The power of platforms: transforming businesses through digital marketplaces and enhanced customer experience

By Annie Turner, Independent Content Consultant

The platform-based business model is the most successful yet at bringing unlimited numbers of parties together who want to interact and transact. Platform pioneers such as Amazon, Apple, Google, Meta (formerly Facebook), Netflix, TikTok, Twitter and Uber and are among the world’s best known, largest and most profitable companies. The great thing is that platform models can be adopted by any ordinary company, of any size, in any sector, without big upfront outlay, especially if firms work with an experienced partner to digitalize.

A team of academics wanted to understand just how much difference adopting platform-based operational and business models can make. Personnel from Harvard Business School, Massachusetts Institute of Technology (MIT) Sloan School of Management and the University of Surry identified and analysed the 43 biggest, publicly listed platform companies in 2019.

The team found they had almost double the operating profits, growth rates and market capitalisation of the top 100 largest concerns in the same sectors over 20 years, but with about half the staff.

Platform giants in crisis: Why customer experience is critical?

Yet some of the world’s best known and most successful platform-based companies are in trouble – and I’m not talking about the various Titanic battles with regulators and legislators on both sides of the Atlantic and elsewhere. They are serious concerns, but arguably not as potentially deadly as routinely disappointing customers and partners.

For instance, Elon Musk has certainly had a profound effect on the Twitter since assuming ownership, but many would argue not for the better with both advertisers and users complaining.

Google’s customers are advertisers, who compete for prominence in users’ search results but users are complaining about their perceived degraded experience. Elaine Moore observed in the Financial Times in January that Google search “was once one of the wonders of the online world” but now is “less encyclopaedia, more Yellow Pages”.

A recent blog in The Washington Post complains, “When you search for a product on Amazon, you may not realize that most of what you see at first is advertising,” and illustrates the claim with an eye-popping demo. Elsewhere, writer and activist Cory Doctrow’s analysis of the trajectory that leads to TikTok and other platforms to treat customers and users increasingly badly has a feeling of inevitability about it.

Outstanding customer experience and vision do not have to be sacrificed to success.

Transforming customer experience: How Riverford and other market leaders create value beyond transactions

Many digital marketplaces put immense efforts into bringing value beyond transactions to customers and partners, making people feel good about being their customers and partners. Riverford excels at this. It sells organic produce online across delivering to 50,000 customers a week. Not bad for business that began 30 years ago with its founder and CEO, Guy Singh-Watson, selling veg from a wheelbarrow.

It has three organic farms and works closely with 325 organic small-scale family farmers, which is a great way of enabling very small businesses to gain scale and reach under a single, award-winning brand without forgetting any of them forgetting their roots.

Seasalt Cornwall is owned by the Chadwick family and famous for its high quality, ethically produced, affordable clothing. It partners household names such as Next and Marks & Spencer to extend its scale and reach, while doing good, such as supporting local conservation projects and a recycling initiative that encourages customers to trade in their worn Seasalt clothes for vouchers towards their next purchase.

Naked Wines in Norwich is based on South African Rowan Gormley’s vision of selling outstanding wines to discerning customers at much lower prices than supermarkets would charge and paying the vineyards a much greater share of the profits.

All three companies have a clear vision and unwavering values. This is gold dust in business: the golden rule is first to know what you want to achieve, then figure out how. Too many companies are dazzled and distracted by tech.

Talk to Torry Harris Marketplace consultants who can guide you in transforming your digital business vision through enhanced customer experience.