TY - JOUR
T1 - Customer entrepreneurship on digital platforms
T2 - Challenges and solutions for platform business models
AU - Park, Hyunkyu
AU - Kim, Sojung
AU - Jeong, Yujin
AU - Minshall, Tim
N1 - Publisher Copyright:
© 2020 John Wiley & Sons Ltd
PY - 2021/3
Y1 - 2021/3
N2 - Drawing on the mixed methods of qualitative research and agent-based simulation, this study examines: (a) how end-users use digital platforms to become customer–entrepreneurs undertaking commercial activities on platforms; and (b) how platform providers can convert this customer entrepreneurship into a revenue stream. Considering that end-users have traditionally been defined as passive and uncharged actors in platform business models, an in-depth understanding of their commercial activities and the viable revenue model to monetize this emerging customer practice is warranted. Our qualitative study reveals that customer–entrepreneurs make substantial use of platform offerings to advertise their products; communicate with end-consumers; and accept payments. These commercial activities are largely exercised for free on platforms, even though they could otherwise serve as a source of revenue. On this point, our simulation results identify two pricing models achieving the generation of nearly identical revenues over time. First, platform providers may charge both advertising and transaction fees, which maximize the survival of professional customer–entrepreneurs. Second, platform businesses may levy advertising fees only, which maximizes the survival of informal customer–entrepreneurs operating on a micro-scale and part-time basis. This study offers theoretical, methodological, and managerial implications for platform studies.
AB - Drawing on the mixed methods of qualitative research and agent-based simulation, this study examines: (a) how end-users use digital platforms to become customer–entrepreneurs undertaking commercial activities on platforms; and (b) how platform providers can convert this customer entrepreneurship into a revenue stream. Considering that end-users have traditionally been defined as passive and uncharged actors in platform business models, an in-depth understanding of their commercial activities and the viable revenue model to monetize this emerging customer practice is warranted. Our qualitative study reveals that customer–entrepreneurs make substantial use of platform offerings to advertise their products; communicate with end-consumers; and accept payments. These commercial activities are largely exercised for free on platforms, even though they could otherwise serve as a source of revenue. On this point, our simulation results identify two pricing models achieving the generation of nearly identical revenues over time. First, platform providers may charge both advertising and transaction fees, which maximize the survival of professional customer–entrepreneurs. Second, platform businesses may levy advertising fees only, which maximizes the survival of informal customer–entrepreneurs operating on a micro-scale and part-time basis. This study offers theoretical, methodological, and managerial implications for platform studies.
KW - agent-based simulation
KW - business model
KW - customer entrepreneurship
KW - digital entrepreneurship
KW - digital platform
UR - http://www.scopus.com/inward/record.url?scp=85089293597&partnerID=8YFLogxK
U2 - 10.1111/caim.12404
DO - 10.1111/caim.12404
M3 - Article
AN - SCOPUS:85089293597
SN - 0963-1690
VL - 30
SP - 96
EP - 115
JO - Creativity and Innovation Management
JF - Creativity and Innovation Management
IS - 1
ER -