I’ve followed several hundred B2B platforms and multi-sided marketplaces for the past three years. Initially, I segmented these platforms by vertical industry or by the portion of the source to settle process they automated (see here).
Over time, many of the vertical players moved across additional verticals (see here) and many of the more horizontal platforms covering one part of the source to settle process, grew to cover the entire source-to-settle process within an industry (see here). As a result, the old segmentation became less and less useful.
A better segmentation more finely categorizes B2B platforms by the value propositions offered to their participants-rather than by industry or process automated. In studying B2B platforms, regardless of industries served, I’ve found that they offer varying combinations of nine basic value propositions :
- Supply chain automation of three types:
- Indirects and services
- Physical supply chain
- Financial supply chain
- Matchmaking of buyers and sellers (products and services)
- Industry catalogs
- Leveraged contracts
- Transaction financing
- Industry big data
- Collaborative project management
- Managed services
Some platforms offer just one value proposition, some offer several, very few offer more than a handful.
In a series of upcoming posts (feel the suspense!), I’ll cover each value proposition, the challenges of providing each, and examples of companies pursuing each value proposition.
For now, here’s a summary diagram of the nine value propositions and a succinct description of the value provided: