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The Rise of the Platforms: Business Model Innovation Perspectives - Coggle…
The Rise of the Platforms: Business Model Innovation Perspectives
Digital technologies are actively penetrating different areas of business activities, political activities as well as a wide range of social interactions.
Companies increasingly use digital
technologies in order to capture
consumers’ attention
and develop long-lasting relations.
“platforms redefine value propositions for customers, reshaping the demand side ofthe market” and companies aiming to apply platforms needs to innovate business model perspective.
As a consequence companies needs to understand how to change business models in order sucessfuly compete in the platforms based digital ecosystems.
The term platforms were related to technological solutions development. These solutions were oriented to help companies to facilitate various activities.
Platforms might define as “digital infrastructure (hardware and/or software) on which different applications can be run, or (by wider definition) allowing for a finite and clearly defined set of uses.”
Platforms are defined as a new business model that uses technology to connect people, organizations, and resources in an interactive ecosystem in which amazing amounts of value can be created and exchanged”.
Two-sided market refers to s platforms’ ability to act between different types of consumers and ability to match value between them.
Network effects refer to increase of value through growing number of users. Network effects are following .transactions appearing in two-sided markets and in particularly strengthening indirect effects
The ecosystem concept was defined by Moore (1996) and refers to “an economic community supported by a foundation of interacting organizations and individuals—
the organisms of the business world.”
Distribution Power. Platforms enable scaling, and supply-side platform participants can generate profits even in the “long tale”.
Asymmetric Growth and Competition. The platform provides opportunities for the same companies to compete I the same and complementary markets.
The business model concept has been widely studied in various management, economics, strategic management, marketing and other disciplines. It remains perspective research area as new technologies and solutions bring new
possibilities for business models implementation.
Business model innovation can be defined as “changes in business logic that are new to the firm, yet not necessarily
new to the world, and have to result in observable changes in the practices of a BM”
The changes which are introduced might be caused by technologies development (such as social media, media, IoT, big
data), the situation in the market (competitive pressure) or even by political decisions (legal regulation).
As technologies develop rapidly and markets became
very dynamic, business model innovation became a necessity for a company to operate in the market.
Although business model innovation is necessary for
successful operation in the market there are not many studies addressing barriers to business model innovation.
The “platform business model” is used to describe
companies which develop platforms for their activities.
Platform providers define platform components and rules, which are followed by platform users;
The platform providers deal with demand, supply and external sides.
The transaction between these parties are facilitated through the platform.
Business model concept address customer segments as
important aspect as companies aims to satisfy selected segment’s needs.
The platform business models aims to satisfy different needs of consumers.
Platform phenomenon became increasingly importantand according different prognosis companies needs to rethink their business models in order to use opportunities
platforms are bringing.
Digitalization is considered as a strategy how to adapt
and use digital technologies instead just of just upgrading them