I just read this great article by David Norris titled “Online marketplaces: What kind of liquidity do you need to grow?” If you are building a marketplace like we do with swapit, I strongly suggest you reading David’s post.
The term of “liquidity” in a marketplace is to be understood as the critical mass any marketplace needs to self-sustain itself. Because swapit is a consumer-to-consumer (C2C) marketplace, we need to have enough sellers and enough buyers to create enough trading liquidity to make the marketplace attractive to both types of users. As a marketplace for pre-loved items we need consumers on both sides:
- Sellers to sell their pre-loved items, and
- Buyers to buy those items.
I totally agree with all of David’s points in terms of creating and sustaining such liquidity, but there are some points which I learnt from David’s great article. We at swapit have been very active to reach out to our target audience. We use various channels to do that: Twitter, Facebook, YouTube, online forums, groups, live events, pitches, conferences, offline lead generation, guest columns / media, networking events, and so on.
Based on some examples and experiences David talked about, we will shift our targeting effort more towards the buyer-side of the equation. There is still the obvious situation that:
Buyers won’t visit a marketplace if there is nothing to buy. Sellers won’t sell at a marketplace unless there are buyers.
Yet, David correctly summarizes the actual situation which everyone of us realizes sooner or later:
One thing is for certain; having a large consumer base is a good reason for sellers to want to use the service. The other way around is less certain; just because you have a large number of products on the shelves doesn’t mean people will come.
So while we were going very directly after our target audience – we were always contemplating whether to focus more on the buyer or the seller-side of that audience. Having read through many of David’s examples, taking into account his experience, looking at our experience at S4BB Limited in terms of building mobile apps for over a decade; building, publishing and running mobile retail apps for over 3 years; we decided to shift our focus of outreach more strongly towards the buyer side.
Some changes in that respect, are very simple actually. In the end it is all about communication and how we present swapit to our target audience. So instead of using a phrase like “Buy and sell second hand items nearby!” we are now using something like “Find pre-loved quality products nearby!“. This addresses buyers directly and actually leaves sellers completely out. Again, I absolutely agree with David that we need to go after our buyer audience much more strongly than our sellers.
To be honest, we already have some rather active sellers on swapit. (If you’re a seller and read this post: Thanks a lot for your participation!) Every day we see new items being posted for sale. In the end we also need to keep in mind that people who are buyers on swapit are also potential sellers, and every so often, such buyers actually turn to sell some of their pre-loved items too. Sometimes that’s even an item they previously bought on swapit. So by attracting more and more buyers to swapit, we know for sure that we are also growing our seller-base. Hence, a strong focus on attracting more buyers makes a lot of sense and we will go after that even more refined target audience.
I will keep you posted here on how the results are.
Just as a quick sneak peek, this is how a “Twitter Card” looks like from that buyer-centric perspective:
You want to give swapit a try? Just go to http://get.swapit.la and download the app.