Kevin Kelly, one of the gurus of the New Economy, has written, for example, of what he calls the “fax effect,” which is a version of this argument. The first fax machine ever made was the result of millions of dollars of research and development and cost about $2,000 at retail. But it was worth nothing because there was no other fax machine for it to communicate with. The second fax machine made the first fax more valuable, and the third fax made the first two more valuable, and so on. “Because fax machines are linked into a network, each additional fax machine that is shipped increases the value of all the fax machines operating before it,” Kelly writes. When you buy a fax machine, then, what you are really buying is access to the entire fax network — which is infinitely more valuable than the machine itself.
Kelly calls this the “fax effect” or the law of plentitude, and he considers it an extraordinarily radical notion. In the traditional economy, after all, value comes from scarcity. The conventional “icons of wealth” — diamonds, gold — are precious because they are rare. And when something scarce becomes plentiful — as oil did in the 1980s and 1990s — it loses value. But the logic of the network is exactly the opposite. Power and value now come from abundance. The more copies you make of your software, the more people you add to your network, the more powerful it becomes. This is why e-mail is supposed to be so powerful: it’s the ultimate tool for easily creating these kinds of personal networks.
But is this true? Epidemics create networks as well: a virus moves from one person to another, spreading through a community, and the more people a virus infects, the more “powerful” the epidemic is. But this is also why epidemics so often come to a crashing halt. Once you’ve had a particular strain of the flu, or the measles, you develop an immunity to it, and when too many people get immunity to a particular virus, the epidemic comes to an end. I think that when we talk about social epidemics, we give far too little attention to the problem of immunity.
In the late 1970s, for instance, businesses began to realize that the phone was a really cheap and efficient way of reaching potential customers, and since then the number of telemarketing calls to target households has increased tenfold. This sounds like a very good example of what Kelly is talking about — the extraordinary economic potential of a communications network that we all belong to — except that in certain key respects the explosion in phone use doesn’t sound like the law of plentitude at all. The fact that everyone has a phone makes the phone network very powerful, in theory. But the truth is that over the past twenty five years or so, the effectiveness of telemarketing has dropped by about 50 percent. Certain low ticket items — things that cost in the range of twenty five to thirty dollars, such as magazine subscriptions — are simply no longer economical to market over the phone. Belonging to a large network may be a wonderful thing, and the larger networks are, theoretically, the more powerful they are. As a network grows in size, however, it is also the case that the time and nuisance costs borne by each member of the network grow as well. That’s why people don’t talk to telemarketers anymore, and why most of us have answering machines and caller I.D. that lets us screen calls. The phone network is so large and unwieldy that we are increasingly only interested in using it selectively. We are getting immune to the telephone.
Is e-mail any different? I remember when I first got e-mail, back in the mid 1990s. I would rush home with great anticipation and dial in on my 4800 baud modem and I would have . . .
four messages from four very good friends. And what would I do? I would immediately compose long, elegant responses. Now, of course, I get up in the morning and go to my computer and I have sixty four messages, and the anticipation I once felt has been replaced by dread. I receive unwanted spam e-mail and forwarded stories and jokes that I have no interest in, and people I don’t particularly care about e-mail me to ask me to do things I don’t want to do. So how do I respond? I compose very, very short e-mails — seldom more than two lines long — and I often take two or three days to get back to people; and lots of e-mail I don’t answer at all. I suspect that the same thing is happening with other e-mail users around the world: the more e-mail we get, the shorter and more selective and more delayed our responses become. These are the symptoms of immunity.
What makes e-mail so susceptible to immunity is the very thing that initially made it seem so attractive to people like Kevin Kelly: how easy and inexpensive it was to reach people. In one recent study, for instance, psychologists found that groups who communicate electronically deal with dissenting opinions very differently than groups who meet face to face. People holding dissenting opinions expressed their arguments most “frequently and persistently” when they communicated online, the researchers concluded. “At the same time, minorities received the highest level of positive attention and had the greatest influence on the private opinions of members in the majority and on the final group decision when they communicated face to face.” The fact that expressing a dissenting view in person is much harder socially, in other words, gives that opinion much more credence in the group’s deliberations. It’s the same way in other kinds of communications. The fact that anyone can e-mail us for free, if they have our address, means that people frequently and persistently e-mail us. But that quickly creates immunity, and simply makes us value face to face communications — and the communications of those we already know and trust — all the more.
I think that the “fax effect” error is being repeated by marketers and communicators over and over again. Advertising agencies often decide which magazines and television shows they want to place their ads in on the basis of cost: they buy whatever time is the cheapest as a means of reaching the widest possible audience. But what about immunity? The agencies’ logic has resulted in so many companies buying ads on television that it now runs more hours of commercial time than ever before. Therefore, it’s hard to believe that people are really watching commercials as closely as they did before. The same is true for a magazine with hundreds of advertisements or a roadside with billboards every hundred feet. When people are overwhelmed with information and develop immunity to traditional forms of communication, they turn instead for advice and information to the people in their lives whom they respect, admire, and trust. The cure for immunity is finding Mavens, Connectors, and Salesmen.
Finding the Mavens
Whenever I look at an unopened bar of Ivory bath soap, I flip it over and burst out laughing. In the midst of all the product information, there is a line that says: “Questions? Comments? Call 1 800 395 9960.” Who on earth could ever have a question about Ivory soap? In fact, who on earth would ever have a question about Ivory soap so important that they felt compelled to call the company right away? The answer, of course, is that while most of us would never dial that number, a very small percentage of profoundly weird people may well feel compelled from time to time to call in with a question. These are people who feel passionate about soap. They are the soap Mavens, and if you are in the soap business you had better treat those soap Mavens well because they are the ones whom all their friends turn to for advice about soap.
The Ivory soap 800 number is what I call a Maven trap — a way of efficiently figuring out who the Mavens are in a particular world — and how to set Maven traps is one of the central problems facing the modern marketplace. For the better part of a century, we defined influence in this country in the form of status. The most important influence in making up our minds, we were told, was the people who made the most money and who had the most education and who lived in the choicest neighborhoods. The virtue of this notion was that these kinds of people were easy to find: in fact, an entire industry in the marketing world was created around the convenient delivery of long lists of people who had graduate degrees, made lots of money, and lived in nice neighborhoods. But Connectors, Mavens, and Salesmen are a little different. They are distinguished not by worldly status and achievement, but by the particular standing they have among their friends. People look up to them not out of e
nvy, but out of love, which is why these kinds of personalities have the power to break through the rising tide of isolation and immunity. But love is a very difficult thing to track. How on earth do you find these kinds of people?
This is a question that I’ve been asked again and again over the last year, and there is no easy answer. Connectors, I think, are the sorts of people who don’t need to be found. They make it their business to find you. But Mavens are a little harder, which is why it is so important, I think, to come up with strategies for finding Mavens — Maven traps. Consider the experience of Lexus. In 1990, just after Lexus first introduced its line of luxury cars in the United States, the company realized that it had two minor problems with its LS400 line that required a recall. The situation was, by any measure, an awkward one. Lexus had decided, from the beginning, to build its reputation around quality workmanship and reliability. And now, within little more than a year of the brand’s launch, the company was being forced to admit to problems with its flagship. So Lexus decided to make a special effort. Most recalls are handled by making an announcement to the press and mailing a notification letter to owners. Lexus, instead, called each owner individually on the telephone the day the recall was announced. When the owners picked up their cars at the dealership after the work was completed, each car had been washed and the tank filled with gas. If an owner lived more than a hundred miles from a dealership, the dealer sent a mechanic to his or her home. In one instance, a technician flew from Los Angeles to Anchorage to make the necessary repairs.
Was it necessary to go to such lengths? You could argue that Lexus overreacted. The problems with the car were relatively minor. And the number of cars involved in the recall — so soon after Lexus had entered the marketplace — was small. Lexus would seem to have had many opportunities to correct the damage. The key fact, though, was not the number of people affected by the recall but the kind of people affected by the recall. Who, after all, are the people willing to take a chance and buy a brand new luxury model? Car Mavens. There may have been only a few thousand Lexus owners at that point, but they were car experts, people who take cars seriously, people who talk about cars, people whose friends ask them for advice about cars. Lexus realized that it had a captive audience of Mavens and that if they went the extra mile they could kick start a word of mouth epidemic about the quality of their customer service — and that’s just what happened. The company emerged from what could have been a disaster with a reputation for customer service that continues to this day. One automotive publication later called it “the perfect recall.”
This is the perfect Maven trap — using the recognition that sometimes a specific time or place or situation happens to bring together a perfect Maven audience. Here’s another example, one that a reader of The Tipping Point, Bill Hartigan, told me about in an e-mail. Hartigan was working for ITT Financial Services in the early 1970s, right at the moment when the entire industry was first being allowed to market the then unknown IRA (Individual Retirement Account). It was a market ITT ended up dominating. Why? Because they were the first to find a group of Mavens. As Hartigan writes:
The concept of giving your money to an institution until you were at least 59½ years old then seemed strange, and scary. But one interesting thing about those IRAs. Even until the mid 70s, tax ‘breaks’ were only for the wealthy. This was the exception. Knowing that was our key to success.
Target the wealthy? Nope. There are never many of them, they are too hard to see, and the benefits of IRAs probably would be of muted appeal. One potential target group stood out like a sore thumb, though. Teachers.
At the time (and to this day, unfortunately) this vital group of professionals was overworked and severely underpaid. No one ever sought the advice of a teacher when the topic was tax breaks and investing. But IRAs allowed teachers many similar benefits that heretofore had only been for the wealthy. It benefited them today and tomorrow.
As the great sportswriter Red Smith once wrote, “Fighters fight.”
And teachers? They teach.
They quickly caught on to the benefits of what IRAs had to offer them. Just as quickly, human nature took over. For the first time ever, they were able to talk to Johnny’s parents about how they handled their money.
Talk about grooming an entire market. Still the most brilliant marketing strategy that I have ever been involved with.
Is there a way of finding the Mavens in every market? I don’t know, although I am quite sure that there are readers who will use The Tipping Point as the inspiration to come up with a way. In a world dominated by isolation and immunity, understanding these principles of word of mouth is more important than ever.
Endnotes
INTRODUCTION
Page 5.
For a good summary of New York City crime statistics, see: Michael Massing, “The Blue Revolution,” in the New York Review of Books, November 19, 1998, pp. 32–34. There is another good discussion of the anomalous nature of the New York crime drop in William Bratton and William Andrews, “What We’ve Learned About Policing,” in City Journal, Spring 1999, p. 25.
Page 10.
The leader in research on yawning is Robert Provine, a psychologist at the University of Maryland. Among his papers on the subject are:
Robert Provine, “Yawning as a Stereotyped Action Pattern and Releasing Stimulus,” Ethology (1983), vol. 72, pp. 109–122.
Robert Provine, “Contagious Yawning and Infant Imitation,” Bulletin of the Psychonomic Society (1989), vol. 27, no. 2, pp. 125–126.
Page 12.
The best way to understand the Tipping Point is to imagine a hypothetical outbreak of the flu. Suppose, for example, that one summer 1,000 tourists come to Manhattan from Canada carrying an untreatable strain of twenty four hour virus. This strain of flu has a 2 percent infection rate, which is to say that one out of every 50 people who come into close contact with someone carrying it catches the bug himself. Let’s say that 50 is also exactly the number of people the average Manhattanite—in the course of riding the subways and mingling with colleagues at work—comes into contact with every day. What we have, then, is a disease in equilibrium. Those 1,000 Canadian tourists pass on the virus to 1,000 new people on the day they arrive. And the next day those 1,000 newly infected people pass on the virus to another 1,000 people, just as the original 1,000 tourists who started the epidemic are returning to health. With those getting sick and those getting well so perfectly in balance, the flu chugs along at a steady but unspectacular clip through the rest of the summer and the fall.
But then comes the Christmas season. The subways and buses get more crowded with tourists and shoppers, and instead of running into an even 50 people a day, the average Manhattanite now has close contact with, say, 55 people a day. All of a sudden, the equilibrium is disrupted. The 1,000 flu carriers now run into 55,000 people a day, and at a 2 percent infection rate, that translates into 1,100 cases the following day. Those 1,100, in turn, are now passing on their virus to 55,000 people as well, so that by day three there are 1,210 Manhattanites with the flu and by day four 1,331 and by the end of the week there are nearly 2,000, and so on up, in an exponential spiral, until Manhattan has a full blown flu epidemic on its hands by Christmas Day. That moment when the average flu carrier went from running into 50 people a day to running into 55 people was the Tipping Point. It was the point at which an ordinary and stable phenomenon—a low level flu outbreak—turned into a public health crisis. If you were to draw a graph of the progress of the Canadian flu epidemic, the Tipping Point would be the point on the graph where the line suddenly turned upward.
Tipping Points are moments of great sensitivity. Changes made right at the Tipping Point can have enormous consequences. Our Canadian flu became an epidemic when the number of New Yorkers running into a flu carrier jumped from 50 to 55 a day. But had that same small change happened in the opposite direction, if the number had dropped from 50 to 45, that change would have pushed the number of flu victims down to 478 w
ithin a week, and within a few weeks more at that rate, the Canadian flu would have vanished from Manhattan entirely. Cutting the number exposed from 70 to 65, or 65 to 60 or 60 to 55 would not have been sufficient to end the epidemic. But a change right at the Tipping Point, from 50 to 45, would.
The Tipping Point model has been described in several classic works of sociology. I suggest:
Mark Granovetter, “Threshold Models of Collective Behavior,” American Journal of Sociology (1978), vol. 83, pp. 1420–1443.
Mark Granovetter and R. Soong, “Threshold Models of Diffusion and Collective Behavior,” Journal of Mathematical Sociology (1983), vol. 9, pp. 165–179.
Thomas Schelling, “Dynamic Models of Segregation,” Journal of Mathematical Sociology (1971), vol. 1, pp. 143–186.
Thomas Schelling, Micromotives and Macrobehavior (New York: W. W. Norton, 1978).
Jonathan Crane, “The Epidemic Theory of Ghettos and Neighborhood Effects on Dropping Out and Teenage Childbearing,” American Journal of Sociology (1989), vol. 95, no. 5, pp. 1226–1259.
CHAPTER ONE: THE THREE RULES OF EPIDEMICS
Page 15.
One of the best lay treatments of the mechanics of a disease epidemic is Gabriel Rotello, Sexual Ecology: AIDS and the Destiny of Gay Men (New York: Penguin Books, 1997).
The Centers for Disease Control’s explanation for the Baltimore syphilis epidemic can be found in the Mortality and Morbidity Weekly Report, “Outbreak of Primary and Secondary Syphilis—Baltimore City, Maryland, 1995,” March 1, 1996.
Page 19.
Richard Koch, The 80/ 20 Principle: The Art of Achieving More with Less (New York: Bantam, 1998).
The Tipping Point Page 24
