Developing a Leading Digital Multi-sided Platform: Examining IT Affordances and Competitive Actions in Alibaba.com

In recent times, digital multi-sided platforms (DMSPs) have revolutionized electronic commerce by enabling new forms of competition and collaboration. Existing studies provide useful insights yet do not recognize the role of information technologies (IT) in examining the development of DMSPs. To address this knowledge gap, we conducted a case study of Alibaba.com (henceforth simply Alibaba), the largest online B2B marketplace in the world with over 80 million members. We applied the theoretical notion of IT affordances to examine the possibilities for competitive action at a platform level based on organizational variables and IT features in the context of the environment in which they function. Our findings show that, toward market leadership, Alibaba has developed competitive actions from actualizing IT affordances. At Alibaba, actualizing IT affordances links closely with its defined organizational goals of developing: (1) a collectivist structure, (2) a coopetitive structure, and (3) an autonomous community among platform constituents. Our stage-wise model captures the relational aspects of IT affordances and proposes actionable prescriptions for a DMSP to achieve market leadership.