The Evolution Of Marketplace Convenience

Picture a bustling ancient bazaar thousands of years ago where buying one item could take hours of searching and haggling. Contrast that scene with one today: with a few taps on a smartphone, you can summon almost any product or service to your doorstep within hours. This difference captures the evolution of marketplaces. Over the past few decades, marketplaces have streamlined commerce by slashing the time and friction of shopping while unlocking new employment opportunities for millions of people. The number of online marketplaces has exploded—generating roughly $3.8 trillion¹ in global transactions in 2024—and fueling a gig economy in which 64 million² Americans are freelancing. 

Anecdotal evidence suggests that average transaction times have dropped from more than 400 minutes in the barter era to fewer than 10 minutes today in mobile marketplaces. Each wave of marketplace innovation—from local shops to department stores, shopping malls, web-native platforms, and mobile apps—has compressed the average transaction time, as shown below. 

Source: ARK Investment Management LLC, 2025, based on data from Ashby 2019 and From the Aldergrove 2024. Data as of April 20, 2025.³ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security.

This article is the first in a two-part series examining the evolution of marketplaces. Here, we take a chronological journey through five eras—from the first barter systems and local shops through shopping malls and web-based platforms to today’s app-powered marketplaces. Along the way, we’ll see how each era improved the three metrics that make a marketplace “sticky”: price, inventory, and speed of delivery. The next article in this two-part series will explore how AI is driving the next wave of marketplace innovation.

Price, inventory, and speed of delivery explain why consumers are gravitating toward marketplaces today.⁴ A majority of users cite better prices (53%) and free or discounted shipping (50%) as the top reasons they choose marketplaces, with speed of delivery (39%), in-stock availability (31%), and shopping convenience (31%) not far behind, as shown below. These preferences explain why digital marketplaces have become dominant: they address the fundamental drivers of consumer choice.

Source: ARK Investment Management LLC, 2025, based on data from Haleem 2025. Data as of April 20, 2025.⁵ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security.

We also will examine how each leap in marketplace efficiency has enhanced the buying experience and created new jobs. Finally, we conclude with a view to the future: while marketplaces are providing critical infrastructure for the economy today, AI will define the next evolution, transforming once again how we buy and sell, and rewiring both consumer behavior and job prospects.

I. The Legacy Eras (Early Antiquity-1990s)

In early human communities, marketplace commerce began with direct barter—trading goods or services like goats for grain or labor for food without currency as an intermediary. Every exchange required a “double coincidence of wants,” making each trade time-consuming and inefficient. With no standardized prices or centralized locations, search costs were extremely high, and negotiating every deal created major friction in the buying process.

As societies developed, marketplaces emerged—forums, agoras, bazaars—where traders gathered. The invention of money and standardized weights improved efficiency, but did not eliminate the friction associated with in-person browsing and haggling. Prices were variable, inventory limited, and speed constrained by the need for physical presence.

In the 18th and 19th centuries, local shops and general stores popped up and began to lessen the friction. Shopkeepers curated inventory for their communities and offered personalized services, which lowered search costs but did not address inconsistent pricing. In a major leap during the late 19th century, department stores like Macy’s in New York and Le Bon Marché in Paris consolidated inventory under one roof, introduced fixed pricing, and encouraged leisure browsing—reducing search time and friction dramatically.

This evolution improved marketplace fundamentals: prices were more transparent and inventory more organized, as the speed of transaction processing increased. Still, commerce was limited to local geographies and constrained by limited hours and inventory.

II. Shopping Malls Era (1950s–1990s)

The post-WWII boom birthed the American shopping mall. As suburban populations grew, developers built enclosed malls—beginning with Southdale Center in 1956⁶—to centralize dozens of stores under one roof, with major department stores as anchors. These malls offered convenient shopping across many stores and evolved quickly into social hubs with food courts, cinemas, and air conditioning. Between 1970 and 2002, more than 800 malls popped up across the US and became part of daily life.⁷

For consumers, malls expanded access to inventory greatly. Shoppers were able to find hundreds of thousands of products—far more than local shops and even department stores could offer. 

Nonetheless, malls forced tradeoffs across the three important variables:

• Price: Fixed pricing eliminated haggling, but prices were often marked up. Comparison shopping required walking from store to store, with discounts limited to sales events.
• Inventory: Variety improved, but shelf space constrained availability. Niche or long-tail items were rarely stocked.
• Speed: Malls streamlined shopping into a single trip: if the item you wanted was in stock, you had it instantly. Yet, you still had to travel, deal with crowds, and shop within store hours.

Malls made shopping more convenient and turned it into a cultural pastime, but they were bound by physical limitations—geography, schedules, and real estate. The stage was set for a digital leap that would dissolve those boundaries.

III. Web-Native Marketplaces (1995–2010s)

The mid-1990s internet boom birthed the first web-native marketplaces. Suddenly, the mall gave way to the world marketplace. Platforms like Amazon (1994), eBay (1995), and Craigslist (1995) revolutionized shopping with global reach, 24/7 access, and an “endless aisle” of inventory. Geography no longer mattered: a buyer in Kansas could purchase a rare collectible from Japan. Shopping shifted from a daytime errand to anytime, even at midnight in pajamas.

Search costs and transaction friction dropped dramatically. Search bars and recommendation engines helped users find products in seconds—no more wandering aisles or calling stores. Amazon pioneered frictionless checkout with its 1-Click feature, while eBay and PayPal helped build trust through ratings, reviews, and buyer protection. Gradually, consumers became confident that what they ordered online would actually show up.

Across our three-marketplace metrics, the web-native era marked major advances:

• Price: Online platforms introduced radical price transparency and competition. Shoppers could compare prices across dozens of sellers instantly, and dynamic pricing—like Amazon’s real-time price adjustments—emerged to stay competitive. Frequent deals and global competition made pricing more consumer friendly.
• Inventory: Digital shelves had no limits. Amazon’s vast warehouses, eBay’s user listings, and Craigslist’s classifieds gave consumers access to rare, niche, and international goods that brick-and-mortar stores couldn’t stock. Regardless of location, sellers could reach a global audience.
• Speed: Browsing and purchasing were instant, though shipping introduced delays. Early online orders could take a week or more to arrive. Still, for hard-to-find items, the wait was worth it. Over time, logistics improved. Launched in the mid-2000s, Amazon Prime’s two-day delivery set new expectations.

Not only did this era reshape shopping—it redefined work. Online platforms enabled individuals to sell products, offer services, or freelance without a storefront or employer. eBay power sellers built businesses, Amazon’s third-party program launched micro-retailers, and platforms like Elance and oDesk (early Upwork) connected freelancers with gigs. As these platforms took off in the mid to late nineties, enabling individuals to earn income independently, the number of 1099 tax filings began to increase faster than traditional W-2s, as shown below. Unlike W-2s tied to full-time jobs, 1099s are issued to freelancers, gig workers, and self-employed sellers, the kind of labor these platforms enabled. Not only were digital marketplaces disrupting retail, they also were reshaping the labor force and work itself.

Note: NEC: Non-Employee Compensation. Source: ARK Investment Management LLC, 2025, based on data from Dourado and Koopman 2015 and U.S. Internal Revenue Service 2025. Data as of April 20, 2025.⁸ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security.

Web-native marketplaces proved that digital commerce could scale—matching millions of buyers and sellers, building trust, and managing payments and logistics. But, the next leap caused an explosion in marketplace participation.

IV. Mobile-App Marketplaces (2010–Present)

Launched with the iPhone in 2007 and accelerated by Android, the smartphone era pushed marketplaces from desktops into pockets. Between 2011 and 2023, smartphone penetration in the US scaled from 35% to 91%, reaching 70% globally by 2023.⁹ Constant connectivity, location awareness, and mobile apps enabled a new kind of marketplace: real-time and on-demand at scale.

This shift created marketplaces for services, not just goods. Companies like Uber, DoorDash, Instacart, and Airbnb turned phones into portals for rides, food, lodging, and labor. A tap could summon a car or dinner in minutes. Mobile-first platforms like Depop and Etsy reimagined e-commerce with rich, verticalized experiences. Commerce became instant, personal, and location-aware.

Several innovations made this new world possible: push notifications and GPS enabled timely, contextual offers. Digital wallets like Apple Pay and Google Pay removed friction from checkout. One-tap purchases became the norm. “See it, tap it, get it” became the reality.

Across our three-marketplace metrics:

• Price: Mobile apps perfected dynamic pricing. Ride-share services used algorithms to raise or lower fares in real time. With push notifications, e-commerce apps introduced flash sales and personalized discounts. Prices fluctuated constantly, creating more competition—and volatility—but often better value for consumers.
• Inventory: Mobile made inventory seem limitless and instantly accessible. Apps connected users to global suppliers, third-party sellers, niche creators, and other individuals. Innovations in shipping and fulfillment allowed sellers to offer products without holding inventory. Marketplaces extended to services—people could “list” their time and skills, offering everything from tutoring to dog walking to logo design, globally.
• Speed: Mobile shrank the time between want and have. Rides in minutes, groceries in an hour, physical goods delivered same day via networks like Prime Now or Instacart. On the service side, video chatting with a doctor, hiring a freelancer, or booking a handyman took place in real-time. From discovery to delivery, transactions could be completed in an hour on a mobile device.

The mobile era also democratized work. The “gig economy” emerged, with platforms enabling millions to work and earn flexibly—driving, delivering, freelancing, or renting out assets. By 2019, an estimated 57 million Americans—36% of the workforce—were engaged in gig work.¹⁰ The platforms supporting them handled payments, logistics, ratings, and even lightweight benefits, reducing barriers to earning. IRS data confirmed a significant rise in 1099 income from platform-based work. Millennials led the way, accounting for 45% of the category by 2023, followed by Gen X at 27% and Gen Z at 15%, while Baby Boomers and the Silent Generation dabbled at 9% and 4%, respectively, as shown below.

Source: ARK Investment Management LLC, 2025, based on data from Tierney 2024. Data as of April 20, 2025.¹¹ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security.

This generational skew suggests that younger, more digitally-native, mobile-first workers were the early adopters of platform-enabled income streams—from Upwork and Fiverr to DoorDash and Airbnb. Smartphones allowed anyone to turn their time, skills, and spare assets into earnings with just a few taps.

Mobile marketplaces set in motion a flywheel: lower friction for consumers led to more demand, attracting more sellers and workers, which improved service availability, in turn boosting adoption. The result was rapid growth. Between 2018 and 2024, global online marketplace gross merchandise value (GMV) more than doubled from $1.7 trillion to $3.8 trillion.¹² Even as year-over-year growth moderated after the pandemic, sales never dropped and growth returned to double-digit territory in 2024.

Source: ARK Investment Management LLC, 2025, based on data from Ghavami 2024. Data as of April 20, 2025.¹³ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security. Past performance is not indicative of future results.

This flywheel—more users, more sellers, faster fulfillment—transformed marketplaces from digital storefronts into real-time, global economic engines. Not only did mobile marketplaces change how we shop and work, but they also reshaped global commerce.

V. The Marketplace Flywheel

At the core of the marketplace revolution has been a powerful flywheel effect: every improvement in convenience—better prices, faster service, broader selection—has attracted more consumers, in turn drawing in more sellers, gig workers, and service providers. As supply has expanded, platforms have improved, with more competition driving better pricing, deeper inventory, faster delivery, and so on. Amazon’s shopper-first approach has attracted millions of consumers and more than ~2 million active third-party sellers worldwide.¹⁴ Uber’s early rider promotions attracted passengers and drivers, reducing wait times and further boosting rider adoption.

This flywheel has created a surge in micro-entrepreneurship and independent work. Unlike traditional retail—in which launching a business required capital, permits, and storefronts—modern marketplaces like Etsy, TaskRabbit, and Upwork make it easy for anyone to set up shop online, tap into a customer base, and earn income without overhead. 

The shift in this form of work is visible in business formation trends. Non-corporate business applications per 100,000 people in the US have surged during the last ten years, as shown below. While not all these applications have turned into self-sustaining companies, the data suggest that individuals increasingly are building solo ventures, often platform-powered.

Source: ARK Investment Management LLC, 2025, based on data from U.S. Census Bureau 2025. Data as of April 20, 2025.¹⁵ For informational purposes only and should not be considered investment advice or a recommendation to buy, sell, or hold any particular security.

This boom has expanded the non-corporate workforce. Nearly 40% of Americans now freelance, and globally, over 1.5 billion people are freelance workers in some capacity.¹⁶ Marketplace platforms can handle the heavy lifting—customer acquisition, payments, logistics—so individuals can plug in and earn almost instantly.

More than job creation, marketplace platforms are transforming the concept of work. People can toggle between gigs: driving for Uber in the morning, delivering for Instacart in the afternoon, freelancing on Upwork at night. Marketplace work has created a safety net in times of crisis—during both the 2008 recession and the COVID-19 pandemic—offering flexible, fast income when traditional jobs faltered. While debates continue around stability and benefits, labor participation on marketplace platforms continues to rise, highlighting the appeal of access and autonomy. Marketplace platforms have evolved into economic infrastructure, enabling both commerce and livelihoods at global scale.

VI. The Marketplace As A Modern Infrastructure: Where AI Is Taking It Next

Today’s marketplaces are more than apps and websites; they are critical infrastructure for the modern economy. They move trillions in goods and services, enable everyday entrepreneurs, and have created new job categories that didn’t exist a generation ago. Platforms like Amazon, Uber, and Airbnb now serve as a global digital backbone, connecting supply and demand in real time, much like the role that roads and utilities played in the industrial age. They shape how we shop, travel, hire help—and how millions of people earn their living.

What’s next? The rise of AI-powered marketplaces. While the previous era reduced friction between buyers and sellers, the next one will automate many more processes intelligently. AI can optimize pricing in real time, forecast inventory needs, and power ultra-fast fulfillment with robotics and autonomous delivery. AI already is matching freelancers with jobs, powering chat-based support, and curating hyper-personalized recommendations.

On the labor front, AI could create new kinds of platform work and reshape existing platforms—matching gig workers to tasks across apps, optimizing schedules, or even enabling users to rent AI-driven services. As in past transitions, those who embrace this powerful technology are likely to leap ahead, while those who do not may fall behind. Just as e-commerce disrupted brick-and-mortar retail, AI-native platforms could challenge digital incumbents during the next few years.

Conclusion

Marketplaces continue to evolve toward less friction and more participation. From ancient bazaars to on-demand apps, the arc has bent toward speed, transparency, access, and empowerment. With AI, marketplaces could become predictive and ambient, blending intelligence into infrastructure and coordinating transactions with minimal user input. We’ll dive deeper into that transformation in the next article, where we explore marketplace innovation in the age of AI.