February 10, 2014

The Network Effect

Every extra person added to the network, makes the entire network exponentially (not linearly) more valuable

The introduction of the fax machine is a classic study of the Network Effect.

If you’re the only one who has one, its completely useless.

But every extra person who used one made the entire network exponentially (not linearly) more valuable.

Some networks become so valuable that they pass a tipping point of critical mass that makes it next to impossible to leave for (or start) a competing network eg. Facebook, eBay

Intentionally making use of the Network Effect then, is one of the key distinctions of those at the forefront of The Connection Economy.

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About Adam Sugihto

Founder of Intentional - a specialist Pay Per Click Advertising Agency based in Melbourne, Australia. Member of Perry Marshall's Marketing Mastermind since 2011. Google Adwords Qualified Individual since 2010.

Category

Connection Economics