Mikko Hänninen and Anssi Smedlund
We illustrate how multi-sided retail marketplaces enabled by a digital platform, engage suppliers, creating new rules of retail altogether. Specifically, we describe how these…
Abstract
Purpose
We illustrate how multi-sided retail marketplaces enabled by a digital platform, engage suppliers, creating new rules of retail altogether. Specifically, we describe how these marketplaces create relational value for their suppliers, as through marketplaces like Amazon.com, suppliers are fully integrated members of the value-exchange relationship with the platform’s end-customers.
Design/methodology/approach
This paper is the result of a study of three leading marketplaces. We compared the marketplaces to understand the impact of the platform economy on the retail industry, including on the governance mechanisms and earnings logic. We identified supplier management as a key theme in our analysis, as on marketplaces such as Amazon.com, the management of supplier relationships differs from more traditional forms of retail, as in platforms, supplier quality reflects strongly on the reputation and reliability of the marketplace.
Findings
Our findings show that in addition to well-known customer engagement processes, the marketplaces also have supplier engagement processes in-place. Through engagement processes, marketplaces are able to lock-in suppliers, thus increasing the total value of the marketplace. For suppliers, marketplaces create relational value, in an industry where competition has traditionally centered on price, selection and location.
Originality/value
Thus far, studies have shown that companies differentiate through customer engagement. This paper looks at the same phenomena from the supplier side. We contribute to the understanding of complementor management in the platform economy. Based on our study, we expect that the novel concept of supplier engagement will transform how retailers interact with suppliers.
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Mikko Hänninen, Anssi Smedlund and Lasse Mitronen
Digitalization has transformed several industries during the past two decades. In this paper the authors focus on the retail sector, where new business models help retailers and…
Abstract
Purpose
Digitalization has transformed several industries during the past two decades. In this paper the authors focus on the retail sector, where new business models help retailers and suppliers meet the ever changing and demanding needs of retail shoppers. One example of this business model innovation is multi-sided digital platforms, which have become popular as they connect consumers with suppliers from around the world with a large ecosystem to support the retail platform. The purpose of this paper is to provide an overview of how multi-sided digital platforms are transforming the retail exchange logic and assess the implications and impact of these platform-based businesses on the retail sector, especially for business managers and consumers.
Design/methodology/approach
In this paper, the authors employ literature review, conceptual analysis and qualitative case study methodology. The authors provide an overview of how the platform economy is affecting the retail sector through the illustration of four digital multi-sided platforms: Alibaba Group, Amazon.com, eBay and Rakuten Group, and what differentiates them from incumbent business models in retailing.
Findings
The findings suggest that platforms transform the transaction logic of retailing as they simply intermediate transactions between buyers and suppliers rather than handling the entire supply and logistics chain themselves. The authors highlight the role of consumer understanding and Big Data as one example of how multi-sided digital platforms differentiate from their non-platform competitors.
Practical implications
The paper highlights how incumbent retailers can compete against new forms of business, such as digital platforms, and the authors demonstrate some of the managerial capabilities needed to remain relevant amidst this new digital competition.
Originality/value
Very little empirical studies in marketing and retail literature have focused on multi-sided digital platforms and their business models. The present study fills this gap with an overview of how multi-sided digital platforms transform the retail sector.
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This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.
Abstract
Purpose
This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies.
Design/methodology/approach
This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.
Findings
Multi-sided platforms, such as those used by Amazon and Alibaba, have dramatically reshaped the retail industry. Old giants, like Walmart, are struggling to keep up with the innovation and customer retention that these new retail giants can command, meaning managers need to update their approach to retail sales.
Originality/value
The briefing saves busy executives, strategists and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.
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Pekka Leviäkangas, Raine Hautala, Virpi Britschgi and Risto Öörni
The aim of this research was to evaluate the new procurement practices of information and communication technology (ICT) services in Finnish-speaking schools in the City of…
Abstract
The aim of this research was to evaluate the new procurement practices of information and communication technology (ICT) services in Finnish-speaking schools in the City of Kauniainen. In the new model, schools define their needs and school administration mandates the procurement through tendering. The research included a review of the problems associated with procurement practices and the assessment of the procurement model. The results show that service levels have been improved and unit costs as well as the environmental load have been reduced. The new model requires the schools to have the skills and expertise to define their needs and the competencies to prepare and execute the procurement process. The case analysis of the Finnish “Dream School” in Kauniainen shows that administrative and governance aspects are equally important in successful deployment of technology.