December 5, 2021

3 Best On Demand Business Models (2021) To Generate Revenue

On demand service marketplace platform is the need of the hour as people are busy and find difficulty in completing their personal chores. They seek help from service providers to do their tasks. 

To get access to dedicated functionality and to all resources, service seekers need to utilize on demand service platforms and so the demand is unimaginably high. This has made many budding entrepreneurs search for on demand business ideas that will help them to get into the market that is in high demand.

Why On Demand Market Growth Been Monumental

To understand the real importance of on demand service platforms, it is very essential to understand the scope and future of these platforms. Let us identify what stats say about on demand service platforms and what are its benefits.

Reliable statistics about on demand service platforms

  • 42% of the adult population in the U.S had used online service marketplace platforms.
  • 22% of the adult population in the U.S is being service providers in any one of the service platforms.
  • 51% of service providers have admitted that their financial condition has been lifted to a higher level after using on demand service platforms.
  • 81% of service providers have decided to stay with the same service platform and continue their work.
  • 33% of workers work with more than one service platform and have increased their work opportunities.
  • Netflix is stated to be the leading video streaming service platform that has 151 million subscribers.

Benefits of Using On Demand Business Platforms

  • Users find service platforms to be more convenient to use and get their service on time by saving their precious time.
  • The development cost for building an on demand service model is cheaper as there are many ready-made solutions available.
  • The on demand service model supports ease of payment that will let clients pay and get their service from service providers through the platform. So greater conversion is guaranteed.
  • All on demand service platforms are SEO-friendly and will have better online visibility that will support users to gain the attention of their target audience.
  • Customer relationship management can be achieved easily by utilizing the service platform as there will be multiple communication channels and will provide service.

What is an On Demand Business Model?

An on demand business model is an online bridge that connects all local service providers with their local clients and processes the service requests and payment through the platform. Clients search the platform and find their service providers and will request for service. 

Service providers will accept the request and will process their service. Clients will pay the platform and the admin will deduct his commission or any other charges that have been agreed between the admin and the service provider and will pay the balance to the concerned service provider.

Top 3 On Demand Service Marketplace Business Models

To succeed in your on demand business you need to look for perfect on demand business ideas that will clearly lead you towards reliable on demand marketplace business models.

Let us analyze the leading business models that will support you in moving your business to next level.

1. Lead-Based Business Model

This is a genuine business model for any on demand business. In this model, clients will request for service and service providers will quote and submit to the platform. The platform will display the quote to clients. 

Clients will select the best service provider whom they find comfortable and will offer their work. The concerned service provider will be notified about the request approval and will be allowed to deliver the service.

In this service model, the platform will not charge service providers on the payment they get for completing the service. Rather the service provider will pay the admin to let their quotation be displayed to their clients. 

The chance of conversion is not guaranteed by the platform but it will allow the service provider to meet his genuine lead. If properly quoted then the conversion is possible. Thumbtack is currently following this business model and has succeeded in satisfying both its clients and service providers.

2. Transactional-Based Business Model

This is one of the beneficial business models that benefits both service providers and the admin. In this model, whenever a transaction is made within the platform the admin will receive the transaction fee.

Clients will find their respective service providers. Will use all communication channels and will get in touch with them. Client and service provider will negotiate and will settle their order. Once the service is completed the transaction will be made through the platform.

The admin will deduct the transaction fee that is agreed with the service provider while getting the provider registered with the platform. In this method the service provider needs to pay only if he gets his order. Else he may not pay and this is the best choice for any start-up.

TaskRabbit is one of these on demand business model examples that has survived well in the market and currently holds more than 2 million active users and thousands of vendors in and around the US also it’s suits for different on demand industries.

3. Subscription-Based Business Model

Certain services need continuous support from service providers like laundry, groceries and many more. Clients need to pay service providers on a recurrence basis. This is where the subscription-based business model works. 

Customers can get their bills on a monthly basis and can pay at once. The platform will charge the subscription charges to the service provider and the service provider need not pay for each transaction that he makes through the platform.

Alfred, a New York based company offers this business model and has set to be the best on-demand service platform example. Now this platform is getting millions of service requests that makes this platform standalone in the market.


Hope our on demand business ideas have helped you to understand more about on demand business models and its types and benefits in detail. Although setting the perfect business model is essential to determine your success in the market, still you need to have brilliant features that will attract enough visitors to your platform. Also you need to have a mind-blowing marketing strategy that will promote your brand and get you to reach your target audience easily.

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Service Marketplace solution

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