Digital Platforms and Two Sided Markets – MIT Masterclass with Dr. Bruce Cameron

Onsite at MIT Boston as part of the Chief Product Officer Program.

Most Markets are single sided.

An eye-opening class that explored the value that can be derived from creating or opening up your platform to a second side to allow multiple revenue opportunities. The classic example is TV or Newspapers. Where there are 2-sides that are providing revenue: the consumer or watcher that is paying for the service to watch TV or to read newspapers AND the advertisers that are paying for the ability to be ‘on’ the platform.

Both sides are gaining value which is critical for the platform to be able to maintain a two-sided market. This concept is not only restricted to the above 2 examples but can be seen in Social Media where they have long been a single side market with marketers buying ads, this is blurred of course with the ability for individuals to also be involved in the buying of ads as the influencer and creator communities seek to grow there exposure and markets. The area that is new and opens the second side in this situation is the selling of a service to individuals in the form of verification. We have seen it on X-Twitter, and then Facebook and Instagram naturally follow. But this is a true second side where individuals are contributing to a growing revenue stream.

In the longer term, there is potential to increase the value in this second side, with the aim to drive continued growth. We saw that the initial rollout was not without issues but as with change, there is an adaption that follows. Now paying for verification is accepted and while the badge might be desired the value in terms of $$ and the influence or protection it offers is still highly debatable. But it grows and if they build the platform there is future potential.

Now if they were to continue to add to the Verification offer, by bringing additional features then no doubt some of those features can appeal to non-verified users. This is where they can grow the market and over time rebrand it away from Verification to a more acceptable and universable product.


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