Digital platform, huh?

Digitization is leading to digital platforms establishing themselves in more and more markets - but most German companies still don't know what to do with this development.

More than six in ten business leaders and board members (62 percent) say they have never heard of the terms platform economy, platform markets or digital platforms.

Only around one in three (36 percent) know any of the terms. This is the result of a representative survey of 503 companies in all industries with 20 or more employees commissioned by the digital association Bitkom.

A year ago, awareness of digital platforms was at a similar level.

"Platforms can change existing markets from the ground up. New companies from completely different industries can displace the established top dogs if they fail to recognize the opportunities of digitization."

says Bitkom Chief Executive Bernhard Rohleder.

There are significant differences in the awareness of digital platforms depending on the size of the company and the industry.

While only 34 percent of top managers at companies with 20 to 499 employees are familiar with the terms, the figure for companies with 500 or more employees is 52 percent.

And while awareness in industry is 41 percent, it is significantly lower in retail (34 percent) and service providers (32 percent).

Well-known examples of digital platforms aimed at private customers are Airbnb, Amazon, Uber, Ebay, or the Apple and Google app stores.

On a digital platform, providers of products or services come together with potential customers. The platform operator may charge the providers, the customers, or both a fee for each transaction or a fee for access to the platform.

The platform operator does not have to produce any goods or offer any services itself, it only operates a digital marketplace. The providers of products or services gain access to a large number of customers on the platform. And the customers can conveniently compare different providers in one place and choose among them.