How Open Should an Online Platform Be? Relationship between Open Strategy and Customer Equity in the E-Service Context
Date Issued
2009
Date
2009
Author(s)
Chen, Li-Yang
Abstract
Facebook, Google and Yahoo have all introduced their open strategy to the public. Via an open strategy, online platform providers presume they can encourage more developers to develop innovative applications. More popular applications mean more users, which are the most precious assets of an online platform. As a result, “open” has become a buzzword in the internet industry. But while all website hosts are trying to include an open element in their websites, their knowledge of how customers perceive their open strategy is insufficient. This research links online platforms’ open strategy and Web 2.0 characteristics with Customer Equity, which might provide another viewpoint in the composition of competitive and marketing strategy. Also, this research proves that being open and having the three Web 2.0 characteristics are crucial to the Customer Equity of online platforms.ased on the survey data analysis, this research offers the following suggestions:. Online platforms should implement an open strategy in their online services instead of staying “closed”.. Online platform providers should keep enhancing the Size of Network of their platform and their perceived Degree of Openness.. Online platform providers should first decide their priority in the three drivers of Customer Equity. After doing so, they can compose the best open strategy for their online platform.. For User Participation and User Usage Frequency, as in the case of open strategy, online platform providers should first decide which driver is the most important, then decide which of the factors that engage users should be the focus of investment.
Subjects
Open Strategy
Customer Equity
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