In the digital age, the rules of capitalism are being rewritten. The rise of powerful online platforms, such as Apple, Meta/Facebook, and Amazon, has disrupted traditional market dynamics and shifted the balance of power.
However, the platform revolution is not limited to tech giants.
Small businesses also have the potential to create their own platforms and carve out their own spaces in the digital landscape. In this article, we will explore the concept of platform capitalism, its implications for small businesses, and how they can create their own platforms to compete with larger entities.
Platform Capitalism
In traditional capitalism, supply and demand are largely regulated by market dynamics. However, with the rise of online platforms such as Apple, Meta/Facebook, and Amazon, this balance has been disrupted. These companies have gained significant control over the market, often dictating the terms of supply and demand rather than responding to them.
Apple's Dominance
Apple, for example, has a near-monopoly on the distribution of apps through its App Store. This allows it to control the supply of apps and set terms for developers.
Meta/Facebook's Influence
Similarly, Meta/Facebook controls the vast majority of social media traffic, influencing what content is seen and shared.
Amazon's Control
Amazon, as a dominant e-commerce platform, has great influence over both product availability and pricing.
Small Business and Platforms
For a small business, these platforms can seem overwhelming. However, it is possible for a small business to create their own platform.
Unique Product/Service
By developing a unique product or service, creating a strong online presence, and leveraging digital marketing strategies, a small business can attract and retain a loyal customer base.
Platform as Ecosystem
The Next step in business strategy and development is the building of a platform. Creating an ecosystem where others can add value. For example, a small business might create an online community for customers to share experiences and advice, or it might open up its platform to third-party developers to create complementary products.
Platform as Destination
In essence, creating a platform involves turning a business into a destination, where customers come not just for the products or services the business sells, but for the entire experience the platform provides.
More than a Website
It's important to note that developing a platform isn't just about having a website or an online store.
Business-Customer Interaction
It's about creating an environment where interactions between the business, customers, and even other businesses can take place. This could involve incorporating social media elements into the platform, allowing users to leave reviews, or offering customer service directly through the platform.
Providing Value
Moreover, the platform should also provide value to its users. This might be through the products or services it offers, but it can also be through the content it provides or the community it fosters. For instance, a small business might offer informative blog posts or how-to guides related to its products, or it might host webinars or online events.
Engaging Customers
The goal is to create a space where customers want to spend time, not just a place where transactions occur. By doing so, a small business can differentiate itself from larger platforms and create a unique value proposition for its customers.
Long-Term Strategy
Finally, it's crucial for small businesses to remember that building a platform is a long-term strategy. It requires consistent effort and investment, but it can result in a loyal customer base, increased brand visibility, and a steady stream of revenue over time.
Become A Platform Opportunist
For entrepreneurs, now is the time to seize the "platform opportunity."
Utilize the power of digital transformation to build a solid foundation for your business. This allows for quick pivots in response to market changes and ensures sustainable growth in the long term. Don't just participate in the digital economy, shape it by creating your own platform. By focusing on providing value and fostering community, you can carve out your own space in the platform capitalism landscape.