Newegg is an e-commerce store that specializes in electronics and tech merchandise, providing customers with an extensive selection of computer components, consumer gadgets, and related accessories. If you’d like to start your own marketplace like Newegg, you’re facing a buy vs build decision. So before you decide to build it in-house on top of Spree open-source, consider using Vendo which is a marketplace SaaS. Go live, start selling, iterate.
Build vs Buy a marketplace?
The use of open-source comes with multiple benefits, such as having complete control and flexibility in development. However, these come with a hefty price tag. To develop a complete marketplace solution, expect to invest a lot of time, often many months or years, and a significant amount of money. This conclusion is based on our experiences with several marketplace projects.
Without significant funding, you’re likely better off using a packaged, all-in-one marketplace solution like Vendo, according to someone who has years of experience in charging for marketplace development.
Back to the Newegg marketplace case study
The Newegg online store is a big deal in the world of technology shopping. It started in 2001 in California and has become a famous place to buy all kinds of stuff like computer parts, gadgets, game stuff, and home appliances.
But in 2023, Newegg had some money problems. From January to September, they made less money, like 16% less, and their profit went down by almost 25%. They even lost $44 million, and after fixing some money stuff, they still had a negative number of $17 million.
These money issues happened because of big economic problems, people not buying as much, and some specific troubles in the tech world, like not enough products and things being late, especially for graphics cards.
Newegg is known for selling electronics, especially in North America. They’ve made a name for themselves by having good prices, having popular brands, and making it easy to shop for computer stuff and game gear.
But the shopping world is really tough, especially online, and people usually care most about the price. Newegg did a good job standing out in some ways, but right now, with prices going up and people not spending as much, it’s tough for them. This has already hurt how much money they make and how much they keep.
Also, Newegg doesn’t have any physical stores, which could limit how much they can grow. Some people still like going to stores in person, especially for big buys. So, Newegg mostly attracts people who are good with tech, which might leave out some other customers.
How to emulate Newegg marketplace success?
To somewhat mirror Newegg’s achievements, it’s a good idea to launch your marketplace quickly, within weeks rather than months. Assess how well your products suit your audience’s demands and adjust your strategies for attracting customers based on actual feedback. Experiment with the market before fully committing to its development.
Here’s what you’d be getting with a Vendo free trial:
- Book a marketplace demo call: We’ll set up your demo marketplace and populate it with products, so you could give it a try and start selling in 14 days
- Customize your Storefront: Use the drag & drop page builder or custom CSS
- Onboard Brands: Invite your brands or choose brands from our catalog
- Select Products: Curate products and collections manually or automate it
- Embed products: Make your content, newsletters, social media shoppable
- Get Paid: Get paid as soon as products are shipped by the brands
- End-to-end automation: Brands sync, fulfillment, payouts, invoicing, taxes
When you’ve tried all that and it works, start thinking about building your own, custom-made marketplace project based on Spree Commerce. First, by decoupling the storefront and going headless with Vendo marketplace API, and later with your own backend, if you decide you really need it. Just lift and shift the storefront.
Nobody has to know what’s under the hood, right?
