Kick-Start Your Own eCommerce Marketplace For Massive Profits – Detailed Explanation on Amazon Business Models

“Becoming a winner in the eCommerce market is sort of a nut that nearly every entrepreneur desires to crack”

Amazon has greatly reshaped the way sellers sell, and buyers buy for specific products. Such an eCommerce platform has pushed many brick-and-mortar shops to transform digitally for better performance and growth. The biggest reason behind Amazon’s success is the flexibility it offers to sellers and business models. 

Suppose you are also planning to get your business online or seeking an Amazon clone app. In that case, it’s obvious several questions strike your mind, such as how to best prepare your audience? Which Amazon business model fits your business well? What essentials do you have to take into account before getting business online? Well! We’ve got an accurate answer for you. This post covers everything you need to grow your startup in the online world.

The Market Insights To Amazon

There is no doubt that Amazon is a leading brand with more than $300 billion in revenue in 2021. Amazon is one of those companies that earned a $386 billion market share and is now on the way to reaching $2 trillion. By the beginning of the 2000s, Amazon established itself with its own distribution hubs, and later on, it also started its own delivery services.

What Opportunities does Amazon offer?

Scalability At Its Best: To process a large number of orders per day, a typical online platform requires a lot of resources. A marketplace can easily accommodate a large number of people at the same time. Additionally, marketplaces aid in the unification of a huge number of partner organizations. As a result, markets are able to provide a wider selection of items and services. 

Higher Customer Traffic: To attract customers to their websites, marketplaces employ a variety of strategies. They put a lot of effort and time into marketing development, for example. Furthermore, marketplace platforms offer a diverse choice of products. This helps in improving consumer flow. 

Flexibility: The ability to offer items that you don’t own makes it easier to adjust and adapt your business to your customers’ needs.

Revenue: Fees, commissions, listening, subscriptions, and providing additional customer services are just some of the monetization possibilities available to marketplace operators. As a result, a business owner can select the best method for generating revenue for their store.

Varied Amazon Models – Know the End-to-end Working Of Amazon

Third-party online sellers uses several business models to generate higher profits. A few are widely used among them compared to others with a unique selling strategy. The method is being completely based on the types of products one is interested in selling.

Retail Arbitrage: This Amazon business model is popular among those on the lookout for an entry-level Amazon business model. Using this model, sellers can benefit from buyers by buying items at reasonable prices. The concept of retail arbitrage is simple, allowing businesses to generate significant revenue over time and avail sale opportunities.

The model offers an affordable way to start with third-party selling on Amazon. One can start with spending less and offering consumers wide products. Also, if your budget is quite tight, you can also start your selling journey and earn well by selling a large volume of products on Amazon. There is complete control over the inventory in terms of the highest product quality.

Online Arbitrage: It is another next Amazon business model that works much similar to retail arbitrage. This model allows easier shopping than shopping around the traditional store. Also, you can compare prices with Amazon directly, identify the potential opportunities, and make sure that each prospective product is worthwhile. With eCommerce becoming a preferred way for consumers to shop, there are also many opportunities for sourcing products.

If you seek an Amazon business model that allows you to work remotely and with much flexibility, this model is the right fit for you. There is no need to visit physical stores, but instead, you can start your work right from home, suiting your lifestyle.

Wholesale Model: The wholesale model involves sellers investing in many products directly from suppliers and selling them on the Amazon platform. A sale in bulk allows you to make high-profit margins.

Once you get a clear idea of products in demand, you can further avail the continuous income stream and widen the inventory over time, depending on sales data. At the same time, the retail arbitrage model involves driving from store to store for more bargains.

Dropshipping Model: This model is quite popular for those admiring to use their platform as a source of passive income. Using the model, one can get rid of the difficulty of managing the inventory stock and product shipping. In simple words, one can sell products on the supplier’s behalf. While the model saves much of the time of Amazon sellers, there is also a need to control the product quality and methods frequently used for shipping.

Tips To Choose An Ideal Amazon Business Model

In the process of picking an ideal Amazon business model, there are several key factors you can take into consideration. 

  • Budget: It depends upon how much you want to invest in inventory.
  • Time: It depends on how many hours you want to manage the stock.
  • Flexibility: It depends upon your flexibility whether you like to work virtually or need a separate workspace. 
  • Experience: It depends upon how much experience you have in marketing your products. 

Different Ways Amazon Like Marketplace Makes Money

There are varied ways Amazon makes money. Let’s look at each of them one by one:

Amazon Marketplace: It is the foremost revenue stream. Amazon can ask for a fee from its sellers for advertising its products.

Amazon Prime: Another Amazon subscription business model plays an essential role in the brand’s growth. Thus, subscribers have access to the platform’s video and music streaming, free shipping plan, unlimited photo storage, etc. Although it is not the main revenue resource, it is certainly the most profitable way to earn.

Amazon Kindle Services: It allows users to browse and buy magazines available at kindle stores. Amazon doesn’t make money by itself but through traffic engagement. Also, the platform allows authors to publish their ebooks and charge royalty fees from the sales.

Amazon Advertising: The platform like Amazon offers sponsored ads and videos. It is the most effective marketing channel to earn.

Strategies To Attract Customers To Your Amazon Like Platform

Amazon’s success is built on a well-structured platform with a plethora of complex features and relevant monetization tactics. The procedure of attracting sellers was quite straightforward. 

Customer Is Always First

Customers are the first focus of the e-commerce platform. It provides buyers with fast delivery and secure purchase and returns policy.

Availability of Wide products 

Amazon sells a wide range of things in several categories, making shopping even more convenient because you don’t have to leave the site to purchase everything.

Enhanced Checkout Process 

As previously stated, the shop allows clients to purchase items with only one click, considerably simplifying the checkout procedure and saving time for customers.

Customer Loyalty

Amazon Prime has proven to be a game-changer for the corporation, as it significantly enhances customer loyalty. Free shipping on dozens of things, special offers, a free ebook download, and other ways to establish confidence in the platform are all available.

Steps On Building The Online Platform or App Like Amazon

Have A Clear Objective In Your Mind

From the appealing images, worthy content, to eye-catching UI, you make sure that your platform has all the essentials to meet corporate goals easily. Before you jump into the process, you make sure to clear all your objectives. The better you know your goals, the better the development team will understand your business and requirements.

Researching & Knowing The Audience

The process of building an online platform like Amazon requires proper material gathering and in-depth examination. It is important to gather all the essential information before starting any project. The development cost relies on features and functionalities you want to add to the platform. So, if you are also planning to build something innovative like Amazon, ready to give your enough time, effort, and resources. Also, there is a need to know the audience and customers based on some parameters like age, gender, etc.

Technology Stack Behind Amazon

You must select the appropriate technology stack for the future development process. The platform’s performance, web page response speed, and stability differ between various programming tools. All of these elements impact the user experience of your visitors, causing them to stay longer or abandon your website. If you want to learn how to build a platform like Amazon, you’ll need to pick the correct tech stack, which can be tricky. Even so, it plays a significant part in the success of your platform and can save you a lot of time and money when it comes to creating a multi-vendor marketplace like Amazon.


Technologies for Front-end Back-end Technologies for Backe-end
HTML Programming Languages – Ruby and Ruby on Rails
CSS Database –  PostgreSQL, Redis, Amazon Web Services (AWS)
JavaScript Server – Nginx

Choosing Must-have Features For Platform

Customer signup & login: The feature allows customers to sign up on the platform by providing personal info. There is one more method for signing up through email, Facebook, and Google.

Advanced product search: You can consider adding as many filters so that users can quickly find their items.

User Reviews & Ratings: This feature encourages the customers to rate the purchased items and share their feedback.

Notifications: It allows users to receive all the necessary news and updates related to their accounts and the service in general.

Order Management: The feature of order management allows sellers to manage their orders better. With this feature, businesses can also print order packing slips, add product order ID, view each shipment’s details.

Shipping Management: Sellers can choose among multiple methods for shipping goods from one location to another.

Admin Panel: The administrator panel is a must-have feature for the business owner. The owner of an e-commerce platform can customize settings for different groups of providers. Payment methods, as well as fees, are among the options available. The administrator can manage sellers’ listings, filters, and categories.

Multiple Payment Gateways: Buyers can use various cards and multiple payment gateways to make purchases. You’ll be able to offer your customers a variety of payment alternatives, allowing them to select the one that best matches their needs.

How Much You Invest In Building Marketplaces like Amazon?

To start, Amazon is a sophisticated platform that has evolved through time. However, let’s get an approximate cost to create a multi-vendor marketplace website like Amazon. We should consider the required functionality and the rates of the software development provider that will help build your marketplace website. It is the most important factor that will impact the necessary expenditures.

Features Cost
UX/UI Development $2100
Home Page $4000
Search & Filters $4500
Product Page $2100
Shopping Cart $3200
Buyer Panel $5000
Vendor Panel $9000
Admin Panel $8500

Turn To Top-Rated Developer For Development Of Amazon Like Platform!

Amazon is an excellent example of a successful e-commerce website that has evolved from a simple book-selling platform to the most complicated and popular marketplace in the United States. It would be difficult to establish an eCommerce website comparable to Amazon and replicate the success of a company. That’s where you need the support of the best app development company. You make sure to make a selection by keeping a few considerations in mind like experience, expertise, reviews, etc. Only a right fit expert can make your business dream come true.

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