Apple (with iOS) and Google (with Android) have been both successful in the smartphone market because they invested huge resources fostering a robust platform/ecosystem of partners and developers built on symbiotic relationships.
It’s this robust platform/ecosystem that is so attractive to Consumers, because it fuels the following virtuous-cycle:
1) more partners/developers create more functionalities that make the platform/ecosystem more attractive to final-users
2) more final-users attract more partners/developers
3) go to 1)
Starting is difficult
To kick-start, maintain and hopefully accelerate this virtuous-cycle, the platform/ecosystem builder must work very hard so that the APIs exposed by the platform make life easier for partners/developers. The platform APIs make all the difference: are they valuable, effective, efficient, performing, easy to learn and to employ? Do they allow partners/developers to quickly build valuable, elegant, etc., etc. applications – in less time – that can be easily monetized?
Better platform APIs are also a significant competing factor: the better the APIs, the harder is for partners/developers to move their applications to some other rival platform.
Moreover, partners/developers do their best to market their applications, but at the same time they indirectly market the platform their applications are built on – and that’s a (virtually free) big push for the platform.
By the way, does the platform offer application-monetizing services to partners/developers? (an Application-store, for instance).
Other valuable services? (for example, “application vetting”, to guarantee that apps work reliably and are fully compliant with the platform/ecosystem rules).
Recap: you will be successful if you create a platform/ecosystem that allows all of its members to thrive economically, that is flexible and adaptable to change (future-proof), that is easy to work with (be productive in a couple of weeks) and that is selective (to eliminate bad apples).
Is this paradigm suitable for Retail solutions too?
The answer is: 100% yes!
Specifically, in Retail personalization/customization is critical: having APIs that allow to add and modify functionalities swiftly (less time means more money, less investment and a quicker time-to-market) makes a really big difference.
Incumbent, traditional, not-platform-based Retail software companies may struggle to respond to a product platform/ecosystem; the incumbent’s standardized application may not be able to compete with the more innovative and more targeted solutions being quickly built by the platform community of partners/developers.
How does the platform builder make money?
Building, maintaining and evolving a platform is not cheap, working with partners/developers is time consuming, keeping good applications in and bad applications out (“vetting applications”) is difficult.
All the above (and many other collateral activities) can be very expensive; fortunately, there are several options platforms builders are able to make money:
- sell services, such as training, technical support, certification or consulting
- sell optional extensions, modules, plug-ins or add-ons (e.g. administration tools, security features, back-up services, etc.) or even vertical market products based on the platform
- sell Developers the SDK (Software Development Kit), the subscription to the official platform community
- put in place a revenue-sharing programme with Developers, especially if the platform includes an Application-store
Andy Cavallini – http://retaildom.com