The platform (and marketplace) revolution has brought about a transformative shift in the business landscape, offering companies unprecedented opportunities in the digital economy. While Europe may lag behind the US and China in terms of large-scale platforms, the region boasts a diverse range of innovative platforms that cater to different needs and markets. By combining Europe’s commitment to the circular economy with the power of platforms, the region can gain a competitive advantage, drive innovation, and create value for businesses and consumers.
1) Strategy for Success. Every company should have a strategy for the platform economy that considers different positions from creating a platform, building on top of existing platforms to working with platforms.
As Oliver Birk, Director Platform Business BASF Coatings, mentioned:
“Not everybody needs to own a platform - but you need to have a strategy to deal with them.”,
2) Platforms and Circular Economy. Companies can leverage the concept of a circular economy to create platforms that drive innovation, reduce waste, stimulate product redesign and provide value to businesses and consumers.
3) Advantages of Circular Marketplaces:
Lower transaction costs.
More buyers and sellers.
Positive network effects.
Expanded reach.
Incentives for product redesign.
Easier to grow community.
Incentives for ecosystem innovation.
4) Platforms for Good. Platforms have created concerns on inequality, power imbalance and privacy. To address these, platforms should actively participate in developing fair and effective regulations and embed ethical principles in their incentives and protocols.
5) Fundamental Questions to Answer. A successful platform business is characterized by its ability to answer four fundamental questions:
Where to play?
How to scale?
How to win?
How to capture value?
6) Why corporate should consider platforms?
Platforms encourages business to act as enables, connecting various stake holders to create new value propositions and revenue streams. Platforms can alleviate inefficiencies and enable corporations to stay top-of- mind for customers and continue delivering value.
7) Network effects vs Virality A network effect occurs when adding a user to a network makes the network more valuable for all users bringing scalability and defensibility. On the other hand virality refers to the phenomenon where growth leads to more growth, as users spread the word.
8) Rise of B2B Marketplaces
B2B platforms grew by 135% last year and providing opportunities for niche specialization. Niche marketplaces cater to specific markets or industries, offering targeted and tailored shopping and a more level playing field for smaller brands and entrepreneurs.
9) Vertical Integration, Insights and Trust. Modern marketplaces focus on vertical integration by offering additional services that strengthen the value proposition, and valuable tools like dashboards and reporting that provide meaningful insights. Ethical business practices, sustainability and trust are also increasing in importance.
10) Chicken or egg, how to launch a marketplace? B2B Marketplaces typically focus on attracting buyers first, as they are the one driving the demand for the products and services offered. B2C Marketplaces often attract sellers first, as they are the ones providing the products and services that will attract buyers.
Delve deeper into the trends in platforms and marketplaces by downloading #TheNTWKSummit23Report and reading the articles there:
The Power of Platforms, by Peter C. Evans, Chief Strategy Officer at McFadyen Digital, Co-chair of MIT Platform Strategy Summit and TheNTWK Summit.
The Platform Re-Evolution, by Sangeet Paul Choudary, Founder of Platformation Labs Best-selling co-author of “Platform Revolution” Author of “Platform Scale".
Platform Thinking Game, by Daniel Trabucchi, Senior Assistant Professor at Politecnico di Milano, Co-author of the book “Platform Thinking – Read the past. Write the future”; Tommaso Buganza, Full Professor at Politecnico di Milano, Co-author of the book “Platform Thinking – Read the past. Write the future”.
How To Approach Platform Strategy As An Incumbent, by Matthias Walter, Co-Founder & CEO of fastbreak.one; Prasa MK, Senior Practice Leader at AWS; Pau Monserrat, Head of Finance & Corp. Business Develop at Coperama.
The Power of Network Effects, by Sameer Singh, Creator of Breadcrumb.vc, Creator of “Applied Network Effects” course, Venture Partner at Speetinvest Part of the Atomico Angel Program.
Marketplace Trends, by Santiago Sanchez, CEO of The Etailers; Juozas Kaziukenas Founder of Marketplace Pulse; Liliana Arroyo, General Director of Digital Society Generalitat de Catalunya; Tom McFadyen, CEO & Author of McFadyen Digital; Francesc Alsina, Founder & CEO of GROAU I Honest Marketplace.
Chicken or Egg: How To Launch a Marketplace?, by Tom McFadyen, CEO & Author of McFadyen Digital; Barbara Buades, CEO & Co-founder of MEETOPTICS; Nick Fulton, CEO & Co-founder of trustshare; Paula Conti, Strategic Account at Executive MIRAKL; Shuhrat Ashurov, Co-founder & CCO at randevu.tech.