Web 2.0 refers to the interactive web. Although the internet has not technically changed , the way people interact with each other on the web has changed. Websites have evolved from information sites into sites that the user can interact with. Social media sites which focus people interacting with each other has also grown.

In the early days of the internet, information was static. The websites were often like billboards lining the information highway. The websites competed to capture the attention of the viewer. In those early days, only chat rooms and forums offered any kind of interaction with other people. When AOL, Compuserve and other services competed with each other, the consumer was limited as to which forums and chatrooms they had access to. The chatroom selection was based on which service provider they used.

With the advent of more internet service providers and faster modems, people began interacting with each other more. The websites began focusing on graphics, and trying to be the most creative. The graphics eventually began moving and changing. With improvements in software, the ability to interact improved. Now consumers could interact with the websites they visited.

With the interaction, the relationship between seller and consumer and between the consumers themselves began changing. The advertising shifted from the billboard mindset to one that by necessity focuses on customer relations. The internet opened the world to new products and new competition for product markets.

Finally, the internet users who observed many of these changes realized that there had been changes in the way people interacted. They had changed the way they did business. The relationships on the internet had changed. This new way of interacting and the changes in the way business was conducted was labeled, “Web 2.0”.

Web 2.0 represents a ‘paradigm shift’ or a change in thinking about how things are done. In this new paradigm, advertising is no longer static, it is interactive. Many pages now include sound, color, motion and movies. With the change in format, there are new ways of attracting and maintaining the attention of one’s audience.

The Web 2.0 marketplace is different in many ways. It is interactive, customer focused, and has a world-wide audience. The need to communicate with people in various parts of the world is a new phenomena for people to understand. In the past, businesses focused on local markets. Now they have a global market and global competition. There is also the need to be able to conduct financial transactions in the global marketplace as well. Businesses that previously only worked with one currency are now faced with dealing with various currencies and various time zones all in a days work.