There have been many entrepreneurs whom have tried and failed to create an online marketplace to serve local retailers. This failure is due to the unique challenges of this business model. The major challenges are as follows
Retailers are not as open to technology as one would assume, many do not have or even want an eCommerce store. In fact about 80% of retailers do not have any online strategy even though they may agree that they should have one. This attitude makes creating an online marketplace for them, very difficult.
However, luckily for us there are major data is online which we can take products from local stores and scrape their data. Secondly, there are some who provide through affiliate API and we can connect that data to the marketplace. We will exploit their affiliate program and create revenue in both cases if possible. In other cases, a merchant may not have an affiliate program, but we will still add it in hopes that it will increase traffic. Then there those cases in which retailer X would like to join the network we will offer that we scrape the data from the site, or they may add products via a CSV file. In this case, a 5% commission commision will apply. We would like to offer retailers as many ways possible to participate in the network and not be confined into one simple model. Citify would incorporate multiple models and ways to participate onto the network.
Adding products from large retailers and even small retailers unto an online marketplace can be difficult.
As mentioned above, we hope to be able to use all technical possibilities to simplify a transfer of data from the retailer to the online store. If this is not possible and the merchant does not want to add products because he/she deems it too troublesome to do. We would offer to send a third party firm to collect photos and data on the merchants behalf and possibly do so regularly if need be.
There is also another avenue that we are seeking to use, and that is an automatic detection device that would be able to add products to the marketplace automatically. This however would still need to be developed.
Retailers want to have control over their brand, service, and have direct contact with their customers. Retailers might not trust a marketplace to generate the traffic and sales to make their participation worth while.
We will use every means necessary to ensure that retailers have the very best chances to make sales online using our platform. We will have account managers for each account and employ online strategies to ensure the maximum opportunity for each retailer to gain exposure, clients and sales.
Their brand is respected and used, they have complete control over how they want serve their clients, and they are the only ones who have contact with their clients. It is there packaging, their brand, and their store. We simply give the platform to connect one with the other.
Finding funding for such a project is immensely difficult. There are many reasons why VC"s do not want to fund such an ambitious project. One is the high failure rate, the difficulty level, the high costs, and in my case, an untested entrepreneur and not part of a click.
They are partly right, however if we find the perfect formula, it may very well be worth the trouble.
However, Citify has found another route to fund the project and that is by adding a crypto currency to the marketplace and holding an ICO to fund its development. We think this is far better, it would allow the common man to join in the development and possibly add value to the token they hold where they benefit from their initial, even small, investment. Also holding the token on exchanges is a constant motivator to ensure that the marketplace is always excellent quality.
Adding Crypto to the mix.
Yes, crypto currencies. In addition to creating and adding our own crypto currency to the marketplace, we thought of adding other crypto currencies as an optional method of payment. The merchant would have the option to add any of the top cryptos including citicoin as a payment method. They can opt out and only accept fiat. It will be their will and pleasure and opt in or out at anytime.
Citicoin in particular, is for both payments and for rewarding frequent shoppers to the platform. That will be the uniqueness of Citicoin that the other crypto will not have.
Adding crypto to a marketplace as an option for payment and purchase will allow merchants to accept a valid currency to their store. I assume not all stores will be fond of the idea or are possibly not even allowed to, but it will be good for business and profit, while in the same time allow cryptos to become mainstream and have a practical purpose other then technical and speculation. The advantages of crypto are multiple, from payment speed, cost, and discretion.
Delivery system and management
At a later stage, Citify would like to add a delivery system from shop to local consumer. There are some difficulties to this option, but we figure, if other start ups can o so can we.
We envision that the delivery providers do not have to be owned or connected to citify, but if the merchant has his own delivery option he is free to use it. However, for those merchants who do not have a delivery service, we would like to give Citify an automated delivery service that would allow 3rd party delivery services to pick up the products and deliver it to the consumers home in the same day and possibly in the matter of minutes.
There are many technical difficulties as one codes the specifics for each part of the marketplace.
Adding crypto wallets, adding products, delivery system, optional online services, etc etc may all offer different coding and logistical problems, but we think a flexible marketplace that respects the retailers brand, voice and services, might very well be the secret formula that cracks this very difficult business model.
These technical difficulties will be tackled one by one with very best technical experts.
There are no major direct competitors known, but there are some mega indirect competitors. There is not a day that a person does not mention o me that it would very difficult it not impossible to run against major marketplaces like Amazon. In a way that is true.
When we started this project, we simply wanted to be able to order anything we wanted from the city, because we are possible some of the laziest people on earth, just press a button and boom the product is before you. However, major online marketplaces can do this, but neglect the uniqueness of the city, products and brands that people of a region are use to and know, not every merchant is on Amazon, and not every merchant is easy to find online.
Also, we hoped to be able to make a change, and save the retail business, small and great alike in our own region. In my case, I wanted to save the Canadian businesses and place them on the map much like Alibaba has done for Chinese goods and services, but wanted to make it in such a way that people can order locally simply and without hassel.
The local merchant marketplace online has been a business model that has floated around for quite a while now with mix results. It's success depends on many factors, but we are confident that it is a valid business model that simply needs to be designed and promoted as a powerful tool for both merchants and consumers.