{"id":14046,"date":"2021-03-01T11:54:43","date_gmt":"2021-03-01T16:54:43","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-digit\/submission\/mindbody-the-playbook-for-saas-enabled-platforms\/"},"modified":"2021-03-01T11:54:43","modified_gmt":"2021-03-01T16:54:43","slug":"mindbody-the-playbook-for-saas-enabled-platforms","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-digit\/submission\/mindbody-the-playbook-for-saas-enabled-platforms\/","title":{"rendered":"MindBody: the playbook for SaaS-enabled platforms"},"content":{"rendered":"

Most likely end-consumers, when I talk about MindBody probably the first association that comes to mind is you booking a fitness class online through their platform. MindBody’s end-consumer platform actually didn’t exist until a decade after the company’s inception. They started and strengthened over the years a SaaS solution for small businesses, creating a suite of tools from booking to payments to staff scheduling. And they remained with this focus, building loyalty with service providers, the supply side of what would eventually also become a platform, for years. While there are advantages in scaling quickly from building a platform upfront, simply connecting end-customers and service providers, time and time again we’ve seen disintermediation play a central role in service platforms. When a match is successful or when a service provider can fill up their schedule with clients sourced from these platforms, they have strong incentives to simply take the relationship offline. MindBody’s SaaS-enabled platform approach, despite of having taken a long time to build, essentially eliminates the threat of disintermediation. The value add for the service provider goes beyond a simple match, and comprises of tools to set up their business for success regardless of where the client comes from and how the relationship evolves (online or offline). The recent acquisition of MindBody<\/a> for almost $2 billion proves the value created from this strategy.<\/p>\n

An important takeaway analyzing many service platforms is that several service verticals are supply-constrained. There are many more consumers looking for these services than there are providers offering them, at least online. In the home services sector, for instance, ANGI Homeservices explains in its investor presentation<\/a> how currently less than 20% of home service projects are fulfilled online. In this vertical and other verticals, lack of digitization of professionals plays a key role in why this percentage is low. High fragmentation and incentives for disintermediation are also key drivers. In fitness, MindBody’s key vertical, the company understood that the only way to grow sustainably the online platform market was to help service professionals step into digitization first. For almost 10 years, from 2001 to 2010, MindBody’s sole focus was on the “supply side”. The tech company built an entire suite of solutions to convert businesses with no software solution with their business management software<\/a>. Their business management software<\/a> today handles scheduling, online booking, staff management, client relationship management, payments, and marketing, to name a few.<\/p>\n

With a loyal and large supply base, once MindBody decided to create its consumer-facing platform, it started having already solved the toughest part for many of these supply-constrained service platforms. The chicken-or-egg problem was no more. MindBody’s clever choice of brand allowed it to navigate from being a business tool to a consumer-facing product, while also leveraging the very own online booking and web presence tools it had already built for its service providers to aggregate and provide an extensive assortment for end-consumers from day one. Its business model not solely relying on intermediation, since MindBody had subscription revenue and payment processing fees as its core monetization strategy, allowed MindBody to fund growth of the platform. Finally, disintermediation was also not MindBody’s top concern. If a new client booked through the platform but for the second class booked directly with the fitness professional, the company would still be monetization the relationship through subscription and payment processing.<\/p>\n

Although it took a large amount of patience, I believe MindBody’s SaaS-first platform provides a framework for many other verticals to tackle increasing their supply base while at the same time reducing the impact of disintermediation.<\/p>\n","protected":false},"excerpt":{"rendered":"

Many of you may think of MindBody as the platform you use to book fitness classes. It turns out that this platform play was only introduced almost a decade later by MindBody. Since its inception, MindBody understood the power of becoming the operating system for a small business and the loyalty that comes with it. Disintermediation? Well, for them it’s not that big of a deal, since the platform play is just another feature in its suite of tools for small businesses to thrive.<\/p>\n","protected":false},"author":18519,"featured_media":14047,"comment_status":"open","ping_status":"closed","template":"","categories":[241,944],"class_list":["post-14046","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-platforms","category-saas","hck-taxonomy-organization-mindbody","hck-taxonomy-industry-technology","hck-taxonomy-country-united-states"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-digit\/assignment\/platform-variety\/","yoast_head":"\nMindBody: the playbook for SaaS-enabled platforms - Digital Innovation and Transformation<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-digit\/submission\/mindbody-the-playbook-for-saas-enabled-platforms\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"MindBody: the playbook for SaaS-enabled platforms - Digital Innovation and Transformation\" \/>\n<meta property=\"og:description\" content=\"Many of you may think of MindBody as the platform you use to book fitness classes. It turns out that this platform play was only introduced almost a decade later by MindBody. Since its inception, MindBody understood the power of becoming the operating system for a small business and the loyalty that comes with it. Disintermediation? 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