added by sari and ยท updated 23d ago
Stratechery by Ben Thompson
- The value chain for any given consumer market is divided into three parts: suppliers, distributors, and consumers/users. The best way to make outsize profits in any of these markets is to either gain a horizontal monopoly in one of the three parts or to integrate two of the parts such that you have a competitive advantage in delivering a vertical s... See more
from Stratechery by Ben Thompson by stratechery.com
sari added 3y ago
- By extension, this means that the most important factor determining success is the user experience: the best distributors/aggregators/market-makers win by providing the best experience, which earns them the most consumers/users, which attracts the most suppliers, which enhances the user experience in a virtuous cycle.
from Stratechery by Ben Thompson by stratechery.com
sari added 3y ago
- The fundamental disruption of the Internet has been to turn this dynamic on its head. First, the Internet has made distribution (of digital goods) free, neutralizing the advantage that pre-Internet distributors leveraged to integrate with suppliers. Secondly, the Internet has made transaction costs zero, making it viable for a distributor to integr... See more
from Stratechery by Ben Thompson by stratechery.com
sari added 3y ago
- This has fundamentally changed the plane of competition: no longer do distributors compete based upon exclusive supplier relationships, with consumers/users an afterthought. Instead, suppliers can be commoditized leaving consumers/users as a first order priority. By extension, this means that the most important factor determining success is the use... See more
from Stratechery by Ben Thompson by stratechery.com
sari added 3y ago