To begin with, a definition. Web 2.0 describes where the internet is today. Presumably, there was an earlier version--the old days when things hadn't evolved past static web pages. Today the online world encompass an interactive, community driven series of platforms with limitless possibilities. Keep in mind that this article looks at Web 2.0 from a marketing and social perspective rather than from the technology side.
So what are a few of these Web 2.0 platforms?
1. Video--sites such as the ever-popular Youtube, Google Video, and Metacafe.
2. Facebook.
3. MySpace.
4. Twitter
All of these sites are places where people can interact and socialize with others. But the real beauty of these sites (and other web 2.0 platforms of which there are many) is that people can share opinions, hear 'insider information' from one another, and interact in a more "real world" environment...similar to the offline world.
Web 2.0 adds personality and relationship to the internet. It takes technology to the next level and is based on the inherent understanding that people want relationships.
Let's consider online commerce. The traditional ecommerce or corporate website builds little relationship, and consequently, little trust. Take a website with video that incorporates a place for customer/viewer feedback and all of a sudden you have interaction. This second kind of website will see much greater sales--assuming the video and interactive components are well done.
How can this work?
The answer is fairly obvious. People like human interaction and relationships in general; however, there's another reason. On the internet, people are looking for information, not to be sold. In the off-line world we are continually bombarded with over-the-top marketing/advertising. When people use the internet, they're typically in another mindset. They're looking for VALUE, good content and opinions from people they can trust. Web 2.0 offers an effective and satisfying solution.