Alibaba’s mobile wallet, Alipay, changed the online shopping experience for customers in China. Alipay had to tackle two major pain points; long checkout times and limited payment options (someone help, please, you’re killing us)!
Before Alipay, customers had to input payment information each time they made a purchase! A super time-consuming process (remember those days?)!
That in itself discouraged many from shopping online! So much typing and re-typing and re-typing, sheesh!
Alipay solved this problem by allowing customers to store their payment information in their app. Now they can make purchases with a few clicks from their mobile devices (now we are talking).
Alipay also expanded the payment options available to customers. Alipay started offering a range of possibilities; bank transfers, credit and debit cards, and online payment services (the world is your Oyster).
Expanding payment options allowed customers to choose the most convenient payment method. And the most secure. Alipay was reducing friction in the purchasing process (no more waiting in long lines like at Walmart, please)!
The app’s widespread adoption in China demonstrated how important it is to solve a real problem in an online marketplace.
The app’s widespread adoption in China demonstrated how important it is to solve a real problem in an online marketplace.
Find and fix! How do you find a problem to solve with your online marketplace? We’ll set out a plan today and narrow down on a few items (once you know the tricks, it ain’t as hard, so stay tuned).
Often, solving issues for users includes one of three essential items:
Create Your Own Marketplace Fast
One way to solve a real problem in your online marketplace is to focus on convenience.
Convenience can mean streamlining your buying process to make it as easy and efficient as possible for your users to purchase. But there are a variety of ways convenience can be improved:
By winning in any one of these areas, you can experience the following:
Yes! Hear the ding of emails arriving in your inbox as orders multiply. With the taste of freshly brewed coffee, watch as golden five-star reviews pop up on orders!
Ensuring your online marketplace provides convenience is like walking into a one-stop shop (a.k.a; almost like a “Walmart”) where everything is under one roof. You get everything you need right on the spot now (now being the key to convenience).
Ensuring your online marketplace provides convenience is like walking into a one-stop shop (a.k.a; almost like a “Walmart”) where everything is under one roof. You get everything you need right on the spot now (now being the key to convenience).
Why is convenience essential:
E.g., Amazon, in their online marketplace, ensured convenience by implementing one-click ordering. Previously, there was too much hassle (you are making me tear my hair out)! Too many steps to complete a purchase previously.
Amazon recognized the pain and introduced the one-click ordering feature!
Amazon recognized the pain and introduced the one-click ordering feature!
Time for you to be the doctor for your marketplace. Let’s prescribe some action steps to improve convenience in your online marketplace:
Offer Lower Prices with Higher Value than Other Online Marketplaces
Focusing on a better price or pricing strategy is another way to solve a problem. Price is a significant factor consumers consider when purchasing!
Better pricing comes in all forms:
Solving pricing in your online marketplace is like baking a cake! Just as the right ingredients and the correct amount of each ingredient are vital for a cake, finding the right balance of value and competitive prices is critical.
And pricing can be tricky! Don’t give up, however! You’ll want to keep experimenting till you get it right.
Why?
Alibaba had its pricing strategy. Alibaba Group’s penetration pricing strategy offered its products at a lower price than its competitors. Primarily to gain a larger market share (think of a drooling tyrannosaurus rex eating up everything in its path).
This strategy aims to attract cost-sensitive consumers and gain a large customer base. Once the company has established a solid customer base, it can gradually increase prices to increase its profit margins (boil a frog strategy).
The use of penetration pricing by Alibaba Group was particularly effective in the early stages of the company’s growth. Penetration pricing was a good part of what helped establish the company as a dominant player in the Chinese e-commerce market.
By offering its products and services at lower prices, Alibaba won market share. Many were drawn to the company’s value proposition of low prices and a vast selection of products.
By offering its products and services at lower prices, Alibaba won market share. Many were drawn to the company’s value proposition of low prices and a vast selection of products.
Want to focus your marketplace on better pricing?
Offer Better Quality Than Other Online Marketplaces
Or your online marketplace might focus simply on providing better product quality.
Quality can mean:
Improving quality for your online marketplace can mean:
Experience fewer sweaty shirts as you have more repeat sales! Stop banging your head against the wall (get rid of your bruised forehead) because of having to provide so many refunds! Feel the joy of attending to your emails because of customer relating their great experiences.
You’ll raise the bar for excellence until you rival those Olympic high jumpers!
Quality does matter:
E.g., EarthLite, a company that sells massage-related products, built its company on a foundation of high-quality products. Marketing them as handmade with eco-friendly materials, superior to what you might find elsewhere.
By promoting their products as quality handmade products, Earthlite solved a real problem in the massage-related retail market.
Namely, low-quality massage products; made with hazardous materials! EarthLite differentiated itself from its competitors.
The company’s focus on product quality has helped attract customers who value performance and sustainability. 
Want to focus your online marketplace on product quality?
Closing Summary
Solving a real problem in your online marketplace requires focus. By focusing on items such as convenience, better pricing, or product quality, you can solve real problems out there.
Think about:
