Platform oriented businesses- What are the branding challenges?

Off-late, there has been rise in the number of 'platform oriented businesses'. Zomato, Ola, Uber, AirBnB are a few businesses who have emerged as unicorns from the 'Platform' oriented model. No, I am not going to talk about their success stories and how they have created a 'niche' for themselves. The article is going to analyse unique characteristics of platforms, and challenges from a branding perspective.

How is a platform different from a linear business?

Before we get any further, let's get the difference between a platform & linear companies straight.  A platform is a business model that ensures exchange of values (owned or created on the platform) between two or more user groups.  Uber, Twitter, Facebook, AirBnB are all examples of such platforms.

On the other hand a linear business creates & owns the value it provides to its consumers. PizzaHut, Hilton Group etc are examples of linear business models.  These businesses control every aspect of the end-user's experience.

With differences laid out, how is branding for 'platforms' unique and challenging?

1. A platform has less or no control over the user experience

The challenge is self-explanatory. Any major platform oriented business does not own or control the user experience. For instance, AirBnb- World's largest market place for vacation rentals does not own a SINGLE hotel or room. Unlike a hotel chain that controls 100% of the user experience (from booking to check-out), AirBnB probably controls 5-10% of the consumer experience.

Like any platform business, the brand persona is created  through users interaction with each other. Dosen't that give you jitters as a brand manager? But dosent seem like Midenhall- CMO of AirBnb is massively bothered.

A quick look at his Linkedin profile reveals how he sees AirBnb- 'World's first community driven super-brand'.  This shows that more than 90% of the AirBnB is dictated & controlled by its users and not the corporate leadership. This can be viewed as a benefit of the platform business model- Externalised brand building. Linear brands try to 'crowdsource' or 'get inspiration' for marketing stories. In a platform, the stories between two humans are stronger than the story of singular human/product/service.

Successful brands have emulated this to overcome the lack of control over user experience.  So build your story.

2. A platform is more momentary in nature

A platform is not an easy business to establish & run. The focus should always be on recruiting producers & consumers to solve each others problem, and ensure that they stick to your platform.  However, platforms are very very dynamic in nature. They are built on moments when everything clicks.

Product- market fit is one such example. Players like  Ola, Uber experienced product-market fit because the product enabled people to easily 'book a car' for committing and drivers benefited from the process of 'automated' revenue & incentives. Whilst Uber initially invested heavily on building technology, on-boarding drivers & consumers, it benefited from massive scalability thereafter.

So, now to the main question! How does disrutption and scalability make branding for platforms unique?

• A platform brand must always start with utility-driven brand positioning.

• The second challenge comes from the fact that any platform will go through three stages of branding within first 10 years of inception (elaborated below) and is evolutionary in nature. This is in complete contrast to what happens for a linear brand, where the positioning is always focussed on just getting 'being aspirational'. 

As seen from a lot successful platforms, there are three stages to platform branding to overcome the 'momentary' nature of platforms.

• Utility-  Any platform has to be disruptive. Introduce new  behvaiour among its users & suppliers (Remember how Zomato changed food discovery among consumers & hoteliers).  This phase of branding usually focusses on convincing users about the value of the platform,  and how to unlock best value, and opportunities  for its suppliers. 'Zomato' did this brilliantly helping users discover new restaurants at the push of a button, "Uber" did an exceptional job of having a private driver for all our commuting purpose, with just a couple of clicks. Both these platforms were vert utility focussed and provided just ONE thing that the user wanted. The problem they were solving was incorporated into their branding strategy! How cool!

• Incubation- This stage, the startups have reached a stage where they need to start thinking like a traditional brand.  All successful platform brands like Google, Amazon etc had a big incubation period, before they built a successful brand positioning.  When Google started out, it was all utility focussed, and offered an alternative to Yahoo search. Google then entered a period of incubation (or product innovation) and came up with awesome stuff like Gmail, Youtube (acquisition), Maps, Adwords which enhanced its core product- Search engine.  The incubation has paid off & how! Currently Google positions itself as 'Organizing world's information'. 

• Aspirational - The final phase of getting a successful platform branding is to become aspirational (After a massively successful incubation). Things like purpose of existence (Mission), Road map etc should be very clear. A good example for this is Facebook's positioning. It started out as a platform for "connecting" friends, and now is on a mission to "Connecting & empowering people around the world" through Facebook. All their initiatives like messenger, Free basics, etc are aimed to deliver this. 

 3.  Platforms have different interaction models based on platform types

Just like products, the  customer interacts differently with different platforms. Some platforms are purely transactional, some are purely for engagement purpose, and some are for utility purpose. The interaction model of each platform will determine how it starts to brand itself in stage-1.

Any other challenges you think needs to included? Feel free to comment in!