As virtual communities tip the balance of power in commercial transactions toward the customer, they will provide a powerful vehicle for vendors to deepen and broaden their relationships with the people who buy their goods and services. This is likely to affect the way businesses are run in physical space as well as in the virtual world. The primary effects will be felt by managers in the marketing and sales functions (Exhibit 1), who will find themselves wrestling with new rules for winning customer loyalty. In fact, "ownership" of customer relationships as a whole is likely to be thrown up for grabs by the emergence of virtual communities.

These threats to the status quo will also represent opportunities. Marketers stand to gain, on balance, from the implications of virtual communities, especially those who find ways to leverage this new customer power rather than fight it (Exhibit 2).

Marketing and selling to more powerful customers

The fact that virtual communities are likely to shift power from vendor to customer by reducing or eliminating the information advantages that vendors currently enjoy is not all bad news for marketers. Because virtual communities will actually improve the quality of information about individual customers...