Here are some of the key principles from Geoff Parker:

1. Organizations that adopt the platform model are those types of companies scale a lot faster. Traditional firms with relatively stable supply-chain do not pivot as quickly as a platform company could. When they have their supply or demand side disrupted, it is more difficult to navigate where to start addressing the problems. Platforms enable working with a broader set of ecosystem partners on both the supply and demand side. The digital platform provides a better overview of solution pathways.

“The important idea is that a lot of the value add starts to take place outside the four walls of the platform sponsor firm, and it’s really being executed by an ecosystem partner in a much more kind of decentralized way.” – Geoff Parker

2. There are numerous reasons for the high failure rate of digital transformation and platformization of companies. The metrics typically used to evaluate digital transformation initiatives in non-platform businesses are derived from standard linear models and practices that historically do not have a high success rate. Before these initiatives reach the scale or growth they need to succeed, the traditional metrics and initiatives shut down. It is difficult for these initiatives to succeed within big companies because “anti-bodies” exist that stamp out digital transformation initiatives. Communicating the importance of this transformation to the organization helps align initiatives.

“It’s a big management challenge for leadership to explain organization-wide why this makes sense-why cannibalizing our a revenue stream is within everyone’s best interest.” – Geoff Parker

3. The inverted firm is achieved by shifting the production from inside the company to its ecosystem partners. Network effects cannot occur internally and within standalone companies, but it becomes easier if companies look within their business frame in the ecosystem. If companies start organizing towards shared value, then the deep-rooted system could be addressed while benefiting multiple players. An open system allows for more opportunities and orchestration to innovate and solve problems.

“In order to do the inverted firm model, there are a lot of assumptions. And a lot of that is going to be this end-to-end digital kind of visibility. That assumes a common data model that assumes we have sort of worked horizontally across the enterprise, and then we’re able to plug in at different points. A lot of times it just doesn’t work that way.” – Geoff Parker

There is a lot to gain from Platform Strategies:

• Platforms allow for accelerated response: Platforms can detect new consumer patterns and immediately sync to automate, inform, and dictate the supply and demand shifts. The responsiveness of platforms allows businesses to innovate and adapt quickly and with ease.
• Investing in digitalization is investing in visibility: Complete visibility from end to end allows the firms to connect with different players through intersection points in varying application services and interfaces. Network effects take place accordingly. As the number of users increases, the value of the overall system to the individual users also increases.
• Understand the benefits of inverted firms: Companies must look across all operations to find opportunities for other players to build from and to layer digital value. The ecosystem partners consequently scale, execute, and develop the added value that provides facile advantages to your company

Conclusion

Companies that leverage platform thinking and ecosystem partners are more resilient and adaptable in this economy because they are used in scalable business models. It is not that the Porter’s 5 forces model is incorrect, it is just incomplete. Strategy today is not just about finding out where to play and how to win. Making an impact with agility and leveraging the shared interests of your ecosystem bolsters dominating the field. 

Watch the full event here:

• 7:58 – Communicating Digital Transformation to your company 
• 10:10 – Willingness of manufacturing companies to rapidly experiment and change their business models 
• 12:22 – The Inverted Firm 
• 15:06 – Food truck platform example 
• 17:19 – Traditional vs Platform Strategy 
• 18:39 – Network effects 
• 25:35 – Digital visibility 
• 27:41 – Enabling infrastructure 
• 33:55 – Copycats in network effects 
• 38:36 – Advantages of omni-channels 
• 42:16 – First step for inverted firms 

This segment was part of The Interaction Field Series of our LinkedIn Live Events. Please connect with us on our LinkedIn page to stay updated with our upcoming conversations.

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A look back at our

Change is the only constant in business today. The rise of platforms, changing consumer expectations, and companies with almost no tangible assets are dominating the business landscape.  In the world of connectivity, it’s about collaboration, interaction, participation, and connection.   

Our CEO and Founder Dr. Erich Joachimsthaler recently released his new book, The Interaction Field: The Revolutionary New Way to Create Shared Value for Businesses, Customers and Society.  The book presents a new business model and operating model for the future – one that creates shared value for all. Companies that embrace this new model – called interaction field companies – generate, facilitate, and benefit from interactions and data exchanges among multiple people and groups–from customers and stakeholders, but also from those you wouldn’t expect to be in the mix, like suppliers, software developers, regulators, and even competitors. And everyone in the field works together to solve big, industry-wide, or complex and unpredictable societal problems. 

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Click here to watch the full LinkedIn Live event and below find key highlights of the discussions: 

Why Esports matter from the following three perspectives: 

• Personal Perspective: 50% of kids today are playing competitive video games. As Tom Ajello discussed from his perspective as a parent, kids rely on these games to connect and chat with their friends. Video games provide a platform for kids to participate and learn social behavior.  
• Demographic Perspective: Esports as a demographic is an incremental consumer. Many of its users are people that don’t activate or monetize in other types of channels because more of these games are looking more like social networks and platforms. 
• Brand Perspective: Esports companies are purely digital brands building for the next generation of digital consumers. They are highly innovative and build clever and nuanced approaches for customer acquisition and retention that any business can learn and benefit from.  

Common Misconceptions of Esports 

It’s a larger business than people think. Esports is a $27 billion-dollar industry that continues to scale, attract and retain new participants.  

Competitive gaming looks more like professional sports than it does kids sitting in a basement. They require casting, analysts, coaching, and production and for players at high levels, demand an extraordinary amount of skill. There are also massive tournaments that draw in hundreds of millions of users – some of the top Esports events will get more viewers than the Superbowl.  

Esports Effectively Engage with Fringe Consumers 

There exists many strategies to manage consumers who already have high affinity and loyalty to the brand. The challenge that Esports has solved is with engaging the people at the fringes, those who are not yet directly involved in Esports. The key is – while conventional brands are built through communications and messaging, modern brands are built through interactions. From becoming a social platform to hosting live concerts and events, the Esports industry has mastered the creation of value through interactions.  

GoPro’s Adoption of Esports Brand Strategy 

GoPro applied Esports principles to connect and engage with its audience as its entire business model is about discovering content and sharing it with others. The value of GoPro is not in the camera itself but in the community, GoPro has built around its product. Just as Esports companies make it easy and effective to share gaming moments with others, GoPro makes it easy and convenient to share action and adventure videos made by its users.    

Implications for the future of advertising within Esports 

The traditional sense of control that marketers have elsewhere is lost in the world of Esports. This is because so much of Esports is about long unfiltered messaging that occurs on livestreams for 4 or 5 hours, as opposed to the conventional 30 second ad spot. The combination of everything being interactive, the prevalence of social media, and content as unfiltered viewer messaging makes loss of marketing control inevitable.  

As William Collis said, “You really lose control of the message as soon as it leaves your mouth. And so, you need a different set of tools and activations for a more modern approach to brand building.” 

 The Esports industry is too big of an opportunity to ignore – click here to watch the full event. 

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Their advice was to be helpful and supportive to consumers BUT also add some distraction and levity and to create community and positivity. This week Kantar launched their COVID Barometer showing a clear majority of consumers expect advertising to make a positive contribution to society: ‘Talk about how the brand is helpful in the new everyday life’ (77%) ‘Inform about their efforts to face the situation’ (75%) and ‘Offer a reassuring tone’ (70%). Conversely 75% said brands ‘Should not exploit the coronavirus situation to promote the brand’ while 40% said they ‘Should avoid humorous tones’.

If brands are to follow this direction then they need to walk a fine line between turning off all communications and being cognisant of the situation, this means thinking carefully, definitely not bandwagon’ing, being sensitive and most of all being consistent with their current brand image and not ‘purpose washing’. So, it is great to see so many brands stepping up and not pausing their contact with the World but rather showing they care, and that they can help. We thought it would be useful to share some of the work and organise the list:

1) Supporting the effort

There is a hugely long list of brands that are donating money, supplies and resources to helping all areas of our lives in the fight against the virus, rather than list all of these extremely valuable efforts here are a few companies that thinking innovatively and in some cases quite differently:

 – Many different alcohol firms pledged to focus on creating sanitiser including Diageo who pledged to make more than 8m bottles for frontline health workers across the World on a more localised scale in the UK Brewdog joined the initiative and in the US Atlanta Based Old Fourth Distillery all helped out. It wasn’t just alcohol brands LVMH were in early using Dior Soap bottles to distribute the sanitiser.

– H&M who had shut shops across the World said it would use its vast supply network to source personal protective equipment including masks, gloves and gowns for hospitals in the European Union to help curb the spread of the coronavirus. 

– Pret has also extended its support for hard-pressed NHS workers, offering them hot drinks for free and implementing a 50% discount on all other products. CEO Pano Christou announced the move in his blog, where he thanked NHS workers for all their hard work. The message rapidly gained public support.

– Ford has joined forces with 3M and GE Healthcare to design and make air-purifying respirators that can leverage existing parts from all three companies. For instance, parts could include fans used in the F-150 pickup truck and 3M’s air filters. Recent report also show that Dyson are almost ready to go with their ‘Co-Vent’ product to help patients with breathing difficulties.

2) Creating digital connections

With gatherings restricted in just about every major city in the world, it’s safe to say that any conference, event, meeting, and other in-person gatherings are going to be postponed indeed all face to face is now off the table. As such companies are looking for how to recreate the in-person experience and drop barriers that online previously created for personal connections, many are doing some sterling work including:

– 14 of the World’s best museums from MoMA to the Musee D’Orsay along with b2,500 other spaces from around the World are offering digital content, virtual walk throughs, livestream talks and curated collections thanks to the extensive Google Arts and Culture project  

 – Paywalls are falling at institutions including The Atlantic, WSJ, New York Times and Washington Post – interestingly a lot of European media outlets have not followed suit but many magazines have including Vanity fair and New York magazine.

– America’s oldest film studio is using the coronavirus pandemic as an opportunity to experiment with what many believe is the inevitable future of film distribution. Universal Pictures will release its current theatrical movies online, including The Invisible Man, The Hunt and Emma. Other distributors and producers have followed suit with many other films available on Amazon, iTunes and other stores.

– Plenty of homebound pop stars have performed virtual concerts during the coronavirus outbreak and recently Bud Light got in on the act sponsoring its first “Bud Light Dive Bar Tour: Home Edition,” featuring country music star Jake Owen. The show, which Owen performed from his house, for a free show but it did feature a cross-promotion with alcohol delivery service Drizly, which gave people $5 off their orders with the promo code “BUDLIGHT.

3) Levity and invention

Despite the challenges of sensitivity and purpose the creativity of brands and agencies hasn’t been diminished over the last few weeks. At first many brands have had to pause (and potentially forever mothball) ill timed and off message campaigns including KFC UK with their ‘Finger Lickin’ Ads and Geico with their “Perfect High Five” Geico spot. Clearly it is no longer business as usual but that said there is also a time for some levity and creativity including:

– Due to most restaurants and bars in big cities temporarily closing or suffering from the effects of social distancing, Time Out magazine has rebranded itself as Time In. bringing you the best of London whilst you are still at home.

– The ever inventive Brewdog have not only switched all their UK Bars to click & collect via our Hop Drop app, they have now gone even further opening what they bill as their biggest and most important bar – The Brewdog Online Bar – this Friday 27th March you are all invited for live beer tastings with their co-founders James and Martin and other beer experts, homebrew masterclasses, virtual pub quizzes, Q&As with BrewDog crewmembers, live music and comedy and giveaways and exclusive merchandise.

– MTV is one of Viacom’s many entertainment brands to partake in its #AloneTogether campaign. The aim is to encourage people to stay at home with the promise that MTV and other channels will be there to keep them company. Promising live artist and celebrity takeovers, positive news bulletins, and continued social engagement with users they want to evoke the sense that we’re all in it together.

– With restaurants closed Chipotle are trying to make the isolation bearable by offering the chance to virtually hang out together with its ‘Chipotle Together’: a series of zoom hangouts featuring celebrity hosts and attended by up to 3,000 guests. So far, celebrity hosts have included stars of the US series, The Bachelor, and featured live music from rock band Portugal The Man.

4) Education and protection advice and help / empathy

One of the first reactions to the outbreak was made by Clorox who, on January 24, around the time the coronavirus outbreak was making headlines worldwide, added a landing page to its site specifically discussing 2019-nCoV. The page provides basic information about the virus and suggested practices that can help stop its spread.

With the stress and anxiety people are feeling over coronavirus, Snapchat is expediting its “Here For You” feature providing users resources when they search for topics related to mental health, such as anxiety, depression, stress, suicidal thoughts and grief. The resources are provided by health partners including: Active Minds, Because of You, Crisis Text Line and Seize the Awkward in the US and Young Minds, The Samaritans and Diana Award in the UK.

Exercise is clearly key when you are stuck indoors and a number of celebrities and companies have been helping get the World jumping – after Joe Wicks managed to get nearly 1m parents and kids heartbeats to rise this week, Popsugar released its new subscription fitness app early to get people exercising amid the outbreak. While Active by Popsugar will normally be a paid app, the company is offering the platform free for the foreseeable future. The app features over 500 fitness classes from celebrity trainers and other experts in yoga, strength, cardio and pilates.

As the coronavirus spreads and the economy sinks, brands will be hard-pressed to stir demand for big-ticket items, like cars. Hyundai and sibling brand Genesis are trying to spur purchases by relaunching a recession-era program called Assurance Job Loss Protection. The brands promise to make up to six months of payments for drivers who lose their jobs and have purchased or leased their vehicle between March 14 to April 30, 2020.

On Tuesday this week a social-media campaign was launched to encourage people to order takeout on Tuesday in support of workers. The Great American Takeout is asking people to order in on Tuesday and encourage friends and family to do the same, via their social accounts, and then to post pictures of their takeout meals. 

Promoted on the social accounts of various regional and national chains, including Panera Bread, Noodles & Company, The Habit and Torchy’s Tacos, it also gained the support of Visa and PepsiCo on Monday. 

Finally lots of brands have been using innovative and creative ways to get people to respect social distancing. Coca Cola used its iconic Times Square billboard showing Coke’s name with extended spaces between letters, McDonald’s controversially separated the Golden Arches and following suit the Latin American e-commerce company Mercado Libre has changed its logo to reinforce the importance of social distancing swapping its classic logo of two clasped hands to two elbows touching. 

I am sure we will see many more brands stepping up to the plate and getting it right (and sometimes wrong) but what is clear is that this is not necessarily a time to stop communicating. Instead brands should be looking to rework their marketing and consider shifting to follow new media consumption patterns including daytime television watching, more time online, and more time on ecommerce whilst of course not forgetting to use the time to continue thinking about long-term brand building.

We will be updating you periodically !

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COVID-19 has affected our everyday lives and our work lives in ways we were all largely unprepared for, and this pandemic will likely continue to do so for some time. Like most other businesses responding and bracing themselves for what is still to come, at Vivaldi we have begun rethinking and stretching our ways of working – which are heavily composed of personal, engaging workshop formats, strategic discussions at board tables, and creative share outs in our offices. While these ways of working fuel and inspire us, given the current climate, they need to change. While we are not able to meet clients and colleagues in person, our strategic rigor and our commitment remain the same.  

Most recently, thanks to the advanced technologies we have access to, we transformed our typical workshop format – which had been weeks in the making – into a virtual session. Sixteen participants from 5 different European countries appeared on all participants’ computer screens, controlling their own cursors and engaging in interactive moments. In a working document, they simultaneously answered questions and filled in digital sticky notes, pinning them on the templates we pre-prepared. It worked. We accomplished what we set out to do and our client was happy – the best result you can get in the services industry. We increased outcomes and efficiency with everyone safe, healthy, and doing their part to limit the spread of COVID-19.

We are not alone in our need to rethink our engagement with clients. This affects any and all businesses engaging with clients, customers, or consumers, be it B2B, B2C, or D2C.

The way in which we directly engage with customers is not the only interaction that is affected, the entire customer journey is, too. The way we get customers’ attention, earn a role in their lives, and continuously fight for and win their loyalty by generating value – all of this must be re-evaluated with a digital lens in this new reality. We must ask ourselves, given the circumstances we’re facing, has any part of our customer journey been compromised, and if so, do we have a digital strategy or digital touchpoints in place to account for this?

It’s important to note that COVID-19 is not solely responsible for the growing relevance and significance of digital customer journeys and engagement – the need for such a strategy has been here long before the recent COVID-19 situation. Gen Y, the deciders, managers, clients and customers of today and the future, are already actively looking for information and engagement with businesses in the digital world. More than 60% of the B2B purchase decisions are made before a company even has the chance of engaging personally with the buyer. The issue here? Many companies have not been addressing this change in customer behavior in recent years, leaving them unprepared for the new generation – and even less so for this new COVID-19 world.  

This dramatic change in consumer behavior is not a temporary state-of-mind, but rather a holistic shift businesses need to be equipped to handle. Perhaps we should look at this time as a starting point, urging us all to rethink our relationships with clients and consumers – particularly the way we collaborate, engage, and support one another to better prepare for what is happening around us, now and into the future. Together, we can develop solutions to support growth with even stronger brand experiences and brand engagement along the digital customer journey.

Lessons to take from these last few weeks: 

• Be open-minded, willing, and ready to turn unexpected events into new solutions for you, your team, and your clients to better connect. For example, Microsoft now offers its unified communication and collaboration platform, Teams, for free to new users and, in Germany, new platforms are emerging for community support. Even if these ultimately do not become profit boosters, these actions will certainly influence the brand awareness of these companies as a positive force during this time of uncertainty.
• Be digital & agile – rethink the way you communicate and engage with your current and future customers, be it in emails, or via video call, platforms, new landing pages, chat bots, etc. In addition, reconsider your communications strategy – move away from distributing high-level comms to providing focused messages to target customer groups. 
• Identify the new ways your customers need your support – are your goods and deliveries from foreign countries being delayed due to COVID-19? Engage in active communications with your customers. Go into joint product development or pain point assessment. Invest your resources in market research, take a closer look at your target groups, and assess their needs and demands. 

In light of these recent events, we will continue to provide content on how your business can stay the course. We’d like to stay in touch with you – follow us on Instagram or LinkedIn, and feel free to continue the discussion via email.

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At Vivaldi, we guide, support and enable clients transitioning to a platform business. Our team of strategists, designers, and marketers work cross-functionally to provide a personalized experience and output that not only ideates but actualizes a digital platform strategy. Building a platform business is more than bringing an idea to life. Rather, it is rooted in a fundamental understanding of consumer behaviors and how to disrupt the cycle in creating a seamless experience.

What does a digital platform strategy look like? 

We’re driven to push the thinking, develop insights, and ideate on how your business can deeply impact the end customer and disrupt the industry by creating value through interactions. Below we share the 5 fundamental steps we take along with the imperative questions to ask at each step:

1. Dig Deep
   • What’s been done and what hasn’t? Let’s dig in and immerse ourselves into everything customer from what drives behavior to decision making to sharing. Intellectually inspired — deep insights are just the start to a digital platform strategy.
2. Understand to Inspire
   • With a focus on being playful and strategic —using Unconventional Wisdom we’ll collaborate as one team. We’ll document journeys, we’ll identify jobs to be done and opportunities for growth.
3. Focus In
   • The way we go-to-market matters as much as what goes to market. Do we set the bar high and let it fly? Do we go-live at ground-level? Here is where we identify and structure a launch with impact in mind.
4. Actualize
   • After a rigorous assessment of what it takes to inspire — we start to bring our thinking to life, together, and with influential feedback woven in. What does it look like?  How does it feel? Where does it live?
5. Execute
   • From packaging to experience—based on our new product vision our creative and digital studio will partner with you to take our secret to market.

How can my business start to make strategic shifts? 

Vivaldi offers workshops that packages our expertise to guide leadership teams through the step by step approach: from better understanding participants within your ecosystem to defining your platform strategy and formulating a roadmap for implementation. Learn more about our Platform Strategy Workshop, or contact us directly to discuss your brand’s opportunity in the platform economy.

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We are in the midst of a monumental shift in behavior due to our world of Digital Darwinism. We now live in a platform economy, which allows for new ways of creating value for customers. Brand names alone are no longer enough to establish a relationship and to command continued loyalty from customers. Platforms facilitate connections and collaboration among participants, and value is created through these interactions.

In working with our clients from long-term engagements to 2-day platform strategy workshops, we have identified the following four perspectives on the platform economy that enrich our definition:

First, platforms offer new ways of matching supply and demand. By doing so, it allows businesses to serve new demand by accessing the long tail. Think about the #1 music streaming platform, Spotify. They can make use of the long tail by hosting rather unknown bands for a small set of customers. This, however, adds up to a big portion of revenue due to high customer margins. At the same time, niche artists benefit by getting access to the massive user network and earning their first fees.

Second, platforms are increasingly viable due to the ease and efficiency of coordinating between entities. OpenTable is a great example of this. The convenience in using OpenTable lies in their ability to quickly connect users with restaurants.

Third, the success of platforms makes it apparent that they grow exponentially through network effects. Uber’s business model creates two-sided network effects: more drivers mean more geographic coverage, and the more the geographic coverage, the lesser the driver downtime, and hence lower prices for customers. This in turn leads to more demand, initiating the cycle again, and mutually reinforcing a spiral of value for all participants.

Lastly, platforms bring a new form of value creation, where the platform creates value for the broader ecosystem, not just for the platform owner. John Deere created an open data platform that allows the integration of third-party services. This creates an intelligent farming ecosystem where farmers have access to an increasing number of services that digitize more and more aspects of agriculture, ultimately allowing all participants to contribute to improving the yield of farmland.

If you’re finding your current business model to be insufficient or ineffective for addressing the challenges facing your business, now’s the time to explore how platform thinking can help better answer your customers’ needs, focus your transformation efforts and deliver new revenue streams. Get in touch to learn of how Vivaldi’s helps clients form and implement a platform strategy.

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Our CEO Erich Joachimsthaler spoke with Retail Dive in December 2018 to discuss the long-term potential of Farfetch’s acquisition of Stadium Goods. Read the full article here.

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