How did this concept come about?

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The network effect is an older concept than you might think.

Its origins are due to the fact that people have always wanted to be accepted and belong to a group. Therefore, if the members of the group they wanted to join consumed something, consuming it would also be a way of getting closer to this group.

This is something that has existed since ancient times, inherent to business models since they emerged.

However, this phenomenon always occurred naturally until it began to be strategically exploited with the emergence of the telephone.

The telephone itself was an innovative form of communication that brought many benefits to society. However, it could only achieve all its goals if it was used by a large number of people.

This excellent form of communication would be taiwan mobile database of no use if only a few people had access to this tool.

The main factor of the telephone was the reach of users who could communicate through it and benefit from the value it provided.

At that time, the term network effect did not yet exist, however, the phenomenon was already happening.

With the arrival of the Internet , network effects intensified and, more precisely, since 1994 — a time when the Internet reached a good number of users — businesses native to the virtual era were able to benefit from this concept.

A study by NFX says that the growth of 70% of digital companies created since 1994 was due to network effects.

Thus, as until now, focusing in the future on network effects to optimize marketing strategies can continue to bring excellent results for any business based on this concept.