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Market Orchestrators:The Effects of Certification on Platforms and Their Complementors

Rietveld, J; Seamans, R; Meggiorin, K; (2021) Market Orchestrators:The Effects of Certification on Platforms and Their Complementors. Strategy Science , 6 (3) pp. 244-264. 10.1287/stsc.2021.0135. Green open access

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Abstract

We study how a multisided platform’s decision to certify a subset of its complementors affects those complementors and ultimately the platform itself. Kiva, a microfinance platform, introduced a social performance badging program in December 2011. The badging program appears to have been beneficial to Kiva—it led to more borrowers, lenders, total funding, and amount of funding per lender. To better understand the mechanisms behind this performance increase, we study how the badging program changed the bundle of products offered by Kiva’s complementors. We find that Kiva’s certification leads badged microfinance institutions to reorient their loan portfolio composition to align with the certification and that the extent of portfolio reorientation varies across microfinance institutions, depending on underlying demand- and supply-side factors. We further show that certified microfinance institutions that do align their loan portfolios enjoy stronger demand-side benefits than do certified microfinance institutions that do not align their loan portfolios. We therefore demonstrate that platforms can influence the product offerings and performance of their complementors—and, subsequently, the performance of the ecosystem overall—through careful enactment of governance strategies, a process we call “market orchestration.”

Type: Article
Title: Market Orchestrators:The Effects of Certification on Platforms and Their Complementors
Open access status: An open access version is available from UCL Discovery
DOI: 10.1287/stsc.2021.0135
Publisher version: https://doi.org/10.1287/stsc.2021.0135
Language: English
Additional information: This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. You are free to download this work and share with others for any purpose, except commercially, and you must attribute this work as “INFORMS Strategy Science. Copyright © 2021 The Author(s). https://doi.org/10.1287/stsc.2021.0135, used under a Creative Commons Attribution License: https://creativecommons.org/licenses/by-nc/4.0/.”
UCL classification: UCL
UCL > Provost and Vice Provost Offices > UCL BEAMS
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science > UCL School of Management
URI: https://discovery.ucl.ac.uk/id/eprint/10127730
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