JOURNAL ARTICLE

WILL THAT MARKETPLACE SUCCEED?

  • Published In: Harvard Business Review, 2024, v. 102, n. 4. P. 94 1 of 3

  • Database: Business Source Ultimate 2 of 3

  • Authored By: Hagiu, Andrei; Wright, Julian 3 of 3

Abstract

The article focuses on critical factors that determine the strength and defensibility of network effects in online marketplaces. It emphasizes that not all marketplaces achieve sustainable competitive advantages despite the appeal of network effects, highlighting key considerations such as the fragmentation and differentiation of buyers and sellers, the marketplace’s ability to add value through discovery and transaction facilitation, and whether network effects operate locally or globally. The article also discusses challenges like platform switching and multihoming, and the impact of emerging technologies such as generative AI on marketplace dynamics. These insights aim to guide entrepreneurs and investors in evaluating the long-term potential and strategic execution of marketplace ventures.

Additional Information

  • Source:Harvard Business Review. 2024/07, Vol. 102, Issue 4, p94
  • Document Type:Article
  • Subject Area:Business and Management
  • Publication Date:2024
  • ISSN:0017-8012
  • Accession Number:177779174
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