Your business can only make a head-start only when you have producers and consumers. Such is your online business of starting a marketplace website? Then it is indeed challenging. What use in having producers alone registering on your site when there are no consumers? At the first place, will producers show an inclination towards your marketplace platform when there aren’t any consumers?

Alongside, what use in a handful of customers registering on your site in anticipation of many producers selling their products only to find less or no producers selling on your site. These two cases are technically termed as chicken and egg problem. Success in running a marketplace website will not come if you do not overcome the chicken and egg problem.

Solving chicken and egg problem in a startup online marketplace

The problem has perplexed many online marketplace startups. However, applying a few strategies may help you overcome.

Offer incentives

Initially, attract one group, be it producers or consumers. For those registering on your startup site, offer diverse incentives. Reach out to them.

Start small

Starting big and lamenting the failure is not recommended. It is always ideal to start small, like catering to the consumers and producers of one area, town or city. Why follow this strategy is that it gives a local feel to your platform. And so buyers and sellers will throng to your platform. Once success in achieved in a particular city, riding on it, you can expand to other cities as well.

Offer monetary subsidies

How about bringing in high-value producers to the site? They will only add value to your site. Given their presence on the site, the customers will flock as well. To do that, offer monetary subsidies to the high-value producers. There are many business models which have overcome the chicken and egg problem by winning such high-value producers.

Loyalty discounts

Offer loyalty discounts to those who have been loyal to your marketplace website, be it buyers or sellers. This way you can retain them and make your presence felt in the market in a much bigger way.

Final words

While starting up of marketplace websites has become so easier with the availability of high-quality scripts like Etsy clone script, it is also important that marketplaces overcome the initial troubles which obviously are faced by every single startup.