Revenue Models of Letgo App and OfferUp

OfferUp and Letgo are aimed at selling and buying second-hand goods. These letgo buy and sell have an identical business model focused on income generation from the advertisement.

let’s understand how they work and earn revenue.

Subscription Fees

apps like letgo and offerup offer their users additional services and perks on a subscription basis. For example, subscriber users can receive direct calls from shoppers and get their featured classifieds on the app. Users can choose to subscribe and pay via Google Play Store or App Store. Therefore, these premium features will be activated instantly at checkout.

Transaction Fees

This is the most common form of revenue generation for consumer-to-consumer markets. Apps like offerup and Letgo charge fees to purchasers, known as “transaction fees” to facilitate a seamless exchange of goods and services through the platform. Moreover, the fee can be fixed or a percentage of the amount.

Seller Fees

Buy and sell marketplace apps like OfferUp and Letgo charge a transaction fee, the apps also charge a sales fee. It’s a commission to provide salespeople with a platform to propose deals on the app. Additionally, these charges vary from app to app and may be based on a fixed cost or a percentage of the price of the item. For example, Etsy fees $0.20 for each item you sell through the platform.

Advertisements and Featured Listings

Users looking to sell their products immediately or at a good price can opt for the featured listings option to find relevant buyers. In turn, the app charges advertising fees to display the classified ads on top of the ads. In short, it’s a win-win situation for all parties involved as demand gains revenue, and buyers and sellers achieve what they want.

These apps like letgo and offerup ways to make money. However, their monetization model is not the sole driver of their success. Consumer-to-consumer app features and functionality are also very important.