The Network Effect

When purchasing a product, the main advantage is the product itself. What people are looking to get is something that the product alone will add. Benefits come from something material or from the features.

The same is not true for community-related products. When creating an app that aims to create a community, the main benefits come from the existence of other users within the platform.

Let’s dive into the example of facebook. As much as the social network platform was well designed, structured and thought (although in the meantime it has undergone significant improvements) the real benefit resulted from the interactions and sharing of photos, ideas and a sense of belonging. The application is not the product, we were the product.

When we went ahead to create and produce the OK Buddy application, whose objective was to bring together all students who were going to study abroad universities as well as those who were already there, on a single platform, the approach had to be thought out. 
It wasn’t about selling the application with cutting-edge technology (specially because it didn’t have it). It was not a matter of directly selling the features of the application. There were many and various better solutions on the market, much more advanced from a technical point of view than ours. However, they did not have what was most important: the community of students who had the same objective to study abroad. Communication did not go through messages praising the technical characteristics of the application, but the appeal to the sense of belonging. “Join the community with over 10,000 students”. 

The focus was not the app itself. The focus was the people who were using the app

The bigger the number of people in the platform, the greater the value for each one. The value does not come from improving features but from increasing number of users. Obviously, users alone on a platform are not a sign of dynamism and information sharing that add value. However, a good organisation and with the correct promotion of communication within the application, are half way to a community that promotes mutual help
Later we will talk about the importance of the gaming aspect for the development of communities and for users to spend more time within the platforms.

This learning process contributed in several ways to the increase of importance we attributed to the community. There are few high product acquisition cost projects that can grow and develop over the long term without proper community development.
Community has several practical effects, some being more obvious than others.


1) The community contributes to sharing information that helps us to improve the product/service.

2) Create value to the product, as the product does not exist alone but linked to a community that the customer can access. This is an extra.


3) The exponential increase in the Customer Life Time Value (CLTV), since several studies point to communities as structures that foster loyalty, and, consequently, greater investment in the company’s products.


We are human beings, and all of us, without exception, crave for this sense of belonging. Creating community is one of the basic desires of customers. I mean, people.

By Vasco de Matos Ramos

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