Coping Practices of Small‐ and Medium‐Sized Enterprises Facing Power Asymmetry in Digital Platform Business

ABSTRACT Digital platform (DP) enterprises have risen to the top of the global economy by inverting traditional business models. They earn money through matchmaking, transaction facilitation, and efficient orchestration of other stakeholders' resources. Small‐ and medium‐sized enterprises (SMEs) play a decisive role in this success story: they offer products and services on many leading DPs and thereby feed platform networks as sellers and suppliers. On the other hand, while DPs enable SMEs to reach new customers and outsource costly managerial tasks, many SMEs struggle with the negative consequences of asymmetric power dynamics and dependency risks in platform business. This paper analyzes 14 cases of SMEs that face power asymmetry as DP value providers, unraveling challenges encountered and coping practices employed in this situation. The findings reveal that power asymmetry between dominant DPs and SMEs creates significant challenges, including exploitative relationships, loss of autonomy, surveillance pressures, and devaluation of SME contributions, while SMEs cope through disintermediation, multi‐homing, individual resistance tactics, and striving for more equitable DP models. Moreover, three relationality types are identified: DPs being SMEs' “partners,” “tools,” and “necessary evil.” This article offers a new perspective on boundaries of SME strategies in the DP economy and contributes with empirical insights to the advancing field of entrepreneurial platform research.