White paper : The Rise of Digital (Retail) Platforms

Platform businesses have become the poster child of the digital transformation. In the past two decades, no other business model has seen faster growth and disrupted more industries. This success has aroused covetousness: Long gone are the times when eBay and Amazon were the only ones reaping the benefits of the platform approach. Today, companies from many different industries, as well as manufacturers, retailers, and suppliers to consumers and businesses, are acknowledging the need to grapple with digital platforms in one way or another, by pushing initiatives to create platforms on their own or using third-party offerings as retail channels. However, in many companies, understanding of platform markets is still limited and reactions to the platformization threat are unsystematic and hasty. Against this background, this study aims to address two questions:
· How exactly do (retail) platforms differ from traditional “pipeline” models of retailing?
· How can firms survive and thrive in an increasingly platformized market environment?
In answering these questions, we draw on a mixed conceptual–empirical approach, synthesizing and extending know ledge from the academic and business literatures, linking it to market observations, and extending this knowledge via business expert and consumer insights. Our findings indicate that innovating an existing business model through platform creation is not for everybody, and some firms may be better off cooperating or competing with third-party platforms in their home arena. We identify different positions that players may occupy in the new market order and give concrete advice on how to avoid loss of relevance.