Powering the Circular Economy: How Marketplaces Drive Loyalty and Revenue in the Transaction Moment™

The most common question I hear from our marketplace ecommerce partners is: how can I increase the value of every transaction, not only for my own business but also for each individual shopper so I can build stickiness and brand loyalty? 

As a bit of background, marketplaces are businesses that operate within the “circular economy”—an economic system focused on extending the life of products and materials through recommerce, promoting sustainability and reducing waste. In practice, this unique model means marketplaces serve both buyers and sellers as their customers, allowing them to monetize from both sides (e.g., sponsored listings for sellers, buyer-side fees, etc.). However, it also means they must balance and cater to the needs of both groups.

So it should be no surprise that marketplaces focus heavily on prioritizing the right initiatives, given the many directions their business can be pulled. Building a sustainable marketplace today involves several key strategies, including:

• Fostering stickiness and loyalty from both buyers and sellers through first-party initiatives like app installs and refer-a-friend campaigns.
• Balancing seller demands, such as providing marketing tools and AI functionality.
• Strategically deciding which side of the marketplace bears the impact of the take rate.

This is why it’s so crucial for marketplaces to convert users from one side of the platform to the other, turning buyers into sellers and vice versa. Acquiring a customer who is already engaged on one side of the platform involves significantly less friction and cost. Additionally, this strategy powers the circular economy flywheel, driving long-term growth and retention. 

For one of our partners, Rokt enabled this exact functionality by powering a first-party offer for individuals who completed a specific “seller” action. They received a significant discount on their next purchase on the marketplace, thus driving millions in incremental value over the duration of the offer flight. 

This is the kind of growth that Rokt unlocks. Our marketplace partners leverage our technology to personalize each transaction experience at the individual customer level, driving higher engagement and conversion rates for every initiative. Many businesses mistakenly believe that offering customers a wide range of options will lead them to choose the one that suits them best. In reality, too many choices often lead to the “paradox of choice,” resulting in decision paralysis. Instead, a focused and intelligent approach that recommends the “next best action” delivers much better results. This means presenting fewer options to customers during the high-engagement Transaction Moment™. When these decisions are guided by machine learning and AI, the likelihood of the desired customer action increases significantly.

In my next post, I’ll share more details around how Rokt can be tailored to seamlessly fit into a marketplace partner’s digital transaction experience and how it can leverage its own first-party data to strategically balance different business priorities (i.e., app download, loyalty sign-ups, monetization, etc.) against the next best action for each individual customer. To learn more about Rokt in the meantime, schedule a time to chat.