even integrate AR/VR technology.
However, you do have to take care of hosting, security, and updates. In addition, support for mobile is available under special terms. For instance, CS-cart includes mobile only in its highest-priced plan, and only with an annual subscription.
With that in mind, something like AR/VR technology can be implemented as shown in the picture below with the help of professional developers and a ready marketplace platform with open code.
Coding a Marketplace from Zero
Seth Godin in his book said:
“If you use your money to create exceptional products and services, you won’t need to spend it on advertising.”
Even though custom marketplace software development is the most costly option upfront, this is the most flexible one. With this strategy, you can refine your product-market fit first and foremost.
- Whatever A/B testing or a test feature you need to run, you can do it. Maybe you want to experiment with ‘Fake Door’ or ‘Ghost Buttons’ and measure the feedback.
- You can create a scalable solution with no bottlenecks.
- You can get a custom UI/UX and do all the optimizations you need for faster loading times.
- All new technologies are at your fingertips as well as the option to develop native mobile solutions.
In addition, one needs to put initial costs into perspective. Ultimately, savings with previous solutions might end up migrating into extra spending on advertising.
Best Approach? Why Choose a Platform with Open Code for Your Marketplace
In the table below you can see some major cost and timeline considerations for all three strategies. You should factor them along with the recommendations made above regarding mobile, customization, and possible technology integration.
| Strategy 1* – SaaS marketplace platform | Strategy 2* – Open Code marketplace platform | Strategy 3 – custom marketplace development services | |
| Development cost | $39/month | 30-day free trial, $30-80 per hour for developers, with 140-280 hours (total of $4,9k to $22.4k) | $5k-$10k/month, some agencies offer a trial period (total of $10k to $50k) |
| Building time | 1 day to 1 week | 2 weeks to 1 month, with more customization from 2 months to 6 months | From 3-4 weeks to 6 months depending on customization and technology level |
| Running cost | Lite: $99/month, mysharetribe.com domain, 50 free transactions;
Pro: $199/month, custom domain, 250 free transactions; Extend: $299/month, 500 free transactions.
Additionally: $0.19 per transaction above the free limit. |
Basic: $105/month, revenues up to $5,000;
Pro: $171/month, revenues up to $10,000; Advanced: $325/month, unlimited revenues.
Additionally: hosting for $50 to $200 per month. |
hosting for $50 to $200 per month;
Maintenance and updates are variable depending on your needs. |
Strategy 1 is based on the Sharetribe’s basic platform;
Strategy 2 is based on the Cs-Cart open code platform.
Conclusion: Choosing Your Marketplace Development Path
- As you can see, the open code platform has the most controllable cost range while still enabling customization and advanced technology along with mobile.
- For typical marketplace needs without extensive customization, the most sound solution is to opt for a SaaS platform.
- For enterprises and tech-advanced marketplace business ideas, custom marketplace development is still an affordable and advantageous option.
