E-commerce is continually evolving, but today there’s an obvious shift towards an aggregation of buyers and sellers.
We’re stepping into the era of marketplaces, but these new marketplaces are designed for a very specific use-cases (hyper-vertical), or a very targeted and proximate user base (hyper-local).
Why? Because changes in behaviour, driven by a shrinking screen size and a need for immediacy, pushes buyers toward marketplaces as an easier way to search, compare, and purchase. For many sellers, operating a website is an important factor of doing business, but there’s still a need to bring buyer traffic to a virtual store. This is expensive, time consuming and takes away from the core business of selling, which makes marketplaces a better proposition as a sales channel.
There’s a perfect storm brewing wherein people with fresh ideas can challenge the status quo — and win. This ideal entrepreneurial environment is brought about by a belief (and countless war stories) of the ‘little guy’ successfully taking-on ‘heavyweights’, and they’ve ready access to affordable technology.
When you couple this with the natural efficiencies provided by marketplace aggregation, and more importantly, inefficient market dynamics across many industries, a million ideas to improve the situation take root in the minds of people who experience these challenges every day.
By the people, for the people
An idea usually comes out of a desire to solve a problem. Mike and Matt were working as developers for a real estate company, figuring out a way for customers to search for apartments online. Late nights at work often made them order takeout dinners, but they were getting irritated with calling restaurants and repeatedly reading credit cards numbers over the phone.
That’s sparked an idea, and GrubHub came to existence in 2004 — an online food-ordering service that has grown into 5.6 million active users and 175,000 orders per day.
Similarly — and almost every aspiring marketplace entrepreneur knows Airbnb’s success story by now — in 2007 Airbnb co-founders Brian and Joe needed to make extra income, so they created a basic website and posted an advertisement to rent their lodging space plus a home-cooked breakfast. When three renters responded, it showed their idea is a go — it was the start of something new that redefined the way we travel.
Eight years later, over 50 million guests have followed the footsteps of those three renters.
Both GrubHub and Airbnb are examples of online marketplaces that take advantage of the sharing economy model, and the ideas behind them came from ordinary people needing to solve everyday problems. Given the fragmentation and diversity of the Asian market, we’re in a period wherein new ideas should sprout daily to uniquely solve marketplace problems and create marketplace opportunities in this region.
I don’t mean copying ideas from other countries and bringing them to Asia hoping they’ll stick, but let’s truly consider localised marketplace concepts that may solve the real needs of a diverse Asian market.
The humble smartphone will drive greater marketplace usage in Asia
In Asia, connectivity between people and places is surging. The number of smartphone users grew 45 per cent year-on-year from 2007, culminating in 1.6 billion users in 2015. Cheap smartphones and hassle-free internet packages result in the proliferation of smartphone usage, which ultimately leads to the growth of digital consumerism.
For marketplace operators this is an ideal situation; ‘users’ are becoming ‘consumers’, and given the limitations of user experience that asks demands navigation across numerous single-merchant sites, consumers will be naturally drawn to marketplace environments.
Dream big and dream small
Any kind of marketplace has a chance to stand out and evolve into something pertinent for a local user base. In recent times, success stories of disruptive marketplaces tell us that anything is possible. Although creating the next Airbnb-esque idea from Thailand or Indonesia is the stuff dreams are made of, using marketplace concepts to solve local problems is the right place to start.
Chances are, you can turn your idea into a business opportunity that will improve lives. Let’s move past ‘travel’ and ‘logistics’ ideas and think about bringing businesses and communities closer together in new ways, or accessing information through knowledge marketplaces even easier.
In Asia, the problems to solve are many, but the opportunities are endless. Marketplace technology is available, and the ability to access online marketplaces is certainly available. We just need more people to act on their ideas.
Dinuke Ranasinghe is CEO and co-founder of Arcadier, a SaaS company that powers next generation marketplace ideas. You can follow Arcadier on Twitter, Facebook, and LinkedIn for more news and updates.
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