Managing Marketspace Service Interfaces

Jeffrey F. Rayport is focusing on the strategic challenges that face businesses selling information-intensive products and services. A key strategic issue in such businesses is the dematerialization of information-intensive products and services as a consequence of the ubiquity of information and networking technology. Intangible substitutes for information-based products range from Web-based information services to video-on-demand on cable-TV to pay-per-view offerings on commercial on-line services. Product-oriented firms organized around the delivery of information-intensive tangible goods face must often compete, under these circumstances, in non-manufacturing settings through virtual or electronic channels; similarly, firms that have traditionally delivered information-intensive services in physical settings have discovered that the information component of their services can be delivered electronically.

The implications of these dynamics are several. Many product companies, thrust into the service world, must adopt a service-oriented approach to doing business, and many physical service firms find that the management of customer satisfaction, loyalty, and retention key drivers of profitability in the service sector is increasingly occurring through automated screen-to-face interface rather than traditional face-to-face service interactions. Both types of firms must develop new ways to manage customer relationships across human and technology-mediated interfaces. Moreover, in many businesses, success in one of these realms depends on success in the other. As a result, a complete business strategy involves management of service dynamics in marketplace and marketspace.

Rayports research has yielded a number of conceptual frameworks elaborated in Harvard Business Review and McKinsey Quarterly articles, along with a variety of case studies and course notes. Among them: the marketspace interface model (with colleague John J. Sviokla, which distinguishes content, context, and infrastructure in information-based value propositions); the virtual value chain, information value chain, and virtual value matrix models (with colleague Sviokla, which develops a marketspace analog to the physical value chain for information-intensive businesses); the trade-off between consumer privacy and customer information in service businesses (with John Hagel III, focusing on the challenges of information capture as the basis for mass personalization of services); and the new organization form of the infomediary (with Hagel, concerning the new intermediary that deals in customer information and related segment-of-one market data).