These last years have seen the advent of platforms as a leading model in the digital economy, to such an extent that many came to the conclusion that the future belongs to platforms and that businesses that don’t become platform will be dead soon. Without being that peremptory it’s obvious that platforms did and will disrupt markets and that one will need strong differentiation factors to coexist with them on same markets.
Platforms are the winning come-back of the marketplace
Before going further, what’s a platform exactly. Uber is a platform. Amazon is a platform. Even states want to become platforms.
A platform is a place where lots of vendors can meet lots of buyers. The promise for the ones is that they will be sure to find customers, for the others that they will find anything they’re looking for. So there’s no surprise that platforms first grew on niche industries that were too small to be profitable with a local/physical approach or regulated ones where some new players did not have the opportunity to meet their customers (it was the case for drivers for instance).
So the platform is son of the marketplace, which was a very trending topic in the first years of ecommerce by the end of the 90s. Nearly the same problems to address, andÂ the same responses to fix them. What changed over time is that customers are really online and that the barriers that helped to keep the web for large players only have been removed. The first marketplaces were mainly B2B, platforms are mainly B2C or B2B2C and the B is not always a large player anymore but can be self-employed people. More, the marketplace owner is not necessarily an industry player but can also be a go-between.
So, to make the long story short, platforms are the heir of marketplaces and are nothing more that intermediaries that make vendors meet their customers, at scale, with various sizes of players.
Customer experience and satisfaction are key to platform’s success
There’s no reason why what works everywhere else would not work here. Of course, customer experience is key to success in the platforms world. And even more than everywhere else because their reason for being is that “if you need anything if a given sector we have it” and that “if you’re looking for customers we have them”. Easiness, simplicity, quickness are part of a platform’s DNA. Whether it’s about Uber, AirBnB etc everyone agrees to say that their success is the consequence of a great customer experience. Experience with the product but also with the platform : seamless, easy, simple, enjoyable.
So there’s nothing really new and you may be wondering why you’ve read 500 words so far to come to such an obvious statement. My point is that a lot of platforms overlooks and even don’t pay any attention to half of their customer experience and that a time will come when it will backfire.
The customer of a platform is not always who you think
Who are the customers of platforms ? You and be as buyers. Yes, in most cases. But there’s also the vendor the platform is putting us in contact with. And, depending on the revenue model, the actual client is sometimes more the vendor than the buyer. So, platforms have two customers. And many of them don’t care a lot about vendors, considering that if they are able to attract many customers the vendor will be forced to come, whatever the experience and the terms.
One of the main reasons behind the success of Rakuten was that while most marketplaces were end-customer-centric, did not care about the vendor experience, to offer the vendor a true experience. Ability to deeply customize the shop (vs extreme standardization), vendor support and coaching to help them understand and embrace ecommerce.
On the contrary, the way Uber is treating its drivers today is a real concern. More and more bad buzz, dribers complaining and in the end a declining customer experience.
The business model of the symmetry of experiences
A platform can be successful only if it has a value proposition for both parties : vendor and buyer. That’s a business approach everyone gets. On the other hand it has consequences many people neglect.Shared value proposition means equal treatment and symmetry of experiences.
In B2C models, the temptation is high to go all-in everything on the “C” and consider it will be enough to drive the rest. That’s the easiest approach but it’s not sustainable. A good “B” experience for vendors is mandatory to sustainable partnerships.
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