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1. Introduction
Incumbent business models in retail are challenged by new competition and evolving consumer expectations as retail has increasingly moved online. New business models take advantage of digitalization and changing consumer expectations, requiring managers to understand and react to the changing retail landscape at a fast pace. One example of this business model innovation in retail is multi-sided digital platforms. These types of platforms consist of multi-sided platforms such as from Alibaba Group without any own inventory and hybrids like Amazon.com combining their own inventory by opening the platform also to independent suppliers (e.g. Hagiu and Wright, 2015). Multi-sided digital platform business models transform the nature of exchange in retail as platforms link consumers with the independent supplier base, in other words the marketplace (e.g. Armstrong, 2006; Eisenmann et al., 2006; Haucap and Heimeshoff, 2014; van Alstyne et al., 2016). In this logic, the retailer intermediates the transactions between buyers and sellers thus shifting the inventory risk from the retailer to the supplier. The platform owners, such as Amazon.com, orchestrate their retail ecosystem of suppliers and consumers (Evans, 2003) unlike in other types of online retail business models where the retailer sells their own inventory (Spiller and Lohse, 1997). Multi-sided markets thus share similar principles to shopping centers or retail agglomerations by functioning as networks that facilitate social interactions and value co-creation (e.g. Teller et al., 2008, 2016; Teller and Elms, 2010) albeit now in the digital realm.
The effects of the platform economy and platform-based businesses on the retail sector have received limited attention from academics. Recent research on retailing in the digital era has looked at topics such as consumer engagement and interactivity in online retail channels (e.g. Dholakia et al., 2005; Vrechopoulos, 2010; Demangeot and Broderick, 2007), consumer value (e.g. Poncin and Mimoun, 2014), gamification (Insley and Nunan, 2014), price promotions (e.g. Breugelmans and Campo, 2016), fraud (e.g. Amasiatu and Hussain Shah, 2014), online recommendations (e.g. Panniello et al., 2016) and product returns (e.g. Minnema et al., 2016). Much of this past work on online retailing is, however, carried out with little regard to multi-sided digital platforms and companies such as Amazon.com or eBay. As, for example, Van Alstyne et al. (2016) highlight, there...