There's a new site called SellaBand. The concept is defiinitely interesting. Visitors to the site can browse through a number of musicians who have posted up their music (for free). If you like a particular artist, you can invest in them: $10 a pop. For that, I think you get a few small items.
The idea is that, when a band hits $50000, the operators of the site bring them into a recording studio and out to record labels. Your $10 then pays back out, based on their success.
This is an amazing experiment. I'd love to get a hold of the data on this. This is a marketplace of art where 'voting with your dollar' has the potential for real payout. A few things may happen: bands that are inherently marketable (attractive members, catchy tunes) may attract a lot of investment; coalitions may form around bands that are known by small groups of people who evagelize them.
But what i think will most likely happen is that bands will tend to accelerate in the marketplace, as their investments go up. That is, a band that looks like it will actually make it to $50,000 is going to be far more likely to get an incremental $10 than a band that looks like a long shot. If you look through the listings with $10 burning a hole in your hard drive, you may see one band that has raised $35,000 and another that's raised $350. Most likely, you'll be attracted to the $35k band, if for no other reason than it seems like they will actually cross the threshold. Either way, the site (if it catches on at all) stands to do pretty well for itself. A handful of bands will make it to $50k, but they get a cut of every investment made.
This, though, WOM thrust right into the marketplace. The buzz around each artist is going to determine its ability to crack whatever secret threshold there is between one that looks like it will make it and one that looks to fail.
An article in the NY Times today talks about Web search queries and their repurcussions on privacy. What's really interesting about this unfolding story is the perception that our identities are easily revealed via our search history. The article discusses the revealed identity of a 62-yr old woman from Georgia whose identity was revealed through AOL's mistaken publication of 3 months of her queries, among them, "dog that urinates on everything."
Undoubtedly inspired by Jon Battelle's renowned terminology, the journalists refer to search behavior as a "catalog of intentions, curiosity, anxieties, and quotidian questions." This can certainly be true; although how does search behavior measure up against WOM units? Granted it is consumer-generated media (albeit not intentionally permanent), but I wonder its ability to predict intentions, or really anything about our identities, as compared to other forms of CGM. We know very little about the relationship between searching, online buzz, offline recommendations, buying behavior, or even traditional media coverage. Searching vs. buzzing (online WOM) might be a good place to start. My feeling is searching is probably a pretty valid precursor of WOM; WOM in turn, might be a stronger predictor of a higher-order variable. Both are very quantifiable...
I recently read an article where the researcher implicitly assumed that consumers engage in WOM to persuade others that their opinion is correct. Based on others’ research as well as interviews I have conducted, this assumption may be flawed. Certainly, some consumers do seek validation of their opinions some of the time, but there are MANY other reasons that consumers generate WOM. For example:
(some of these links may be dead for some of you, so I also included the references)
• ALTRUISM – consuners may generate WOM simply to help other consumers make better consumption decisions (Price, Feick & Guskey 1995)
• REVENGE – consumers may act as vigilantes, policing the market and seeking revenge against firms that have done them wrong (Richins 1983)
• COGNITIVE DISSONANCE – could be construed as persuasion, but more likely consumers seek to reduce uncertainty or to validate that their judgment of a product is correct (Engel, Kegerreis and Blackwell. 1969)
• TO CONNECT & BE SOCIAL – Sometimes consumers talk about products and services simply to make conversation. (see Idil Cakim’s blog)
• MORAL HAZARD - may discourage consumers from generating WOM. For example, research demonstrates that when moral hazard is high, weak ties are frail, that is, when it is not in consumers’ best interest to share information, they don’t, particularly to their lesser-known acquaintances (Frenzen & Nakamoto 1993)
• RECIPROCITY – Consumers will feel compelled to reciprocate with WOM when they themselves feel indebted to a potential receiver of information (for example because they received valuable information from the receiver), or because they desire the opportunity to similarly obligate the receiver (Engel, Kegerreis and Blackwell. 1969); Gatignon and Robertson 1986)
• SELF-ENHANCEMENT - consumers may generate WOM when they sense an opportunity to improve their power or status by doing so (Engel, Kegerreis and Blackwell 1969) ; Feick and Price 1987 (http://www.jstor.org/view/00222429/ap040207/04a00080/0); Gatignon and Robertson 1986)
When I consider this list, I wonder which motivations are most prevalent? And what other motivations inspire consumers to generate WOM? I would love to hear your thoughts.
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