The combined intelligence of the crowd is smarter than the individual. A brief background to ‘Crowd Wisdom’ and how this is relevant to marketing
Surowieki’s, Wisdom of the Crowds argues that the many are often smarter than few. He explains how a crowds combined intelligence averaged out, is most often smarter or more accurate than that of the individual. The crowd averages out the individual weak ideas and because of its diversity of opinions tends to come up with the most accurate answer of all. This can only happen when the crowd contributions are diverse and not hijacked by a single point of view. Surowieki brings a number of examples to illustrate this, such as jellybean contests, where contestants are asked to guess the number of jellybeans in the jar. The collective guess is often closer than any individual guess. So too this is the reason it is so difficult to outperform the market
There are a few ways I have thought that crowd wisdom is relevant to internet marketing:
Google as a crowd wisdom search engine
I think it is possible to say that the search algorithms are based on crowd wisdom. What stood Google apart from its competitors was it’s link based algorithm. In an overly simplified form, each link from a different site pointing to a target site is considered like a vote and contributes to the sites Page Rank. Because more links means more votes this is in essence crowd based wisdom, where the collective decides. Googles wisdom was simply to harness this crowd voting and use it as a scoring system. It turned out that this was a superior way to rank websites!
I think that people inherently understand this crowd wisdom and therefore want to associate themselves with the decisions of the collective. They feel that if others have bought the same object, so too they should buy this object. (as a side point: According to Surowieki, this is problematic as this will in fact impede crowd wisdom if everyone follows the leader, rather crowd wisdom needs to come from diverse points of view) nevertheless, this it is important to make your customer feel that your product has been accepted by the crowd. A great way to do this is through testimonials. These should be placed in a prominent position on the site.
This idea fits well with behavioral psychology and social learning theory. Proponents like Skinner and Bandura have argued that behavior is determined by observation. Bandura’s famous bobo doll experiment found that behaviors such as aggression were learnt by children after observing models. We can adapt these learnings to harness the power of observation. We can affect our customers behavior through modeling on our site. If we can show our customers other people that have brought the product, how they are using it and what they think of the product, this will all contribute positively to shaping another sale. Consumers are likely to be encouraged by this behavior and it will influence their own behaviour.
lastly, try and harness this crowd wisdom for yourself. Either create customer feedback forms and ask your customers how you can change for their benefit. Find out what customers want to see on your site that is not there (you can use the site search option in analytics to discover what they are searching for on your site). Also look at split testing and A/B testing to understand how your users interact with your website.
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