How to Achieve Incumbents Thrive in Platform-Based Ecosystem in the Hotel Context: The Role of Digital Complementarity

Abstract

While the majority of incumbents struggle with survival, a few thrive against the backdrop of a platform-dominant ecosystem. Recent studies highlight the importance of reconfiguring, especially in a complementary way, to enhance incumbent adaptation and achieve thriving. Scholars have primarily focused on either possessing or accessing resources to enhance incumbent adaptation; however, the understanding of how to reconfigure resources, especially in a complementary manner, remains limited. Based on an in-depth case study in the hotel industry, incumbents with historical roots proactively organize multiple complementarities, thanks to digital technology. This successfully gains committed relationships with customers to outcompete digital giants. This study develops a "digital complementarity" framework to describe the phenomena by which incumbents outcompete digital giants. Particularly, we trace three mechanisms—"digital branching," "digital fortifying," and "data-driven intimating"—and underpin a process model to understand how incumbents achieve successful adaptation to thrive in the platform-dominant ecosystem.