Everyone is clamoring to be a platform, the basis on which every other thing is built – a dash for service immortality and survival from the fickle consumer mind for which loyalty is a subjective and many times nonexistent. Google and Facebook have built themselves into one, as has Mpesa and many other online and mobile properties that have become or are fast becoming daily destinations in our lives.
Platforms do not just happen, and whether by business evolution or smart strategy the foundation lies in creating marketplaces that are sustainable. A market place is where exchange of value happens, and it becomes sustainable only when all of the participants derive sufficient value to keep then re-engaging and when there is critical mass to compound the inherent value.
Beyond this foundation are two other building blocks that feed markets; the first is trust. Offline, we are already used to this model of engagement whether it’s taking goods on credit at the kiosk or engaging a plumber referral. Online, used broadly to cover even mobile interactions, we find the same traits in the platforms that are getting entrenched. Mpesa for example, had the backings of a “trusted” brand courtesy of a daily interaction with millions who felt sufficiently secure to latch on.
The second building block is that of a balanced critical mass that draws from network effects to make the marketplace more valuable. With an increase in unique transactional volume – transaction used in reference to the attainment of users motivation, and a high fulfillment rate, a marketplace is on the path to longevity. Balanced mass is important because having to many producers or consumers will result in value attrition.
In Africa where the use of digital platforms is small but growing compared with other regions, it takes juggernauts with deep pockets to create both demand and trust. However, governments can seed markets by driving a mental shift and reducing the barriers to adoption of technology by delivering services pain free to the citizens using these tools. This will fast track adoption of other platforms that are complimentary and co-dependent in the larger scheme of things.
So, if you are thinking of starting out or are thinking about how to remain relevant in what can be a very competitive space, build trust and drive critical mass; and where the demand is not apparent go ahead and create it. At the end of the day, platforms benefit from the wisdom of the crowds, able to create additional value through innovation that one company or person can never fully cover. That reinvention underpins immortality.