How We Changed Our Industry Through a Two Sided Marketplace

by Startacus Admin

Building a two sided marketplace, can be the most challenging type of company to start. Here's some great advice from David Ciccarelli, CEO of voice-over marketplace, Voices.com.

David Ciccarelli is an entrepreneur at heart. For the last decade, David, with the help of his team, has grown Voices.com from the ground up to become the leader in the voice-over industry. As Chief Executive Officer, David is responsible for setting the vision, executing the growth strategy, creating a vibrant culture, and managing the company on a day-to-day basis.

Building an online marketplace is, as I’ve been told, the most challenging type of company to start. Producing a marketable product can prove to be a difficult task in itself. Selling a product to two separate client bases can be doubly hard. Thus, building and growing your online marketplace means facing and embracing a robust, and sometimes daunting, set of challenges.

Identifying these challenges and coming up with ways to solve them has helped some of today’s biggest companies grow and scale so that they become household names. Let’s take a look at what they are and how you can set your business up to succeed when faced with each.

Tell Me Where to Start

One of the biggest challenges early on is achieving both user acquisition and user commitment on both sides of the platform. Whatever service it is that you are providing needs to be attractive enough so that it naturally pulls customers into its orbit. Figuring out which customer base to focus on first is the business version of the chicken and the egg scenario.

Honing in on the core interaction that brings customers from both sides of the market will make your product an enticing option in your industry. For us,  that core interaction was bridging the gap between producers and voice actors. With the internet gaining prominence, the voice industry needed to be digitized.

Our core interaction was, and continues to be, the job, and our initial strategy was straightforward: acquire jobs, invite the most suitable talent, provide tools for the client to listen, and hire and pay for work that is downloaded from the platform. The resulting network effect will start a cycle of growth, all based on your focus on the job. More jobs means more members will sign up to potentially be hired, meaning clients from broader geographies using the site, resulting in faster payments, driving more demand, which means more members will sign up to potentially be hired, and on and on.

Keeping Users Interested

As attention spans deteriorate and marketplaces become overcrowded, building an attractive product simply won’t cut it anymore. If the core interaction is the starting point of a race, reiterating and innovating is the middle leg, when you really get tested. Focusing on the core interaction is a strong base, and building out the platform that enables that interaction is the next step in growing a successful two-sided marketplace.

It is at this stage that you may face an information roadblock. Determining what each consumer base wants is easier when they give you that information. Through profiles and information-rich job postings, we have been able to better understand who our customers are and create a platform that they want to use and re-use.

Find what it is that is giving your clients value, then balance constant innovation, iteration, and testing with careful design centered around that thing. Similar to the cyclical nature of the network effect that grows the platform, you are designing a cyclical system that produces a recurring sequence of behavioral norms. If you find your consumers are leaving the platform, consider reviewing this sequence, as it should be self-sufficient.

Scaling What You’ve Built

You’ve started your business and you’ve kept both client bases interested so that they continue to use your platform. But network effects alone aren’t enough to grow and scale your business. You will, at some point, hit a critical mass of users. Solving that challenge of growth is the third key to building a successful two-sided marketplace.

Consider how you can build your current platform. It may be expanding into new geographies, offering a complementary product, or acquiring new business. We know that keeping a strong focus on our two consumers’ experiences will ensure a successful platform. Your goal is to meet the needs of both your consumers, and then exceed them.

In the End

Building a successful two-sided marketplace takes more than just technological know-how; it takes understanding your customers, meeting their needs and delivering on what you promised to help keep their business moving ahead. As a connector, you’re serving two very different customer groups, often with diametrically opposing goals. It’s your job to understand what’s most important to both sides and then translate that knowledge into value that fuels your platform and industry as a whole.

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Published on: 23rd May 2018