Monetization

Best monetization scheme for marketplace?

Yevgeny Balter

November 1st, 2018

Hi


Advise please

We are building online marketplace for home chefs - web + app. What is the best monetization scheme for us?


I see possible options

1. Comission from each deal. Not really like it because many deals will be done by cash and we can't control that seller set correct full sum. Plus I expect that this option will stimulate to make a deal without service in order to not to pay comission

2. Payment for premium posings. Not sure that money flow will be big enough

3. Google ads - will divers users from our service and site+app with google adv does not looks like great worldwide service, so also don't like this option

4. something else?

Paul Garcia marketing exec & business coach

November 1st, 2018

The answer is that you won't know until you try. First, map the paths you could take with the predicted revenues, then test each of them (even if not starting service, you can still test by offering the framework to prospects) to see if reality matches your estimates. The direct feedback you get from pitching the structure to chefs/clients will tell you more about monetization than any guess ever will. This is your direct research step you should be doing now, not asking strangers for an opinion that has no research component.


It's always going to be better for you dollar-wise to have direct control than to use a commission structure.


What do your prospective customers currently tell you about what they're willing to open their wallets for? Don't worry about cash, because you can include the administration of the payment system in the service (do not allow direct payments to chefs from clients).


On a side note, this seems like an extremely tiny market. Where are you planning to offer this service? People in the USA are not accustomed to hiring home chefs or having anyone else do cooking for them outside of a restaurant. Perhaps it's different in other countries, but here it would be a small handful of potential customers.



Yevgeny Balter

November 1st, 2018

Hi Paul, thanks for answer


My question was more about possible monetization schemas for marketplaces besides commision


Our dev office is located in Eastern Europe and first we will target here. Our service is more closed to food delivery than to restaurants and I don't agree that market is tiny. At least here there are huge amount of home bakers who try to find customers through internet

Dane Madsen Organizational and Operational Strategy Consultant

November 1st, 2018

#1 maybe tough because of competitive pressures. Unless a successful chef is able to turn the role into a long term relationship, they will have to price their services based on your commission. #2 is successful if even small. Do not dismiss it due to its small number. #3 is again small, but the targeting by Google could generate small amounts that are useful. Facebook is interesting for the same reason. Instagram, the home of taking pictures of food, is also worth considering. #4 could be add on services for the chefs to assist them in marketing to their target. This can include deep information about their services (and what they do not do), rate cards, RFP interfaces, reviews, and outside marketing services that many are likely not expert in. If you position yourself as a source for these chefs to find other jobs, and are their sherpa for what they need to do, you can generate revenue as a source for them to simplify their business.