Electronic Communities in E-Business: Their Role and Issues

Abstract

Electronic communities are social aggregations of critical masses of people on the Internet who engage in public discussions, interactions, and information exchanges with sufficient human feeling on matters of common interest to form webs of personal relationships. Many such e-communities are rapidly evolving on the Internet, some initiated, organized, and controlled by community members themselves, some organized and controlled by marketers, and some by third parties acting as intermediaries between members and other interest groups such as marketers and advertisers. In this paper, we explore the role of e-communities as intermediaries in exchange relationships among community members and between community members and other interest groups such as marketers and advertisers from an economic perspective. In particular, we focus on the types of interactions that take place among community members and between community members and other interest groups and examine the economic and social issues involved in maintaining a healthy community. Deriving parallels from extant research in financial intermediation and social exchange theory, we explore conditions and incentive mechanisms under which such communities could develop and add value on the Internet. We also draw upon limited empirical examples from the World Wide Web to provide support to our propositions.