A Strategy to Address Business Community Platforms Pricing Challenges

61 Pages Posted: 6 May 2019

See all articles by Irina Romochkina

Irina Romochkina

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); Erasmus Research Institute of Management (ERIM)

Rob Zuidwijk

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); Erasmus Research Institute of Management (ERIM)

Peter J. van Baalen

University of Amsterdam

Date Written: March 17, 2019

Abstract

In this paper we present an exploratory case study of a business community platform in a sea port setting. We focus on pricing challenges faced by this type of inter-organizational information systems. We find that traditional cost based pricing methods in the form of transaction and subscription fees poorly cope with the following business community platform characteristics: 1) users of the system can be also contributors (i.e. they provide data for the system); 2) the services within the platform can have a hierarchical structure in which old services provide input for new services. We propose a new pricing strategy that accounts for these specific challenges. This strategy relies on two building blocks: user value based pricing and fair sharing. The approach aims at aligning the incentives for individual users to adopt a business community platform and the community wide benefit from the platform's introduction.

Keywords: Business community platform, pricing strategy, inter-organizational information system, IOS

Suggested Citation

Romochkina, Irina and Zuidwijk, Rob A. and van Baalen, Peter J., A Strategy to Address Business Community Platforms Pricing Challenges (March 17, 2019). Available at SSRN: https://ssrn.com/abstract=3354032 or http://dx.doi.org/10.2139/ssrn.3354032

Irina Romochkina (Contact Author)

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Rob A. Zuidwijk

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Peter J. Van Baalen

University of Amsterdam ( email )

Roeterstraat 11
Amsterdam, Z-H 1018 WB
Netherlands
+31 20 525 4320 (Phone)

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