Thursday, December 13, 2012

Social proof in behavioral economics and online networks


Social proof is a strong element in online social networks.  Wikipedia defines Social Proof as a “psychological phenomenon where people assume the actions of others in an attempt to reflect correct behavior for a given situation.”  Social proof is obvious to all in the forms of “liking” something and then seeing how many of ones fiends like something.  Social contagion and virility are one of the cornerstones of the internet and one of the driving forces behind the dialogues that occur between companies, users, and marketers. 
At the heart of social proof is conformity, where uncertainty or an over-abundance of choice leads people to look towards others for information on the best thing to do.  This is evident in sheep, pack animals, monkeys, and all other social animals.  From an evolutiontionary perspective, a social animal derives a significant amount of information about its surroundings and environment simply by watching other animals.  When one gazelle sees another suddenly break into a sprint, it too will begin to run.  When stock traders see a sudden unanimous behavior being undertaken by others in their surroundings, there is strong pressure there for them to act likewise.  Social proof is an underlying physchological mechanism that has its roots in our evolutionary history and it is strongly embedded in how we behave.  The implication for marketers is that, wherever and wherever possible, it is effective to frame their desired result in terms of how many other people are doing it.  Whether it be making a specific purchase (“your friend just bought this product from this store) or raising brand awareness (your friend likes this product/company), the more a marketer can frame its message in terms of something that the target’s community already supports, the more effective the message will be.  

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