Monday, September 27, 2010

The Yo-Yo series

Welcome to the Yo-Yo series, a three part dive into crazes that sweep across the market before disappearing just as quickly.  The first post, "Crazes happen because people herd" looks at herd behaviour and the typical characteristics of crazes.  The second post, "Tsunami style and Mexican wave style crazes" explores two types of crazes and key differences between them.  The third post, "Marketing's role in crazes" brings home the lessons for marketers including creating and riding a craze.

Yo-Yo 1: Crazes happen because people herd

They had us transfixed.  Five of them, head to toe in Coca-Cola tracksuits.  It was lunchtime in the playground and all the kids gathered around these exotic and super cool visitors.  They were there to Yo-Yo.  It was the 80’s and a Yo-Yo craze was just beginning for a new generation. Five years ago Pokemon might have been the Yo-Yo equivalent. Today it is more likely to be Apps.  So why do crazes happen and why was Coke gambling on a toy that our parents had first played with in the 1950s?  Are all crazes all alike, how do they start and as marketers, what’s our role to play?  This is the first of three posts in the Yo-Yo series that will examine these questions.

Let’s start with defining what I mean by a craze.
  • Something that sweeps up a mass of the market,
  • It’s compelling – something about it is so attractive that you can’t help but join
  • Finite – usually short-term, but of course “short-term” is relative

To flesh out the definition with some examples, consider the following crazes that have entertained us over the years; Pokemon, perms, Scrapbooking, knitting, iPhones, Masterchef, fashion, disco/ boot-scootin’/ Macarena,  in-line skating, aerobics/Zumba, polished floorboards, slow cooking, double denim… it’s a long and nostalgic list.

Fundamentally, all crazes are alike in that they compel a group of people to behave a certain way.  This is underpinned by the concept of herding where people tend follow their peers where there is comfort in numbers (James Surowiecki, Wisdom of Crowds). Indeed in an industry where staying out of the herd would seem advantageous, Surowiecki describes herding behaviour amongst money managers.  In this environment, doing what others do is a way to show that investment decisions are not irrational – comfort that financial matters are being handled responsibly. Another example is in restaurant selection – if you see a busy restaurant, logic tells you it must be a good one, and therefore the busy restaurant becomes busier (until of course a new restaurant triggers a new craze, but more on that in post 3). 

In the schoolyard, herd behaviour was definitely on display. There was comfort in being part of the Yo-Yo craze, and in fact it was very uncomfortable if you were unable to participate.  ‘No Dad, the Yo-Yo has to be a Coke one otherwise no-one will like me!’ As adults we are no more immune.  ‘No honey, let’s get polished floorboards so that the house is easier to keep clean/will be better for resale/looks better.’ 

As marketers, we need to understand herding so that we can anticipate market behaviour and gain the scale our businesses require. In theory, herding means that as long as we can influence the pack leader, we can generate mass.    

In Switch, Chip and Dan Heath give a nod to ‘herding’ by noting that behaviour is contagious, where people look to their peers for behavioural cues and tend to follow. If all my friends are getting smartphones, perhaps I should too?  The talk around the office on Mondays is Masterchef, so maybe I should tune in to see what the fuss is about? 

What really interests me about herding is the degree to which behavioural decisions are rational – after all, we are looking at “crazes”.  Whilst each example cited of a craze in this article can be explained rationally– to learn a new, fun trick at school, to improve resale of my property, for the convenience of managing information in a smart phone – it’s more likely that I simply do not want to be left out.   It’s the deep seeded survival mentality kicking in where the risk of being socially ostracised is just as powerful as the attractiveness of the craze itself.

So back to the schoolyard. Why did Coke send its Yo-Yo team to a local primary school? No surprises that it was a Brand identity activity that sought to associate ‘active’, ‘fun’, ‘cool’ with its product amongst a young demographic. But the clever part was the inferred association between being part of the ‘in crowd’ with Coke vs the ostracised, non-Coke, non-Yo-Yoers. Coke was using a toy to leapfrog its Brand to a deep unconscious connection that had a permanence that the toy could never have.  Long after yo-yos had been relegated to the bottom drawer and replaced by Pokemon, the Brand connection of being part of the insider herd remained.

So as marketers, the promise of herding is that we can get mass scale, and the key to engaging the herd may be more emotional than rational. But the beauty of inciting herd behaviour could be the magical long term associations that a craze can create.

But how to influence a herd in the first place, and how can you generate a craze of your own?  Post 2 looks at two different styles of crazes and how they begin, and post 3 examines the role of marketing in creating and riding crazes.

Characteristics of Crazes