Lets start off with what Web 2.0 is not: it's not a new version of Web 1.0. Web 2.0 is not a revolution in technology, it's an evolution in the way people are using technology. It's about harnessing the distributed collaborative potential of the internet to connect and communicate with other like minded people wherever they are: creating communities, and sharing knowledge, thoughts, ideas and dreams.

If you've ever shared photos on Flickr, read and commented on a blog, looked for friends on Facebook or MySpace, watched a video clip on YouTube, tried to find your house on Google Maps, video-called friends or family abroad using Skype or looked up an article on Wikipedia, then you've used Web 2.0 technologies.

Suddenly it seems we've been inundated with version 2.0 of anything and everything as different sectors of society seek to demonstrate that they're current and progressive. We have Business 2.0, Government 2.0, Education 2.0, Careers 2.0... and of course Marketing 2.0. Well, not to be outdone, we'd like to introduce you to the new, improved, Consumer 2.0.

One upon a time consumers were quite happy to sit in front of passive broadcast media, accepting whatever was being peddled their way by editors and programme schedulers. Yes, there was an element of choice – you could buy a different newspaper, listen to different station or choose a different channel – but the ultimate decision in terms of the content available to you rested with somebody else.

Then along came the web, and changed all the rules. Now, with Web 2.0, broadband and rich media content, today's consumers are in control like never before. They can choose the content they want, when they want it, in the way that they want it... they can even create their own and share it with their friends, their peers and the world for free.

'Consumers are becoming better informed, better connected, more communicative, and more in control than ever,' highlights Julian Smith, an analyst with Jupiter Research writing for the ClickZ network. 'They're better informed through the increased ability to access and sift an abundance of information any time, anywhere. They're better connected through the ability to instantaneously communicate with others across time zones and social strata. They're more communicative through the ability to publish and share their ideas and opinions. They're more in control through the ability not only to personalize their information and entertainment consumption, marketing messages, and the products and services they buy, but also to gain satisfaction on demand.'

Analysts at Jupiter Research identified seven key ways in which the increasingly widespread adoption of technology is influencing consumer behaviour:

• Interconnectivity: networked digital technology is enabling consumers to connect with each other more readily, be it through email, IM, mobile messaging, or web-based, social networking platforms such as Facebook, MySpace, and LinkedIn – or more likely a combination of all of these platforms. Consumers are interacting with like minded people around the world, paying scant regards for trifling concerns like time zones or geography. Peer-to-peer interaction is reinforcing social networks, and building new virtual communities.

• Technology is levelling the information playing field: with digital technology content can be created, published, accessed and consumed quickly and easily. As a result the scope of news, opinion and information available to consumers is broader and deeper than ever. Consumers can conduct their own unbiased research, comparing and contrasting products and services before they buy. Knowledge is power... and digital technology is shifting the balance of power in favour of the consumer.

• Relevance filtering is increasing: with such a glut of information available to them, digital consumers are, through necessity, learning to filter out items relevant to them and to ignore anything they perceive as irrelevant. Increasingly digital consumers look to have their information aggregated, categorised and delivered (whether through email or RSS feeds). They use personalization features to block out irrelevant content and increasingly employ software solutions to exclude unsolicited commercial messages.

• Niche aggregation is growing: the abundance and diversity of online content allows consumers to participate and indulge their specialist interests and hobbies. Aggregations of like-minded individuals congregate online; the homogeneous mass consumer population is fragmenting into ever smaller niche groups, with increasingly individual requirement.

• Micropublishing of personal content is blossoming: digital media's interactive and interconnected nature allows consumers to express themselves online. Publishing your own content costs little more than a bit of time and imagination, whether through discussion forums, message boards, feedback forms, voting platforms, personal photo galleries, or blogs. Users are posting their opinions online for all to see, and are consulting the opinion of their online peers before making purchasing decisions. How often do you check an online review before booking a table at an unknown restaurant, a weekend break at a hotel, or even buying a new car?

• Rise of the 'prosumer': online consumers are getting increasingly involved in the creation of the products and services they purchase, shifting the balance of power from producer to consumer. They're letting producers know what they want in no uncertain terms: the level of interaction between producer and consumer is unprecedented. Individuals are more involved in specifying, creating, and customizing products to suit their requirements, and are able to shape and mould the experiences and communications they receive from producers. Traditional mass-production and mass-marketing concepts are rapidly becoming a thing of the past.

• On-demand; any time, any place, anywhere: as digital technology becomes more ubiquitous in people's lives, the corresponding acceleration of business processes means that consumers can satisfy their needs more quickly, more easily and with fewer barriers. In the digital economy trifling concerns like time, geography, location, and physical store space are becoming irrelevant. It's a world of almost instant gratification – and the more consumers get of it, the more they want it... now, now, now!

For marketers this evolution of the marketplace, and the shift in consumer mindset that it heralds, presents a plethora of new challenges. As consumers increasingly embrace new ways of communicating, take greater ownership of the information and entertainment they consume, and aggregate in increasingly specialised niche online communities, marketers must shift their approach if they want to connect with them.

(This is an extract from Chapter 1 of Understanding Digital Marketing)