Win your marketplace through happiness
Sourced from: The Hierarchy of Marketplaces by Sarah Tavel
The first step of building an enduring marketplace is not focusing on GMV(Gross Merchandise Value), but on creating happiness.
The marketplace that wins is the marketplace that figures out how to make their buyers and sellers meaningfully happier than any substitute. GMV is irrelevant — a vanity metric that can lead you down the wrong path if you chase it.
It’s understandable to focus on growth and hitting a mile milestone because they are easy to measure.
But the ultimate success of your marketplace will depend on your ability to create meaningfully more happiness in the average transaction than any substitute, not how many transactions you accumulate.
Growing is still crucial. The only way to achieve marketplace saturation is through growth.
Think of growth as a means to increasing the average level of happiness per transaction (instead of the goal itself), it will focus you on quality growth over vanity growth.
By pursuing happiness, you’ll achieve growth. But not vice-versa.
If you pick the right thimble, you can win the ocean. But you’ll never win by going after the ocean first. Pick wisely.
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