Hagel and Armstrong devote their book to addressing the new economics of networking. The Web-based venture, which largely reaches people between the ages of 18 and 34, now has more than 270,000 members. They share ideas in chat sessions and online conferences on everything from the arts to employment opportunities. Tripod generates revenue by selling targeted advertising and subscriptions to expanded services. This will change as customers become more sophisticated capturers and managers of their own information.
Virtual communities can reduce search costs for new customers.
They create an environment where customers have an increased propensity to buy. They also enhance a vendor's ability to target individuals who are most likely to purchase their product or service. Of course, all of this presumes that online community members will exchange knowledge among themselves and with companies to achieve mutual benefit. Without information and knowledge sharing, there is no relationship building. Without strong relationships, there is no community.