This paper explores the problem of designing a Web site that meets the needs of both an evolving community and an evolving business. It reports a case study of a business that introduced an e-tail site and an associated on-line community. The site development used an existing community-centered development method. The study found that participants had different motivations for visiting the site-some only wanted product information and purchase, some were seeking social support and information, others sought a more intense experience and greater social involvement. Failure to recognize the separate needs of these clusters resulted in not fully achieving business-and community-building goals. The analysis of the relationship between Web site design, cluster needs, and business goals offers a conceptual framework for co-evolving community and business.KEY WORDS AND PHRASES: Case study, e-business, e-commerce, e-tail, iterative design, on-line community.This paper applies an adaptation of the Preece framework for virtual community development to an e-tail scenario based on a case study of an on-line community associated with an e-tailing business [46]. On-line consumer communities built around a company can help build stronger brands, are sources of valuable insights into how customers use their products, and provide inexpensive mechanisms for developing customer relationships [22,23,39,41,53]. Researchers increasingly recognize that to achieve success, an on-line community linked to a business must satisfy social as well as commercial needs [3,7,8,14,35,63]. This brings dual challenges as the community and business co-evolve over time, and the underpinning of on-line systems must be dynamic to account for such changes.An "on-line community" can be defined in terms of a technology platform or as a "web of personal relationships" [37,50,56], but most researchers agree that on-line communities need more than just technology to flourish [49,55,56] and that individual users need encouragement to participate [4,9,31,33]. The need to plan for social interaction has increasingly been recognized and requires a clear understanding of the purpose of the on-line community, identification of the different types of people to be involved, and clear policies for governing the community [16,28,47,56]. Technology should not be The authors gratefully acknowledge the contribution of the UK Department of Trade and Industry for part-funding the project in the context of a Knowledge Transfer Program whose aim is to assist in the transfer of knowledge from universities to small businesses. Downloaded by [University of Exeter] at 23:43 03 August 2015 54 MACAULAY ET AL.