Prediction market tools are more efficient, more flexible, and they provide better insights. So why aren’t you using one?
At Zappi, we understand that choice is helpful, but we also know it can be overwhelming. All of our tools are valuable, but their use might not be immediately obvious. Browsing through our product pages, you might ask, ‘Why would I opt for a prediction market tool over and above anything else?’ It’s a good question.
The answer’s relatively simple: it’s quick, customizable, and useful at every stage of the development process.
Wait, what’s a ‘prediction market’?
Similar to within the world of finance, prediction markets are speculative markets used to forecast future interests or trends.
Huunu from Consensus Point (our fully-automated prediction market tool) harnesses ‘people power’ to determine how likely an event or action is to occur. It’s one of the most flexible tools in our arsenal, allowing for uniquely customizable elements within a robust and validated framework – which means it’s perfect for posing questions that contain terminology specific to your brand or business.
Prediction market research allows you to predict the likelihood of an action or event
Prediction markets have a key differentiator over other market research methods; when a respondent participates in the survey, they don’t over-rationally ‘predict’ their own behavior, they bet on the behavior(s) of others.
This incorporates a user’s tacit knowledge of their family and friends’ social behaviors while avoiding the pitfalls of second-guessing their own decision-making process.
As such, prediction market research methodology is ideal for use across a broad range of business needs: test concepts and copy, packaging and labels, as well as new products and ad campaigns, pre- or post-launch, allowing for a reliable approach to testing breakthrough ideas, white-space and theories where other quantitative tools would fail.
How does Huunu’s prediction market methodology work?
Huunu is unlike other survey-based tool due to the method by which it facilitates the above. It asks respondents to ‘place bets’ rather than answer questions, working a bit like a game. Users distribute betting ‘tokens’ based on how strongly they believe their predictions against real-time odds.
This isn’t gamification for gamification’s sake; there’s a best-in-class algorithm under the hood, accounting for the many minor processes a human goes through prior to making a prediction.
The devil’s in the detail, so let’s elaborate on how this works. Here are some of the key factors accounted for in Huunu’s prediction algorithm…
- Who raised their hand (and who didn’t)?
Respondent’s don’t have to place bets, but when they do they’re effectively raising their hand (as if volunteering themselves in school assembly). Huunu’s first port of call is in assessing which respondents raised their hands and when.
- How high did they raise their hand?
Token allocation signifies the confidence with which they ‘raised their hand’. One token is a tentative gesture, whereas ten tokens is as sure as an extended forefinger.
- How quickly did they raise their hand?
Did the respondent’s hand immediately shoot up, or did they hesitate? In other words, did they shape the market early or come along late and follow the crowd?
Worried about participants “gaming the system,” well don’t. Huunu controls for crowd followers and contrarians in real-time and factors it into your final research report.
Additional insights with prediction market research
To further bolster the results, Huunu participants are asked to justify why they made their decision, combining quantitative and qualitative approaches to deliver a combined outcome as reliable as industry leading survey approaches with additional insights and differentiation.
Generally, prediction market research is also cost-effective when compared with a traditional survey, so to call it a research ‘swiss army knife’ would underplay its strengths.
Huunu, for instance, is adept at delivering succinct answers to a variety of business questions, quickly gauging the overall breakthrough potential for new and disruptive ideas.
If you’re frustrated with traditional survey methods and would like to experience the benefits attached to prediction market research, check out our prediction market tool, Huunu.