While there can be wisdom in crowds, the masses sometimes behave more like lemmings.
Take the buildup to the housing mess, for example: a lot of people making a lot of bad decisions.
As general manager of global research for online metrics company Hitwise, it is Bill Tancer’s business to glean useful information from online behavior — and to understand which information isn’t so useful and why.
Author of "Click: What Millions of People Are Doing Online and Why it Matters," Tancer is an expert in marketing, market research and corporate strategy who has previously worked for LookSmart, Zaplet, NBC Internet and Pacific Bell Internet Services.
During a keynote address at the Inman News Real Estate Connect conference in San Francisco, which runs from Aug. 5-7, Tancer will discuss what we can learn from online behavior.
Tancer has used online search statistics to help predict the outcome of reality television competitions such as "Dancing with the Stars" and "American Idol."
In a 2006 blog post, Tancer noted how many people were surprised at how "Dancing with the Stars" darling Stacy Keibler didn’t win the competition — especially because her online search popularity topped the charts compared to other competitors on the show.
Tancer later explained this paradox with the "Stacy Keibler Correction Coefficient": it wasn’t the volume of search traffic that was telling in this instance — it was the type of searches related to Keibler.
He noted in the blog that some of the top-searched sites related to Stacy Keibler were "visited primarily by 18- to 34-year-old males, not the most likely candidates to pick-up the phone and vote for their favorite ballroom dancer" … and the searches by this online audience didn’t always relate specifically to her dancing skills.
Tancer has also looked to Internet statistics as a possible predictor for trends in resale home sales.
"In today’s market, when you’re thinking about buying a house you’re going to turn to the Internet to look at listings and compare prices. If that holds, then the changes, flux in visits to the real estate category overall should be predictive of interest."
So as a commentator on CNBC, Tancer noted that he stood apart from other analysts during a news segment in predicting a monthly rise in resale sales stats based on a rise in online real estate search activity.
Again, the Stacy Keibler Correction Coefficient reared its head. "I was wrong," he said.
"We misinterpreted that interest in (the real estate) category as buyers’ interest." But some of the increased traffic was a result of consumers checking home valuations — not searching for for-sale homes. …CONTINUED