Too much can be as bad as too little: product update strategy for online digital platform complementors

Abstract

AbstractProduct updates have become prevalent on online digital platforms, given the unique market, product, and technological characteristics that underlie digital platforms. Scholars have begun to explore the efficacy of updates on digital platforms, highlighting the merits of implementing frequent updates. Drawing on behavioral decision theory, this paper analyzes the trade-offs that consumers encounter between the benefits and costs associated with updates and challenges an implicit assumption held in extant studies with respect to the linear efficacy of updates. In the context of mobile platforms, this paper, using a multi-method study, identifies the existence of an inverted U-shaped relationship between product updates and complementor product performance. We also find that the moderating efficacy of platform endorsement is positive in that it serves as an amplifier of whatever a complementor offers, tightly intertwined with the complementor’s offerings. Our paper expands the platform literature by investigating successful complementor product strategies that take into account unique platform characteristics with a strong grounding in interdependent owner–complementor dynamics.