Specificity as a trend of occupied market by the example of local service marketplace

From 2010 to today the popularity of a marketplace is climbing year by year. The dramatic leap happened in 2019, when COVID isolation measures nudge people to online interacting and online shopping. There was a boom in the creation of new platforms for online shopping. 

How to stay on the top in such a highly competitive environment? A particular niche is the answer.

When you first start thinking about opening a marketplace you should decide which concept of it you will pursue. In this article, we will look through the main types of marketplaces, their benefits and features. We will focus on a local service marketplace more comprehensively.

Classification and structure of marketplaces

To create a marketplace successfully, you should know their structure. There are several types of marketplaces. They can be divided according to the commodity, the target audience,a number of product types, and the territory. 

By the commodity:

  • Product marketplace. Marketplaces for physical products are one of the most common types. It is Amazon and eBay, for instance; 
  • Service marketplace. Marketplaces with services can offer freelance work or some kinds of helping services; 
  • Booking marketplace. This is a vast niche, so booking can be singled out from other services. There are services such as booking of a hotel room, tickets, cars, etc.

By the target audience:

  • Business-to-Business. Businesses intend for other businesses and sell the object of marketplaces to them. It is about interaction between legal persons; 
  • Business-to-Customer.  Businesses provide individuals with products and services;
  • Customer-to-Customer. This type gives the opportunity for individuals to display and sell their products and services for other individuals. It can be a marketplace of used things or freelance services.

By a number of product type:

  • Verticalmarketplace sells one product type;
  • Horizontal—have several product types with common characteristics;
  • Global—have several product types with absolutely different categories of products. 

By the territory:

  • Global—Obviously, global marketplaces work all over the world or include several countries. A customer from any point of the planet can place an order and a marketplace guarantees that ordered products will be shipped to the customer;
  • Local—A local marketplace covers only a certain territory and delivery may not be available in any other place.

Marketplace’s classification is a handy knowledge. It can suggest the direction of marketing strategy and developing points, when managing a website. Read more about types

Local vs Global marketplaces 

When world marketplace giants conquered the market, small businesses lost their positions. However, one cannot see through a brick wall. In certain conditions global marketplaces are not as powerful as they seem at first glance.

For example, the world famous taxi service “Uber” had a lot of difficulties when trying to win the Indian market. There is a local taxi company “Ola” which is very popular there and based on the needs of local society. “Uber” is still making concessions to win the market. 


When we talk about a local market, one may imagine a small territory but it is not the case. For sure, it might be a business within a city, but usually the term “local” includes the territory of a whole country. Local does not mean limited. These companies leave the idea of globalization in favor of quality. 

What are the benefits of local marketplaces?

  • Local interconnection. It is important to have connections with people. With the knowledge of the social environment, it is easier to gain trust. You know which companies you can attract to your project. It is like knowledge of the context of partnership. 
  • First-hand experience. You have a unique possibility to learn the real needs of the people from the region you are going to work in. At least, you might have faced problems yourself and you can already guess what and how to improve. You know the “pre context” of this communication “business-people”, audience’s tastes, so it is easier to recognize the most efficient marketing strategy.
  • Local support. Foreign companies look destined from a certain group, while local companies are more readily supported by people from the same location. It is a matter of pride and community. When you start a business in a familiar location, you already have common ground with your audience.  

The key message is that we should not underestimate possibilities which are provided to local businesses. Globalization is about “how much you can sell”, but locality is about “how good and specific your offer is”.

Wants of a certain group of people may not coincide with the demands of people from other places. It generates the possibilities for a niche market—a market with a range of products and services that are relevant only in a certain place. It may grow in the form of a local services marketplace.

Niche market 

A niche market is a specificity of the business; a part of a market with high demand and low supply. Working in a certain niche gives an advantage to a business owner since there is no genuine competition. Sometimes people are afraid that they can miss opportunities if they choose a niche, but these hesitations are unfair.

What are the advantages of niche market:

  1. Less competition. For the first time you will have less competitors, sooner or later this sphere may become overloaded with other businesses. But you still have the advantage over others since you are one of the first players.
  2. Brand loyalty. You can concentrate on services and clients to become a credible and attentive partner. This helps to build a positive image which will an advantage when the niche will have another players in it.
  3. Higher profit. Clients do not have the opportunity to get the similar service or product from the outsource that is why they are ready to pay a higher price.
  4. Expertise. It is difficult to be a know-it-all, but if you have a niche you can become a specialist in one sphere. Experienced professionals always attract partners and customers. 

Marketing spendings is a double-edged sword in this issue. On the one hand, a particular product or service allows you to recognize your audience easier. On the other hand, it is an unfamiliar field and standardized marketing patterns may not fit. 

What are the characteristics of a niche market:

  1. There are no big players at all or competition is very low;
  2. The demanded products or services can be specific;
  3. It can be a niche at the intersection of two spheres.

However, these points are very tricky. Imagine a rosy picture: Michael is a young businessman. He has found a unique concept with no competitors on the market, he asked his close friends about this idea and they highly esteem it. Michael invested all his money in this project and it was a total flop. What was a mistake? The start-up looked so good and it met the characteristics. The key step here is to test the idea.

Note: If there are no competitors and it is something very specific, it may be not a niche market, but an irrelevant idea.

Do not be trapped by fleeting inspiration for a new project, stay cool-headed and test a minimum viable product (MVP), organize survey and research, try to find similar successful and unsuccessful start-ups in this niche. All these measures need not to be subjective since a circle of close friends or family members may be a too specific group to test the demand. So, it is about the requirements for choosing a sphere. 

The requirements for entering a niche: 

  1. Relevance of the idea. You must have an audience. It is MVP that can help you to determine the validity of the idea.
  2. Customer focus. The idea should be related to current preferences of the audience. You should be customer-oriented and ask for feedback from your current customers. Your product should correspond to modern tendencies which can be distinguished by such searches. 
  3. The advantage over competitors. The uniqueness of the idea lies not in the creation of something completely new, but in the improving of the existing concept that will give you an advantage. It is better if the idea has possibilities for fast scaling.
  4. Balance between investments and profit margin. The higher the margin, the higher the profit of your business. Try to choose the most profitable idea or add high margin products for cross- and upsales. If the spendings is too high in this niche this idea is not appropriate.

Note: For the first time you may not invent something new, but you can improve what people have now.

How to choose a niche:

  1. Identify your interests and strengths. Only if your activity brings you a sense of satisfaction, can you do it well. It is appropriate to business, too. Find your key skills and knowledge and use them at full capacity.
  2. Do some research. Surveys, statistics, talks, everything is beneficial in this deal.
  3. Learn your audience. It is about a deep knowledge of your future customers. Try to learn mainstream and tendencies in your niche. 
  4. Test your idea. Once again, test your business model!

Generally speaking, doing business in a certain niche is a reliable strategy. As well as other business models it should be tested and considered wisely. 

Steps before you decide to create a service marketplace website

First of all, let’s look at the comparative table. There are some principle differences between product and service marketplace. 

FeatureProduct marketplaceService marketplace
MeaningProduct marketing refers to the process in which the marketing activities are aligned to promote and sell a specific product for a particular segmentService marketing implies the marketing of economic activities, offered by the business to its clients for adequate consideration
Marketing mix4 P’s: Product, Price, Place, Promotion7 P’s: 4 P’s + People, Process, Physical evidence
Who comes to whom?Products come to customersCustomers come to service
TransferIt can be owned and resold to another partyIt is neither owned nor transferred to another party
ReturnabilityProducts can be returnedServices cannot be returned after they are rendered
TangibilityThey are tangible, so customers can see and touch it, before coming to the buying decisionThey are intangible, so it is difficult to promote services
SeparabilityProduct and the company producing it, are separableService cannot be separated from its provider
CustomisationProducts cannot be customised as per requirementsServices vary from person to person, they can be customised
ImageryThey are imagery and hence, receive quick responses from customersThey are non-imagery and do not receive quick responses from customers
Quality comparisonQuality of a product can be easily measuredQuality of service is not measurable

According to this table we can distinguish the main features of service marketplaces: 

  1. Services do not have materialistic component, margin profit is higher, so the marketplaces fee may be higher
  2. The most common cases for services marketplaces are C2C and B2C relationships.
  3. Such marketplaces should be promoted twice as hard to be successful.

You should find a niche according to these features. There are a lot of popular variants of platforms of this type: a marketplace for IT services, private tutoring, booking services, etc. 

However, let’s be specific. We are trying to find a variant for people from a certain location. So, it should be services that obligatory require the real presence of a specialist or any other face-to-face contact. For example, you can find a developer from a distant country for your project, but you cannot ask a plumber from another country to come to repair a pipe. The local service marketplace is based on this simple rule.

The keys are: niche, specificity, certain business type , and location.

If you already decide to create a service marketplace website or you have any other idea and you are looking for steps, tips and advice on how to launch a marketplace, read this article. It explains the marketplace technology, classification, and the universal steps of how to launch it. You can also try a demo version of a marketplace launched on CS-Cart to see how it looks.


In conclusion, the specificity is a game-changer in today’s business. We look through the main points of niche characteristics, types of marketplaces and unusual strategies on how to reach success. There is no doubt that the sky is the limit and localization and specificity are not a burden. They might become the best foundation for your business.