Swaziland, May 29, 2008-- Joanne Campbell and Nicky Liddle from TNS Customer Equity Company, TNS’ Brand Equity Centre based in Cape Town investigated the effects of cumulative advantage – when a brand reaps success from past successes. It is a concept that looks into the unpredictable nature of brand success due to the impact of social influence on an individual’s preferences.
They shared what they had found with the audience attending the annual SAMRA conference at the Swazi Sun and Spa in Swaziland and walked away with the 2nd prize for overall paper and presentation.
Cumulative advantage is also known as the ‘rich getting richer effect’, where individuals’ preferences are impacted on by the preferences of others, leading to strong brands getting stronger. So, why do people look at what other people are doing to make decisions? In an era of endless choice, people don’t have a hope of ever finding what they are looking for, and therefore seek the advice of their peers and online social networks.
The effect of social influence has become even more relevant and visible in today’s interconnected society of the Internet and the emergence of new types of media platforms such as social networks, which expose ‘ordinary individuals to one another’s decisions about what they watch, listen to and buy’ (Hasker and Watts, 2006).
It is becoming apparent that the more people think that shared content is liked by others, the more people will download it and the higher the probability that they will like it themselves, based on the perception of popularity. It would be interesting to see the effect of removing the rating of articles and the articles’ number of downloads, and whether the same amount of users would download and view the articles.
The research done by TNS looked at three groups of people who were asked to rate different artworks. The first group provided independent ratings, while the second and third groups were exposed to social influence conditions, by being given other stimuli that shaped their perceptions, in the form of comments and adjuncts. The lowest scoring images were those attached to negative social cues, and the highest ranking images were those believed to have had positive outlooks by others. This led the researchers to believe that social cues had an influence on people’s decisions.
This becomes crucially important when one looks at the move toward consumer generated content, and the impact this has on one’s brand. Take for example a recent example, where a story was loaded onto a news website about a new cheap car that is being brought into the marketplace. The article was scathed by dozens of users, with comments from people about poor safety and the flood of cars already on our roads. There is no doubt that people ‘jumped on the bandwagon’, but also that negative comments affected the brand’s opportunities of market penetration.
This all comes together under the banner of ‘cumulative advantage’, where positive cues will lead to improved brand positioning by consumers, while negative cues will lead to a lesser perception by others of the brand or product.
Research abstract
We know how powerful the effect of ‘badging’ can be among peer groups. We have seen how packaging and the look and feel of brands can affect perceptions. But how much do we know about cumulative advantage, also known as ‘success breeding success’- a state in which a current advantageous situation leads to even greater advantages’?
People do not operate in a vacuum and are highly influenced by the preferences of others, particularly in cultural markets. Exploring the concept of cumulative advantage and gaining insight into how people make decisions will be a powerful tool for marketers and market researchers.
Other papers presented by brand equity team included ‘From sponsorship effectiveness to sponsorship appropriateness’, by Alida Jansen and Enrico Tronchin and ‘Sample size unknown: perceptions about women and media influence in an unrestrained network’, by Alice Louw.
For any other Conversion Model papers please contact:
Naboe Grainger
naboe.grainger@customerequity-co.com
About SAMRA
The Southern African Marketing Research Association is a professional body of individuals engaged in every aspect of marketing research – from planning, supervising and setting standards for the industry, to teaching and promoting professionalism in marketing research. The Association provides its members with numerous benefits, not least of which is the opportunity to share knowledge and learn from the experience of other members. SAMRA has been the professional association for members of the marketing research industry since 1963.
www.samra.co.za/
About TNS
TNS is a global market information and insight group.
Its strategic goal is to be recognised as the global leader in delivering value-added information and insights that help its clients make more effective business decisions.
TNS delivers innovative thinking and excellent service across a network of 80 countries. Working in partnership with clients, TNS provides high-quality information, analysis and insight that improves understanding of consumer behaviour.
TNS is the world’s leading provider of customised services, combining sector knowledge with expertise in the areas of Product Development & Innovation, Brand & Communications, Stakeholder Management, Retail & Shopper and Customer Intelligence. TNS is a major supplier of consumer panel, media intelligence and audience measurement services.
TNS is the sixth sense of business™.
www.tnsglobal.com/
