The Untapped Potential of Horizontal E-Markets

 

Like-for-like data across sectors could inform our driver's decisions and - by exposing market gaps she is placed to fill - attract investment in her upskilling. Her peers and institutions, accessing the same market data, might both be willing to invest in her development for a cut of the enhanced income. But overhead laden institutions could be less competitive than local peers who can better interpret her opportunities.

 

Despite this potency of technologies that match buyers/sellers, we live in a world shaped by vertical markets; Uber/ Lyft/Bolt for minicabs, StyleSeat/ Booksy /Vagaro for beauty treatments, Dentulu/  WhatClinic for tooth cleaning, Sitter.com/ UrbanSitter/ Nanny Lane/ Sittercity for childcare, Peerby/   Yoodlize/ RNTR/ FriendWithA for neighborhood goods rentals, and so, endlessly, on. Each market has its own registration, specialisms, rules, geographic strengths and charges. Most of them will go bust.

 

Profitability for e-market operators comes from "category killer" dominance of a vertical, typically internationally. Rover's global supremacy in petcare, as one example, netted its operators $2.3bn in a 2024 sale to private equity. Reaching dominance requires huge spend on customer acquisition and building duplicative technology. Those costs must be recouped through high prices and/or low pay. But buyers and sellers gain little from global reach. Few people travel the world walking dogs. Many have a wide range of monetizable possibilities around their local economy, including love of animals. 

 

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1) Inadequacies of Vertical Markets for Earners

The highly skilled welcome vertical markets. An architect - as example - will maximize income by designing buildings full time. None of her other experiences or household assets can match that earnings potential. Lower-paid workers have so much to gain from exposure across sectors.

 

To make the friction imposed by disjointed platforms tangible, we can take, as one example, the market for mystery shoppers. Someone wanting this work in their portfolio of employment must decide between Market Force Information,IntelliShop, BestMark, SecretShopper, Intouch Insight, Sinclair Customer Metrics, BARE international, and other forums that may have faded by the time you read this. 

 

But any platform may have no work around their locality at times the person can be available. Each may impose arduous registration processes, even mandatory online training. Operators bear no costs or risks from fostering oversubscription. They gain from a bloated supply side that can be touted to retailers. 

 

Inspecting shops is just one monetizable capability for anyone earning this way. Navigating the 7 obvious vertical marketplaces for that one path to income can take hours. A worker must repeat the process for all other possibilities to gain the kind of cross-market exposure jobseekers take for granted. The inefficiency is often unnoticed. Three misconceptions about supply-side empowerment in today's e-markets reoccur, typically among people who have not earned through such platforms:

 

• Multi-platform working: Surely workers trade across multiple platforms, forcing operators to compete for labor? In reality, being available (or tapping for bookings) in more than about three platforms at the same time is self-defeating. Algorithms running Market A will downgrade a worker unavailable because they are doing an assignment through Market B when required. And vice versa.

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• Workers move to the best platforms: It can be thought sellers gravitate to the markets offering the best opportunity. But patterns of activity, numbers and location of buyers, plus earnings data is typically secreted by operators fearful of giving competitors any insights. 

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• Connective tissue can link platforms: Periodic announcements of tools intending to make multiple platforms operate as one for sellers can foster a belief this functionality is at work. In reality, platform operators fiercely resist encroachment on what they consider their sovereignty and data. As the Financial Times reported (August 2025) "Platform giants have threatened or launched legal challenges against services such as Rodeo, which helps workers track their data and “cherry pick” the most profitable jobs." (Rodeo has pivoted to a new model.)

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In fragmented vertical markets, lower-paid workers are only visible to a sliver of their potential sources of income and possible buyers of their services.

 

 

 

2) Why we Have Vertical Markets Today

The private sector has been largely left to build a new generation of marketplaces. Successful vertical markets can extract huge sums. Horizontal markets offer no path to profitability.

 

There are broad market platforms Craigslist, Gumtree, OLX and others feature extensive directories in which diverse local goods can be sold, services offered or work sought. But these are bulletin boards, an online version of newspaper classifieds. This mechanism for commerce is inconvenient for buyers in low-value transactions. Each putative seller must be emailed, responses can take time, the resource may no longer be available, or the provider may be unreliable. 

 

By contrast, someone wanting their house cleaned may wish to simply input their need, instantly see a rated worker and book them for the given price. An app enabling this controls the end-to-end transaction, including pricing and allocation of work. Anyone can launch an app in this space, perhaps using off-the-shelf tools. Their challenge is then reaching a critical mass of demand. If buyers come over from other channels, sellers or workers have to follow. 

 

Companies like Uber pioneered huge subsidies to attract activity. Advertising is another launch cost. This spend is only cost-effective if targeting specific tasks and geographies. It can cost dollars-per-click to come top of a search page for "Housecleaners, New York". Overheads of building sector dominance explain why staying focused on a niche makes sense for market operators. 

 

It might be assumed possibilities of transaction revenues across thousands of sectors would prompt companies to launch horizontal markets. There have been limited steps in this direction including:

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• Super apps: China's Alipay, "financial supermarket" app has extended into a range of purchasing options. But they are provided by partner companies, not a market open to any seller. In 2018, Uber launched a general labor market platform for lower skilled workers. Uberworks was shuttered in 2020 and has not been revived, presumably because it is unprofitable compared to Uber's aspiration to become a ubiquitous transport app.

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• Demand-side horizontalism: Airbnb has extended its hold over short-term property rentals into "experiences", activities for visitors provided by locals. This is an adjacent sector for buyers. On the supply side, there is little commonality between people who have accommodation to rent and individuals who serve as tour guides or activity leaders. 

 

Even if venture funding to competitively build critical mass across thousands of sectors materialized, it would not unlock the potential of horizontal markets.  Investors would demand the marketing costs of outspending so many rival marketplaces were recouped, and with cross-sector network effects achieved, could retain hefty chunks of earnings. Extractive operators make a bad market.

 

Operators would have no reason to share market data which helps competitors pick sectors to undercut. As it became relied on for so much economic activity, the markets system would almost certainly attract regulators' attention, unwelcome for backers. Striving to unlock diverse economic potential across a region is not a route to billionairedom.

 

 

 

3) The Case for Initiating Horizontal Markets

Horizontal markets are cheaper to build and operate than thousands of verticals. Building initial demand can be cheap if government is willing to channel public spending into the economy through the new markets to pump-prime activity. Why should any government do this?