How Much Does it Cost to Build an Online Marketplace

Cost of Online Marketplace


The online marketplace (or ecommerce website) is a platform, where the buyer can compare and buy goods from numerous suppliers. Marketplaces serve as mediators between the consumer and vendors of products or services. The popularity of the marketplaces is easy to explain: they can accommodate countless products, provide convenient purchase conditions and necessary guarantees. All this is very attractive to the buyer: there is no need to check dozens of sites or go to the mall – everything can be bought at a single platform.

Another notable benefit for the consumers – all the emerging issues can be addressed using single-window system (without contacting each provider directly). The benefit for sellers is that they get access to a much wider audience. Such platforms become multi vendor marketplaces and help to grow a new business or even secure a leading position in the market.



Kinds of Marketplaces

There is a range of attributes by which online marketplaces are differentiated – by offered products, business models, communication means and types of participants.



By offered products marketplaces are divided into following groups:

  • goods and products (eBay, Amazon, Etsy, AliExpress)
  • services (Uber, Airbnb, Booking, Couchsurfing)
  • media (TravMedia IMM, Matpra Media Marketplace, MediaMath)
  • investment and crowdfunding (Kickstarter, Indiegogo, CircleUp)
  • more uncommon types like social networking, entertainment, advertising marketplaces, etc.

By participants, three types of marketplace websites are distinguished – C2C, B2C, and B2B:

  • B2C  — business to customer

This is the most traditional model, enabling the interaction between sellers and customers. On such platforms, there are always many offers. The best online marketplace examples are AliExpress and Booking. High competitiveness provides a strong incentive for sellers to better their client service and provide quality products.

  • B2B — business to business

In this case, the business sells to the business. B2B marketplaces are useful for wholesale shopping and entrepreneurs that look for suppliers. Good examples are Alibaba and Made-in-China.

  • C2C — customer to customer

This model assumes equal communication between customers. Usually, participants in such platforms are not entrepreneurs and businessmen. On such platforms, people exchange skills and services. Examples of such marketplaces are BlaBlaCar and Couchsurfing.


Comparative of C2C, B2C, and B2B business models


How to Create an Online Marketplace

Creating a strategy for building a marketplace depends on your business specifics and involves a number of steps. But the most important things for future success are a competitive idea and choosing the right platform for its implementation.

  1. Conduct a market research

To begin, conduct a market research, gather information about marketplaces that already exist, analyze the most common issues that concern your target audience and try to address one or even several of them.

  1. Choose the right business model

Find out all details about each business model and decide which one would be best for your business. There is always a risk of failing if you create a marketplace using the wrong business model.

  1. Select a platform

The choice of the platform to build a marketplace website development depends on the particular business needs. If you have the idea of an entirely new service, which will break into the market, then you should order the custom development. If you only want to create an online marketplace, bring vendors and receive interest for sales, then you can base an online marketplace platform over a ready-made solution. Such platforms allow starting the system quickly, reducing the implementation time through the usage of ready resources, increasing the efficiency of operations, reducing the maintenance costs and purchasing new equipment, simplifying the future integration of the trading platform with partners. However, there are also a number of disadvantages. Ready-made templates can not perfectly meet your business requirements and your customers’ needs. Also, you will not be able to receive behavioral data about the users and will not be able to update your platform quickly according to this information.

  1. Create a marketplace website MVP

MVP allows demonstrating your idea to customers, collecting user feedback, and adjusting the marketplace platform development process according to the received data.


Online Marketplace MVP

While building an online marketplace, it is important to get feedback as soon as possible. Minimum Viable Product (MVP) is a product that, being endowed with the core features of the idea, presents it to the users to collect the user feedback for further development. The MVP will answer a number of questions, such as whether you have chosen the right niche, whether the core functionality is chosen correctly, whether your product is generally interesting to people and how satisfied they would be. And it will help to determine the problems that may arise later, saving time and money. Having all this data, you wil have a solid understanding on how to build a marketplace.

Therefore, MVP not only allows presenting your marketplace website to users as early as possible but also helps to improve the product, having an acute understanding the behavior and expectations of your target audience.




Main Features of a Successful Online Marketplace

At the stage of the marketplace MVP creation, you should think about the main values that your product would offer and develop your marketplace accordingly. Also, do not forget that the first impression is very important. Below, we present common features that are indispensable for marketplaces.

  • Personal user accounts

It is important to make personal accounts and profiles as detailed as possible and to develop functionalities specific to the needs of each party. Buyers, for example, will appreciate a simple registration process, thoughtful navigation and the ability to see detailed information about the providers. Sellers should be able to manage their public information, create new tasks, group their products or services.

  • Instant messaging

While looking for the necessary service or product, users often have questions. Therefore, the instant messaging option and the ability to communicate with providers is really important.

  • Real-time booking

This feature will give users the opportunity to book a service or product they are interested in and subsequently return to buy it, so it is worth adding booking capabilities. In addition, this option will allow users to book a product that is temporarily out of stock.

  • Flexible payment system

First of all, both the users and providers should be sure that the payment process is safe. For convenience, you should provide a transparent payment system that will calculate the total amount of services and standard fees automatically. It also important for users to see transaction history and easily manage payment methods.

  • Listings

Providers should be able to publish and manage products and services they offer, users — search, filter, manage and search for a listing.

  • Reviews and a reference system

Online shopping differs significantly from the offline retail by the fact that customer can review a product only by its description or photo. Therefore it is important for buyers to be able to receive detailed information about services, products, and sellers. Feedbacks are trusted information, so the functionality for ratings and reviews will be useful in building trust between users and providers. Users should be able to see a product’s reviews, write reviews themselves and rate listings; providers – view users reviews and moderate them.

Additional Features that can be Developed in Future Versions

After introducing the basic version of the product to the customers and receiving feedback you can start thinking about improving your platform and implementing additional features. Leading criteria here should be convenience, novelty, and user-friendliness.



  • Push Notifications

Notifications from the marketplace help users to stay informed when new products appear or when the booked product becomes available again. They also will encourage users to visit the platform more often. Users should be able to view notifications and change their notification settings.

  • Product Comparison

This feature will help users choose the best product or service by comparing product features, prices, and ratings. This will save time and effort of the buyer.

  • Sharing to Social Networks

Given the popularity of social media nowadays, this feature will be useful to both buyers and sellers as well as the platform owner. Social media sharing creates additional advertising for your market and promotes your brand.

  • Wishlist

This feature will be useful not only for users but also will increase the chances that this product will be bought using your platform. And, as noted above, sharing such wishlist to social networks will attract a new audience to your platform.

At the implementation stage, it’s important to remember that the online marketplace is a link between the supplier and the buyer, which is why its main task is to ensure their effective interaction and convenient data flow. Ensure a perfect user experience. Every user who visits the platform should be able to navigate quickly and easily find the necessary section. There are so many offers on the market, that no one will spend even 5 minutes to find out which button to press to read the reviews. No one will spend the time to learn how to use the service as well as wait until the page loads. If you are looking for a team that can deal with it, contact our back-end or front-end developers and they will find the right solutions for you.

When it comes to software implementation, it is a good idea to think about outsourcing. This is a good way to reduce costs and get quality services. In addition, outsourcing allows you to focus on the main tasks by entrusting the development to the team of professionals. Our team ensures the successful project development starting with the conception engineering to software implementation and further maintenance. In our work, we employ the Agile methods such as Kanban and Scrum, which enable us to split your work into spurts, regularly track progress and focus on the customer’s requirements. The main advantage of the Agile methodology lies in taking into account all the ideas and changes to the project without starting it over. This provides us with great flexibility, even if the customer requirements change. Our project management system helps to organize work process and providе a workflow smoothness.

We are always confident in our products due to the expert quality assurance department. We offer different types of quality assurance services: manual testing technologies such as New Relic or automated testing with RSpec and Capybara. These applications ensure real-time application monitoring and simulate a user behavior in the application.


How Much Does it Cost to Build an Online Marketplace

The prices for the marketplace website development are very different and depend not only on hourly rates of developers but also on the type of the platform: the adaptation of ready-made solution or custom development, as well as used components.



Anyway, while budgeting you should take into account the following costs:

  • backend hosting cost
  • user interface and user experience design cost
  • development – front-end and back-end programming
  • quality assurance – automation tests and manual testing
  • marketing costs
  • further tech support.

According to the Europe services cost market research, an average hourly rate of the Ukrainian engineers is $35 per hour, and it’s cheaper than in the Baltic states ($45), Scandinavia ($70) Central and Western Europe ($65).

In the table below, you can see an approximate amount of time needed to build an average online marketplace:



Why Choose us?

We are a progressive team with 8 years of experience on the market that has successfully completed more than 100 projects for customers from USA, Canada, Germany, United Kingdom, Japan, and others. We are experts in text processing, marketplace development, social and community network development, the creation of event platforms’ software and, most important, we are open to any possible challenge. Most of our projects are developed under a strict NDA but let us showcase a couple of our public developments.

TikkTalk ( is an open marketplace for interpreters that enables them to cooperate with customers anywhere they want using a number of various devices  (using video and phone conferences, web chats, Skype, mobile apps). This project is not just a platform for booking the services of translators but also a great help for businesses that require solutions to communication problems. ( is a convenient Switzerland-native solution, with the idea to help customers to rent a power bank when they need to recharge their mobile device and return it to any of the numerous rental points.



If you need more information about online marketplace creation, contact our team today and we will be happy to discuss your wildest ideas!

Alex Morgunov

Alex Morgunov

Project Lead

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