UPD 05.01.22

C2C Marketplaces: How to sell your goods on C2C Platforms

According to McKinsey, about 30% of online shoppers began to purchase more used items online after the pandemic. Statista shows that the number of C2C marketplace visits in the US exceeded 28 million in 2020, and Gen Z accounted for more than 43% of the total number of users. This gives grounds to say that the C2C market will continue to develop in the future. Today the Scallium expert team will discuss the pros and cons of the C2C marketplace platform and how to create and launch your business based on this model.

What is C2C marketplace?

The C2C business model differs from B2C and B2B by its participants. On such a platform, the user can be both a seller and a buyer at the same time. A B2C marketplace, for example, does not allow this, clearly dividing business-to-client roles.

A C2C marketplace is like a virtual flea market. Here we see the interaction of all participants on equal terms. Therefore, this model is also called P2P in capital letters: peer-to-peer or people-to-people. Another distinctive feature is that users who gather on the website are usually not entrepreneurs. These may be people who want to sell their own things, artists who offer their services, etc.

Whom do C2C marketplaces focus on?

First of all, these trading platforms are useful for ordinary users. Everyone perhaps has things that are a pity to throw away. We do not use them but cannot return to the store or present them to someone. This is where C2C marketplaces come to the rescue. There are no difficulties in registration and authentication because they are aimed at the average user. To get started, you need an email, photos of the product being sold, and its description. With this data, you can successfully sell "valuable" second-hand goods, which may serve faithfully to the next owner for several more years.

In modern realities, these websites are used by freelancers and service providers, both household and professional. The abbreviation C2C means "consumer to consumer", i.e., work without intermediaries at the best price. The main categories of services on most trading platforms are related to IT, maintenance (repair or adjustment of equipment), household work (housewives, cleaners, etc.), and professional (to some extent, they duplicate job search services).

Flexibility is the hallmark of C2C marketplace platforms. In addition to the range of goods and services, there is another critical factor affecting the final price. Previously, this factor was the auction model, but now it is communication. While communicating with the seller, you can reduce the cost or negotiate bonuses and gifts. It makes C2C stand out from the rest of the models. But all this comes at a price. Administrations usually set a fixed percentage of ~2-3% of the value, charged as a commission upon a successful transaction.

The nuances of working with C2C platforms

There are 3 main characteristics that apply to C2C marketplaces. To make it easier for you to understand them, we will tell you in detail about each and give examples.

1. Savings

Marketplaces allow users to negotiate the purchase and sale of goods/services on mutually beneficial terms. People love to save money, which is why such platforms often appear in social areas. The most famous example is ridesharing marketplaces that help drivers find travel companions and vice versa. It is a mutually beneficial deal for both parties:
The car owner shares the cost of gas with the passenger and earns extra money.
The fellow traveler saves their money by paying the driver less money than, for example, when catching a bus.
Websites on which you can save your money belong to the so-called sharing economy when the costs are divided equally among all parties to the transaction. Popular C2C marketplaces for finding fellow travelers are Lyft and BlaBlaCar.

2. Thematic communities

Platform participants gather to get suitable offers or meet the most interested customers. Associations of like-minded people can also save money. For example, the Couchsurfing platform allows travelers to find free accommodations around the world. Here, the aspect of saving is not even so important as meeting new people and learning about the lives of natives firsthand.

C2C marketplace platforms place their USPs on home pages and often link them to a specific community of interest: travel for Couchsurfing, homemade for Etsy, and pets for DogVacay. Users come to such platforms because they are in tune with their hobbies. Such people remain faithful to the services they like.

3. Role reversal

All participants are equal in the C2C model, so there is no clear line between buyers and sellers. Today we are looking for products on a website, and tomorrow we can put up our things for sale. An important point: this condition allows all participants to be interchangeable, so it would be helpful to learn how to use this and select the best options.

For example, educational marketplaces offer hundreds of lessons from experts in various disciplines. But if you are a specialist in some field, you can post your own training video. SkillShare is a prominent representative of educational C2C platforms. Preply, a website for tutor search, is another good example. It allows you to learn a foreign language and teach your native language to others, communicating via Skype.

Like other platforms, there are some risks on C2C marketplaces. First of all, they arise from unscrupulous sellers who have occupied such places. They often offer goods at a very attractive cost, sometimes even 2 times cheaper than the market price. They ask for an advance payment and disappear. Due to the abundance of such scammers, a rating system was introduced, which helps to distinguish between reliable users and fraudsters.

What does this mean for beginners? Difficulties when getting started. Since users look at sellers without high ratings with suspicion, the demand for their goods/services is underestimated. With the first successful sales and gradual gaining of rating points, it will end, and trust and demand for your goods will rise.

Pros and cons of C2C marketplaces

The pros and cons of these platforms are identical to other models with a difference only in the participants.
Moderate competition. C2C marketplaces imply the absence of legal entities and other business representatives among their clients. Therefore, there are fewer offers from popular areas where monopoly companies rule. The goods and services from people to people are most in demand.
Rating system. It acts as a motivational tool for sellers. The higher your rating, the more credibility your potential client has. This rating option also helps weed out outright scammers and unscrupulous merchants who offer substandard goods.
Low entry threshold. It is a huge plus for trade newbies. Often, aspiring startups do not have enough funds to pay for advertising and promotion on the Internet. However, C2C marketplaces offer profitable options for cooperation, for example, payment upon the transaction. The main thing here is to start your business and be honest to get the maximum rating from buyers.
Communication without intermediaries. Unlike the B2C model, such platforms allow you to communicate with your customers. You may discuss all the nuances regarding services or goods and bargain or offer bonus gifts for regular customers.
Price flexibility. The cost of goods from the used segment does not entail a margin for own earnings and covering costs for creating products. Therefore, C2C retailers can set their own prices and change them to adjust to the average cost of a similar assortment on a marketplace.
Unique offers. Such websites make it possible to create a new product niche. For example, marketplaces for artists and designers where customers may get free portraits or exclusive room interiors. Here, talented people make money thanks to their unique offers.
A wide range of products and services. C2C marketplaces host hundreds of product categories from various fields of activity. The used segment and the focus on selling creative services expand this assortment, forming additional unique and exclusive trading positions.
Risk of fraud. Unfortunately, no one is safe from a deal with unscrupulous retailers. Marketplace owners strive to minimize this risk by banning unreliable consumers.
Emphasis on ranking. The rating system may become a kind of restriction. It is a barrier for aspiring retailers that complicates entering a C2C platform.
No partnership with logistics companies. If the B2C model assumes that the platform solves the issue of storing goods and their delivery from the seller to the buyer, then C2C marketplaces usually do not offer anything similar. Delivery of the order here is the sole responsibility of the retailer. Such marketplaces do not have any storage space, as traders sell their own items. And sending to the buyer is carried out through popular courier services or mail.
Slow progress. It awaits newcomers at the start of their businesses in almost all industries if they do not prepare for this. Unfortunately, on C2C websites, even if you launch an advertising campaign, you don't increase your rating quickly because it depends on customers and their buying experience.
In general, anyone can work on C2C platforms. Despite initial difficulties, this model gives a good profit. It is confirmed by the fact that a lot of brands and small retailers have moved to C2C.

Functions and technical capabilities

C2C marketplace software should provide consumers with the main options:
The ability for customers to purchase goods/services from different sellers.
Online shopping, i.e., selecting products using search tools and categories, such as trending products, most popular services, bestsellers, new items, and more.
The ability to be both a trader and a buyer on the same website.
Various proposals. Different sellers can participate in the sale to offer the client the best prices and quality of their products.
Social networks. They connect the main opportunities and allow customers to discuss goods/services in their communities, forums, blogs, and other platforms.
Control interface. This C2C marketplace software tool is necessary for owners to manage consumer and merchant accounts, control payments, adjust items, etc.

How to sell on a C2C marketplace successfully?

To start on this platform, you should master both online trading practice and the theoretical aspect of this activity. Prepare an action plan considering all the positive and negative sides. First, let's look at the benefits of selling on C2C marketplaces. These include the following:
  • A huge target audience collected on a website;
  • great prospects for promoting products/services;
  • cheap start compared to other online trading options;
  • minimum costs for starting your business;
  • reduced tax burden, in some situations down to zero;
  • no need to hire highly qualified personnel;
  • attracting customers without personal communication and conducting expensive advertising campaigns.
In addition to the obvious benefits for sales, this trading model has some drawbacks:
  • need to adapt to the policies and restrictions of a C2C marketplace platform;
  • need to attract customers at the first stages;
  • the seller's responsibility for paying taxes.

What should you do to organize sales in the marketplace?

To create a competitive offer, you need creative product design, USP, a good Call to Action, and a bit of luck. Now let's look at the main steps to selling on a C2C marketplace:
Find a good platform. First, choose a niche in which you will develop. At this stage, it is necessary to analyze the market and determine the most trending directions. Then do a little research to select the best C2C marketplace.
Analyze the activities of competitors. Having studied offers similar to yours, you can develop a unique promotion plan. The analysis of competing entrepreneurs also will help to discover market trends.
Create your design. This also includes a unique description of the product with the most detailed characteristics, high-quality shots from different angles, and an amusing text that convinces users to buy here and not from a neighbor.
Use social networks. In 2021, the number of users of virtual communities was about 3.78 billion, that is, almost 48% of the world population. Is it worth saying about the need for an advertising campaign on social networks?
Cooperate with the C2C marketplace. Most of such websites provide advertising services. The seller moves to the top of search results for a small amount of money, which guarantees more views and a bigger chance of a successful sale. To start your business, you should pay attention to such offers and monitor the ratings of the best retailers working with this online store. It will allow you to understand the demand for a particular niche among clients and adjust your trade to these criteria.
The consumer-to-consumer branch of e-commerce is developing and moving forward every day, improving sales results. Thus, the ubiquitous building of C2C marketplaces and retail stores leads to new promising sectors of the virtual market. According to forecasts, it will soon be a quickly expanding industry with improved payment models and optimized opportunities for buying and selling goods.

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