Irrational Herding or a Marketing Gold Nugget?
Are you a think-for-yourselfer? Do you weigh positive and negative Yelp reviews with a cold, dispassionate sagacity? Do you fancy yourself immune to the influence of others when you browse Reddit? That’s cute. Newly published research says you’re wrong.
A study that appears in the latest issue of Science reveals that users on social news aggregator sites like Digg, Reddit and Hacker News are heavily influenced by the opinions of other users, viewing comments differently depending on how they’re rated previously. Sound obvious? It’s not.
This is one of my favorite articles of late. I know I am on to something when I am feeling a combination of slight embarrassment, intrigue, and a dawning realization of the meaning, in terms of how to use the information in some way for increased effectiveness. All true here, and in this case, for more effective marketing. Well worth the momentary discomfort when a ‘truth’ interrupts my blissful state of ‘knowing.’
I love the way this article opens: “Are you a think-for-yourselfer? Do you weigh positive and negative Yelp reviews with a cold, dispassionate sagacity? Do you fancy yourself immune to the influence of others when you browse Reddit? That’s cute. Newly published research says you’re wrong.”
Now this captures my attention precisely because it does hit home: I do see myself as an independent thinker…. And, yes! By golly, I do indeed secretly harbor the belief that sagacity does visit me from time-to-time. But the kicker in that first paragraph is that new research says I am wrong. Having been steeped in a behavioral economic viewpoint, I don’t actually harbor illusions of complete rationality for me or for anyone else, but I do secretly believe that being armed with knowledge of my own irrationality somehow makes me more rational. So that bubble is getting ready to be burst. Intrigued I read on.
This article is about the impact of ratings and reviews on our decision-making, summarizing a study reported in Science. In this study, researchers evaluated our tendency to make decisions based on prior ratings and a form of not-so-rational thinking called “irrational herding.” The problem we all face when we read reviews, of course, is how to distinguish when they are based on irrational phenomena instead the “wisdom of the crowds,” the utopian expectation of crowd participation. Our aspired-to ideal.
Anyway, to the useful point: A controlled, randomized experiment on a major social news site demonstrates that a comment’s very first vote, if positive, had a huge impact on subsequent individual rating behavior and gave rise to herding effects. In a nutshell, what was found was that ONE positive vote dramatically increased the likelihood of another positive vote, and that the result would snowball, so much so that by the end of the experiment, the effect was a 25% increase in rating as compared to either the experiment’s control group or negative vote group (that, by the way, is another interesting finding, which makes the negative review a lot less worrisome)… Gulp, we can be a little bit herd-like, it seems…
So, dusting off the ego, let’s think about what this means from a marketing perspective. What this study appears to indicate is that if you can encourage someone from your audience to give you the initial positive vote (remember, even one strong one will do!), you may very well set into action a sequence of future reviews that build a wonderfully positive result for your offerings. That is well worth acting on, in my book. So…what are you waiting for? Get going to find your most ardent supporters to write reviews or positively rate your business. Now!
Happy marketing and continued success.