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• Working Paper | HBS Working Paper Series | 2013

  Marketplace or Reseller?

  Andrei Hagiu and Julian Wright

  An intermediary can choose between functioning as a marketplace, on which suppliers sell their products directly to buyers, or as a reseller, purchasing products from suppliers and selling them to buyers. In our model, this choice comes down to whether residual control rights over non-contractible decision variables are better held by suppliers (the marketplace mode) or by the intermediary (the reseller mode). We focus on a single non-contractible decision variable ― the level of demand-enhancing marketing activities. The reseller is better able to coordinate these activities across products, whereas the marketplace mode benefits from allowing independent suppliers to tailor their marketing activities to local information about buyer demand. In the benchmark setting, the marketplace mode is preferred if and only if the variance of local information exceeds the squared value of spillovers from marketing activities across products. We explore several generalizations, showing how the benchmark tradeoff is modified in different settings.

  Keywords: Intermediation; multi-sided platforms; control rights; marketing;

  Citation:

  Hagiu, Andrei, and Julian Wright. "Marketplace or Reseller?" Harvard Business School Working Paper, No. 13–092, May 2013.

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• Case | HBS Case Collection | 2013 (Revised from original 2013 version)

  Royal DSM: Fighting Hidden Hunger

  Rebecca Henderson, Noah Fisher and Mary Shelman

  In 2007 Royal DSM, a leading life science and materials company, entered a partnership with the World Food Programme (WFP) to combat hidden hunger around the world by providing micronutrient solutions. The case investigates the unexpectedly large impact the partnership had on DSM and on the global nutrition discussion, and discusses the benefits and challenges of scaling up the Nutrition Improvement Program—a key component of DSM's human nutrition and health division—beyond the WFP partnership, despite the need to build significant additional capabilities and its somewhat lower margins.

  Citation:

  Henderson, Rebecca, Noah Fisher, and Mary Shelman. "Royal DSM: Fighting Hidden Hunger." Harvard Business School Case 313-085, May 2013. (Revised from original January 2013 version.)

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• Case | HBS Case Collection | 2013 (Revised from original 2012 version)

  GREE, Inc.

  Andrei Hagiu and Masahiro Kotosaka

  In 2012, GREE was one of the world's most profitable mobile social gaming companies. Its success in Japan was due both to its in-house games and to the development platform that it offered to third-party game developers. Its biggest challenge was to replicate the success of this two-pronged strategy in international markets, where it had to contend not just with many other game developers (e.g. Zynga), but also with the mobile platform providers themselves (e.g. Apple's iOS and Google's Android).

  Keywords: Strategy; Technology; Japan;

  Citation:

  Hagiu, Andrei, and Masahiro Kotosaka. "GREE, Inc." Harvard Business School Case 713-447, April 2013. (Revised from original November 2012 version.)

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