A Deep Analysis - How Does Letgo Make Money?
In this day and age, an online marketplace to buy and sell the products is on the boom. A few popular apps in this sector are eBay, Craigslist, Letgo, OfferUp, and many more. Out of all Letgo came up to be the most used app in recent times.
The users of Letgo said that they are so impressed and comfortable with the features provided by Letgo. To the facts, Letgo made up to $1.5 billion in the first three years of its launch. Many entrepreneurs and startup enablers are always keen to know more and more about the working of Letgo.
Therefore, in this article, we will discuss how does Letgo make money and its business model. So, let’s proceed first with Letgo Business Model.
Letgo Business Model
Letgo is an online classified platform through which you can easily sell or buy things. In a way, the Letgo Business Model is quite similar to that of OLX. This mobile app is available in more than 35 countries around the world. With more than 20 million users, the company comes with two advanced features that are “ Letgo featured listings and Letgo Pro”.
The best part of Letgo Business Model is that it uses geolocation, artificial intelligence and image recognition. This listing of the products is completely based on the user’s location and preference. The advertisements are usually listed that comes under the 50 miles radius of the users. As the actual exchange will take place in the offline mode. Users can easily apply the filter based on the distance, location, newness, category, price and more.
How does Letgo Make Money?
So, now comes the main point, how an app like Letgo makes money. We all are aware that Letgo is a free marketplace platform where users can easily advertise the products. Still, Lego has three revenue models for its business.
● Ad base model (On-Platform Advertising)
● Two subscription-based model
● A freemium model
Let us go through all of them one by one.
The ad-based model was a success for Letgo in a short span of time and it even helped Letgo to increase the number of users. Marketplace platforms always come with the numerous advantages for the advertisers which attracts them to such platforms. Therefore, Letgo took advantage of this thing and launched an ad-based model.
The app or website users will see a lot of banners ads and when the users get attracted to such ads Letgo will earn revenue. The more users get engaged in these banner ads, more revenue will be earned by the Letgo.
Users always love the things which are free, so placing such ads on the platform never results in losing users. As users don’t need to pay anything for this.
The freemium model of Letgo is for all those product owners who want to list their products on the top. Letgo freemium model comes with a feature called the “ bump up ” & featured listing. The “bump up” feature will let the users list up their product on the top positions for approximately 7 days in a row. The product owner even has a feature to attract the audience with the sale.
Letgo will charge the product owners with fees ranging from $0.99 to $3.99 that depends on the product. More and more users on the Letgo are attracted to this feature, as it allows them to play safe. This way Letgo earns revenue from the Freemium model.
Two Subscription Plans
Letgo comes with the two subscription plans for its users.
#1 The Super Boost Mode
When a user subscribes to super-boost mode, one of the products every day will remain in the featured list automatically by the systems. Lego will collect the data of products in the marketplace and will accordingly show it in the featured list. In short, the product with the highest probability to be sold will be shown in the featured list.
#2 The Letgo Pro plan
This subscription plan is specially made available for the car dealers. The main aim of this plan is to provide more leads to car dealers. The pricing for the Letgo pro plan goes like $99 for 30 vehicles, $399 and $599 for 70 and 150 vehicles respectively. These plans are on a monthly basis. It even comes with a 30-days free trial.
So, these are three revenue models through which Letgo earns money. The subscription plans result in the highest revenue for the Letgo. This even shows that the revenue model of Letgo is completely different in comparison to other models.
Planning to Build an App like Letgo?
Building an app like Letgo is a good choice if you’ve hands-on this industry. The reason for the success of the marketplace like Letgo is its business and revenue model. So, if you’re planning for a similar marketplace then do deep research on its model as it will help you to achieve success.