Marketing & network effects in the new-age era of digital platforms

Abstract

A platform business is an enterprise that creates an ecosystem of suppliers and buyers to facilitate transactions between them via its platform. Platform business models leverage technology to connect demand and supply and create value on both sides. Examples of platform businesses include Uber (for ride-hailing), Flipkart (for e-commerce), Airbnb (for short-term rentals), and MakeMyTrip (for travel aggregation). Platform businesses usually earn revenue by charging a % commission of each transaction that occurs on their platform. The key to scalability and success in a platform business is to generate network effects, where the value of the platform multiplies as more users join and engage with each other.