The value creation of platforms in a network economy
Posted: Wed Dec 18, 2024 8:44 am
There are several ways in which successful platform organisations create value in a network economy. In a platform business model, products and/or services are not produced themselves. The value of the production process is brought in by external producers and thus disappears as an activity from the value chain of the platform company. The focus is shifted by platform organisations to the demand side of the economy.
In the value creation of platforms, there is no longer a value chain with activities that take place in a linear order, but a two-sided market. The consumer is no longer at the end of the value chain, but is part of the value creation.
The platform owner creates value by facilitating the infrastructure for direct interaction between two independent parties
The owner of the platform creates value by facilitating the infrastructure for direct interaction between two independent parties. In addition, the platform creates value by continuously improving the matching functionalities based on collected data. This allows for an increasingly relevant match between supply and demand.
Finally, the platform creates value by brazil telegram data 30 million imposing strict quality requirements on participating providers. This allows them to guarantee reliable and secure transactions on the platform.
Competing in a network economy
In a network economy, the goal is not to beat the competition, but to motivate the customer. Traditional competition models focused primarily on defending (own) market share. But the new competition models in the network economy focus primarily on customer loyalty.
There are a number of clear differences between the classical approach (old) and the network economic approach (new) to value creation. This is clearly shown in Porter's five forces model.
Porter's five forces model, classical and in the network economy.
In the value creation of platforms, there is no longer a value chain with activities that take place in a linear order, but a two-sided market. The consumer is no longer at the end of the value chain, but is part of the value creation.
The platform owner creates value by facilitating the infrastructure for direct interaction between two independent parties
The owner of the platform creates value by facilitating the infrastructure for direct interaction between two independent parties. In addition, the platform creates value by continuously improving the matching functionalities based on collected data. This allows for an increasingly relevant match between supply and demand.
Finally, the platform creates value by brazil telegram data 30 million imposing strict quality requirements on participating providers. This allows them to guarantee reliable and secure transactions on the platform.
Competing in a network economy
In a network economy, the goal is not to beat the competition, but to motivate the customer. Traditional competition models focused primarily on defending (own) market share. But the new competition models in the network economy focus primarily on customer loyalty.
There are a number of clear differences between the classical approach (old) and the network economic approach (new) to value creation. This is clearly shown in Porter's five forces model.
Porter's five forces model, classical and in the network economy.