In our conversation with Adrien Nussenbaum, Co-Founder and U.S. CEO of Mirakl, he gave us lots of insights and key success factors regarding the 3 lifestages of a platform, how to set up a platform initiative as an incumbent company and how platforms can create a more sustainable business.
Mirakl started its journey in 2012 with the vision of the digital revolution in the retail industry. Initially based in France, Mirakl today is operating on a global level as one of the leading providers of marketplace infrastructure solutions. With their Software-as-a-Service model Mirakl helps traditional retailers, manufacturers and distributors to cope with the emerging requirements to adapt to new business models and transform into online marketplaces across different industries. Up to today, Mirakl enabled over 300 businesses to open-up marketplaces in their specific industries. And this makes them a perfect guest for our podcast to talk about best practices and trends in setting up and scaling a platform.
In our conversation with Adrien Nussenbaum, Co-Founder and u.S. CEO of Mirakl, he gave us lots of insights and key success factors regarding the 3 lifestages of a platform, how to set up a platform initiative as an incumbent company and how platforms can create a more sustainable business.
How to find your unique platform opportunity
The first important stage of building a successful B2B-Marketplace is finding your unique platform opportunity. According to Adrien, the very primal thing you need to do is “look at the broader world that surrounds you and ask yourself a simple question: ”Are there transactions happening in that broader world that could happen through you?” Based on the identified transactions and the related inefficiencies you can platformize them in a more qualitative or efficient way so that it creates a value for all the players on your platform.
As a next step you have to decide whether to chase a defensive or offensive platform strategy. Each of them has its own challenges. A defensive strategy is more like „entering a platform strategy in a reactionary mode and when you do that, the challenge is to react really fast and well“, as Adrien explains. So you join an already existing platform ecosystem while an offensive strategy on the other hand means digitizing everything around your core product in a way nobody has done yet.
Adrien points out a huge challenge especially for start ups, because they have to start really from scratch without any partners or brand advantages which could enable a successful platform from the very beginning. Regarding incumbent companies he sees another problem in terms of understanding the own legitimacy:
And so the legitimacy is really waking up to understanding that in a digital world, becoming a platform is understanding your assets can allow you to create an infrastructure business.
Talking about key success factors
Out of his longstanding learnings from working with over 300 companies worldwide, Adrien takes away some key success factors of building a platform. For a better understanding he summarized them to three really important aspects:
- a top-down platform initiative
- a platform strategy which fits your business and its integration
- understanding the long term transformation of a platform program
Accompanying this, it is indispensable for an organization „to learn and adjust quickly to what this program is going to create in your company“, like adapting your go-to-market or pricing strategy according to changes in your environment.
Furthermore, big parts of these three points are about change management within the company. The challenge here is that the whole transformation of the regular business which comes up with enabling a platform has to be accepted and supported by the whole company. So every single one has to understand the benefits of a platform but also that they have to work on the platform to create these benefits. Therefore, stakeholder management, which can be facilitated e.g. via cross-functional teams, plays a central role.
Facing and rationalizing fears
Another important major problem Adrien mentioned, are fears which arise especially in the marketplace context with regard to the connection of all the different stakeholders. Worries about cannibalization if stakeholders sell products much cheaper than the platform owners for example are not uncommon. But it is precisely this multitude of stakeholders that is necessary to enable the scaling of the business model in the first place.
The only important aspect here is to rationalize these fears and, as Adrien recommends: „structure the fear in different buckets and understand what they mean for your business and how you’re driving your business“.
Three different looks at sustainability
Looking at the impact of platforms to sustainability Adrien points out three different ones: „Sustainability in terms of ecology, in terms of being better humans and fostering a better community.“
So we see there are divergent leverages. Some firms for example concentrate on improving the circular economy or secondhand retailing, like H&M who created a platform called „Found“ to enable sustainable fashion. Another example Adrien brings up is using software to track the consumer behaviour of firms and their employees and using this data the other way around to engage them towards a more aware consumer behaviour.
One last piece of advice
As always, we asked for the one leadership advice that spontaneously occurs to our guests. For Adrien, it’s the very crisp and simple statement:
“Trust your guts.”Adrien Nussenbaum, Co-founder and U.S. CEO of Mirakl
Thank you Adrien for the great conversation and insights.
The complete episode can be listed at your favorite podcast provider.