Optimal Distinctiveness: The Role of Platform Size and Identity

Abstract

Recent theoretical advances hold that platforms comprise a second strategic dimension next to size, called identity, which describes the platform’s techno-logical and market scope. Letting go of platform size as the main criterion for platform value opens the possibility for platforms to pursue differentiation strategies with a distinct market positioning. The concept of optimal distinctiveness (OD) implies that differentiation can be optimized so that it maximizes performance. In this paper, we draw on recent OD research in and outside of the field of platforms and elaborate on the role of platform size within the distinctiveness framework. We discuss platform size and identity in the context of OD and suggest propositions for future research. The paper contributes to the management of platforms and OD in platform markets by showing how a platform’s distinctiveness strategy may depend on its size. We contribute to platform management across various platform sizes and to research on OD in platform markets.