Trust your friends not the Wisdom of Crowds

Social Shopping is still in its infancy because it hasn’t reached the mainstream audience, yet. It has come a long way this year and after the first innovative experiments - like the successful Etsy (my view here) - it is finally getting more attention.

Following this, new services (Wists, Kaboodle, StyleHive, ThisNext, Crowdstorm) have been created and a lot more are on the works. But I’m doubtful of the focus of some of these services.

What is Social Shopping ?
Wikipedia describes

Social Shopping to be based on the principles outlined in the wisdom of crowds where a large group of users can recommend products to each other and between them work out what to buy and which ones have the most buzz.

Steve Rubel at Micro Persuasion thinks that

Social Shopping can take several forms, but in sum it means creating places where people can collaborate online, get advice from trusted individuals, find goods and services and then purchase them. It shrinks the research and purchasing cycle by creating a single destination powered by the power of many.

I agree with recommend products to each other and get advice from trusted individuals but I’m not so keen on the idea that most buzz and power of many are valuable Social Shopping definitions.

Trust your friends
James Surowiecki’s book on the Wisdom of Crowds explores the simple idea that

large groups of people are smarter than an elite few, no matter how brilliant—better at solving problems, fostering innovation, coming to wise decisions, even predicting the future.

There are a thousands of examples where this is certainly true. But there are also a few ones where this idea does not apply. Product recommendation is one of them.

A practical example: if you have 10 reviews on a bottle of wine and 9 of them were negative (from unknown people) and 1 of them was positive and from a friend, which recommendation would you trust ? Of course it depends on how much you trust this friend, but in general I would follow a friend’s recommendation over the people’s choice. So the focus should be on the friends side not on the crowds. This leads me to another point, niche oriented sites.

Niche Social Shopping Sites provide a much more interesting user experience than generic ones. By focusing on just one type of object: books at LibraryThing, Photos at flickr, sneakerplay for… well, sneakers (and, hopefully, wine at Adegga) these communities are more prepared to serve the specific needs of each of these products. And, because the user is using a niche interest oriented service it is more likely to find (or make) friends there and decide who is trustable to him.

So I guess that by not being niche and not focusing on friends each of those Social Shopping services fail in serving the users needs. And if users find a place where their individual motives are better fulfilled then they’ll change to the new service.

What do you think of these sites ? Have you used any Social Shopping site ?

September 22, 2006 | Tags: business

comments

11 Responses to “Trust your friends not the Wisdom of Crowds”

Carlos Jorge Andrade on September 22nd, 2006

which recommendation would you trust ? Of course it depends on how much you trust this friend, but in general I would follow a friend’s recommendation over the people’s choice.

I think your mixing concepts that are not alike. I can *trust* you, in your decisions, but not follow your recomendation over 10 other people all of them (including yours) based on *taste*. I can trust you and take you *opinion* into high account but i can *statisticly* choose a product based on 10 peoples taste or opinon. Trusting one person is not the same as an “expirienced crowd”.

What I mean is… I will only take you opinion into greater account if your’re an expert in the field. Not just because your’re my friend or I know you. But that’s me…
Tim on September 22nd, 2006

Hi. The LibraryThing guy here. Nice post. I have to say I find the whole social shopping trend a little gross. I don’t want to relate to my friends through shopping, create buzz, have a “buzzrank” (eg., http://popist.com/) become a “trusted” buzzer, etc. Shopping is empty enough without dragging friendship down with it. Certainly, if it were in my power, the people who thought up those new agencies that pay you to push products on your friends—”Hey, Sue, have you tried that new chicken sausage from Hormel?”—would be shot.

It strikes me that VCs are constantly churning out companies that take something interesting and revolutionary and twist it in a simplisticly commercial way that nullifies the value and generally fails. Think Wikis are cool? We’re gonna have PRODUCT wikis! Think posting to YouTube is fun? Well now you can make MONEY on the videos you post! Social networking cool? Now you can be “friends” with a cola, or join a social network around SHOPPING.

As I see it, LibraryThing is NOT a social shopping site. We don’t care about pushing anything—links to stores are there, but very down-played. Certainly we make almost nothing on affiliate revenues. (Notably, we list a slew of places to buy the book, as well as all the swapping sites, and only get affiliate money from one of them, Amazon.) What’s going on at LibraryThing is cataloging and social networking around shared tastes and experiences—a different animal, I think.
Lee Odden on September 22nd, 2006

Another angle on applying the “wisdom of crowds” to social shopping is to aggregate large numbers of reviews and algorithmically sort/rank products that way. Apply individual “friends” reviews on top of that and you’d have something very much like http://www.wize.com
Tim on September 22nd, 2006

Something I’ve discovered with LibraryThing is that rankings are a very bad way to sort things. This may apply particularly to books, but books that you own you generally own for a reason and like. Just because “The Purpose Driven Life” or “Rush Limbaugh is a Big Fat Idiot” are highly ranked doesn’t mean that everyone will like them. Rather, the people who buy them, like them. Since you can’t know this information beforehand, you need to look at “similas.” Social clustering is a much better way–people who liked “Dude? Where’s my Country” like “Rush Limbaugh is a Big Fat Idiot.”
Andre on September 22nd, 2006

Tim,
that’s the reason I really like LibraryThing. Each time i introduce a more obscure book and find out that a few people own it an have written a review, I discover a whole new variery of books that I might also like. Because other people who like that one I also liked, also like a few other one.

And it’s much more about discovering new books than might be interesting than finding out what many people thought was good.

I think that the book example is very much like what we’re trying to do at Adegga. Wine is also a kind of object that does not deal well with rankings. It’s all about liking a certain type of regions / grapes.

And if on top of those-who-like-this-also-liked-that you can filter by people you might trust than you have a system that adds value to the experience of choosing a book or a wine bottle.

Regarding shopping we are thinking of adding wine findability so that when you decide to buy a wine you can easily find it.
Andre on September 22nd, 2006

Carlos,
I think it depends on the products. If 10 people say that a notebook is awful I might take them serious because they are experienced.

But if I’m talking about books or wine (which are more subjective) I might find it more useful to go with the opinion of someone I know better and trust.

It doesn’t have to be a friend, just someone you said you trust and value his opinion as an expert to you.
Andre on September 22nd, 2006

Lee,
I like the idea of including Wize on my research for product buying for reference.

But I like I wrote on the post I think that social shopping means shopping integrated in your social context. Not a specific shopping oriented site. I like Wize but I see it as a destination on product research not a site where because I’m already using it I might buy something.

I think that successful social shopping sites will not be social shopping sites but sites that have a community that leads people to buy because they are already using it.
howard lindzon on September 23rd, 2006

i posted a few days back on this. Wisdon of crowds is a nice sounding buzz word but to smart people and customers you want over time, means zipppoo. It IS gross when it comes to shopping and will break you when it comes to the markets.

good post.

Looking forward to addega
Howard Lindzon » Monday Moring Cleanup - Wisdom of Crowds, Lists, Big Ideas and a Party on September 25th, 2006

[...] My friend Fraser Kelton from “The Golden Horshoe” (ooh the nectarines are sweet) has a new, better, definitive post on the Wisdon of Crowds . Another great one is offered up by Andre Ribeirenho - straight from the blogger paradise of Portugal no less. I love his blog and design and have added Andre to my blogroll. Check it out completely. [...]
Philip Wilkinson on November 9th, 2006

Believe it or not - I just found this post
Firstly, social shopping is here to stay as it is not just a collection of websites trying to make some money but actually implementing an aspect fo true shopping psychology. I believe people are really influenced by bestsellers and buzz to initially narrow their search, followed by recommendations and reviews from others, and finally taking into consideration trusted or expert opinions from people you care about.

It’s all part of the same process.

Of course personal taste comes into it too - but at least you are 3 steps closer than you were with a google search or price comparison.
The Web killed the Expert Star (not) at blog.delaranja.com on April 10th, 2007

[...] The Web does not work the same way for everything. Many times the concept of the participatory Web is put together with the concept of the Wisdom of Crowds. As I’ve written before trusting the Wisdom of the Crowds depends very much on the area we’re talking about. Generalizing the idea that the crowd is smarter than the individual is a mistake. So is also the idea that the Web is going to kill creativity or innovation. [...]