Platform Product Management- 1

What is Platform

A platform is something that is foundational, enables people to undertake core activities, and helps connect different entities together. In terms of a platform in a public speaking context, a speaker or singer can connect to the audience through a platform. Similarly, a train can connect to passengers via a platform.

In digital business, a platform enables the core activities of the business and connects different entities; for example, in a payment-processing platform, banks or credit card companies connect with vendors to enable seamless money transfer.

Software vs Tool vs Platform

Software serves end-user needs directly, tools assist in specific tasks within a larger workflow, and platforms provide the infrastructure and ecosystem for building and managing complex applications and services.

Under what category Tableau will fall?

Tableau falls under the category of Software with specific characteristics that also align it closely with being a Tool and, in some contexts, part of a Platform.

Here’s an explanation of why Tableau fits into these categories:

Software

As a general classification, Tableau is a piece of software. It is a comprehensive application designed to provide specific functionalities related to data visualization and business intelligence (BI).

Examples of Software Characteristics:

• User Interface: Tableau has a graphical user interface (GUI) that allows users to interact with their data visually.
• Functionality: It provides capabilities to connect to various data sources, create interactive dashboards, and generate reports.

Tool

Tableau is also a tool, specifically a data visualization and analytics tool. It helps users perform specific tasks related to data analysis and visualization.

Examples of Tool Characteristics:

• Data Visualization: It provides a set of features specifically designed to create visual representations of data, such as charts, graphs, and maps.
• Analytics: It includes functionalities for analyzing data trends, patterns, and insights through interactive visualizations.
• Specific Purpose: It is designed to aid users in exploring and understanding their data more effectively.

Platform

In some contexts, Tableau can also be considered part of a platform, especially when integrated into a broader ecosystem for business intelligence and analytics.

Examples of Platform Characteristics:

• Ecosystem: Tableau integrates with other tools and services, such as databases, cloud services, and data warehouses.
• Extensibility: It offers APIs and tools for developers to extend its capabilities and integrate it with other systems.
• Server and Cloud Versions: Tableau Server and Tableau Online provide a platform for sharing, collaboration, and governance of data visualizations and dashboards within organizations.

Power of Platform

Unlike traditional businesses, platform companies must navigate intricate networks of users, developers, and partners, each with distinct needs and motivations. Balancing the interests of these stakeholders while driving value and ensuring growth poses a formidable task for product managers and executives alike.

Moreover, the rapid pace of technological advancements further complicates the landscape for platform companies. As consumer preferences evolve and new technologies emerge, staying ahead of the curve becomes imperative. From integrating artificial intelligence to enhancing data privacy measures, platform companies must continuously adapt and innovate to maintain their competitive edge.

Nevertheless, despite these challenges, the allure of platform-based business models remains undeniable. The ability to scale rapidly, harness network effects, and foster innovation through open ecosystems offers unparalleled opportunities for growth and disruption.

• Scalability: Efficiently handle varying workloads.
• Integration and Interoperability: Seamless connection with various tools and services.
• Innovation and Ecosystem Development: Foster new applications and services.
• Cost Efficiency: Optimize costs through shared infrastructure and scalable models.
• Enhanced Security: Provide robust security measures and compliance.
• Data and Analytics: Enable data-driven decision-making.
• Collaboration and Connectivity: Promote teamwork and information sharing.
• User Empowerment and Customization: Offer tailored experiences to meet specific needs.

Characteristics of Platform

Platforms, in the context of technology or business, possess several characteristics that distinguish them from other types of products or services. Here are key characteristics of platforms:

• Enable Interactions and Transactions

Platforms facilitate interactions and transactions between multiple parties, such as users, developers, producers, and consumers. They serve as intermediaries that connect participants within a network or ecosystem.

• Provide Infrastructure or Services

Platforms offer infrastructure, tools, or services that enable users to create, share, and exchange value. They provide the foundation upon which other products, services, or applications can be built, integrated, or accessed.

• Foster Ecosystems and Communities

Platforms foster ecosystems and communities of users, developers, partners, and stakeholders. They create networks of interconnected participants who collaborate, innovate, and co-create value within the platform ecosystem.

• Exhibit Network Effects

Platforms exhibit network effects, where the value of the platform increases as more users, developers, or participants join and interact within the ecosystem. Network effects create positive feedback loops that drive growth, adoption, and engagement.

• Support Multi-sided Markets

Platforms often serve as multi-sided markets, where they facilitate transactions or interactions between distinct groups of users or participants. They balance the needs and interests of multiple stakeholders to create value for all parties involved.

• Enable Scalability and Flexibility

Platforms are designed for scalability and flexibility, allowing them to accommodate varying workloads, user bases, and use cases. They provide infrastructure, tools, and resources that can scale up or down based on demand.

• Promote Innovation and Customization

Platforms promote innovation and customization by enabling users, developers, and partners to build upon, extend, or integrate with the platform. They provide APIs, SDKs, and development tools that empower stakeholders to create unique solutions and experiences.

• Offer Value-Added Services

Platforms often offer value-added services, such as analytics, security, compliance, or support, to enhance the functionality, performance, and reliability of the platform. These services complement core platform offerings and address the diverse needs of users and developers.

• Monetization Opportunities

Platforms offer various monetization opportunities, such as subscription fees, transaction fees, advertising, licensing, or revenue sharing arrangements. They generate revenue by charging for access to platform features, services, or usage.

• Governance and Management

Platforms require governance and management to ensure compliance, quality, security, and fairness within the ecosystem. Platform owners establish rules, policies, and standards to govern platform usage, behavior, and interactions.

Types of Platform

When building a platform strategy or creating a platform, it is essential to understand that there are two types of users: consumers and producers.

The approach and design of these kinds of platforms where producers and consumers are the same will be different from that of a platform where producers and consumers have two separate personas. To understand this concept in detail, let’s look at some common types of platforms, as follows:

• Marketplace: This is the most common and easy-to-understand platform type. Here, buyers and sellers (producers and consumers) are two different entities and they connect using the platform. Buyers get to explore various products, compare them, and make an informed decision about the purchase. Sellers can demonstrate their products to all potential and interested buyers. Amazon, eBay, Alibaba, Walmart Marketplace, and so on are some of the well-known platforms in this space.
• Social media: Everyone is familiar with social media platforms nowadays. They are where people connect, share ideas, and socialize virtually. Facebook, Twitter, and LinkedIn are some examples of popular social media platforms. Social media platforms are one type of platform where producers and consumers are the same. On these platforms, a user shifts between being a producer and a consumer within the same session and in a few minutes. For example, when a user is writing a tweet, they are the producer, but they are the consumer when they are reading someone else’s tweet.
• Search engines: When I say search engine platforms, it is not just the Googles and Bings of the world, but it could be a search engine for a very specific category. For example, Zillow is a real-estate search engine where buyers/renters can search for properties, and Indeed is a search engine where candidates search for job openings. There are two entities in the specific search-platform category — on Zillow, there are homeowners and renters, and on Indeed, there are recruiters and job seekers. But information search engines that are category-agnostic, such as Google and Bing, only have consumers; there are no specific producers of that information.
• Content and entertainment: For entertainment and content platforms, content creators are producers, and users streaming and watching the content are consumers. On some of these platforms, content creation is restricted to artists and experts and is controlled by the platform owners — for example, Netflix or Spotify. But there are platforms where content creation is open to everyone and anyone — for example, on YouTube, which can also be categorized as a social media platform.
• Knowledge and information sharing: Knowledge and information sharing platforms are similar to social media platforms in that the producers and consumers are the same. Some common examples of such knowledge and information sharing platforms are Stack Overflow, Coursera, Quora, and Yelp. When a user asks a question or replies to a question on Stack Overflow, they are a producer, but when they are browsing and reading solutions, they are a consumer. Similarly, on Yelp, when a user is adding a review, they are a producer, but when they are browsing and reading reviews, they are a consumer.
• Service-oriented: Service-oriented platforms are the ones where a platform enables the aggregation of Service Providers (SPs) and connects them to the consumers. SPs are the producers in this scenario. Classic examples of this type of platform are Uber, Airbnb, DoorDash, and so on. These platforms crowdsource the SPs and connect them to the right consumers. Platforms such as DoorDash have an additional layer; they connect three entities instead of two, as seen in most platform types. They connect restaurants, dashers (drivers), and consumers for the seamless completion of food delivery.
• Transaction and payments: All financial platforms such as PayPal fall under this category. They facilitate the completion of a transaction by processing the payment. Most of them operate at a commission or transaction fee; we will cover this in the Platform revenue models section. Similar to DoorDash, transaction platforms have three layers or connect three entities — buyers, merchants, and banks.
• Infrastructure: Infrastructure platforms provide hardware and computing resources to organizations. Infrastructure platforms take care of hosting, storage, networking, and other essential hardware and software needed to create and deploy any application. Cloud computing platforms such as Amazon Web Services (AWS) and Azure are the most popular and dominant players in this space.
• Development: All the operating systems are categorized as development platforms; some are controlled and closed, such as Windows and Apple App Store, whereas some are open source, such as Android and Linux.
  Apart from the operating systems, platforms built to access data via Application Programming Interfaces (APIs) or platforms that enable different software development aspects are also classified as development platforms. Example: Data Platform and MLOps platform.

Platform Product Management:

Platform product management represents a unique paradigm, blending elements of consumer and enterprise-focused approaches while introducing its distinct set of challenges and opportunities. At its core, platform product management involves the creation and management of products that serve multiple users and cater to diverse use cases. Platforms, such as Salesforce’s ecosystem, act as the foundation upon which third-party developers and partners build complementary solutions, driving innovation and expanding the platform’s reach. Key characteristics of platform product management include its focus on facilitating integrations with external partners, fostering ecosystem growth, and managing longer development cycles with potentially less available data. Platform product managers are tasked with not only developing core capabilities but also nurturing a thriving community of developers and stakeholders who contribute to the platform’s success.

Here are key aspects of platform product management:

• Understanding Platform Dynamics

Platform product managers must have a deep understanding of platform dynamics, including network effects, two-sided markets, and ecosystem economics. They need to grasp how developers, partners, and users interact within the platform ecosystem to drive growth and value.

• Defining Platform Strategy

Platform product managers define the strategic direction of the platform, including its target audience, value proposition, and competitive positioning. They identify opportunities for platform expansion, ecosystem development, and revenue generation.

• Building Developer Tools and APIs

Platform product managers work closely with engineering teams to build developer tools, application programming interfaces (APIs), and software development kits (SDKs) that enable third-party developers to build upon the platform. They prioritize developer needs and ensure that the platform provides robust, well-documented, and easy-to-use tools for building applications and integrations.

• Curating Platform Ecosystem

Platform product managers curate the platform ecosystem by attracting developers, partners, and users to the platform. They create programs, incentives, and resources to support developers in building and monetizing applications on the platform. They also establish governance mechanisms to ensure compliance, quality, and security within the ecosystem.

• Managing Platform Roadmap

Platform product managers develop and manage the platform roadmap, prioritizing features, enhancements, and integrations based on user feedback, market trends, and strategic goals. They balance short-term needs with long-term platform vision, ensuring that the platform evolves in alignment with market dynamics and customer requirements.

• Analyzing Platform Performance

Platform product managers analyze platform performance metrics, such as user growth, engagement, retention, and developer activity. They use data-driven insights to assess the effectiveness of platform initiatives, identify areas for improvement, and optimize platform performance.

• Facilitating Partner Integrations

Platform product managers facilitate integrations with third-party partners and service providers to enhance the value proposition of the platform. They collaborate with business development, marketing, and legal teams to negotiate partnerships, establish integration requirements, and support partner onboarding and integration efforts.

• Enabling Platform Monetization

Platform product managers explore and implement monetization strategies for the platform, such as subscription fees, transaction fees, advertising, and revenue sharing arrangements. They balance the needs of platform users, developers, and partners with the goal of driving sustainable revenue growth for the platform.