Media Products Influenced By The Cumulative Advantage

February 8, 2008

Found a few days ago this NYTimes article from April 07 by Duncan J. Watts. He is a professor of sociology at Columbia University and he did a quite interesting experiment on consumer behavior.

He analysed consumer behavior around the assumption:
“People almost never make decisions independently.”

This has big consequences on the success of products and especially media products.

“The reason is that when people tend to like what other people like, differences in popularity are subject to what is called “cumulative advantage,” or the “rich get richer” effect. This means that if one object happens to be slightly more popular than another at just the right point, it will tend to become more popular still. As a result, even tiny, random fluctuations can blow up, generating potentially enormous long-run differences among even indistinguishable competitors — a phenomenon that is similar in some ways to the famous “butterfly effect” from chaos theory.”

So far that`s not really new, it`s also a bit comparable to “network effects“. But the experiment showed, that it isn’t possible to predict the success of a product, when there is something like “cumulative advantage”.

The experiment was simple:

“In the webbased experiment participants were asked to rate songs of bands they had never heard of. Some of the participants saw only the names of the songs and bands, while others also saw how many times the songs had been downloaded by previous participants (social-influence group).”

With the result:

“In all the social-influence worlds, the most popular songs were much more popular (and the least popular songs were less popular) than in the independent condition. At the same time, however, the particular songs that became hits were different in different worlds, just as cumulative-advantage theory would predict. Introducing social influence into human decision making, in other words, didn’t just make the hits bigger; it also made them more unpredictable.”

Find detailed information on the experiment here.

What does that mean? In a world of web 2.0, Facebook, Myspace and Last.fm this effects get stronger as ever before, and is much more complex than in the old mass media age. There is now more than just the weekly music charts, or the playlist of your favourite radio and music television channel. That`s why there will always be a “high peak” at the beginning of “the long tail”.

What does that mean for the media industry?

“The implication for marketing executives is that they should de-emphasize designing, making and selling would-be hits and focus instead on creating portfolios of products that can be marketed using real-time measurement of and rapid response to consumer feedback.

In a short article in the Harvard Business Review Duncan J. Watts and Steve Hasker recommend five strategies in more detail.

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