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Accenture: Digital platforms becoming a default business model

Sep 21
Tags: Accenture
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Accenture: Digital platforms becoming a default business...

Digital platforms are expanding beyond "digital-born companies" like Amazon and Google and becoming a "default business model in most industry sectors", according to Accenture.

A recent report from the professional services firm highlighted the huge potential of platform-based business models and strategies, but also pointed out that a large proportion of corporations and governments have substantial scope for improvement in order to succeed in this field.

As few as ten per cent of new start-ups whose business models are focused on digital platforms will become profitable independent entities in the coming years, according to Accenture. One of the reasons for this is that some countries are not sufficiently prepared to support growth in digital business models. 

The company's research analysed the ability of 16 G20 economies to sustain and encourage the development of digital platforms, based on factors including technological preparedness, digital user size and savviness, digital entrepreneurship, policy and regulation.

At the top of the final ranking by quite some distance was the US, followed by China and the UK, while India and Germany completed the top five. Russia, Italy, South Africa, Turkey and Brazil received the lowest scores.

Accenture predicted that China, India and the US will be the dominant forces in the digital platform economy by 2020, while some emerging markets and European nations are at risk of falling behind.

Paul Daugherty, chief technology officer at the firm, said the leading digital economies are using the power of platforms to "create large-scale markets very rapidly".

"Many European economies are in danger of missing out in the platform economy," he warned. "Multi-stakeholder cooperation is required to address the fragmented digital markets and to support the greater levels of digital enterprise and consumption that successful platform businesses need."

Francis Hintermann, managing director of Accenture Research, said: "Digital platforms are not just the preserve of digital-born companies, like Airbnb and Alibaba, but are now becoming a default business model in most industry sectors, both B2B and B2C.

"To enjoy efficiencies and high rates of growth, companies will need to transform everything, [including] the way they co-create goods and services with third parties, tailor their offerings to customers and price them dynamically."

The company offered some key pieces of advice for digital-platform businesses looking to succeed and grow, one of which is to offer a personalised experience that targets customers with bespoke services across channels. Customer data is likely to prove crucial for anticipating needs and designing a relevant experience.

Accenture also underlined the importance of taking a fresh, innovative approach to pricing. Using dynamic pricing models like pay-as-you-go, 'freemiums' and subscription pricing can help to meet the needs of different demographics and respond to fluctuations in demand.

According to the consulting firm's analysis, some $20 billion (£15.4 billion) was invested in digital platforms between 2010 and 2015, encompassing 1,053 publicly announced deals. More than half of this investment occurred between 2014 and 2015.

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Image: iStock/Pinkypills

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