When is a product a product and when is it a platform?
- When did Amazon stop becoming a place to buy books from and when did it become a place to go and sell your goods?
- When did a phone become not just a device to make calls but a channel to contact your customers?
- When did Instagram become a place to share photos to a place to sell filters?
Each of these examples — a website, a device and an app can each be seen as platforms in their own rights. In each case a consumption product/service has become a platform / marketplace to sell your wares. This is an interesting shift and one which (potentially) any app (mobile and web) can exploit.
How to find the ‘platform potential’ of your product?
Once you have a certain number of users, looking at their typical behaviour within the app or device context or within their usage context will help reveal other products or services your users could find useful. To some extent the need of your users to use your app could also help uncover potential services.
Once you’ve uncovered such utilities or services, you could then see how to fulfill these. It is tempting to develop such services in-house. But this is where thinking of your product as a platform comes in handy. Opening up part of your app and inviting 3rd party vendors to sell their creations on it is much more interesting approach and a lucrative one too as the next point explains.
Advantages of a Platform-izing your Product:
More Money: Platform-izing will help you generate more revenue as you can charge a percentage when vendors sell on your platform. This in addition to the setup and account maintenance fees you could potentially charge (as Apple does for App registrations and Developer programme). To this extent, platform-izing your product could be a monetisation strategy.
Increased User loyalty: Platform-izing helps you keep your users happy by not just giving them what they need (your App) but also additional services/trinkets/features (3rd party stuff) they would like to use.This helps build an affinity between your users and your app and keeps them from going to competitor services. Thereby raising the barrier to entry.
