Multi-sided platform strategies for organizations: transforming the business model

Abstract

PurposeThe purpose of this study is to explore and summarize the strategies organizations can follow when adopting a multi-sided platform (MSP) business model. MSPs benefit from direct and indirect network effects, quick scaling, fast innovation and new revenue streams.Design/methodology/approachThis study draws from the literature on business model innovation to identify five strategies in which organizations can transform by creating or acquiring an MSP. This taxonomy is confirmed with a classification of 20 MSPs adopted by 18 organizations, 5 short case studies and an interview with an executive involved in the launch of an organization’s MSP.FindingsTo implement an MSP, companies can expand their offerings, intermediate their industry with a marketplace, expand to new geographies or market segment, co-innovate their core product or service and co-innovate complementary offerings.Practical implicationsOrganizations are presented with five distinct approaches to transform their business model and benefit from MSP interactions. The cases, quotes from executives and analyzes will serve organizations in designing a platform strategy.Originality/valueThis study provides executives and researchers with insights about how organizations can transform their business models with MSPs.