Monday, May 08, 2006

WOMM as a Cooperative Game

While doing something completely separate from work, I started to think about Word of Mouth Marketing as a Cooperative Game.

A cooperative game, as opposed to a competitive game, is one where players are best served by forming coalitions toward a goal. The Wikipedia entry imagines a volleyball game where the object is to keep the ball aloft for the greatest amount of time possible. Cycling is perhaps the ultimate cooperative game, since success is very clearly tied to working together during the race.

In order for a cooperative game to work, players must recognize that the greatest possible value comes from having both a) as large a coalition as possible and b) a situation where no one player can accrue more value outside the coalition than in. That is, if one person decides to let the volleyball drop, he is not in a position to get any extra, personal points.

So, it occurs to me that purchasing things (cars, medicines, whatever) has become a cooperative game: consumers have formed coalitions which help them make better decisions. I think one could begin to put value on the WOM that is occuring around a brand by looking at those two factors: coalition size and coalition value.
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Blogger Meikah said...

You are right about the good effect of WOM (coalition size and coalition value) on consumers. By taking part in this cooperative game, we consumers no longer rely on superfluous ads and actually take their word for it. I guess the only thing we need to do is to examine the coalition if it's legitimate or just a ploy by rival brands.

10:49 PM  

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