What's a platform?
Technology companies are combating disruption with “marketplace ecosystems” that have powerful digital offerings, such as advanced product discovery and distribution methods. This allows smaller producers to participate in an ecosystem that attracts a massive audience from day one.
Producers aren’t the only beneficiaries. Customers get access to more product selection, improved relevance, convenience and competitive pricing (see “Jeff Bezos’ Virtuous Cycle”). Customers have evolved to expect the convenience and/or engagement enabled by the likes of Amazon, Google, Uber, Airbnb, Facebook and Apple, which have proven powerful for business. These companies have leveraged their technology platforms to increase customer value for existing products, drive loyalty and trust, allow others to build customer value within their ecosystems, scale quickly into new markets/industries and sometimes invent new industries. They are able to do this with strong platform and product strategy and development.
A platform is not just flexible data and technology. At a minimum, all platforms must provide a useful function/service, third-party access and governance, but successful platforms must couple that with the right business strategy, product assortment and support for producers and consumers. That said, ultimately you don’t get to decide you are a platform, the market decides that for you.
The goal should be to allow for product teams to leverage the work, data and learnings of others in the ecosystem. What distinguishes product technology from platform technology is that it provides capabilities that are not specific to any one business unit. This expands the support first-party product teams can provide to encompass third-party platform participants as well as customers. Platform participants can leverage shared capabilities like analytics, performance, payment systems, fraud detection and personalization models. These foundational capabilities give digital releases a seamless guest experience and a leg-up against niche players that introduce similar products without these more mature “baseline” capabilities. These amplifiers improve the customer experience, increase demand to engage and participate, and attract more sellers – improving assortment options and competition for a more sustainable ecosystem.