Marketplace Business Model vs. Aggregator Business Model
Marketplace Business Model and Aggregator Business Model, though very similar, have noticeable differences.
But before talking about those difference, let us first talk about what these models are.
An online marketplace is basically an eCommerce website or an application which organizes the products and services of different companies/sellers and sell them on its own website. The firm only acts as a mediator and doesn’t own the products or services provided. Hence, the prices are determined by the sellers themselves. Marketplace only charges a commission as they are providing sellers with a platform (with a huge network) to sell. Examples of online marketplace are Amazon.com, Flipkart.com, Hotels.com, etc.
The Aggregator Business Model usually organize an unorganized and populated sector like hotels, taxis, etc. and provide their service under their brand. Aggregators, just like a marketplace, are big brands which provide goods/services under their own name. The sellers are their partners but, unlike marketplace, sellers don’t sell under their own name. Goods/services are sold under the name of the aggregator and hence the price/price band is determined by the aggregator. Examples of online aggregators are Uber, Ola, Oyo, Munchery, etc.
A marketplace has its own brand but the partners (sellers) perform their services / sell their goods under their own brand. That is, brand image of Partners also matter. E.g. hind computer Ltd. selling its product on amazon has its own brand image in the minds of the customers.
All the partners working with aggregators perform under one brand, i.e. the aggregator’s brand.
Different partners working with a marketplace have different product qualities. It’s a marketplace for different producers serving to different customers. Similar products provided by different producers may have different qualities.
Aggregators believe in a similar and standardized quality. They see to it that the goods/services provided by the partners are of similar and standardised quality. Certain teams are given duties to check on the quality provided by the partners.
Since partners are responsible for deciding the prices, similar products may have different prices in the marketplace. Same product may be sold for ‘x dollars’ by one seller and ‘y dollars’ by another. User has to find the price suiting his requirements.
Aggregators decide the price themselves. Partners perform their service / sell the goods on the price decided at the time of the contract.
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