Mark posed a question, “Are your markets shaped by independent or social choice? …by what goes on between people or between their ears?” The awareness of the role of social influence is growing in our understanding of markets.
Mark’s latest book – published today! – is I’ll Have What She’s Having: Mapping Social Behavior. “Our ability to copy from one another is the biggest piece of the jigsaw to understand how behavior scales up from individuals to the patterns we see in populations.”
“We are not talking about boiling the ocean, but spotting patterns in population-level data sets, such as sales register receipts, to allow us to see what is going on.” Normally we as researchers start with the individual but “market-level pattens reveal what lies beneath (not vice versa).”
For instance, is the consumer electronics business shaped by independent choice or socially shaped choice? Is it shaped by the features of a product or by the celebrity endorsement of a product? Independent sales have a short-tail distribution, where copying has a long-tail distribution, with very few items accounting for most of the market volume and many items in the long tail having small share. With too many products and too many choices, social sharing makes it easier to identify products to purchase.
Mark has analyzed popular music downloads, charitable giving, car insurance, deodorants and spirits. Deodorant formats (rather than brands) and car insurance (policy configurations rather than brands) are independent, short-tail distribution, while the others are long-tail distribution with social copying.
In a quadrant analysis of markets with few to many choices, independent to social copying, different decision techniques emerge: guesswork for independent evaluation of many choices (auto insurance configurations), considered choice for independent evaluation of few choices (deodorant formats), fashion copying of peers for many choices in social sharing situations (music downloads) and finally mimicking experts when social sharing exists in markets with fewer choices (charitable giving).
“What kind of market are you dealing with?” Mark asks. This model is useful because it provides a “rapid return on effort” for the analysis, based on behavior rather than media channels. Such work raises two additional questions: “Sometimes looking for patterns above the level of the individual is more important than looking for more data.”
Where is traditional research appropriate? Certainly for independent decision making with few choices, and perhaps for independent decision making with many choices. Unfortunately, traditional research falls short at understanding social influence. “Let’s look for patterns rather than drilling down.”
Author Notes:
Jeffrey Henning
