E-commerce / Marketplace
Marketplace marketing where growing one side breaks the other.
Running a marketplace is not running a store with more products. It is running two acquisition problems that constrain each other, where growing the easier side faster than the harder one makes the product worse rather than better.
How do you market a two sided marketplace?
A marketplace has to acquire supply and demand in a workable ratio. Growing either side alone degrades the experience: too many buyers and nothing is available, too many sellers and nobody sells enough to stay.
The practical measure is liquidity, meaning the probability that a given listing transacts or that a given search finds something, within a defined area and time. That number, rather than total users on either side, is what determines whether the marketplace works.
Most marketplaces should therefore grow narrowly first, concentrating in a category or a geography until liquidity is genuinely good there, and expand only after. Broad early growth produces a large marketplace where nothing happens.
Total users is a vanity metric. Liquidity is the business.
Marketplace reporting defaults to the numbers that grow most easily: registered users, listings, sessions. None of them describe whether the product works, because a marketplace with a hundred thousand listings that nobody can find anything useful in is a worse product than one with two hundred listings in a single well served category.
Liquidity is the honest measure. On the supply side it is the proportion of listings that transact within a reasonable window. On the demand side it is the proportion of searches that produce something a buyer actually wants. Both should be measured within a defined geography or category rather than across the whole platform, because an average conceals exactly the failure you are looking for.
Read the full breakdown: Total users is a vanity metric. Liquidity is the business.Hide the full breakdown: Total users is a vanity metric. Liquidity is the business.
That reframing changes strategy substantially. Growth stops being about volume and becomes about density: enough supply in one place that buyers find what they want, and enough demand in that same place that sellers see results.
It also explains the failure mode. A marketplace that markets hard to whichever side is cheaper to acquire ends up with an imbalance that is difficult to correct, because the neglected side has already formed an opinion about whether the platform is worth their time.
Measuring liquidity by segment is the single most useful reporting change most marketplaces can make. Results vary by market, budget, competition and other factors. Nothing here is a guarantee of a ranking, a lead volume or a revenue outcome.
Five ways marketplaces solve the empty room problem.
Every marketplace begins with neither side having a reason to be there. These are the approaches that have worked.
Constrain the market
One city, one category, one campus. A small market with good liquidity is a real product. A large market with poor liquidity is a directory nobody uses twice.
Subsidise the harder side
Usually supply. Free listings, hands on onboarding, or paying early sellers for their time. It is expensive, it is temporary, and it is frequently the only thing that works.
Be the first seller yourself
Several successful marketplaces began by supplying inventory directly until enough third party supply arrived. It is unglamorous and it removes the chicken and egg problem entirely.
See the remaining steps: Five ways marketplaces solve the empty room problem.Hide the remaining steps: Five ways marketplaces solve the empty room problem.
Aggregate existing supply
Listing what already exists elsewhere, with permission, gives buyers a reason to arrive before sellers have joined. It has to be handled carefully and it solves the first stage.
Solve a single use case completely
One specific transaction, done better than anywhere else. Breadth is what a marketplace earns later, not what it launches with.
The common thread is narrowness. Marketplaces that try to be broad from the start almost always fail on liquidity rather than on awareness.
Supply and demand need entirely different marketing.
Running one campaign, one landing page and one report across both is the most common structural error in this category.
Open the full comparison: Supply and demand need entirely different marketing.Hide the full comparison: Supply and demand need entirely different marketing.
| Item | Supply side | Demand side |
|---|---|---|
| What they want | Sales, with low effort | Choice, trust and a fair price |
| What they fear | Wasted time and no buyers | Being scammed or disappointed |
| How they are reached | Direct outreach, communities, trade channels | Search, social and word of mouth |
| Acquisition cost | Higher, and worth it | Lower, and easy to overdo |
| Onboarding | Hands on, high touch early | Frictionless |
| Churn signal | Listings stop being refreshed | A search that returns nothing useful |
| Right metric | Proportion of sellers transacting | Proportion of searches that succeed |
The bottom row is where most marketplace reporting fails. Counting active users on each side tells you how many people arrived. Counting successful transactions per participant tells you whether they will come back.
A marketplace sells the transaction, not the product.
Buyers are being asked to transact with a stranger, which makes trust design a product decision rather than a marketing message.
The elements that matter are consistent across categories: verified identity in some form, reviews that cannot be manipulated, a payment flow where the platform holds the risk, a dispute process that is described before anybody needs it, and a clear statement of what the marketplace guarantees and what it does not.
That last one is where marketplaces most often equivocate. Saying plainly what is covered and what is not is better than implying broad protection, because a buyer who discovers the limits during a dispute becomes a public complaint rather than a customer.
Read the full breakdown: A marketplace sells the transaction, not the product.Hide the full breakdown: A marketplace sells the transaction, not the product.
Review integrity is both a product problem and a legal one. The FTC's rule on fake reviews and testimonials covers fabricated reviews, incentivised ones and suppression of negative ones, and a marketplace carries exposure for what happens on its own platform as well as for what it does itself.
Seller quality control is the underrated half. A marketplace that admits anybody will acquire buyers and then lose them, and no amount of demand side marketing repairs a reputation for bad transactions.
What applies to a marketplace operator.
- The FTC's rule on fake reviews and testimonials took effect on 21 October 2024. It covers buying reviews, writing your own, and suppressing negative ones. Every review we help collect is first party, requested from a real customer, and never gated on the rating they intend to leave.
- Any material connection between you and someone endorsing you has to be disclosed clearly and close to the endorsement. Paying, gifting, discounting or employing someone all count as material connections.
- The FTC's Mail, Internet, or Telephone Order Merchandise Rule requires a seller to have a reasonable basis for any shipping time it advertises, and to ship within 30 days where no time is stated. A dispatch promise in ad copy is a legal representation.
- Fees and charges shown to either side have to be disclosed clearly where the decision is made. Surfacing a commission or a service fee only at the final step is the pattern regulators and consumers both react to.
- Email and phone follow up carry their own rules. CAN-SPAM requires accurate headers, a physical postal address and a working opt out honoured promptly, and calls and texts to consumers sit under the Telephone Consumer Protection Act. Follow up sequences get built to those rules rather than retrofitted to them.
Marketplaces carry obligations their sellers may not understand, and it is generally the platform that is visible when something goes wrong. Publishing plain seller guidance is a protective measure as much as a service one.
The two sides are reached in almost entirely different places.
Demand side acquisition looks like ordinary consumer marketing: search, social, content and word of mouth, with the important caveat that it should only be scaled where supply can serve it. Driving national demand into a marketplace with supply in two cities produces a bad first experience for everybody outside them.
Supply side acquisition is closer to business development. Sellers are frequently reached through trade communities, direct outreach, existing platforms they already use and, in professional categories, through associations and industry networks. It costs more per acquisition and it is usually the constraint.
Read the full breakdown: The two sides are reached in almost entirely different places.Hide the full breakdown: The two sides are reached in almost entirely different places.
Search behaves differently for a marketplace than for a store, because the listings are the inventory and they change constantly. Category and location pages that persist while the listings beneath them rotate are the structure that works, and they need to remain useful when supply is thin rather than presenting an empty page.
Content has a specific role here too. Guides that help a seller succeed on the platform are supply side retention, and guides that help a buyer evaluate a category are demand side acquisition. They are different content with different authors and most marketplaces publish only one of them.
What consumers require before transacting with a stranger.
BrightLocal surveyed 1,002 US consumers in 2026 on local business review behaviour. The thresholds transfer directly to marketplace listings, where the seller is unknown.
SourceBrightLocal, Local Consumer Review Survey, 2026, base 1,002 US consumers
The under twenty reviews threshold is the cold start problem restated. A new seller on a marketplace faces the same barrier as a new business, which is why seller onboarding usually has to include help getting the first transactions.
What a participant is worth, and how to tell the work is weak.
A marketplace participant is worth their contribution across every transaction they take part in, which means take rate multiplied by expected transactions, net of the cost of supporting them. Supply and demand should be valued separately because the numbers are usually very different.
Define qualified by segment rather than by volume. A seller in a category with no demand is a cost. A buyer in a geography with no supply is a bad first experience. Both are easy to acquire and both make the product worse.
Read the full breakdown: What a participant is worth, and how to tell the work is weak.Hide the full breakdown: What a participant is worth, and how to tell the work is weak.
The most useful operational number is the proportion of new participants on each side who complete a first transaction within a defined window. It is the clearest early signal of whether onboarding and liquidity are working, and it moves long before revenue does.
How you tell it is being done badly: reporting that leads with registered users or total listings, one funnel covering both sides, demand marketing scaled into geographies with no supply, and no liquidity measure broken down by segment.
The vanity metric is total users. It is the easiest number in a marketplace to grow and the least connected to whether anybody is transacting.
Take rate belongs in the same conversation. Whatever the marketplace charges should reflect how much of the transaction it actually handles, from discovery alone through to payments, trust, dispute resolution and fulfilment. Raising a take rate on a marketplace with weak liquidity accelerates supply leaving, which is why the rate has to be earned by making the transaction better rather than by being the only route to the buyer.
Leakage is the related worry and it is best answered by being worth the fee. Payment protection, dispute handling, records and repeat discovery are the reasons participants stay inside a marketplace. Enforcement alone produces resentment on both sides and rarely works, because two people who have already met have every incentive to arrange the next transaction directly.
What we would do.
E-commerce SEO
Category and location pages that persist while the listings beneath them rotate.
Conversion Tracking Setup
Liquidity by segment, and first transaction rates on each side.
SEO Content Strategy
Seller success guidance and buyer evaluation content, which are different jobs.
LinkedIn Marketing
Supply side acquisition where sellers are professionals rather than consumers.
Conversion Rate Optimization
Onboarding on both sides, where most marketplace acquisition is wasted.
Your website works alongside the store platform you already run.
We do not replace your store platform, we do not migrate it, and we do not ask you to change it. The site links to it from the places a customer is ready to act, and embeds the vendor's own widget where the vendor publishes one. Being plain about the mechanism: that is all it is. Nothing is synced, nothing we build reads or writes your records, and the names below are systems our clients run, not partners of ours. Selling on somebody else's platform means the handoff is one way by design. The brand site's job is to be the thing people search for by name after they have seen a listing.
Store platforms
The platform owns the cart, the checkout and the customer account, and it should keep owning all three. A custom checkout is a liability and the platform's own is not, so we build around it rather than over it.
- Shopify and Shopify Plus
- WooCommerce
- BigCommerce
- Adobe Commerce and Magento Open Source
- Ecwid by Lightspeed
Subscriptions and repeat purchase
The subscription tool owns the hardest page you have, which is the one where somebody manages or cancels. We do not replace it. We do argue for making it easy to reach, because a cancellation somebody cannot find becomes a chargeback instead.
- Recharge
- Bold Subscriptions
Email, SMS and reviews
These already own the messages and the review requests. What the site controls is what they have to work with: whether a product page earns the signup, and whether reviews are shown on the page and marked up rather than left sitting in a dashboard.
- Klaviyo
- Attentive
- Mailchimp
- Yotpo
What we actually change
Not the system: the path to it. Where the button sits on the page, whether it says what happens when you press it, how many taps it takes from a phone, whether it appears again at the point a customer has finished reading and decided, and whether somebody who is not ready yet has a second way to reach you. That path is ours, it is measurable, and in most store audits it is the part doing the damage.
Where the handoff is only a link
Some vendors publish an embeddable widget and some publish nothing at all. Where there is nothing to embed and no deep link worth pointing at, the site sends the visitor to your booking page or your login and stops there. That is a perfectly good outcome and we would rather say so than describe a seam we cannot remove. What we can do is make the destination unsurprising, so nobody arrives wondering whether they are still dealing with you.
Get a marketplace growth review.
We start with liquidity by segment and first transaction rates, because total user counts describe a marketplace that may not be working at all.
One caveat on all of that. These are descriptions of rules as they are published today, not legal advice about your situation. They differ by state and they change, sometimes quietly, so check the current wording with your own counsel or compliance officer before you rely on any of it. Where a rule touches your marketing we write to the stricter reading and send it to you for sign off before anything publishes.
Straight answers.
Which side should we grow first?
Usually supply, because it is harder to acquire and because demand arriving to an empty marketplace does not return. The exception is a category where supply is abundant and buyers are scarce.
Whichever you choose, grow it narrowly. A small market with good liquidity is a product; a large market with poor liquidity is a directory.
What should we actually measure?
Liquidity by segment: the proportion of listings that transact and the proportion of searches that succeed, within a defined category or geography.
Total users, listings and sessions are the easiest numbers to grow and the least connected to whether the marketplace works.
How do we solve the cold start problem?
By constraining the market, subsidising the harder side, supplying inventory yourself at the start, aggregating existing supply with permission, or solving one use case completely.
Every approach that works involves being narrow. Marketplaces usually fail on liquidity rather than on awareness.
Can we run one campaign for buyers and sellers?
No. They want different things, fear different things and are reached in different places, and a blended report will optimise toward whichever is cheaper to acquire.
Separate campaigns, separate landing pages and separate reporting, with a liquidity view that shows how the two are balancing.
Are we responsible for our sellers' reviews?
A platform carries exposure for what happens on it as well as for what it does itself. The FTC's rule covers fabricated reviews, incentivised ones and suppression of negative ones.
Publishing plain seller guidance and enforcing it is a protective measure as well as a quality one.
How much buyer protection should a marketplace offer?
Whatever you can honour, stated plainly, including what is not covered. Implying broad protection and revealing the limits during a dispute produces public complaints rather than resolved cases.
Clarity about the limits is a stronger trust signal than a vague assurance, because buyers have learned to distrust the latter.
Should we advertise nationally?
Only where supply can serve the demand. Driving national interest into a marketplace with supply in two cities produces a poor first experience for everybody else, and first experiences in this model are rarely repeated.
Scale demand geographically behind supply rather than ahead of it.
What take rate should we charge?
Whatever the value you add supports, which depends on how much of the transaction you actually handle: discovery alone, or payments, trust, dispute resolution and fulfilment as well.
Raising a take rate on a marketplace with weak liquidity accelerates supply leaving. Earn the rate by making the transaction better rather than by being the only route to the buyer.
Where this comes from.
Primary documentation and published research behind the guidance on this page.
- FTC: final rule banning fake reviews and testimonials (opens in a new tab)
- FTC: endorsement guides, what people are asking (opens in a new tab)
- FTC: complying with the Mail, Internet, or Telephone Order Merchandise Rule (opens in a new tab)
- FTC: .com disclosures, how to make effective disclosures in digital advertising (opens in a new tab)
- Google Search Central: product structured data (opens in a new tab)
- Google Search Central: ecommerce site structure best practices (opens in a new tab)
- BrightLocal: local consumer review survey (opens in a new tab)
Talk to the team
A short call, a look at how the business currently shows up, and a straight answer on what we would do first.