S2E7: A Playbook for Platforms in Crisis, with guest Prasad Vana
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S2E7: A Playbook for Platforms in Crisis, with guest Prasad Vana
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All businesses must endure a crisis every now and then. But not all businesses are digital platforms, such as Facebook, Uber, and eBay. What sets these businesses apart is their role as an intermediary between sellers and buyers, two stakeholders who are crucial to the business model but who can react to a crisis in very different ways, and with different consequences.
In this episode, Tuck marketing professor Prasad Vana talks about a new paper that takes an in-depth look at platforms in crisis. The paper is titled “When Crisis Hits the Platform Economy: The Effects on Supply, Demand, and Spillovers.” In it, Vana studies two crises that the platform Kickstarter went through, and the impact those crises had on people looking to fund projects and the backers of those projects. He finds that the crises had bigger effects on the supply side stakeholders than on the backers, and that projects that relied on a fan base—such as art and culture-related efforts—were especially likely to respond negatively to crises.