Does your business become exponentially more valuable with every new customer?
In the platform era, one certainty is truer than any other: the digital revolution has put the consumer and their needs at the center of all successful business innovations. Platforms serve as an exceedingly successful means of connecting consumers with any variety of actors instantaneously, be them major financial institutions, independent artists who make novelty lampshades, or any producer in between; likewise, the roles between producer and consumer have totally blurred, with the site of interaction becoming equally as valuable as the exchange itself. In this series, we identify platforms that commodify and facilitate these interactions, enabling the power of network effects to drive exponential value for consumers. See below for a list of five winning retail businesses that have invigorated their platform offerings to remain relevant.
- Warby Parker– Warby Parker is a well-known American e-retailer of sunglasses and prescription eyeglasses that also has 20 physical retail locations. Their claim to fame, however, is their platform offering of try-at-home glasses packs, providing five pairs of affordable frames for users to experiment with from their own line of frames. The $1.2 billion company continues to innovate its retail offerings.
- Stitch Fix– Stitch Fix is an online styling platform that delivers personalized shopping experiences – once users fill out their Style Profile, a Personal Stylist picks pieces to fit user taste, budget, and needs, before mailing them right to your door. The platform helps to connect users to new brands and items, while simultaneously creating value for the platform by having users pays for the service. This two-sided marketplace creates three sets of actors who benefit from the transaction.
- Rent the Runway– Setting off the chain of subscription and rental clothing services, started in 2009, Rent the Runway’s platform connects a growing number of customers with curated fashion collections to be rented as temporary additions to customers’ wardrobes. Likewise, designers can work directly with Rent the Runway, allowing shoppers to pick from an ever-growing roster of clothing, accessories, and more. The platform also provides invaluable data and insights on customer demands in the rental and retail ecosystems.
- IKEA– No single, specific initiative has set IKEA apart – rather, it is their continual, unwavering effort to innovate that isolates them as a platform leader in today’s marketplace. When IKEA acquired TaskRabbit, a platform that allows consumers to connect to individuals who will assemble their IKEA furniture, it gave their customers a way to avoid the DIY trauma. With the IEKA Place app and its capabilities of augmented reality, the platform helps users to try out different furniture in their home before choosing what to purchase – this platform alone has been downloaded 2 million times and enjoys wide use.
- Amazon Wardrobe– Inevitably, in a discussion of the top retailers and their headway into the digital space, Amazon is a natural mention. Among their offerings, Amazon’s Prime Wardrobe is one of their newest and most successful forays into the platform space. Amazon Prime Wardrobe is a “try before you buy” shopping service free for Prime members – the platform allows users to order clothes and try them on at home before purchasing them, giving consumers 7 days after their last item arrives to try on the items at home, before sending back what they don’t want to keep. Prime Wardrobe also has free shipping and free returns, allowing users to order up to eight items at once.
These winning retail businesses never stop innovating their platform offerings, a major contribution in their sustained success.
What other retail innovations do you use in your daily life – and how can other industries mirror their approach?
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