Open for Business: Harnessing the Power of Platform Ecosystems

240 Pages·2016·7.2 MB·English

by  Laure Claire

Platform Strategy
During the last decade, platform businesses such as Uber, Airbnb, Amazon
and eBay have been taking over the world. In almost every sector, traditional
businesses are under attack from digital disrupters that are effectively harnes -
sing the power of communities. But what exactly is a platform business and
why is it different?
In Platform Strategy, Laure Claire Reillier and Benoit Reillier provide a
practical guide for digital entrepreneurs and executives to understand what
platforms are, how they work and how you can build one successfully.
Using their own “rocket model” and original case studies (including Google,
Apple, Amazon), they explain how designing, igniting and scaling a plat -
form business requires learning a whole new set of management rules. Platf orm
Strategy also offers many fascinating insights into the future of platforms,
their regulation and governance, as well as how they can be combined with
other business models.
Laure Claire Reillier and Benoit Reillier are co-founders of Launchworks,
a leading advisory firm focused on helping organizations develop and scale
innovative business models.
Laure Claire Reillier has worked for a number of high-growth start-ups
and established tech firms. Before co-founding Launchworks, Laure Claire was
a senior executive at eBay Europe. She studied computer sciences and tele -
communications at Telecom SudParis (France) and holds an MBA from
the London Business School.
Benoit Reillier has been advising the management teams of platforms and
digital and technology companies for the past 20 years. He studied informa-
tion systems, management and telecommunications at Telecom Management
and economics and competition law at King’s College, London. He holds
MBAs from both Columbia University in New York City and London Business
School.

Platform Strategy
How to Unlock the Power of Communities
and Networks to Grow Your Business
Laure Claire Reillier
and Benoit Reillier
First published 2017
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
and by Routledge
711 Third Avenue, New York, NY 10017
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2017 Laure Claire Reillier and Benoit Reillier
The right of Laure Claire Reillier and Benoit Reillier to be identified as authors of
this work has been asserted by them in accordance with sections 77 and 78 of the
Copyright, Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
utilized in any form or by any electronic, mechanical, or other means, now known
or hereafter invented, including photocopying and recording, or in any information
storage or retrieval system, without permission in writing from the publishers.
Trademark notice: Product or corporate names may be trademarks or registered
trademarks, and are used only for identification and explanation without intent
to infringe.
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
A catalog record has been requested for this book
ISBN: 978-1-4724-8024-8 (hbk)
ISBN: 978-1-315-59894-9 (ebk)
Typeset in Bembo and Gill Sans
by Florence Production Ltd, Stoodleigh, Devon, UK
To the memory of Philippe Reillier

Contents
List of figures viii
List of tables x
About the authors xi
Preface xiii
Acknowledgements xvii
1 Introduction to platform businesses 1
2 The meteoric rise of platform businesses 11
3 What is a platform business? 21
4 Economic characteristics of platforms 31
5 Platforms as business models 41
6 Platform-powered ecosystems 57
7 Life stages of platforms: design 73
8 Platform ignition: proving the concept 91
9 Platform scaling: reaching critical mass 105
10 Platform maturity: defending profitable growth 121
11 Platform pricing 137
12 Trust, governance and brand 153
13 Platforms, regulation and competition 173
14 Competing against platforms 193
15 The future of platforms 205
A word from the authors 216
Index 217
Figures
1.1 Airbnb global listing growth 2
2.1 Digital transformation from linear to non-linear 12
2.2 Platform-powered businesses in top 10 FT Global 500 (market cap) 13
2.3 Platform companies by region 14
2.4 The top 10 most valuable brands in the world 15
2.5 Private value of platform-powered unicorn start-ups 16
4.1 Network effects 34
5.1 The linear firm 42
5.2 Michael Porter’s value chain (1985) 43
5.3 The business model canvas 44
5.4 The rocket model 46
6.1 Amazon’s main business lines 59
6.2 Relative growth of Amazon retail vs Amazon marketplace 60
6.3 Apple’s main business lines 64
6.4 Split of Apple’s hardware vs services revenues 65
6.5 Apple App Store billings vs Hollywood US box office revenues 66
6.6 Google’s main business lines 68
7.1 The main life stages of a platform 74
7.2 Pre-launch rocket questions 77
7.3 Direct vs indirect platforms 81
8.1 Ignition rocket questions to achieve platform fit 92
9.1 Scaling-up the rocket to reach critical mass 106
9.2 User and producer acquisition sources 109
10.1 Defending platform position and growing profitably 122
10.2 Assessing platform changes on users and producers 129
12.1 Trust survey 154
12.2 The trust bank 155
12.3 The 7Cs of trust 157
12.4 BlaBlaCar driver profile 158
Figures ix
12.5 eBay star system 160
13.1 NYC taxi medallion prices (2004–2015) 179
13.2 Google’s proposed search page during negotiations 184
13.3 Uber banner appearing in Google Maps mobile searches 185
14.1 Denial 195