Customers care about the environment. They are ready to back up sustainability to preserve the environment with their wallets, but are businesses ready?
- According to PwC’s 2024 Voice of the Consumer Survey, consumers are willing to pay an average of 9.7% more for sustainably produced or sourced products.
- According to the McKinsey US consumer sentiment survey, above 60% of customers said they’d pay more for a product with sustainable packaging.
- According to a recent study by NielsenIQ, about 78% of US consumers say that a sustainable lifestyle is important to them.
Let’s take a look at some data on why sustainability in eCommerce is important before starting with how to build an online marketplace for sustainable and eco-friendly products.
- According to Statista, carbon emissions are forecasted to reach around 25 million metric tons of CO2 by 2030, primarily due to eCommerce logistics. Additionally, several other practices contribute to carbon emissions in the eCommerce industry.
However, to contribute to the environment and establish a footprint in the eCommerce landscape, businesses are building eco-friendly and sustainable online marketplaces and providing a platform for people concerned about the environment. Especially for entrepreneurs and startups, it’s a good time to start an eco-friendly marketplace because sustainability today is becoming a priority.
Let’s dive deep into the blog and explore how to build a sustainable and eco-friendly online marketplace, including its benefits, challenges, key features, cost to build and understanding the right approach.
What is a Sustainable or Eco-Friendly Marketplace?
A sustainable marketplace is similar to other marketplaces. However, what makes it different is that these marketplaces follow ethical, eco-friendly and sustainable practices while conducting online trade.
Sustainable marketplaces offer a range of eco-friendly products that are sourced, produced, and packed using eco-friendly and recyclable materials that minimize the impact on the environment.
In addition, these marketplaces implement several practices and strategies that reduce their carbon footprint and contribute to the environment.
What are the Benefits of Building an Online Sustainable Marketplace?
Building a sustainable and eco-friendly online marketplace can benefit in many ways for buyers, sellers, and admins. Most importantly, its contribution to the environment and society is invaluable.
Benefits of a Sustainable Online Marketplace for Customers
- Buyers get access to a wide range of eco-friendly products on a single platform.
- They can find products that align with their values.
- Buyers can contribute to the environment by lowering their carbon footprints.
Benefits of a Sustainable Online Marketplace for Sellers
- Sellers can easily find and attract customers who are looking for eco-friendly products.
- They can target their targeted customers more precisely.
- Sellers can generate more revenue by accessing the global audience.
- Build brand image and establish a loyal customer base.
- Sellers can get a competitive advantage as they can differentiate by selling eco-friendly products.
Benefits of a Sustainable Online Marketplace for Admin (Marketplace Owner)
- Marketplaces can grow faster compared to others, as sustainability is in high demand.
- A sustainable marketplace can easily attract customers who are conscious about the environment.
- An eco-friendly marketplace can sustain itself longer.
- Marketplace can acquire funding easily as sustainability is increasingly attracting investors.
- Marketplace owners can also greatly contribute to the environment by encouraging sustainable businesses.
Benefits of a Sustainable Online Marketplace for the Environment
- Minimizes the need for a physical store. Digital storefronts don’t require physical visits, energy consumption due to offline operations, maintenance, and other management, including reducing the use of electric appliances.
- Sustainable marketplaces encourage eco-friendly, recyclable, reusable products and packaging, contributing to waste reduction.
- By utilizing eco-friendly and easily degradable materials, sustainable online marketplaces reduce pollution associated with manufacturing.
- Sustainable marketplaces can raise awareness about environmental issues, educate people through their marketing campaigns and encourage them to choose eco-friendly products and practices contributing to the environment.
- Sustainable online marketplaces attract businesses, encouraging them to invest in research and development of materials, sources, and more that are eco-friendly.
Building a Marketplace for Sustainable and Eco-friendly Products?
Challanges in Sustainable and Eco-Friendly Marketplace and Their Solutions
On the one hand, a sustainable online marketplace and eco-friendly practices in the eCommerce industry bring several benefits. On the other hand, operating a sustainable and environmentally-friendly online marketplace poses significant challenges. These can be increased costs, navigating complex supply chains, managing packaging waste, addressing consumer skepticism, and ensuring transparency and traceability.
1. Ethical Sourcing and Transparency:
A sustainable online marketplace where multiple sellers sell products, ensuring products are compliant with environmental standards and sourced and produced ethically, can be a challenge.
Solution:
Traceability throughout the supply chain, continuous monitoring, standards parameters, multiple check-points and practices like them can help ensure practices and products are environmentally friendly and comply with standards.
2. Sustainable Packaging:
Businesses operating a sustainable online marketplace often face hurdles when it comes to eco-friendly packaging. Sustainable packaging means you need to be careful about the materials and practices. Because packaging waste like plastic and cardboard leads to overflowing landfills, pollution and increased greenhouse gas emissions.
Solution:
Minimizing the use of excessive packaging materials and ensuring eco-friendly practices and materials without compromising safety can contribute to the health of the environment.
3. Logistics and Shipping:
Ensuring shipping through sustainable solutions or methods is again a challenge. Businesses face a lot of difficulties when defining the practices to deliver products safely to the customer’s doorstep without impacting or with a lower environmental impact.
Solution:
It is something you need to ensure that the means of transport utilized is electric or has lower carbon emissions. Also, the route must be optimized so that products can be delivered quickly without the need for multiple transports.
4. Cost:
Eco-friendly materials are sourced through ethical labour practices that often take more time and require a higher initial cost. Again, sustainable and eco-friendly production methods also lead to higher product pricing. As a result, affordability becomes a challenge.
Solution:
Ethical practices can be cost-saving in the long run. These may include a reduction in the use of packaging materials, running programs to return packaging materials, using recyclable products, reduced need for inventory, waste management, shifting to renewable energy, cost-efficient shipping approaches and more.
Businesses can work on reducing returns. It significantly impacts the environment and costs through increased transportation emissions, packaging waste, and sometimes product disposal in landfills.
In 2022, over 4 billion tons of return items ended up in the landfills alone in the United States.
Key Features to Look for in a Sustainable and Eco-Friendly Online Marketplace
A sustainable marketplace operates similarly to other marketplaces. Therefore, most of its features are the same. However, to ensure products are sourced sustainably, a few features are required. Let’s explore essential features to look for when building a sustainable and eco-friendly online marketplace.
1. Easy Registration: The First and foremost feature that enables customers and businesses to start interaction with the marketplace is the registration and sign-up option. It should be easy to provide multiple options to register on the platform.
However, for vendors offering sustainable and eco-friendly products, the marketplace can ask for additional certifications or any such document to ensure they meet the specific requirements. It further validates that they source and sell eco-friendly products and practice sustainability.
2. Sustainable Product Listing: Transparency and detailed information are the key to educating and informing customers about the products. Sustainable product listing means providing all the essential information, including certifications, practices and others that ensure products are eco-friendly and that other associated practices comply with sustainability.
3. Advanced Search and Filter: A multi-vendor marketplace has a vast catalogue of products. Advanced search and filtering capabilities enable customers to search for the products they are looking for. They can even filter and sort them according to specific requirements to find the right fit that precisely aligns with their needs.
4. Add to Cart: Customers often prefer comparison before they make a purchase. Sometimes they save products and purchase them later, or check out multiple items at once. The add to cart feature enables them to add, compare, delete or buy products later according to their preferences. It works like a virtual storage where they can store products by adding them to the cart.
5. Multiple Payment Gateways: Payment gateways are service providers that process online payments and provide payment options like credit card, debit card, digital wallets and more to make secure payments. Multiple payment gateways help marketplaces cater to diversified customers’ preferences and enable the option to pay using their currencies. They access payments in multiple currencies and convert them into the merchant’s preferred currency.
There are several payment gateways committed to contributing to the environment by supporting technologies that reduce carbon emissions and partnering with businesses that encourage sustainable practices.
6. Order Tracking: Customer satisfaction is paramount for businesses operating in any industry. Order tracking features enable customers to get updates and progress on their orders from the time of purchase. They can track by themselves or can get updates through emails, sms and more. This also helps increase the order delivery rate.
For businesses, on the other hand, the order tracking option reduces customer inquiries and enhances customer satisfaction, leading to more sales and customer loyalty. In addition, help them gain insights in case of delay, so that they can work to speed up delivery.
Apart from the above features focusing on the buyers, there are several other features required for sellers and admins to play their roles.
Click here to explore all the Online Marketplace features.
7. User Ratings and Reviews: A significant percentage of buyers look for ratings and reviews before they make purchase decisions. It shows how important the feature is. This user-specific feature enables them to leave reviews and ratings for the products they have bought. Checking positive reviews and ratings, there is a high chance that a visitor on the page will convert into a customer.
On the other hand, for businesses offering products, reviews and ratings help them gain insights into what their USPs are, and identify the improvement areas where they can work to improve product quality and other areas.
Explore the Out-of-the-box Features of Yo!Kart
Essential Steps: How to Build a Sustainable and Eco-friendly Online Marketplace?
Transforming your idea into a sustainable and eco-friendly online marketplace requires the following steps. There are several strategies and planning, you can’t miss when building an eCommerce business.
Step 1: Conduct Proper Market Research
Doing market research is the initial stage towards your eCommerce journey. This process helps you understand your target audiences, business model, marketplace type, required budget and more.
During this phase, you analyze your competitors and identify the potential and the gap that you can fill.
In addition, you will also be able to define what features your marketplace should have, what an appropriate development approach is, how much time it will take to launch and several more.
In short, market research provides you with answers to all your questions related to a sustainable and eco-friendly online marketplace.
Step 2: Decide on the Revenue Models
The revenue models are the strategies to monetize your marketplace. They enable revenue streams through which a marketplace generates revenue. However, different marketplaces apply different strategies for monetization. Below are the popular revenue models that marketplaces follow.
Popular Marketplace Revenue Models
- Listing Fees: Listing fees are charged by the marketplace to the sellers on the platform to list their products. Possibly in two popular ways, either the seller will pay a flat fee, or, depending on the number of products listed on the marketplace.
- Transaction Fees: It is a commission-based revenue stream in which the marketplace charges a certain percentage or a flat fee for each transaction initiated between buyers and sellers.
- Subscription Fees: In this revenue model, vendors pay monthly or yearly recurring fees to the marketplace to list and sell products on the marketplace.
- Freemium Fees: This revenue model is similar to a subscription-based revenue model. What makes it different is that buyers and sellers both can benefit from it. They access premium features or services on the marketplace via a paid subscription.
- Featured Listing: In this revenue model, the marketplace generates revenue by promoting sellers’ products or listings. Sellers pay certain charges to the marketplace in order to increase visibility of their products and listings.
- Third-Party Advertisement: In third-party advertisement, the marketplace charges in order to promote their products or services on the platform of third-party businesses.
You can choose a revenue model that fits your business model. However, always consider all the key aspects before you decide. The revenue model can play an important role in achieving your goals.
Step 3: Choose the Right Approach to Build a Marketplace
Once you have finalized all the above considerations. In the next step, you can choose the right approach to build your sustainable and eco-friendly online marketplace.
You can go with any one of these three popular approaches:
- Build a marketplace from scratch: In this development process, you can build your marketplace according to your specific requirements. On the other hand, building a marketplace from scratch is time-consuming and expensive. Also, there are several challenges you can encounter.
- Choose a SaaS-based eCommerce platform: You can build your online marketplace by choosing SaaS-based solutions. SaaS stands for Software as a Service. To avail their services, you need to pay monthly or yearly recurring fees.
However, recurring fees and other additional charges widely vary depending on several factors such as the number of transactions, the products listed and more. In addition, you face hurdles when it comes to customizing and scaling the marketplace, gaining complete control over the platform, getting full ownership over the data and more. In short, SaaS-based solutions pose limitations and are expensive in the long run.
- Launch using readymade marketplace software: As the name suggests, you can launch your sustainable marketplace using ready-to-use software effortlessly. Readymade solutions like Yo!Kart provides complete control over the platform that one gains with a custom-built marketplace. What makes the solution different from SaaS is that it poses no limitations and is available with a one-time payment option; no recurring fees are required. In short, a readymade solution offers complete control, freedom, access and ownership.
Conclusion: Readymade solutions can be the best choice for your sustainable and eco-friendly online marketplace. It combines the advantages of a custom-built marketplace with its unique offerings, making it an ideal selection for a feature-rich eCommerce platform.
Launch a Sustainable Online Marketplace Using Readymade Software
Step 4: Build an MVP (Minimum Viable Product)
Once you have finalized the right approach to launch your marketplace. The next step is to launch your marketplace MVP before you launch a full-fledged eCommerce platform.
A marketplace MVP is the basic version of your full-fledged platform to test your idea, gather feedback, and understand improvement areas. It is introduced with all the essential features to the early adopters. Launching an MVP is always advantageous and less risky than the final one. It requires less time and initial investment to launch.
Essential features of an online marketplace MVP:
- User Registration: It allows users to register on the marketplace.
- Search and Filter: This feature allows buyers to search and filter products they are looking for.
- Add to Cart: Using this feature, buyers can add products to a virtual cart and make a purchase later, or can purchase multiple items at once.
- Secure Payment Gateways: Payment gateways enable buyers to initiate payment by choosing their preferred payment method.
- Reviews and Ratings: These features allow users to provide feedback according to their experiences.
Reviews and ratings serve the purpose of an MVP by providing reviews from the real users and helping them improve their experience and resolve issues.
Step 5: Launch Your Full-Fledged Sustainable and Eco-Friendly Online Marketplace
After you are satisfied with the MVP and finalize working on the implementation or required improvements. The last and final step is to launch your full-fledged marketplace with all the features and functionality, making it a complete solution for its users.
However, your work is not done yet. After you launch, you need to market your sustainable online and promote eco-friendly shopping.
There are several digital platforms where you can market your products or services, including a marketplace. What you need to do is proper planning and execution according to your target audience and products.
How Much Does it Cost to Build an Eco-Friendly Online Marketplace?
Building an eco-friendly and sustainable online marketplace can cost you anywhere between $1000 to $20000 or more. The cost widely varies depending on its complexity, UX/UI, features, functionality, development approach, tech stacks and more. Let’s discuss factors that influence the cost to build a sustainable online marketplace.
Key Factors influencing the cost to build a sustainable online marketplace:
1. Marketplace Complexity: Marketplace complexity is something you can determine by analyzing the time, effort, technology and resources required to build a marketplace.
Based on the complexity, marketplaces are of three types:
- Simple marketplaces: Marketplaces with some basic and essential features.
- Medium marketplaces: Comes with advanced features, functionality, navigation and more.
- Highly complex marketplace: A highly customizable, scalable platform containing all the advanced features and functionality.
2. UX/UI Development: The Intuitiveness of any digital platform matters the most. It enables users to navigate the platform easily. At the same time, building a user-friendly UX/UI significantly impacts the development cost.
A positive marketplace experience helps businesses convert visitors into customers. Also increases the chances of repeat purchase.
However, making a marketplace intuitive and user-friendly requires a good sum of time and effort that ultimately impacts the overall cost.
3. Marketplace Features: To make the marketplace operational, marketplace features are essential components. They help users play their roles and complete transactions.
Developing essential features is also a time-consuming process. It requires specialized expertise and experience to build a feature-rich marketplace.
Determining what features you are looking for can help you determine the cost of building features. However, again, it varies depending on the complexity of the task.
Must-Have Features of a Sustainable and eCo-Friendly Online Marketplace:
- User Registration
- Sustainable Product Listing
- Certification and Badges
- Advanced Search and Filtering
- Add to Cart Option
- Communication Channel
- Multiple Payment Gateways
- Shipping Management
- Marketing Tools
- Social Media Integration
- Analytics and Reporting
- Review and Ratings
4. Third-party Integrations: However, integrating third-party tools and services also requires a significant investment. They enable several services, automate tasks, handle customer data, process payment, manage tax, manage shipment and more. Third-party integration helps streamline operations and improve the overall user experience.
5. Development Approach: The development approach you choose also impacts the cost to build your online marketplace for sustainable and eco-friendly products. However, we have already discussed the popular approaches in the section on steps to build a marketplace.
Yet, cost can vary widely. Building a custom marketplace can cost you up to $20,000 or even more. On the other hand, using a readymade marketplace like launching a feature-rich eCommerce platform starting at $999. However, the cost depends on one’s specific marketplace requirements, customization needs, and many other factors.
Explore Yo!Kart’s Pricing
Yo!Kart: A Cost-Effective Approach to Build Your Sustainable Marketplace
Yo!Kart allows you to build your sustainable and eco-friendly online marketplace effortlessly. It helps you eliminate the cost associated with the factors that are required to build a user-friendly, feature-rich eCommerce platform. As the cost is divided among multiple users.
The supports all the essential features and functionality needed to operate a global eCommerce platform. Once you start your journey with this readymade eCommerce software, you will experience no challenges throughout. Yo!Kart comes with pre-integrated APIs and tools required for processing payment, order fulfillment, managing tax, checking reports, analytics and much more.
Yo!Kart has empowered thousands of global marketplaces and has been leading the eCommerce industry for years. Especially, when it comes to building sustainable and eco-friendly marketplaces, Yo!Kart has proven its ability to offer tailored solutions.
Sustainable Marketplaces Launched with Yo!Kart
- NPK Marketplace: A US-based client found the problem of increasing global warming due to livestock farming. Yo!Kart helps him launch an online sustainable fertilizer marketplace by understanding personalized needs.
- Green Sourcing Hub: Green Sourcing Hub is a Japan-based global online B2B marketplace for sustainable products.
- TransporTECO: A multi-vendor marketplace for electric vehicles based in Europe. The platform deals with a range of electric mobility products like bicycles, motorcycles, scooters, cargo bikes, accessories, and more.
- Watersorted: A New Zealand-based B2B marketplace for addressing escalating water pollution challenges and streamlining procurement for businesses.
Looking for an Affordable Option to Launch Your Online Marketplace
Why Choose Yo!Kart?
Choosing a solution over SaaS or even a custom-built marketplace should bring something additional. Similarly, with Yo!Kart, you should be aware of the advantages of choosing the software as your marketplace.
Advantages of Choosing Yo!Kart:
- One-time payment Option
- Lifetime License to use the software
- Fully customizable solution
- Self-hosted Solution
- Readymade software
- Easily scalable platform
- 100% white-label
- Intuitive and User-friendly UX/UI
- Source code ownership
- Offer complete control and ownership
- No transactional charges or recurring fees
- Free technical support
- Dedicated Project Manager
Final Thought
Sustainability in eCommerce is not just a growing demand but a necessity. Today, a large number of businesses are focusing on eco-friendly products and practices to save the environment. The government is also promoting such practices by offering additional benefits to them.
Interestingly, customers are also conscious and support eco-friendly shopping. In this blog, we have gone through all the essential information that one needs to know or access before building a sustainable and eco-friendly online marketplace.
We have discussed benefits, challenges, cost, essential steps, and the best approach to build a marketplace. If you are one of those entrepreneurs or business owners looking for a solution to build a sustainable marketplace, you should book a demo with Yo!Kart.
FAQs
Q 1. Why is sustainability important for online marketplaces?
Ans. Today, customers are mindful about the impact of their online shopping on the environment. Therefore, they are more likely to make purchases on the marketplace promoting sustainability, eco-friendly products and practices.
Q 2. Does online shopping impact the environment?
Ans. Yes, online shopping also impacts the environment. Ensuring the delivery of products purchased online requires good packaging that causes packaging waste, while shipping products from one city to another requires transportation, which again causes transport emissions, and energy consumption is also one of the significant concerns impacting it.
Q 3. What are the benefits of eco-friendly shopping?
Ans. Shopping for eco-friendly products can help the environment. When the demand for eco-friendly products increases, businesses will start practicing it. As a result, we will contribute to a healthier planet by reducing pollution, conserving resources, supporting ethical practices and many more.
Q 4. What is an affordable way to build a sustainable online marketplace?
Ans. Readymade marketplace software like Yo!Kart helps you introduce your sustainable online marketplace starting at $499. Which is truly the most affordable way to build your marketplace.
Q 5. What are sustainable and eco-friendly products?
Ans. Sustainable and eco-friendly products are the products that are recyclable, biodegradable and reusable, that don’t cause much impact on the environment. They are sources naturally or produced following ethical and sustainable practices.
