If you ever have thought of establishing an ecommerce business, it is a top-notch idea to be considered in the present day scenario. However, people choose mobile apps to purchase fashion, home decor, pet accessories, and many more. Thus, the growth of the ecommerce market is tremendous as it became an essential part in the last few years.
The net value of the global fashion eCommerce market in 2020 was $752.5 billion, which is estimated to reach $1.1647 billion by the end of 2025. Notably, this market’s net value in the United States in 2020 was about $110.6 billion, which is expected to reach $153.6 billion by 2024. Nonetheless, Poshmark has marked its place in the eCommerce market with its unique business model. This blog will guide you through an effective business model and standard revenue models to think about implementing in your Poshmark Clone app.
Poshmark – A eCommerce Marketplace To Sell and Buy New & Secondhand Products
Poshmark, a leading social marketplace for buying and selling new and secondhand products like clothes and accessories for women, men, and kids. Also, it paves the platform for selling & buying home decor products, beauty products, pet accessories, and many more.
Elaborately speaking, users themselves have both options to sell and buy products on this platform. Customers can browse for the products with the help of filters and buy a suitable product. Contrarily, they can sell unwanted or unworn clothes and accessories. Remarkably, the payment transactions can be made through credit card, PayPal, and Apple Pay. Its operation is widespread in the United States, Canada, and Australia. It is expected to expand its operation in India.
Timeline Of Poshmark – It’s Business Growth
Poshmark is not only a fashion marketplace but also an eCommerce platform, connects customers with sellers, facilitates selling & buying new as well as secondhand products. It was introduced by Manish Chandra in 2011. Other founders are Tracy Sun, Gautam Golwala, and Chetan Pungaliya. In the beginning, it launched its service on iPhone and later introduced it for Android & the web. The company closed its Series A funding with $3.5 million.
Through the year 2011 – 2012, the users on this platform reached 1000. Roughly, they opened the Poshmark app seven times/day. By the end of 2012, the company secured $12 million funding from major investors such as Menlo Ventures and Softtech VC. In 2013, its growth was rapid with the introduction of the Showrooms feature, enabling in-person meet-ups with blogs, who participated in live posh parties.
In 2017, it raised $87.5 million funding, and is valued at $600 million. Its active users increased and reached 4 million in the succeeding year, with a net profit of $1 billion. In 2019, its revenue was $150.5 million and surged to $193 million in 2020. In 2021, this platform facilitates the selling & buying of pet accessories. At present, it is valued at $57 billion.
The Outstanding Business Model Of the Poshmark Clone App
Prior to establishing a fashion marketplaces app like Poshmark, you should be aware of its business model. This helps to set up a successful eCommerce business that provides a better customer experience.
Poshmark, a social e-commerce marketplace, connects social media capabilities and the eCommerce platform. Being an online platform, it primarily focuses on selling products like clothes, shoes, and accessories. It stands out from the rivalry with the social selling business model.
The social media capability drives the discovery and purchase process. However, nearly 87% of products bought via this platform were anticipated by customers’ feedback, including likes and comments. Thus, customers have the option to curate their newsfeeds based on their preferences. This platform also supports selling secondhand products. In a nutshell, this platform provides a direct connection between the customers and sellers.
The model allows the customers to buy a variety of products that are available on the app with a few taps. From the sellers’ perspective, they can build their own eCommerce marketplace and sell products. This is to appeal to the larger customer base.
What Should Entrepreneurs Learn From Poshmark’s Business Model?
There is no doubt that Poshmark has over 80 million users in the United States, Australia, and Canada with a simple “buying and selling” business model. Consider the following key takeaways from Poshmark that will help you to initiate a successful e-commerce business.
Figure out the solutions for a real-time problem
As the app permits sellers to sell & buy new as well as unwanted/unworn clothes, it will be useful for the customers to choose the one as per their wish. Knowing the customers’ demand and expectations, and resolving their problems in real-time will pave the way to gain more customers.
Target on building a scalable business model
Depending on the customers’ needs, tweak the business model so that you can retain your potential customers and attract new customers. In the initial stage, Poshmark empowered sellers to sell clothes for women, men, and kids. Later on, it allows them to sell pet accessories.
Adapt to the new technology
It is hard to survive in the thriving competitive market unless adapting to the recent technology. The market trends change as time evolves. Therefore, stay updated on the latest trends in order to cope up with your rivalry.
Set a competitive price
In the initial stage since the inception of the app, you can make the sellers sell products at a lower price compared to other competitors. This is to attract new customers to the platform. Once you have got a reach from a wider user base, you can consider varying the price. Ensure that the price is reasonable concerning the product’s quality.
Strategies To Consider For Generating Revenue From A Poshmark Clone App
For instance, Poshmark’s net value in the second quarter of 2021 was $82 million, which is a 22% increase when compared to the second quarter of 2020 ($67 million). If you aim to start an eCommerce business, it is essential to figure out how to generate income from a marketplace app like Poshmark. Here are the effective and standard ways to generate revenue from a fashion marketplace app.
It is the common revenue stream for marketplaces apps, in which you can collect a seller or commission fee from the sellers for each sale. For instance, Poshmark collects $2.95 from the sellers when the sales value is under $15. However, it takes 20% from the total amount when the sales value is above $15.
Payment processing fee
When the seller prefers to choose digital payment modes (like PayPal or Stripe) for payment transactions, you can fix a certain fee to charge them.
A particular seller listing can be displayed at the top of other listings. This is to gain visibility among other sellers. For this, a particular seller has to pay a specific percentage of the amount as a fee.
This is the standard revenue model that you could consider for your business. You can collect a fee from the sellers who want their products to list in the app. For instance, Etsy charges a $0.20 listing fee from the sellers.
Embark Your eCommerce Business With A Poshmark Clone App
Poshmark Clone Script, a ready-to-go social marketplace app solution for fashion, empowers you to establish your eCommerce business within a few weeks. Poshmark Clone is a replica of the original version of Poshmark in terms of features and functionality. This approach of development is quite time-conserving and budget-friendly when it comes to Poshmark similar app development.
Undoubtedly, starting a fashion marketplace eCommerce business is a great niche in the fast-paced digital world. If you already own an eCommerce business, invest in the Poshmark Clone app development. This will pave the way to escalate your business and evolve as a key player in the thriving e-commerce industry. Go with the trend of choosing the e-commerce clone script, which will facilitate you to launch your social eCommerce marketplace app like Poshmark shortly.