The online marketplace accounted for 57% of total ecommerce sales in 2019, and this number is expected to reach further in 2020 and later years. There are 2 types of online marketplaces which can be further classified into B2B, B2C, C2C, etc.

Vertical marketplaces: Vertical marketplaces are niche-specific, for example, Airbnb.com. On Airbnb, all hosts rent homes/rooms to a target audience. Other examples in the vertical marketplace model are Firstcry.com and Pepperfry.com

Horizontal Marketplaces: Amazon is the best example among horizontal marketplaces where different vendors are selling a wide variety of products ranging from grocery to car tyres.

Why vertical marketplaces are more popular and why more business owners are building it these days

  • As stated above, vertical marketplaces are user-centric & this leads to the rich UI UX of your online store and improved customer experience.
  • On-boarding of vendors is easy in vertical marketplaces. You do not need 100s’ of vendors in different categories to launch. This will also save your marketing costs.
  • In the vertical marketplace, you will have a single/centralized policy for all sellers and buyers. Therefore, it is easier to manage orders, commissions, and returns.
  • The most important reason, nowadays, customers want exclusive experience while shopping. On horizontal marketplaces, such experience can be frustrated for a user where he is buying grocery and seeing ads or suggestions for electronic items.

Continue reading here to understand in-details: https://www.yo-kart.com/blog/vertical-vs-horizontal-marketplace-model/