How crowd wisdom disrupts traditional research

October 18, 2012

Whether they are buying a car or planning a trip, savvy buyers have always sought out knowledge and opinions before making a purchase.

What’s changed is where they are going to find that information. Instead of relying on individual experts and publications, buyers are heading online to get feedback from the crowd. Here’s how the Internet has changed the research process for buyers:

Old way: A few professionals research and become experts on a small number of products or services and make recommendations based only on their limited knowledge.
New way: A large community with diverse opinions and experiences offers more in-depth and wide-ranging expertise.

Old way: Experts often share opinions and recommendations based on experiences from several years in the past and use dissemination methods that are slow and inefficient.
New way: Members of the community share their feedback in real time, with new results generated constantly.

Old way: Large, established companies woo experts in exchange for favorable reviews and more exposure, prompting the experts to often recommend only these larger businesses and ignore smaller, more niche products and services.
New way: New channels afford small companies and their advocates a similar level of exposure with a much lower barrier to entry.

A good example of this shift can be found in the travel industry. In years past, I often used a travel agent to help plan my trips. A travel agent was a trusted advisor who helped me  determine where to stay and what to do, and ensured I got the best price. About 13 years ago, I thought I would surprise my soon-to-be wife with a trip to Bali (a place she had always wanted to go) for our honeymoon. Unfortunately, the travel agent, my supposed trusted advisor, forgot about the surprise and told my wife about the trip. As you might guess, this ruined the trust I had in the travel agent.

After this frustrating experience, I sought out a new trusted advisor: the crowd. To plan my honeymoon, I turned to the Internet to see recommendations from other people who had been to Bali. The results were outstanding. Based on the advice of the crowd, we stayed in some amazing hotels with excellent service, and got a great price to boot. I was hooked, and from then on, I looked online for guidance on both business and personal travel. I know I’m not the only one: when was the last time you used a travel agent? Probably a long time ago, if ever. It’s more likely you’ve used Travelocity, TripAdvisor, Orbitz, or Expedia to book a hotel or plan a trip.

Like travelers, buyers of business software planning a purchase have many needs they want met and questions they want answered. Gone are the days when the opinion of one person or a small group sufficed; the wisdom of the crowd is a better resource for making informed decisions. Check out how this wisdom works for business technology on G2 Alpha.