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Multi-sided platforms - how to attain critical mass?

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dc.contributor Aalto University en
dc.contributor Aalto-yliopisto fi
dc.contributor.advisor Stryjan, Miri
dc.contributor.advisor Knoepfle, Jan
dc.contributor.author Palomäki, Akseli
dc.date.accessioned 2021-01-17T17:03:22Z
dc.date.available 2021-01-17T17:03:22Z
dc.date.issued 2020
dc.identifier.uri https://aaltodoc.aalto.fi/handle/123456789/101960
dc.description.abstract Businesses in various industries create value by connecting users in distinct customer groups through a platform, where the value for users stems at least partly from cross-group network effects. Multi-sided platforms may be able to grow rapidly, but only after attaining a critical mass of users that make the platform attractive for more users. In this literature review, I explain the distinctive characteristics of multi-sided platforms, examine what makes reaching critical mass an easy or difficult task, and demonstrate strategy options that platform startups can use to attain a critical mass of users. I present two models by Rochet and Tirole (2003) and Armstrong (2006) to illustrate what separates two-sided platforms from traditional one-sided businesses and to show why platform pricing tends to favor one group and harm the other. I use another theoretical framework by Evans and Schmalensee (2010) to address the critical mass problem of a two-sided platform, showing that the challenge may be easy or difficult depending on customer tastes and behavior, and pricing options. I present multiple concrete launch strategies suggested in earlier literature and discuss them in light of the theoretical findings. en
dc.format.extent 28
dc.format.mimetype application/pdf en
dc.language.iso en en
dc.title Multi-sided platforms - how to attain critical mass? en
dc.type G1 Kandidaatintyö fi
dc.contributor.school Kauppakorkeakoulu fi
dc.contributor.school School of Business en
dc.contributor.department Taloustieteen laitos fi
dc.subject.keyword multi-sided platforms en
dc.subject.keyword two-sided platforms en
dc.subject.keyword two-sided markets en
dc.subject.keyword network effects en
dc.subject.keyword platform economics en
dc.subject.keyword launch strategy en
dc.subject.keyword critical mass en
dc.subject.keyword cross-group network effects en
dc.identifier.urn URN:NBN:fi:aalto-202101171270
dc.type.ontasot Bachelor's thesis en
dc.type.ontasot Kandidaatintyö fi
dc.programme Taloustiede en

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