What are digital platforms?
Digital platforms are software-based systems that bring together users, data and services through standardized interfaces and enable interactions or transactions. They bundle functionality centrally, can be extended, and form the technical foundation for digital business models.
Also known as: platform ecosystem · digital business platform · platform-as-a-service solution
Where digital platforms are used
Digital platforms connect several actors – such as customers, partners and internal departments – through a shared technical layer. Unlike a single application, they provide reusable building blocks such as identity management, data storage, APIs and billing, on top of which various functions and services can be built.
In mid-sized companies they often serve as a central system that replaces isolated, grown-over-time solutions. Instead of separate tools, a coherent ecosystem emerges in which data flows and new services can be added step by step. Microsoft Azure supplies the infrastructure for this, from app hosting and databases to security services.
A practical example
An insurance service provider wants to bundle claims reporting, customer communication and partner connectivity in one system. A digital platform provides a tenant area per client, central user management and open interfaces for connected systems. New functions such as reporting or automated review processes are later added as modules without rebuilding the foundation.
Benefits & typical use cases
The value of digital platforms lies in reuse and scaling: shared services are built once and used many times, so new use cases emerge faster and at lower cost.
- Central identity and access management instead of many separate logins
- Connection of external systems via APIs and standardized interfaces
- Multi-tenancy for several clients or business units on one foundation
- Incremental feature growth without rebuilding the entire system
How it differs from related terms
A digital platform is more than a single SaaS application: while SaaS describes a concrete subscription product, the platform is the supporting layer on which several applications and services run. It uses cloud infrastructure as its foundation and often relies on a multi-tenant architecture as well as REST APIs to connect further systems.
How smiit works with it
smiit built a digital SaaS platform for the InsurTech sector for Claimity AG and brought it into production on Microsoft Azure in just six weeks. The multi-tenant architecture cleanly separates customer data, Azure App Service and Azure Database for PostgreSQL provide the runtime and data layers, Azure Front Door secures delivery, and Keycloak handles identity management including MFA. REST APIs let the platform connect to existing systems – fully GDPR-compliant throughout.
Common mistakes & misconceptions
- A digital platform is often confused with a simple website or app, although its core is to connect multiple user groups and create value through network effects.
- It is often assumed that more features automatically make a better platform, when in fact reaching critical mass of participants and the quality of matchmaking usually determine success.
- Many underestimate the chicken-and-egg problem, namely that a platform only becomes attractive to one side once enough participants on the other side are present.
Frequently asked questions
What is the difference between a digital platform and an app?
An app serves a defined purpose, whereas a platform provides shared building blocks such as user management, data storage and APIs on which several apps and services run. The platform is the foundation, the app an application running on top of it.
Is a digital platform worthwhile for mid-sized companies too?
Yes, as soon as several applications, tenants or partner connections are planned. The foundation built once saves effort with every additional use case and ensures consistent security and data storage.
Which Microsoft Azure services form the basis?
Typical choices are Azure App Service for hosting, Azure Database for PostgreSQL for data, Azure Front Door for delivery and protection, and Azure Key Vault for secrets. Identity and MFA can be covered via Keycloak, for example.
How long does it take to build a digital platform?
That depends on the scope of functionality. A first viable version with core features can often be brought into production within a few weeks, while the ecosystem then grows step by step with further modules – instead of building everything at once.
How do you avoid dependency on a single provider?
Open standards, documented REST APIs and the use of widespread, portable technologies instead of proprietary special solutions all help. This keeps the platform extensible and makes it possible to swap out individual building blocks later.
Related terms
Sources & further reading
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