B2B Marketplaces: Is This Model For You and How to Achieve Success
The B2B eCommerce Podcast
There are different reasons B2B companies start with the marketplace business model. Some are doing it to stay on par with competitors. Others launch marketplaces because they want to serve their customers better, create a one-stop-shop for them, and centralize product data. Either way, it's critical to be clear about what you want to achieve with a marketplace, and what's the added value will be before going all in.
When launching a marketplace, creating the best possible customer experience is of utmost importance. For this, you need to ensure that the product data you collect and provide on your marketplace website is clean and standardized. Another consideration is the outreach strategy: make sure to define a strategy of how you're going to bring in suppliers and buyers to your marketplace.
Investing in an off-the-shelf marketplace solution or developing from scratch? Rodrigo Garcia's advice is to adopt a solution that can give you the 75-80% of the marketplace functionality out of the box and provide the flexibility to develop or integrate the rest 20-25%. This way you'll get to market faster.
Do not underestimate the power of the minimum viable product (MVP) approach. Build an MVP first to prove the marketplace model works for your industry; see what works, get vendors and buyers' feedback; iterate and build the platform on real knowledge, not guesses.
B2B Marketplaces: Is This Model For You and How to Achieve Success
Jary Carter: Hello, everybody. Welcome to the B2B UnCut podcast. We’re here with episode six today, which is about B2B marketplaces. We’re going to talk about, is this the right model for you, and how to make it successful. I’m really excited.
We have a couple of very, very special guests here. Today, we are joined by Rodrigo Garcia, who’s the Vice President, Chief Technology and Transformation officer at PartsBase Inc. Welcome, Rodrigo.
Rodrigo Garcia: It’s a pleasure being here.
Jary Carter: We’re so happy to have you here. And also we have Yoav Kutner, who is the CEO and co-founder at Oro Inc.
Yoav Kutner: Hi everyone. Great to be on another podcast with you. It’s been a while.
Jary Carter: I know you, and I have been doing this a long, long time since I first met you in early 2010. When we were at, just a small company called Magento, that grew into a very, very large company where you have created that technology. He was the CTO and co-founder there. We worked together and then came here to work together in Oro in early 2012. I can’t believe it’s been 10 years. been
Yoav Kutner: It’s been a long time. And it’s always a pleasure to be interviewed by the person that was voted the best-looking person in eCommerce.
Jary Carter: I’ve had the opportunity to work together with the creator of the OroPlatform, OroCommerce, and the marketplace platform, which we’re going to be talking about today. Not so much the product, but the idea of marketplaces. Rodrigo, I’d love for you to share a little bit of maybe your background, and maybe a little bit of the PartsBase story, if you don’t mind.
Rodrigo Garcia: Of course. Thank you, Jerry. And again, thank you for the opportunity being here today is very, very exciting to have the opportunity to talk to you about marketplaces.
Yeah, well, I’ve been in the IT industry for I don’t want to date myself, but it’s been over 20 years. So I’ve seen a lot of the growth around technology and transformation, if you will, that has happened in the technology industry in the world for over 15 years. I was in the consulting industry, and I had the pleasure of participating in working with many Fortune 500 companies like GE, Coca Cola, ADT, and Baxter pharmaceuticals.
But you know, at some point I decided to join the corporate world. And for the past six years, I’ve been working at PartsBase initially as the CTO, and then I moved on to Chief Transformation Officer. And well that’s a quick intro about myself in terms of PartsBase.
PartsBase, as of today, is the largest aviation aerospace parts locator service in the world. We have almost 8000 companies using our products, our platform every day. We have between 25,000 and 30,000 users on a monthly basis coming into the search for parts, and market intel, repair capabilities for the aviation, and aerospace industry.
The community keeps getting bigger and better every day. Just to give you some sense of additional statistics, in Q3 we added 346 companies to our community, which equates to over 800 aircraft that require service that are coming about companies that have aircraft that require maintenance, repairs that come into the PartsBase Platform to search for parts, repair capabilities, market pricing information. In terms of brand names, I mean, any big company out there, in the aviation aerospace industry, one way or another is connected to PartsBase. It doesn’t matter if it’s like a large operator like Iberia, Bombardier on the manufacturer side. So it’s a huge community. On an annual basis, we have over 12 million parts being searched and quoted for on our platform. So it’s a again, those are very high level stats in terms of our usage, the size of the community.
Jary Carter: That’s great. Tthank you for the breadth of the introduction. PartsBase didn’t start out as a marketplace, which we talked about this in our pre-call. What evolve the company into the marketplace model, because we see a lot of this specifically in B2B commerce? A lot of companies are considering going into this marketplace model. And if it’s worth it, what drove you all into strategically thinking about, you know, building a marketplace?
Rodrigo Garcia: Thank you, Jerry. Yeah, the another quick fun fact, for us. PartsBase was born in 1986, as the world’s first internet-driven part locator service.
But over time as the community has grown, we know that at the end of the day, as technology has evolved as well, ultimately having a full, I guess, integration between what technology allows you to do and the power of the community, we weren’t going to be in a place where we weren’t able to operate a fully transactional model, right. So at the end of the day, it all started with providing the platform, the digital platform for buyers and sellers to connect, identify potential suppliers or other procurement needs, market pricing information and some of the other capabilities that we offer to our customers. Obviously, at the time, the technology wasn’t out there. But as technology has evolved, it was a natural evolution, if you will, of our company to transform into a full featured marketplace.
Jary Carter: Interesting, very cool. Where are you headed with that? So like How far are you planning to take this like through this evolution? And where’s next for you all? And then I want to catch Yoav up to this conversation because you have you we’ve seen a similar evolution, right. And then you saw a similar evolution on the B2B eCommerce side. So I want to tie you up for that. But Rodrigo, any other perspective?
Rodrigo Garcia: So the first thing that I would say is, as I mentioned a couple of minutes ago, so as of now, if we look at last year’s statistics, we had over a little bit over 12 million parts being searched and quoted for in our platform. This year, we are on pace to break that record by I would say between 12% and 15%. But the reality is that I mean that those are just parts being quoted in the platform, right? So when you asked me the direction that we’re taking is right now with the current eCommerce experience that we offer our customers, I would say it’s just a fractio, less than 5% of those parts are being sold through PartsBase. So in terms of direction that we want to go, we want to be in a place in the next three, four years that at the very least 30-40% of those 12 million parts are being sold in our marketplace. Right. So that’s where we want to go.
We know that the reason why I give you these conservative numbers is because we know that for us to integrate all the members of our community to the marketplace, everybody has, you know, the technology, sophistication, the budget, the other different elements that you need to be fully connected into a true transactional model that PartsBase has to offer. But we have, like, hundreds, I would say in the 1000s, like midsize enterprise customers that can definitely participate in the full transactional model, but there’s going to be an adoption process or investments that they have to do, there’s some transformation that they need to go through in order to fully participate. But that’s kind of that’s where the vision is.
Jary Carter: I really appreciate that perspective, and really helpful to a lot of folks. Yoav, I want to go back to you and this because you’re the other side of this coin, you’re a vendor on the B2B eCommerce side, that you and the engineering team made a strategic decision to really get into the marketplace to build a B2B marketplace. And I’m curious, what drove you into that, you know, opportunity and decision?
Yoav Kutner: With Oro, when we designed that we actually were trying to fill the void and actually build the product for B2B companies that are trying to sell online or digitize their sales operations. And really, we kind of looked at what’s the use cases in the B2B space that needed to be solved that were underserved by the existing platforms at the time. And that’s what we kind of focused on.
And for us, these models included, of course, what we call buyer-seller interaction, where you can start any kind of interaction between the potential buyer and a seller and a sales team and interact in a digital format.
But other use cases that we can solve out of the box with our platform and kind of design our platform for what we call franchise model, reseller model, distributor model. And we started seeing and creating a lot of these kinds of features in our application.
Of course, we also did stuff that was more advanced. So we had all kinds of permutations around the B2B kind of use case of B2B2B, B2B2C, all kinds of things. We created a lot of features built into our platform to kind of solve and address B2B needs.
What happened was that we were actually demoing our products to some of the biggest analysts on the market. And like, they kind of looked at the demo and said, you know, why aren’t you starting a new category, which is marketplaces, why aren’t you participating in that? You kind of outperforming already in these demos with a lot of features that we’ll be seeing lacking in the marketplace industry right now, so why won’t you participate in that too.
And we did, and we scored pretty high. So again, using all the built-in features that were already solving for what we were considering standard use cases for B2B also kind of almost as a side effect created a whole new product, which is OroMarketplace. So we already had vendor management, we had a lot of these kinds of tools and features that are needed for the marketplace.
Plus, we brought a lot more flexibility than other platforms in terms of the different business models that we see from marketplaces, because we could not only just list all items in one place, and just allow the different vendors to kind of log in and manage that. But we also could solve for use cases where every seller gets his own website built on our platform. So a different kind of a little bit of model for marketplaces.
So if you think about the Amazon marketplace versus a marketplace that’s virtual, where you do go through a separate website for every seller, but it’s still managed by a single entity on the back end. So again, we are able to solve, with our platform, so much of the use case for marketplaces that we decided, with the analyst recommendation, to actually market it as such and start addressing this market directly. So you know, even though we a lot of us are technologists this was almost like a business and slash marketing decision to be honest, just as I said as a side product for what we already created for the B2B eCommerce space already.
Jary Carter: Love that, and it is such a tribute to the flexibility of Oro. That it was so easily fit into that purpose. I’m curious what market shifts are what is happening in the market Yoav yhat you feel like is driving this? You know, the need for B2B companies to have a marketplace> Is it technology evolution? Is it business needs?
Yoav Kutner: So there are different aspects that we’re seeing right now that are kind of making this decision. First of all, the old use case where ‘my competitors doing it, I should do it as well’. So this kind of, I have to start rushing to the playground and kind of match and be competitive. We see a lot of this today. And because marketplaces are becoming a hot trend right now.
But I would add that we are seeing that a lot of B2B companies, because of just the way they do business, right, they might be the central point of contact to a customer. But in the back end of that, there’s a lot of other vendors. And for many orders, there can be, you know, 5-10 vendors involved in a single order, even if I’m selling directly to a customer. So we see that those relationships already exist on the business side.
A lot of times, there’s the use case for just bringing direct contact between the buyer and one of the vendors that I work with. And that often makes it more optimal to have them interact directly, sometimes, without the needs of my sales team to get interacted in the middle and kind of facilitate that communication, we see that.
We also see that there’s a lot of B2B companies that maybe they provide the products or sell the finished goods. But there’s a lot of services around that, for example, installation, implementation, configuration, whatever the industry needs, and then allowing to have one place where the customer kind of interacts with the brand that’s selling their devices that they’re buying or machinery or goods, and then put them inside, like, Rodrigo is calling it a community of service providers around the software around the products that they’re creating.
So we really think this kind of multiple use cases, what’s driving the kind of the larger company, the largest seller to bring around and allow some of the vendors that they’re working with have direct contact to the to their customers.
Now that said, we also see models where the backend vendors are not exposed. But that is a way for them to allow the seller themselves to kind of grow their catalog, right. So let’s say if I want a factor of 5000 products and can sell them by bringing on vendors that can do dropship now and B2B and stuff like that something we haven’t seen traditionally done, but in a single interaction, meaning that as a customer, I might be even oblivious that I’m actually ordering from multiple vendors. And that’s actually done on the back end. Now, we still treat that as marketplace, because a lot of times, we still need the vendor management, there’s all the order processing, splitting the order to the different vendors on the back end.
But sometimes the customer won’t even know that they’re interacting or buying off the marketplace, right. So we’re seeing a lot of these evolutions in B2B, I think a lot of this comes from what we’re seeing on the markets as a lot of market consolidation, there’s a lot of attempts to cut costs and be more efficient, reach more customers. So we’re seeing a lot of drivers that are from the business side. But now technology is there to serve them. So they can actually do this in a more simplified and efficient way. Rather than having a lot of mess where a lot of phone calls are happening in the background and fax machines that are still involved, etc.
Technology is providing them an efficient way to actually build these processes, automate a lot of it and make it an efficient way for the buyers to interact with less vendors for a single order. So I’d say those are a lot of the drivers, I would say I do I know I’m probably babbling here a little a little bit.
But I do want to add one interesting use case that we’ve seen, and I was gonna mention the name, but this is one of the biggest energy companies. And they were in the alternative energy kind of space, as well, one of their departments. And they actually created this marketplace to actually learn about the competitors. And if you look at some of these kinds of alternative energy farms, they might use different brands for older turbines and generators and whatnot. But by creating a marketplace for all the spare parts, regardless of the brand that they’re using, even if it’s a competitor brand, it was a data play, because that’s allowed the actual manufacturer to learn how those energy farms are actually being used, get some of the stats on the competitors, products, etc.
So we’ve seen that data play is used for as a reason to have actually more marketplace. So again, just putting that out there, there are a lot of different drivers why we’re seeing businesses going into this space. But it’s definitely something that we’re seeing as a growing trend. And we’re seeing the amount of free press growing, we’re seeing more and more companies that are interested to start understanding what marketplace means to them and how they can change their business model.
Jary Carter: This is just fascinating. If I were going to distill some of that down Yoav, I’m hearing is one strategy for growth, like how do we offer more than our existing catalog? How do we offer more than what we can provide customers? I’m also hearing this idea that like the market is trending that way, you see companies that are really starting to see really successful business models. I also heard about, you know, customer experience and creating an even like, through a lot of different use cases, whether it’s services, whether it’s additional products, whether it’s trying to be a one stop shop, really providing a better customer experience is a huge part of this for what you’re seeing in the market, just you know, again, creating like this better customer experience, making yourself more relevant.
Yoav Kutner: Yeah, absolutely. And keeping your customers around, because if they start looking around other places you might lose them. There are more and more businesses that are coming in providing the service because this specific industry lacks this kind of place where you can consolidate all these different vendors in an efficient way you can basically buy in shops, of course McGregor’s business model is something that we’re also seeing growing but we’re also seeing a lot of manufacturers and distributors actually dabbling now in marketplaces. One of the
Rodrigo Garcia: If I may add something to what you’re just mentioned to round it off. And to your point, like make it very specific to aviation aerospace that what this is part of my personal view, but again, it’s this is what we’re seeing in the industry as well is that you think of marketplaces are the almost a byproduct of part of the evolution of the democratization of information in the sense that for the B2B space in the sense that a marketplace, ideally should be a neutral, unbiased party, if you will, I just give you the digital platform where a particular any given seller right in that industry can go in and have a higher degree of confidence when they are searching and comparing potentially 1000s of products and providers based on industry-specific data.
That’s, for instance, something that even as much as I love Google and some of the searching capabilities, and when you’re comparing products that this I know this is more applicable to the B2C market. But in the B2B market, whenever you go and buy a part while being able to see identify what is the demand, what are the average pricing right, and in our case is specific in aviation, I noticed a similar case for other industries as well, when you go to the B2C is normally you’re buying new things. So the price is just MSRP, or whatever it may be, but you only have one, it’s a more linear equation.
In our industry, you can have multiple condition codes. So depending on the condition code of the part, the pricing might be drastically different. Right? So a marketplace, if it’s able to provide the seller, all that information is again, a higher confidence that yeah, this is the right part. This is the right provider for him, as you know, in my case, because of the criticality that these parts play in our customers business as well.
I want to make sure that for instance, who is this seller, right? What are some of the additional data points associated to that part of that? Yeah, I can buy especially with a lot of the I think that will be probably a conversation for a different time. But COVID, specifically in aviation, Aerospace has forced from the larger operators to repair stations to rethink how they do business.
So having all of this aggregated industry-specific information as part of the purchase process when you go into the marketplace and said yeah, this is the part for me, it’s crucial for us, right, that’s one of the huge differentiators that we have at any other company out there. Because Amazon they may have, for instance, at one point they could have all those sellers that we have, which again, I’m exaggerating, but the industry data that we’ve collected over 25 years that it’s available to our members, right every time that they search for a part, there’s no one else that can provide that level of detail around again, supply-demand market pricing information.
Jary Carter: Yeah, that’s really interesting. I want to move to the next question, but I want to anchor in something as we go through this idea of customer experience, and creating a better customer experience, because you both kind of touched on it through this process. And I am seeing especially, you know, as we got into 2020, in the pandemic, there was just this acceleration of creating a better customer experience. And I now work on the Enterprise WordPress side of the world. And we’re seeing this same thing that Yoav was talking about, which is this idea that the world is really trying to create a better digital experience.
So how do you do that? What are some of the must-do things that folks have to do? Like what are some things that folks have to have to get right before they launch a marketplace?
Rodrigo Garcia: Knowing your customer, I think that’s a key. And I said it may sound like that’s obvious. But I guess the reason why I bring it up is because in the B2C arena, or depending on the industry that you’re playing, you might be able to arrive to a clear definition of who your prospect buyer is going to be right.
But in the B2B space is very different, because the buyer personas that you are potentially catering to might be very diverse based on geographical location based on industry class within your vertical. And the other thing is that you need your customer both in terms of buyers and suppliers, right, because for a marketplace to be successful, you need to have a healthy amount of both right. So to me, that’s one of the key things that you need to size up not only in terms of market share, the prospective revenue, but again, knowing those different personas, the sub the industry classes that they play within your industry. I think that’s that’s huge. That will be one of the key things for sure.
Yoav Kutner: These points are very, very valid, I just bring what we’re kind of talking to some customer. So again, Rodrigo’s business has been in the marketplace business model for a long time. But I would point out that one of the biggest things that when we talk to companies that don’t have experience in marketplaces is actually understand first and foremost their business model and where they’re expecting that to be because we really see that a lot of companies, you know, come to us and say, well, we want to the marketplace, but then when we start getting into kind of the features that we need to build them, we see that they are lacking kind of the real vision of the business model around it.
And just understanding what the type of interaction is between them and the different sellers, them and the different customers. And that goes even then to other places where you need to kind of understand who’s gonna have the customer support to, you know, things that a lot of companies don’t even put on the list of things to do for the marketplace, because everybody’s like, Oh, marketplace, just allow everybody to list everything and we get something from it.
But I think there’s a lot more to do around that. And especially if you’re new to it. So like if you’re a manufacturer or distributor and saying, you know, I want to now start offering kind of a marketplace features or availability to my customers, understand that there’s a lot of business decisions that need to be done there. Because we see that as I said, when we start projects, when we start working on specs with companies that are new to this, there’s a lot of open issues that they have to figure out on the business side before we get to the technology product side. So just pointing that out and adding it to kind of if you considering it if you’re new to this, there’s a lot of things to learn about the business model behind the marketplace.
Rodrigo Garcia: There’s so many different things right. But another element that I believe just thinking in terms of the business model side of things is, I think a huge component of, or a huge part of what you need to do is have a comprehensive, well-defined outreach strategy that you’re going to have to bring in those people like both suppliers and buyers to your marketplace.
And yeah, when I say outreach strategy, I mean, that’s, again, that’s the that’s a topic in itself, but includes your SEO, your PPC, email campaigns, trade show presents, and how are you going to do tha.
In fact, going back to the previous question for a second, one of the advantages that you get by participating in a marketplace and why they are such a hot trend is because it provides, but in this case, for sellers is the benefits of economies of scale, you know, so when a marketplace is already positioned well, just in terms of the the the organic reach that you’re gonna get to potential buyers of your product, right. So if you’re considering doing that on your own, it’s doable, right? And there are ways that, without having to spend millions of dollars with PPC, with Google, you can do it. But it’s important that as part of your business model, and how you’re going to be attracting people that you have a very well, like, at least outlined, like, outreach strategy, and how are you going to get people into that marketplace?
Jary Carter: We’ve talked a lot about the business elements of creating a marketplace, which I so value, you all’s perspective, because I think you both are, definitely have come up through the technology organization, but have a deep amount of empathy for the business case, and the use case and the customer, which is it’s actually really interesting to hear sort of both sides of your both of your minds work. I want to jump into the technical side really quick. You know, we may have some CTOs listening, and some folks that are leading the technology side of this, what’s the biggest challenge that you faced? Maybe, Rodrigo, I’ll start with you. What’s the biggest challenge that you faced? Building a marketplace at PartsBase? And then Yoav, are you seeing this something similar in other customers? Or is this thematic across what you’re seeing, you know, with other companies trying to build up a marketplace? But Rodrigo, I’d love to hear your perspective on that. Just from a CTO perspective.
Rodrigo Garcia: Thank you, Jerry. Well, the first thing, probably the biggest top to mind is adoption. You know, in terms of the challenges is, and when I say adoption, from a technology perspective is, and this is, even if you think of our core locator service, right? So I want as many sellers, suppliers, advertising, their, their products in our marketplace. So I need to give them the ability to easily connect to our platform, right. So we have a public API that everybody is capable of using. But because of the nature of our industry, in many cases, we’re not as standardized, or we’re not as sophisticated as other verticals, for instance, healthcare, and financial services.
So it is a challenge to build, like a one size fits all, if you will, model for the intake of inventories and capabilities that are going to be listed in our platform. It’s a similar challenge that we’re facing now that we’re moving into the full transactional model with the marketplace.
The good news is that with the OroMarketplace, we have a very robust API that we can rely on, but still is working with our customers to find those generic adapters that are going to help them ultimately to be able to effectively list all their inventories right in the marketplace.
And when I say it’s not only the inventory, right is another challenge that we have is that in many cases, our suppliers, they have different systems that are not necessarily talking to each other I’m sure that some people in the audience that might sound familiar so bringing in because when you’re talking about marketplaces, well obviously I need the part number information I need to but I need all these other ancillary elements related to the board. So I can effectively advertise that. Sell it online. So that is that is probably one of the biggest challenges and kind of a byproduct of that is sometimes the information coming from our suppliers sellers is not perfect. So how do I rationalize it right.
In many cases, you have to rely on the seller for the correct information, the accuracy of the information included as part of the part description. That, I mean, is the point that I’m trying to make is Yeah, building that Universal Interface. And then how do I help my sellers to make sure that they provide as much information as they can? Right? And whenever there are deviations from what we would normally expect, how we can rationalize all of those? So going back to your comment in terms of the user experience, how can I provide my buyers a very seamless the best experience possible when trying to look at a part compare between different sellers.
Yoav Kutner: If I can jump in on this a bit? Because the points are the one thing that we actually face a lot. And like I said, as being a platform, we interact with companies that this is their first go at the big marketplace, right. So I think we always see maybe a lower, even starting point to where PartsBase is today, and their maturity in this space, right. So they really know this but the biggest points that we’re seeing is that there’s a huge problem in many, many industries to kind of standardize the catalog, standardize the content, make sure that the product is really identified across the board across different sellers across your catalog, your ERP system, etc.
So I think that it was always going to be and will be a challenge. I don’t know that there was many attempts in the technology world to get a standardized all the world’s catalogs and all that, you have to see that happen. I’ve been around for about 20 years in eCommerce. And, and we’ve always heard this kind of attempt to do that. But that doesn’t exist.
So definitely one of the hardest points is to kind of understand how your industry’s products are being referred to called how you can kind of link them and understand which product is which then, of course, enriching the content. Especially in B2B, a lot of content is so basic, and so nondescriptive, and no imagery, etc, etc. So there’s a lot of flack in the terms of content. So we see that as a huge problem.
And I’ll say, again, to the biggest point of this, the next big point for us is integration to existing systems. And now you’re enhancing that problem, because now you might have to integrate to third party and sellers kind of systems if they’re big enough, and they demand from you this kind of this kind of integration to their systems, right. So again, if you’re working with a lot of smaller ones, you might tell them, This is how we work. And you do the work, you can decide to use our API’s or flat files or something. But when we always bring like bigger sellers into our marketplace, they might demand integration to their systems.
So again, choosing a platform that’s flexible enough allows you to kind of integrate to multiple technologies, different systems, etc, I think is something that needs to be a key for that. And then just again, rounding it up is the customer experience. Right? So how do you create this kind of this unified customer experience in the catalog, but then also for the checkout and interaction with the different sellers? So I’d say those are all things that new companies that are trying to get into B2B have to kind of focus on I think those are the biggest pitfalls, again, those many others, but those are ones that you have to figure out, can I send a catalog? Can I integrate to all the systems that I will need to integrate? And then how do I build the customer experience that is kind of seamless and building value for them to use my marketplace rather than going directly themselves?
Jary Carter: How do you integrate in a way that is seamless? iThis kind of goes into one of the questions I wanted to ask Rodrigo is, you know, you’re hearing you all talk about some of the, you know, things that customers really need, what have been some of the competitive advantages that you all have created against your competition? In this marketplace? What are some of the features and capabilities that you feel like put you way ahead of the competition?,
Rodrigo Garcia: Maybe it’s wrong for me to say it, but I’ve been, you know, I’ve been in technology for over 20 years and I think that the first and foremost is the technology behind our solution. It’s on the on the locator side of the business. I think that’s a huge part of our recipe for success because we continue investing, adding features and functionality that is being requested by our customers.
And obviously it’s also required to us just observing how the different types of users use the platform and make sure that we cater to their needs. And now combining the power, if you will, of our native platform with all the features and capability going back to the technology element that that Oro brings to the table, I think that’s probably one of our biggest competitive advantages compared to any other marketplace solution out there.
The other huge differentiator, as I mentioned before, is the amount of industry-specific information that is available. The minute that they search and want to buy a part on our marketplace, they can easily see different elements, as I mentioned, supply and demand, average price points, from market perspective, get catering to the different use cases that for instance, when an airline comes in by a party, well, they may look at different data points versus a regional operator or you know, the different a different type of user platforms and being able to cater to those different buyer personas, I think that’s another big differentiator for us. So those are probably some of the key things that I would highlight in terms of what we have, right now.
One of the things that thinking about the future, this is not this is something that we’re going to be including early next year is in our casing. And this is very specific to the aviation aerospace industry, we have this particular use case called an OG, right, so aircraft on the ground. So when an aircraft is down, like for maintenance, and they were scheduled to fly, whatever, as you can imagine, and they need the part yesterday, right. So in some cases, they might even fly out someone just to whatever, they can buy the part, right and bring it to where the aircraft is. So it can be it’s back on circulation. So as part of our marketplace solution, we’re going to be incorporating this additional capability. So whenever you’re buying a part, as you go through the checkout process, you’re gonna be able to see in terms of the different shipping options that are available is not only the cost, but we’re gonna give you all these different options for you to select the again, not only pricing, but the reliability. And in terms of how quickly we’re going to rank those shipping options based on the reliability and how quickly the product can be delivered to you. So it goes back to that whole seamless user experience that caters to the specific needs that are applicable to our industry, which goes back to being very industry-specific and all those elements that y’all was referring to earlier.
Jary Carter: You’re both talking about the same thing, which is leaning on this theme for me of flexibility and customization. You know, if you’re a B2C eCommerce company, you may not need a lot of flexibility and customization, if you’re selling hats, it may be the same thing as T-shirts may be the same thing as pants. But if we’re talking about this, you know, your world wherever you go is so oh custom and unique and has so many unique intricacies. You know, it really goes back to what I’m hearing you anchor in is this need for flexibility and uniqueness and a and a technology that really has empathy for the uniqueness that you have as a business and we’ll adapt to from a flexibility standpoint, we’ll adapt to the technology needs you have which maps into exactly what you’re always talking about what the Gartner conversations with, with the need that companies have for unique flexibility, unique integrations, no two businesses being the same. And this and I think a lot of companies feel almost, you know, this is just my own perspective on this. But I think a lot of companies feel this intimidation like well, you know, do we build something from scratch? Because we have such a unique need, right? Like or do we like no off the shelf technology is really going to work for us. And you know, what I’m hearing you both say is, is if you find a technology that’s approachable enough or modular or customizable enough, you can really work on that as a platform for the integration and the customization that you need which is exactly what’s made you successful in this Rodrigo.
Rodrigo Garcia: Adding to what you just said, I don’t think there will be a use case out there for you to justify the investment of building the marketplace technology on your own. I mean, I may be wrong maybe if you’re huge manufacturing Maybe, but given the state of technology, and is it because by the time that you get there a your marketplace is going to be obsolete and the millions of billion dollars that you’ve invested now, that’s why you have to let companies like Oro do what they do. Right.
Besides if the other thing that I would say to that point is that if you want a product that is going to fit 100% of your use case, your assessment is incorrect, you gotta go for that 80/20, you know, so there is no product out there is going to be able to cater to everything that you need. So as long as you said, as you look for a product that gives you that modular approach, and that gives you speed to market in terms of ability to develop or expand existing features. And again, that it caters to the 80% of your use case and the 20% or 25% you will get based on the building blocks that the solution gives you. That’s what you need to do. If you got to be approaching it from the other side, you’re missing it. Because by the time you get there, you’re already extinct. My humble opinion.
Jary Carter: We’re just about a time here, I want to give both you and Rodrigo the time to give some final thoughts for companies, businesses that are thinking about adopting a B2B marketplace solution, what would you recommend? And you have you probably what with what Rodrigo just said, which, which I believe is really, really impactful and profound. What would you add to that, or or, say about two companies thinking about this business model?
Yoav Kutner: I’d probably say that, again, really, really figuring out what’s the added value that they’re bringing with this marketplace in their industry; how you’re going to entice your both your customers and your vendors actually to join this. But I’ll say from the technology side, really choose a product that works for you. You know, I always say in the IT world, that’s a pendulum, right, we go between, do it on your own and off the shelf, one size fit, all right, and we kind of moving between those two extremes.
It’s never good to be on any one of these sizes, choose something that really allows you to be fast to market all that.
As much as we’re at the conscious, I’m gonna bring that back, make sure the business is under is understood that the businesses are sort of signed in and, and committed to doing this, and providing a clearer kind of understanding of the steps that need to be taken. Again, working with a mature company, like PartsBase, it was easy for us, because they knew what they need. And we told them how we’re going to do that. And what needs to be built and what’s available out of the box. But when you are new to this, definitely you need to have this understanding, sign off and sign in from all participants, and clear understanding what the technology needs to do.
I would also add, for what we’re kind of Rodrigo alluded to this, but this is very, very important is to not buy too much at once, especially if it’s a new business channel for you. Go in and do iterations, work on it, see what’s successful, and leave it or continue on that path. And then add more and more but kind of the MVP, right? What’s going to bring you to market what’s going to start proving this kind of business model for you, before you spend years and years developing something really do the sooner either they’ve kind of model to off like one bite at a time, add that make sure that’s successful, and then continue adding. So sometimes we get lists like RFPs, with like 1000s of 1000s of line items and RFPs. And we look at it and there’s like there’s no way this is going to be done in three to four or five years even right, just from the scope and what needs to be done on the company side. So we really tell let’s choose them up. Let’s prove this model in your industry. Let’s see if that actually works.
And then improve on that, get feedback, real feedback from real customers, real vendors that are going to use your marketplace and improve on that rather than guessing and going to market.
You know after a few years and then like Rodrigo said by most, most times you’re going to be upset and irrelevant by the time you launch it. So be fast to market with what features you think is going to change the industry, help the industry, make more customers and vendors during the marketplace, and then continue evolving from there.
Rodrigo Garcia: One last thing to what Yoav just mentioned is, yeah, even for a company as mature as we are in our industry, when we decided to kind of move forward, if you will, with the first with obviously, what I would humbly call like our POC into eCommerce. Even when we had all of this information, stored information in terms of our customers, how they do business, we as you all said, we wanted to start small, right, we wanted to be quick to market provide what I would call a basic user experience that would allow us to validate some of those hypothesis, if you will, that we have in terms of how people were going to use it. And again, to your point, once we start getting the feedback, in some cases is that yeah, it’s right, that it was good that we did it this way. In some cases, it’s good that we didn’t spend that much money in XYZ, because guess what, people were gonna use it differently anyway. Right?
So it’s important that you take an incremental approach. You remain relevant, and you can quickly test what works and what doesn’t, right, even now that we’re about to launch the next iteration or the full features that come with the PartsBase’s marketplace. We’re going with MVP, right? So that doesn’t contain everything that we want, right? Because again, we want to test that we want to get this could be probably conversation for another podcast, right? So there are technologies like DAP that can help you understand how people are using the product, right.
So if you put that on top of any type of product that you have, but especially in the marketplace, and again, if you’re able to segregate on your different users out there that is worth gold, because you will truly understand how people use your marketplace. And then based on that, that’s how you grow, right?
Otherwise, you may be spending, again, millions of dollars on something that only 10% of people use. But then you have this other feature that you spend nothing and then everybody’s using it. So the point is that you want to be incremental, that’s why I use this as an example. Even as with all the years of experience that we have, it was important to take an incremental approach, because as much as you know, the more you know, I guess the more you understand that there’s so much more that you need to learn.
Yoav Kutner: yeah, be incremental, the iterative approach to the development I think that definitely will be important for your success in the future.
Jary Carter: It’s it’s amazing how much alignment there is between the things that the two of you are saying. These are fantastic tips. I really appreciate the time. None of this is scripted, we have an idea of some of the questions we may talk about. But none of this is ever scripted. So I just so appreciate both Yoav and Rodrigo and thank you for sharing your wisdom with us in this format. Have a great day.