The bottom line is that both digital products and platforms offer numerous features and value. Therefore, separating these two platforms is difficult for the majority of businesses. Do you have a hard time deciding whether to develop an online product or a digital platform? This guide is to help you.
Technology has opened the door to massive growth in business and has created unforgettable digital experience platforms in every possible way. These two top and popular business concepts triggered by evolving needs of both providers and consumers are centered around digital products as well as the digital platform. Entrepreneurs often get in a state of confusion when it comes to digital platforms as opposed to. online platforms. Although both can add worth to businesses they each have their own distinctive position on the market.
Digital platforms form a commercial model that creates value by connecting multiple people, typically the producers and the consumers. Digital design is geared towards users as a result of the content or products that are sold to people looking to gain benefits from what it offers.
That’s exactly the point of two models of business mainly focus on:
Platform = Communication
Product = Production
There are a variety of distinctions that significantly distinguishes digital items from other digital platforms. Let’s dive deeper into a meaningful analysis.
What exactly is a digital product?
Every product that you offer or distribute on the internet is classified as a digital item, like an ebook, the mobile application mobile skin template web theme and a video game and so on. The product is designed to create worth for the buyers or customers by addressing their issues, spreading knowledge of a topic or expanding their knowledge.
Facebook application, Google search, Uber application, as well as WordPress themes are some of the most popular examples of digital services.
What exactly is a digital platform?
Digital platforms allow the communication between suppliers and consumer. It can also facilitate interactions between customers and businesses as well as within companies. Platforms can be the most effective tool to allow an organization to increase its customer service.
Here are a few instances of different digital platforms:
- Social media sharing platforms such as Vimeo, Spotify, and YouTube.
- Social media platforms such as Twitter, Facebook, LinkedIn and Instagram.
- Platforms that are based on knowledge, such as Quora, StackOverflow, and Reddit.
- Services-based platforms such as GrubHub, Uber, and Airbnb.
Digital product digital product. the digital platform the differences
1. Linear Model Vs. Circular Model
Digital products are based on the linear model i.e. they create worth by making goods that are then later delivered to customers/consumers through in the chain of supply. Below are two excellent instances of a linear model
- Toyota, the manufacturer of automobiles Toyota makes cars, and then sells direct to customers.
- The production company Netflix develops content and markets direct to consumers.
In contrast the digital platforms like vectorgi.com operate on the circular model, which is adapted to better systems where the business can create value by facilitating communication between users and businesses of third parties.
As an example, YouTube allows content creators across the globe to distribute content to the people who use their services. It is true that platforms have proven very useful. In fact, a research conducted of Statista declares that among the top 10 firms in terms of market capitalization have platforms.
In contrast digital platforms are based on an inverse model which adapts to provide a more efficient system in which the business can create value by facilitating communication between users as well as third-party companies.
As an example, YouTube allows content creators across the globe to distribute content to their viewers. The platforms have proven extremely beneficial. In fact, a research conducted of Statista declares that among the top 10 firms in terms of market capitalization have platforms.
3. The Complexity of Operations
Both digital and electronic platforms function in different methods. Digital platforms create value by offering a single item to one user. It’s as simple as that in that the company offers a product and users consume it, thereby making a single source of revenue. However, users aren’t allowed to sell products as long since the individual or digital product development firm which created it remain the owner.
A well-known example can be Netflix. The company provides streaming services to its customers who pay a monthly cost. The users can pay for, view and experience the content but they can’t sell it. Netflix is the sole owner.
However the digital platform is focused on several revenue streams. Consumers as well as creators can be involved in the transaction through it. Additionally, a digital platform works on demand-and-supply models in which the user is able to fulfill a need, while the creator meets the requirement. The creator and the customers are the owners of the system.
YouTube is a great illustration of the ways digital platforms operate. It is a place where both creators and users of content are both part of a transaction. Content creators gain from the volume of viewers, and consumers are benefited by watching the contents. The platform is not owned by anyone; the two parties are involved by a partnership that benefits both.
4. Direct Network Vs. Indirect Networks
Every new person joining the sea of networked networks is known as”the impact of the network. In other words, if for instance you are a smartphone owner and your buddy doesn’t, there’s no benefit associated with the phone since it is not able to communicate.
When we look at the various types of platforms that are digital We can conclude that groups of two or more are able to exchange values with each other. It’s a similar situation in which everyone owns an electronic phone that allows them to communicate with everyone.
Uber is an instance that shows an indirect system. When more users join the service and the benefits it brings to drivers increases exponentially. Better profit margins are on the horizon.
5. The Economics of Products/Services
Digital technology may not provide any significant value for disruption in the years to come, however digital platforms are considered to be better. The reason is that companies require additional financial resources as well as people resources to market greater digital items.
As an example. When Netflix requires to bring new content to its portal it is required to invest extra on its development in terms of production, launch, and marketing for example. If the content they create is great, profits are likely to be earned, but of the funds spent go to into waste.
However on the other hand. It is true that the margin cost for production and distribution for digital platforms is quite lower. That means that expenses are lower than revenues, which can turn out to be multi-fold. If we take YouTube as an instance when it comes to cost. The price of adding new content and videos to the platform is not significant because the site only has to sign up new users in order to add new content for its digital experiences solution.
Differentiate in Digital Ptoducts and Platforms
How Can Differentiate in Digital Ptoducts and Platforms
