Tuesday, April 17, 2007

Cumulative Advantage: Why Marketing Strategy is Dynamic

NYT has a short article about Cumulative Advantage, which is essentially the effect that occurs in a networked world where a moderately successful item (song, book, Web site, YouTube video) begins to become extremely successful, very quickly, pulling away from highly similar items of equal intrinsic quality.


Essentially, this is why you are more compelled to watch a video that 1 million people
have seen, as opposed to one that only 5 have seen. You (we) are drawn to things that others have deemed to be good. This is one of the mechanics of word of mouth, and something that clearly sets us up--as marketing strategists--to think of the world in highly dynamic terms.

Past (broadcast world) strategy had more to do with trying to figure out what would work and running it. You'd see if it did work, and try to learn from success and failure. Today, that is myopic and lazy. Today, we live inside of a highly-connected world where there is data, data and more data.

This is the opportunity that we have today. Everything is a living lab, where we can watch our target markets operate in very-close to real time, with stacks of algorithms at the ready. We need to continue to operate in a living way. Running a marketing program is more about optimization today than it is about initial insight. It is about flexibility and the ability to think quickly and recognize patterns as they begin to emerge.
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