Forget Price and Quality – your Business needs LUCK
Cumulative Advantage is what often makes one product more popular than another even when the less popular product is better in all respects. A few years ago at Columbia University a very interesting study was performed; participants in the research were able to choose and listen to music however some control groups were able to see how many other people had listened to each song and other control groups weren’t able to view the ‘popularity’. The groups unable to view the number of people who had listened to each song rated the quality of the songs they listened to. The results were certainly interesting; people who saw the number of times a song had been listened to chose to listen to the most popular songs far more than the least most listened to songs. The quality of the songs however was not a factor in the number of times a song was listened to by the group able to see the popularity of the song meaning that the popularity was more important to people than the quality. Of course, this is just a summary of the findings however the message is ‘loud and clear’, that the more popular people perceive a product to be the more often they will choose that product.
Cumulative Advantage explains why, for example, a movie that is seriously bad gets massive audiences whilst a great movie may not do that well at the box-office. People quite simply are very influenced by the purchasing decisions of others and in some ways this is understandable; in purchasing decisions we try to reduce our risk and we trust our peer group more than an advert in a newspaper. There however is not a means of determining in advance what will create cumulative advantage for one product over another.
So, in short it appears that business is not all about skill as there is an element of luck in getting people to buy your product.
