http://ssrn.com/abstract= 1812084

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Competing With a Crowd: Informally Organized Individuals as Platform Complementors

Kevin J. Boudreau

London Business School

Lars Bo Jeppesen

Bocconi University

February 1, 2012

Platform complementors are increasingly organized as “crowds” of individual producers working outside formal relationships – rather than as complementor firms. As crowds are motivated differently from firms in a market, here we hypothesize that the best way to stimulate complementary development differs from usual “grow-the-platform” strategies known from earlier platform studies. In crowd complementary development on online multiplayer games, we find that strategies intended to stimulate crowd complementary development by boosting platform usage did so (elasticity of .45), even when the crowd received no cash payments from users. However, boosting the size of the crowd itself had no impact on subsequent development rates or network effects. We found evidence that strategies more directly geared to inducing complementary innovation (i.e., an inducement prize) had much greater impact.

Number of Pages in PDF File: 38

Keywords: two-sided platforms, platform strategy, crowds, digital innovation, motivations

JEL Classification: L1, O31, D03

working papers series

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Date posted: April 18, 2011 ; Last revised: April 30, 2013

Suggested Citation

Boudreau, Kevin J. and Jeppesen, Lars Bo, Competing With a Crowd: Informally Organized Individuals as Platform Complementors (February 1, 2012). Available at SSRN: http://ssrn.com/abstract=1812084 or http://dx.doi.org/10.2139/ssrn.1812084

Contact Information

Kevin J. Boudreau (Contact Author)
London Business School ( email )
Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom
Lars Bo Jeppesen
Bocconi University ( email )
Via Sarfatti, 25
Milan, MI 20136
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