- Oren Inditzky
- Sep 18
- 6 min read
When you’re creating a website, investing in great design and top-notch products is essential. But in today’s world, anyone can undercut your prices, copy your design or even clone your products.
To set yourself apart, you need an advantage that can’t be copied overnight. You need an edge that grows stronger over time. You need strong network effects.
I’ve spent years working with internet apps and online businesses, and I can confidently say that network effects are one of the most powerful yet underrated drivers of rapid growth and long-term customer loyalty. The idea comes from consumer software, but it works brilliantly for websites, too.
Let’s break it down.
What do I mean by “network effects”?
Network effects refer to the idea that a product or service becomes exponentially more valuable as more people use it. Take Instagram or WhatsApp as examples: the more friends and family who join, the more useful and engaging the app becomes.
In the context of websites, the more people who use your site and contribute to it, the more valuable it becomes to other visitors (and the stronger your brand grows as a result).
Competing by utilizing network effects means going beyond building a static site that competes on things like product selection or price alone (which are easy to replicate). It’s about creating a dynamic ecosystem of users who actively bring others to your site and make the experience better for everyone.
The four loops behind creating a network effect online
Going one layer deeper, network effects are fueled by four loops that play off of one another:
01. The viral loop: designing a shareable experience
When most people hear “viral,” they think of a social media post that blows up overnight. But viral loops aren’t just about posting gimmicky videos in hopes of amassing a bunch of likes. They’re about designing an entire experience where users naturally bring in other new users, creating a self-propelling engine of growth.
Take Groupon’s early days as an example. Remember when you could only unlock their discounts if enough people jumped in on the deal? To get the savings, you had to share the offer with other people. You were, in essence, acting as a Groupon ambassador. That’s a viral loop in action.
For your website, think about how to encourage organic sharing. For example:
Offer group-based rewards or unlockable perks for inviting others.
Set up referral systems that reward both the referrer and the new participant with tangible benefits.
Publish quizzes, free tools and other resources that naturally get shared because they’re genuinely useful or fun.
Create ‘utility loops’ where using the site brings in new users, like sending a document to sign or sharing a booking link. Recipients become users too, and often return for their own needs, fueling growth.
Hand out a limited number of early-access invites per user so they can share with their friends (note: people tend to act quickly on opportunities that feel exclusive).
Give customers a voice in product design by allowing them to vote or suggest ideas, then share their input to inspire others to participate.
02. The social loop: turning visitors into active participants
Websites that encourage more active participation are likely to be more sticky. According to Playwire, sites with a focus on problem-solving (e.g., tutorial sites), discussions (e.g., community pages) or games and interactivity have significantly higher session duration times than those that are more transactional in nature (e.g., news sites).
It’s why sites like TripAdvisor have fared so well. In the world of online travel, where everyone is essentially selling the same flights and hotels at roughly the same prices, TripAdvisor stood out by building a system that encouraged users to leave reviews and share their own travel tips.
Over time, the site shifted from being a one-way content destination to a lively community that travelers returned to again and again. That repeat engagement made it much easier for TripAdvisor to drive bookings and slash customer acquisition costs.
For your site, the goal is the same: keep visitors coming back and get them involved in making the site better for the next person. Experiment with things like:
Inviting user reviews, testimonials or even Q&A on product and information pages. (You could even make the review process fun by giving participants levels or badges they’ll want to show off on social media.)
Providing interactive spaces (such as forum threads, discussion boards, polls) where users can add input and see each other’s contributions.
Embedding mini-polls on product pages, where customers can answer questions like “Which color should we launch next?”
Offering a space where visitors can share their own photos featuring your products, such as outfits they’ve styled using your pieces.
Creating post-action sharing prompts that make it easy for visitors to share reviews, quiz results or outfit creations, and reward the best posts with prizes or leaderboard recognition.
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03. The compulsion loop: keeping things fresh
Why do we compulsively check our phones and “doomscroll” through TikTok every day? It’s because we never know what we’re going to see next, and each little surprise hits our brain with a dopamine rush. That cycle of surprise and delight keeps us coming for more, time and time again.
Similarly, when it comes to your website, visitors are much more likely to come back if you give them something new to look forward to. This doesn't mean obsessively redesigning your website every month.
Rather, think about Costco. When you walk into a Costco, you’ll notice that Costco keeps staple goods in the back of the store, and puts high-impulse, limited-time offers up front. As a result, shoppers who stop by for their usual items often walk out with an unexpected purchase. Shoppers remember that feeling of surprise and delight, and look forward to experiencing that again in the near future.
You can start generating that addictive habit online by trying things like:
Rotating your featured products or services regularly. Take advantage of the hero section or other “above the fold” elements of your site to draw attention to the most seasonal or highly anticipated offers.
Introducing a sense of surprise, such as flash sales, limited-time bundles or exclusive product drops.
Offering fresh, engaging content via a blog, forum, sales section or a “new arrivals” section (as an example) that keeps visitors checking in regularly.
Promoting weekend specials that create a ritual where visitors know that every Friday bring a surprise drop, and every Sunday brings a bundle deal (as an example).
Including a mystery gift with every purchase, changing weekly, so customers can’t help but wonder, ‘What will I get this time?’”
04. The data loop: building a “smarter” experience
The data loop is an iterative process of gathering data, analyzing it and using it to adapt your site. In other words, you’re creating a website that grows smarter with every visitor interaction. The more your visitors use your site, the better the experience becomes for them and for future users.
Amazon is an obvious example here. The platform factors in user behaviors, product reviews, seller performance and a number of other signals to predict what visitors will do and want to see. This, in turn, improves their product recommendations, pricing strategies and other personalization efforts across the marketplace.
Over time, your site doesn’t just serve all customers. It becomes a place that’s customized to their needs.
For your site:
Use website analytics to identify what your visitors are clicking on, how long they’re staying and where they might be dropping off.
Show relevant recommendations, reminders or offers based on past activity. If you use a solution like Wix, you can leverage AI product recommendations that suggest products based on a visitor’s past behaviors.
Surface the right products or messages to the right users at the right time with smart FAQs, context-aware chatbots, adaptive content and apps like Twik. Each of these tools use real user data to predict their next move and to personalize the online experience accordingly.
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