The modern business environment is widely transformed by information technologies which modify existing ecosystem and create new business models. One of the significant changes in the business sphere of the last years was the active development of so called multisided platforms (MSPs). These platforms unite two or more different, but related to each other, groups of users and create value through mediation between them. They have existed for a long time, but they started developing rapidly only with the spread of the Internet. Such companies as Google, Visa, Amazon, Facebook are just a few examples of successful multisided platforms, attracting and satisfying the needs of different groups of participants.

The multisided platforms have been changing the way of conducting business for many industries, encouraging companies either to build their own platforms or to participate on existing ones. The consumer goods industry has been also directly affected by the developing platform economy. In the highly competitive environment, fast-moving consumer goods (FMCG) are becoming more blurred and it is becoming more challenging for the producers to distinguish their brands among numerous familiar products. Thus, FMCG companies have to find the ways to communicate with their consumers directly, influence their purchasing decisions and increase relevance and awareness of their brands in the time of disruption of traditional business models. It means that FMCG brands must become active participants on many platforms, addressed by modern consumers. However, unlike many other industries, FMCG companies are now only at the early stages of adopting digital and interactive platforms to promote their products.

Hence, the goal of the master thesis is to find out the risks and benefits for FMCG companies while participating in multisided platform business model.

In order to achieve the goal, the following tasks were set:

· To review existing literature on the topic: the concept of the term of MSP, its origin, definitions, classification and main preconditions for development;

· To point out distinctive features of MSP as a new business model and compare with traditionally (linearly) operating companies;

· To examine MSP model application on FMCG companies' business activity;

· To analyze international FMCG companies' participation in business model of global MSPs;

· To discover the threats and opportunities for traditionally operating FMCG companies and further perspectives for their participation on MSPs

Therefore, we consider the multisided platforms in general as the object of the research, while the subject is the multisided platform business model in the fast-moving consumer goods industry.

As a theoretical basis for the current master thesis such well-known journals as The Business Insider, Bloomberg, Harvard Business Review, Forbes and others were served. Significant attention was also paid to the papers of scholars and writers, specializing on the topics of MSP and business models, such as A. Hagiu, J. Wright, M. V. Alstine, J. C. Roshet, J. Tirole, A. Yablonsky, A. Osterwalder and others. Moreover, different online reports and databases from such analytical agencies and organizations as Pricewaterhouse Coopers, Nielsen, Kantar, United Nations and so on were used, because the most up-to-date news and current events about the companies, consumption and digital trends are broadly observed on the Internet. In the theoretical part author of the master thesis also referred to her previous research on the topic of sharing economy business model. It should be mentioned that despite the number of publications devoted to the topic is growing, they do not provide a holistic approach for the problem and theoretical and practical aspects are not always clearly connected. First of all, because the topic has received significant attention from the researchers globally only since the late 1990's, and secondly because existing articles mainly focus on the platforms themselves rather than companies' participation on them.

The master thesis consists of three chapters. The first part is devoted to the previous works on multisided platforms as new phenomenon and business model, determining distinctive features from linearly operating modes and its development in the FMCG industry. In the second chapter we made an overview of new consumption trends in FMCG industry, which lead to the relevance of companies' participation on MSP business model. Then two prominent examples of global social and electronic commerce platforms - namely Facebook and Amazon - were analyzed. Through case study research method, we investigated how FMCG companies participate on these MSPs and how they use the tools provided by the platforms. The final part summarizes the role of social platforms and online marketplaces and describes the benefits and threats for FMCG companies while participating on the MSPs. This sequential structure allows us to better understand the phenomenon of multisided platforms and its influence on FMCG industry.

Chapter 1. Theoretical aspects of multisided platforms (MSPs) and literature review on the topic

1.1 Overview of multisided platform concept: definitions and evolution of approaches

Internet economy is rapidly emerging. The most valuable companies in the world, such as Amazon, Facebook, Google, Uber and Airbnb are creating online infrastructure and facilitating a wide range of human activities. What is common between these examples is that all these companies enable interaction between many different sets of users - for instance, sellers/providers and buyers/users of goods, services, content, etc. Such kind of companies, getting two or more sides on board and enabling the interaction between them, are called Multisided Platforms (MSPs) (Hagiu and Wright, 2015). Platforms play an important role both for consumer groups, benefiting from wider selection, and for businesses throughout minimization of transactions costs between entities. Thus, the main goal of the platform is to enable effective and constant interaction between producers and consumers (Parker and Van Alstyne, 2016).

The core element of MSP is a digital platform. The first definition of “platform” was firstly recorded in 1550s as «a raised level of surface», intended to a particular action or activity, on which people or things can stand (for example, a raised structure at a railway station to provide an access to the train (Cambridge Dictionary) or a stage used by public speakers or performers to be seen by the audience (Oxford Dictionary)). Later, the concept of a platform has gained another connotation and has been developed by three overlapping fields of research, focusing on products, technology and transactions.

· Product development economists (Wheelwright and Clark, 1992) characterized platforms as projects, developing a new generation of products to satisfy the needs of a core group of consumers for a particular firm;

· Technology strategists (Bresnahan and Greenstein, 1999) described the phenomenon as a tool or technology to control industries and evaluate both strengths and weaknesses of the firm, facilitating its success or failure. This approach was mainly applicable for the computer industry, where such «platform groups» facilitated the coordination of different market segments and evolution of new product systems;

· Industrial researchers (Rochet and Tirole, 2003) adopted the word “platform” to describe products, services, companies or institutions on two-sided markets that ultimately enable beneficial transactions between two distinctive sides. It should be mentioned that the authors look on the platform as on a firm, serving two different market parties as two different market segments with different client preferences, needs and solvency.

Thus, we may observe that, the term «platform» has always been described as a solution to some problem, as a tool helping either to get an access to physical object or better location, satisfy the needs, evaluate the performance, facilitate coordination, etc. Despite these approaches were not directly about mutually beneficial mediation between different group of agents, each of the study field contributed to the current understanding of the phenomenon.

As for the multisided platforms, there is no one generally accepted definition yet. There are several approaches, focusing on different aspects of the phenomenon:

· Balanced fees between the groups of users: «the volume of transactions, affected by charging more on one side of the market and reducing the fee paid by the other side by an equal amount» (Rochet and Tirole, 2006);

· Interdependence between the groups and cross-effect: «two or more groups of customers, who need each other in some way, but who cannot gain the value from their mutual attraction by their own, without the platform» (Evans and Schmalensee, 2007);

· Direct interaction between affiliated groups: «an organization that creates profit, primarily through providing the direct interaction between two or several different types of affiliated groups of participants (parties)» (Hagiu and Wright, 2015).

However, all these definitions have some common points. A holistic definition of modern MSP is given by European Commission (2015) as an «intermediary service providers, undertaking operations in two (or multi)-sided markets and using the Internet to enable interactions between two or more distinct but interdependent groups of users to generate value to these groups». Thus, they provide a common meeting point (virtual or real marketplace) to enable the interaction between distinct consumer groups. For example, credit cards link merchants and cardholders; operating systems match hardware manufacturers, software developers and users; game consoles - game developers and players. The main point is that platform should attract and serve all groups simultaneously to create value. Thus, the value of the platform for one group of users largely depends on the number of users on the other side of the platform. Accommodation platforms like Airbnb will attract travelers only provided the apartments available on this platform, while new landlords will rent out their personal space and join the platform only if it is demanded by a sufficiently large number of people. Here multisided platforms often face «the chicken or the egg» dilemma: no party will join without the other participants. This becomes one of the most challenging problems for many MSPs (Platform Thinking Labs.com).

Scientific foundations of research in the field of multisided platforms started to appear in the early 2000s in the works of several American and European researchers (namely Andrei Hagiu, Julian Wright, Martin Kenney, Thomas Eisenmann, Jeffrey Parker, Marshall Van Alstine, Jean-Charles Roshet, Jean Tirole and others). The phenomenon of «platform economy» started to develop after the boom of the Internet of things and social media networking, enabling companies to interact via online technologies. Hence, a notable increase in the number of studies has been observed since the beginning of the XXI century (Graph 1).

Graph 1. Dynamics of Publications on Platform Economy

Source: composed by the author according to the Scopus data bases

Since the publications, devoted directly and holistically to MSPs as a concept, appeared relatively recently, we can say that research in this area is just in its beginning. Moreover, there are many topics adjacent to the creation and management of the MSP, including the issues about describing and measuring the added value created through this type of mediation; measuring network effects between the users of the platform; studying the nature of MSPs; analysis of pricing features; the role of marketing, advertising and quality management in the MSP, as well as the problem of analyzing the innovation extent of this type of business model (Yablonsky, 2013).

Despite the research is just in its early steps, multisided platform is not entirely a new phenomenon. Platforms, connecting different groups of participants, have been existing for a long time: for instance, large shopping malls, matching buyers and sellers together, newspapers, connecting readers and advertisers, dating clubs, enabling males and females to meet each other and so on. However, due to the development of the Internet and related technologies, increasing connectiveness, facilitation of online payment, decentralized production and rise of artificial intelligence, MSP has become a common phenomenon in recent times (Choudary, 2015). Digital revolution has significantly expanded the opportunities for potential applications of the platforms and has also increased the availability of products and services provided on these platforms to customers. Companies have been evolving in ways they perform their business, create and deliver value, shifting from products to more services. It does not mean transformation of products' manufacturing into services' providing, but more companies start developing and offering the product-related services (Ardolino, Perona and Saccani, 2016).

These digital platforms are different in functions and structure. The most prominent examples of platform business are such companies as Google (connecting advertisers, application developers and users of search system), Uber (drivers and passengers), Alibaba or Amazon (sellers and buyers), Airbnb (travelers with local homeowners) and so on. Some other examples of well-known companies, operating on this business concept, are presented in the tables 1 and 2, classifying MSPs based on industries and consumers' activities.

Table 1. Examples of multisided platforms by sectors

Source: made by the author based on the resources used in the research

Table 2. Examples of multisided platforms by consumers' activities

Source: made by the author based on Oxera and the resources used in the research

Such a new digital-based economy has been named in various ways, depending on some of the characteristic features. Platform-based economy is also quite often known under other names such as collaborative economy, creative economy, sharing economy, peer economy, gig economy, on-demand economy and other terms, often used as synonyms (Zhuravleva, 2017). However, it is not correct to substitute one term with another, since they emphasize particular aspects of the phenomenon. For example, «sharing economy» focuses more on effective and rational use of assets via internet-based platforms, while «collaborative economy» highlights that modern economy is based not on centralized institutions, but on decentralized network of linked individuals and communities (Botsman, 2010). MSPs are also quite often called “matcmakers” (Evans and Schmalensee, 2016).

Multisided platforms coordinate the demand of distinct groups of customers who need each other in some way. Sometimes an uncertainty about the difference between «multisided-markets», «two-sided markets», «resellers» and some other terms appear. In order to clarify the difference, we should look at the formulation of the main characteristics that will help to identify the concept of multilateral markets and MSPs.

To perform as a multisided platform, the following factors should exist simultaneously (Yablonsky, 2013).:

· Presence of two or more different groups of participants (users). So, the number of the «sides» depends on number of affiliated groups joining the platform. Such kind of platforms as Kraiglist (real estate), or LinkedIn (recruitments agency) initially used to be two-sided marketplace, connecting owners and users, employers and candidates respectively. But today more of the online platforms are becoming multisided indeed, attracting also advertisers, marketeers, developers, etc.;

· The value obtained on one side grows with the number of participants on the other side(s). A special attention is paid to the driving force of any multisided platform - a network effect. The concept of network effects is a distinctive feature and indicator of the attractiveness of successful MSP, where consumers appreciate MSPs with a large number of users. Each additional participant on the platform usually affects positively the counterparty (more sellers mean more opportunities to choose for buyers, more buyers mean more options to transact for sellers). The wider the network, the more beneficial the platform for users, what eventually attracts more new players and increases the value of the platform (Hagiu, 2014).

· Presence of a digital intermediary to ensure direct interaction between participants from different sides and to provide network effects created on one side for the other party;

· Without the platform it may be quite complicated for the parties to find each other;

· The «chicken and egg» dilemma is overcome better due to different price charge or even when if one side(s) subsidize the participation of other(s).

A graphical explanation of difference between MSPs, resellers and product platform is illustrated on the picture 1. In product platform, there is only one side, joining the platform, while reseller does not enable the direct interaction between the sides.

Picture 1. Difference between MSP, product platform and reseller

Source: Hagiu, 2014. Strategic Decisions for Multisided Platforms

So, we may see that despite the theory of platform economy is only in the beginning of its research and development. There are still some misunderstanding of the concept, but the multisided platform model is spreading across the industries and increasing its significance in the business world. Considering definitions and features mentioned above, we will use the following understanding of multisided platform in the research: is a business (based on a product, service or technology), digitally connecting two or more different, but affiliated groups of consumers on a balanced charging basis and creating value through enabling direct interaction between these groups.

1.2 Multisided platforms as a new business model