How online marketplaces make money

Ecommerce store playbook

How online marketplaces make money

  • December 11, 2020
  • December 11, 2020

The leading online marketplaces sell about US$2 trillion third-party products on their website, making an enormous amount of money in the process. This is encouraging thousands of young entrepreneurs to start their own multi-seller stores. 

However, making money and profits via marketplaces isn’t an easy task, especially if you are a young entrepreneur without little know-how of online businesses. You must use the right marketplace business model and methods that get the sales and profits flowing.

In this blog, TechoSquare will share 4 models using which top online marketplaces earn big sales and profits. 

Membership fee 

One of the best marketplace models to earn huge profits. In this profitability model, merchants pay a membership fee to sell products on the online marketplace. The membership fee gives vendors access to features and capabilities the help maximize sales. Some online marketplaces also sell memberships to customers by promising benefits like free shipping. 

how online marketplaces make money

Commission model 

The commission model is another popular method used to earn profits and sales. The marketplace owner earns a commission on every transaction or sale that takes place in the online marketplace. Websites like eBay charge commissions from merchants to make big money and profits. So, there is no reason why you cannot do the same!  

Featured listing and ads 

Another well-known marketplace model to make money and profits. The featured listing and ads method allows vendors to promote their listing by paying an advertising fee. While all merchants can list their products for free, those eager to sell faster can opt to pay a premium. This creates a WIN-WIN situation for all parties involved. 

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Customer contact fee

The customer contact fee is somewhere between the commission and featured listing model. In this method, customers post requests on your marketplace, and sellers pay to make a bid for these customers. Popular gig websites like Freelancer are based on this model and make millions in profit every year by selling virtual currency.   

Above are 4 popular methods and models used by online marketplaces to make a tremendous amount of money and profits online. The majority of existing marketplaces have utilized one of the aforementioned monetization methods to earn revenue. 

However, for making big money and profits, you have to make sure your online marketplace is built using a scalable e-commerce website builder like SwiftKart. 

The most radical online store launcher of 2020

Swiftkart came out in 2020 and took the world of e-commerce by surprise. The lean online store builder is widely being favored by entrepreneurs who want to build an e-commerce store that can support critical pivots with ease.  

Swiftkart guarantees a responsive e-commerce platform that's multilingual, scalable, and affordable. Got any queries to ask? Send them at and have them answered by our ecommerce experts! 

Also read: 

10 niche ecommerce business ideas to dominate 2021

70 must-have features to build an ecommerce website 

A DIY guide to starting a vintage clothing store


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