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The Joneses Don't Matter

Maybe it was my move to the suburbs over the weekend, but I found this story today in the New York Times (free registration required) fascinating. David Leonhardt describes new research from economists at the Helsinki School of Economics and UCLA that turns the old notion of keeping up with the Jonese on its head. The study produced incredible evidence that when one of a person's 10 closest neighbors buys a car, the chances that that person would buy the same car brand—within the next week and a half—jumbed by 86 percent. The correlation between used cars was even higher, and lower-income residents were more likely than the wealthy to follow their neighbor's lead.

This suggests—quite strongly, really—that over-the-fence envy pales in comparison to a good neighborly nod for why people buy. People do run out and buy cars because their neighbors have them—but it's due more to the honest, unbiased endorsement than the copycat nature of American consumers. I wonder how Buzz Agents will skew the researchers' results?

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  • roger fulton

    old news, learned that in Wharton School marketing in the 60's. What goes around, comes around pre-chewed: market "position, personality,
    now - BRANDING ! ! !"
    And for this they get paid millions

  • Chris O'Leary

    I love studies like these because they knock the (often obnoxious) advertising industry down a notch or two by making it clear that most (no, not all) people are very pragmatic. Yes, some people are conspicuous consumers and some people blindly conform to what everyone else is doing, but most people buy on the basis of plain old value.

    The fact that 10 of your neighbors have the same car, and presumably have good things to say about it, is a powerful message about the value of a car due to its credibility.

    The link between credibility and message impact is something that too many people overlook.

    FYI, here's a link to the original study...

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