The rise of the platform economy has been phenomenal. Amazon, Apple, Google, and
Facebook together have an almost $3 trillion market cap and make up nearly 11% of the S&P 500.
Yet, there is more. You don’t need to be a global giant to take advantage of platform economy dynamics. In almost every area of business there are interactions in the value chain that can be made more frictionless with the help of platform thinking – which involves much more than pure technology.
We have summarized the most essential principles in this material to help your business to get on board.
Some form of the platform economy has probably existed as long as people have engaged in trade. The oldest findings of marketplaces date back five millennia.
The market square enables food producers and consumers to interact without intermediaries.
For producers, it would be time- and resource-consuming to find all customers and present offerings for everybody separately. For consumers, it would be similarly inefficient to find various producers one by one. The market square (a platform) hosts several market stalls that enable various producers to make their offerings visible and attract consumers to see what is available and buy something (in essence, interact with the platform). Furthermore, the market square in itself accumulates growth. The more consumers there are present, the more producers are willing to participate, and vice versa; the more producers there are, the more consumers it attracts.
Why did we not then see Uber-like growth back in medieval times? First, non-digital contexts do not scale as well because more interactions require more human labor. Furthermore, the limits of the physical world (e.g., the size of the market square and the local population) further limits growth. As we shall see later, these limits are often absent in the digital world. On top of that, digital resources carry generative characteristics that truly make digital platforms run on steroids.
Why another canvas? Inspired by the renowned Business Model Canvas, we feel that there is a need to focus on the very essentials of the platform economy, such as network effects and boundary resources, which make the platform economy different from the traditional pipeline type of business model. We hope that our canvas helps you to start your journey toward platform thinking and raises the right questions to explore further.
Learn platform economy fundamentals
Model your business from platform perspective
Learn to use the canvas method
Experiment chosen platform candidates with minimum investment
Measure & steer the platform development
Utilize AI/ML capabilities to boost your platform
Map your business ecosystem, actors & interactions
Identify & prioritize platform candidates
Align platform strategy with your existing business