Learn how to forecast Marketplace Revenue with your financial model made with Sturppy.
To start configuring who you will generate revenue from the platform, go to
/Revenues/Marketplace. Here you will be able to configure everything you need in just a single page.
The particular thing about a Marketplace is that you can earn revenue from both the sellers and the buyers so you can configure both of them.
The first thing that you will have to enter is the Leads Split, basically how your leads are divided between sellers and buyers. This is a direct result of how you set up your traffic sources.
If most of your marketing (both paid and organic) is focused around sellers, then you will have more seller leads than buyers and vice-versa.
The sellers are those that register to your platform in order to sell a product or a service. For instance, on Air BnB the sellers are those that post their home making it available to buyers.
This is the percentage of seller leads that join your platform. You can learn more here.
This is the cost that the sellers have to pay to join the marketplace. You could also have a free marketplace for sellers to join, in that case you can leave this field blank or enter 0.
Participation fee type
If your marketplace has a participation fee than, this is when that fee should be paid. If it is recurring then the seller will pay the cost of your marketplace each month, if it is one-time than the fee will be paid only the first month (when the seller joins the marketplace).
The percentage of Sellers that leave the marketplace each following month. You can learn more here.
Usually finding sellers is more expensive than finding buyers so your CPL for them whould be higher and in turn, the Leads Split whould be in favor of the sellers.
The buyers are those that register to your platform in order to buy a product or a service. For instance, in the same example of Air BnB the buyers are those that book and pay a home that has been made available by a seller.
The percentage of Buyers leads that make a purchase from the marketplace. You can learn more here.
Average order value
The average cart size of the buyer. This is the average price that the buyers will pay to the sellers.
The percentage that you hold from the Average order value. This is probably your main source of revenue.
The percentage of Buyers that make another purchase in the following months. This is because some buyers will never make a purchase again while some will. If you set this at 100%, it means that all the buyers will make a purchase each month.
At the end, you will have the projections of your sellers and of your buyers. You can also check out the further details about your marketplace, such as how much you paid out to sellers.
Average order value
Coming up with this number can be difficult, try to see how much the sellers are charging for the product that they will sell on the marketplace outside the marketplace, then adjust for competition.
If your sellers can sell multiple products, you need to average that too.
The average should be weighted: this means that the products that sell more have a bigger impact on the average.