A Study of More Than 250 Platforms Reveals Why Most Fail

#News(General) [ via IoTGroup ]

Headings…
A Study of More Than 250 Platforms Reveals Why Most Fail

Auto extracted Text……

Platforms have become one of the most important business models of the 21 st century.
The 209 failures allowed us to extract some general lessons about why platforms struggle.
In general, platforms fail for four reasons: (1) mispricing on one side of the market, (2) failure to develop trust with users and partners, (3) prematurely dismissing the competition, and (4) entering too late.
However, creating a successful platform business is not so easy.
The 209 failures allowed us to extract some general lessons about why platforms struggle.
The average life of the failed platforms is only 4.9 years.
We grouped the most common mistakes into four categories: (1) mispricing on one side of the market, (2) failure to develop trust with users and partners, (3) prematurely dismissing the competition, and (4) entering too late.
A platform often requires underwriting one side of the market to encourage the other side to participate.
Firms may have to throw commonsense pricing out the window when two or more platforms are racing to create a network effect.
A common misconception about platforms is that once the market tips in your favor, you will be the long-run winner.
Perhaps the most classic platform mistake is mistiming the market.
Entering the business five years after Apple, and three years after Google, meant that Microsoft missed the platform window and never recovered.
First, since many things can go wrong in a platform market, managers and entrepreneurs need to make concerted efforts to learn from failures.
Uber’s great insight (and Sidecar’s great failure) was recognizing the power of network effects to drive volume by dramatically lowering prices and costs on both sides of the market.
While Uber is still struggling to make the economics work (and it may yet fail as a business), Google, Facebook, eBay, Amazon, Alibaba, Tencent, and many other platforms started by aggressively subsidizing at least one side of the market and made the transition to high profits

Read More..
AutoTextExtraction by Working BoT using SmartNews 1.0299999999 Build 26 Aug 2019