Work

A Dynamic Analysis of Cross-Category Innovation in Digital Platform Ecosystems with Network Effects

Year: 2025

Type: article

Abstract: Cross-category innovation in digital platform ecosystems is increasingly pivotal for competitive reconfiguration, and the value it generates for users primarily stems from the benefits of network effects. By extending the spatial competition framework of the Hotelling model through a four-stage sequential game comprising category competition, we formalize the strategic mechanism for expanding network effects governing benchmark competition and category dynamics. The cross-category innovation strategy proposed in this paper offers valuable insights in three key areas: investment in core technological advantages, reconstruction of user cognitive boundaries, and strengthening ecological dependency within the ecosystem. By transcending the limitations in the explanatory power of traditional management theories for cross-organizational boundary issues, this study integrates digital contexts into its analytical framework, thus providing a novel perspective for understanding the dynamic processes of cross-category innovation in digital platform ecosystems.

Source: Journal of theoretical and applied electronic commerce research

DOI: 10.3390/jtaer20030229

Authors: Shuo Sun, Bing Gu, Fangcheng Tang

Institutions: Beijing University of Chemical Technology, Northeast Electric Power University, Beihang University

Language: English

Topic: Digital Platforms and Economics

Subfield: Strategy and Management

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Industry, innovation and infrastructure

Open Access status: gold

Estimated APC paid: $1,207