Cross-Category Innovation Strategy and Evolution of Digital Platform Ecosystems: A Technology-Driven Perspective

Shuo Sun, Bing Gu () and Fangcheng Tang
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Shuo Sun: School of Economics and Management, Beijing University of Chemical Technology, Beijing 100029, China
Bing Gu: School of Economics and Management, Northeast Electric Power University, Jilin City 132012, China
Fangcheng Tang: School of Economics and Management, Beihang University, Beijing 100191, China

Sustainability, 2025, vol. 17, issue 11, 1-26

Abstract: Digital platform ecosystems confront critical management challenges as they overcome path dependence amid rapid technological change. This study explores cross-category innovation as a key strategic action, using a longitudinal case study of ByteDance to analyze how digital technology drives ecosystem evolution, and constructs a “technology-driven–strategic action–ecosystem evolution” framework to examine the interplay between technological capabilities and strategic actions. Findings identify two stages: in the category emergence stage, platforms establish a core business ecosystem via identity, legitimacy, and differentiation strategies, leveraging technologies like algorithmic recommendation to shape user cognition and market legitimacy. In the category spanning stage, platforms leverage platform envelopment, open innovation, and status strategies to expand cross-category ecosystems, enabling technological spillover and integrated innovation across new domains. The findings reveal a co-evolution mechanism of cross-category innovation strategy and ecosystems, where the cross-category innovation strategy serves as both a driving force for ecosystem evolution and acquires new strategic opportunities. This study offers insights for building sustainable ecosystems that transcend industry boundaries and enhance resilience.

Keywords: digital platform ecosystems; cross-category innovation; platform strategy; category evolution (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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