The document outlines the characteristics and advantages of two-sided markets, highlighting the impact of network effects and the importance of creating economic benefits for both users and suppliers. It presents examples of innovative companies and discusses strategies such as freemium models and information services. The document also emphasizes the goals of a successful two-sided marketplace in enhancing demand and supply while providing better services.

1. 2-sided markets
January 19, 2015
Version 0.6
© Node1

2. Agenda
1. Two sided market characteristics
2. Examples of innovative companies
in two-sided markets
3. Innovation ideas for mijnpakket
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3. Agenda
1. Two sided market characteristics
2. Examples of innovative companies
in two-sided markets
3. Innovation ideas for mijnpakket
3

4. Two-sided market : Definition
4
side 1
side 2
Same-
side
network
effects
Same-
side
network
effects
Cross-side
network
effects
platform
Network effects
Economies of scale
Multihoming
Pricing
Openness
Regulation
Scalability
Differentiation

5. Two-sided market characteristics
• Benefits of scale: fix set-up cost and variable revenue;
• Network effect: value for individual users depends on
total number of users;
• Cross-network effect: attracting more users on one side
increase value on other side.
5
Market
Characteristics
• Freemium: charge below cost for basic services and
earn money with value-add services;
• Cost transfer: charge cost to the party with the
highest willingness to pay;
• Information as a service: add value by providing
information about other side (e.g. reputation), or help
parties get an overview of all transaction.
Typical
strategies

6. Agenda
1. Two sided market characteristics
2. Examples of innovative companies
in two-sided markets
3. Innovation ideas for mijnpakket
6

7. Examples of two sided markets

8. Example: Instacart
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9. Agenda
1. Two sided market characteristics
2. Examples of innovative companies
in two-sided markets
3. Goals 2-sided marketplace
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10. Goals of 2-sided business model
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If done well a2-sided marketplace should on the
one hand create an economic advantage for
users (> switching cost) and economic
advantages for suppliers (enlarging and better
qualified market = more revenue).
Economic
advantage
For both sides the 2-side marketplace should not
only aggregate demand and supply, but also
enhance it.
Better
service

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