The first thing to do when faced with an excess of marketplace supply is to take a step back and re-evaluate your strategy. This could involve an in-depth market analysis, checking current trends, and understanding your audience's needs.
In every marketplace, there needs to be a balance between supply and demand. If there is too much supply and not enough demand, it could lead to a stagnant market. Therefore, you need to ensure there is enough demand for your products or services to sustain your supply.
Most marketplaces spend over 40% of their revenues on marketing and incentives. When there's too much supply, you need to optimize your spend on marketing and incentives. Identify which marketing channels are bringing the highest ROI and focus on those. And consider adjusting incentive structures through experimentation.
One of the major problems marketplaces face is high churn rates. This is often due to competition, short-term incentives, and a lack of differentiation. Focussing more incentives on the demand side is important, and it'll pay off in the long run when you are oversupplied.
Manual processes, reliance on spreadsheets, and limited tech resources can lead to inefficiency and high costs. Automation can be a game-changer. Through Village, marketplaces can automate segmentation, incentives, and comms - reducing operational inefficiency and costs.
Tackling the issue of too much supply in marketplaces requires strategic action - from re-evaluating strategy to leveraging technology like Village. Our platform, used by big and small marketplaces, provides a range of features that can help combat such issues. Drive your growth and increase LTV, while creating stronger, stickier relationships with your customers and suppliers.
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