by: David Wigder
This past week, the Industry Standard (IS), an icon of the late nineties Internet boom, relaunched its online property. It did so, however, not as a publisher of industry content but rather as a consumer-driven platform to predict the future.
How does a platform such as this enable seemingly ordinary consumers to predict the future? Quite simply, IS taps the "wisdom of crowds" or consensus view to determine the probability that an event will happen in the future. Such an approach assumes that that "aggregation of information in groups...result[s] in decisions that...are often better than could have been made by any single member of the group." Perhaps somewhat surprisingly, this approach has been demonstrated to be quite effective at making accurate predictions.
How does it work? In the case of IS, a "market" is simulated whereby members place a bet on the probability that a future event will or will not occur. They do so using "virtual currency" called "Standard Dollars". The probability of that event coming true is estimated based on "community consensus" calculated as the weighted average value of the bets placed for or against the prediction coming true.
Interestingly, IS is only the latest online publisher to tap into this type of platform as a way to engage consumers. Moreover, many of the existing platforms have a focus on predicting environmental trends including FT Predict, intrade, IdeaWorth, newsfutures, Popular Science Prediction Exchange, and ZiiTrend.
Intrade's Market Predicting EU Carbon Targets
Popular Science's Market Predicting Green Events
While many other sites exist to predict the future, it seems that only IS has tapped industry heavyweights as regular participants. Their presence not only lends credibility to the site (and the predictions generated there), but arguably, also increases the accuracy of those predictions as well. Quite simply, influentials possess domain knowledge that can shape the opinions of other site participants and the wagers that they make regarding the future.
As marketers experiment with new ways to attract and engage consumers, simulated markets should be in the mix. Moreover, participation by domain experts may only enhance this consumer experience by providing credibility and enhancing the accuracy of the predictions. But, you don't have to take my word on this, however. Just ask a crowd.