Groupon, Kickstarter, Pledgebank: when does

conditional commitment work?

Roger HallamCulture, Media, and Creative

Industries, Kings College London.Radical Think Tank (UK).

The Collective Action Problem

• In political science (Olson 1965) this problem is formulated as follows:

There are situations where it is in the collective interest of a group of individuals to act together to acquire a collective good. But is not in the interest of an individual to act on their own. Therefore no one acts and so the collective good is not acquired

So latent groups “suffer in silence” (p134).

The Basic thesis: Conditional Commitment Works.

• The new communication technologies have dramatically reduced the costs of communication.

• This enables groups to overcome the collective action problem by pre-organising critical masses of participation in collective activity.

• This can “revolutionise democracy” as much as majority vote elections!

Two types of collective organisation

• Type 1 (T1). Individuals act without knowing how many others will act with them

• Type 2 (T2). Individuals know that a set number of other individuals will act if they act as well.

Eg T1 = wild cat strikes. T2 = majority vote ballots of labour union strikes.

Three communications with T2

• The setting of the TARGET for the collective action to go ahead

• The giving of conditional commitments to take part in the action if the target is reached

• If and when the target is reached people giving the conditional commitment are informed and the collective action goes ahead

ICTs make this easy, quick and cheap.

Groupon

• Originally “The Point” – T2 conditional commitment organising website

• Change from social/political to economic with Groupon: 2 pizzas for 1 if go to the restaurant at off peak time. Target for go ahead: 20 people.

• “Fastest grown company in the history of capitalism” (Forbes). In three years worth $30 billion with 180 million users.

“They have cracked the code” Schultz. The code is T2

Andrew Mason…

Kickstarter

• T2 fundraising design for cultural/artistic collective projects.

• Put up project; target figure; conditional commitments; if and when target hit project goes ahead.

• Within four years raises $850 million from 5 million people for 50,000 projects.

“the most democratic way art has ever been made” Heleker 2013

Pledgebank

• Set up in 2005• Slogan “ I will do it but only if you help me do

it”• Proposals: personal, charitable or political• 1,300 proposals in UK: 15,000 Internationally

Aim to “Revolutionise Democracy”Irving 2012

The tipping point for Pledgebank

0.0

05.0

1.0

15.0

2D

ensi

ty

0 20 40 60 80 100% Target

kernel = epanechnikov, bandwidth = 6.7307

Unsuccessful Pledges

Proposed group typology

• Altruists – will do it anyway• Moderate rationalists – will conditionally

commit to all collective actions they will benefit from

• Reflexive observers – react to information effects, what others are doing

Collective action S curve(Schelling 1985)

Lower Equilibrium – Point A

Tipping Point – Point B

Upper Equilibrium – Point C

A

B

C

So why doesn’t it happen?

• Noise of the internet – getting attention• “Cultural lag” lack of social information –

people don’t use it because people don’t use it

• Therefore subject to its own collective action problem.

2016 UCL Rent Strike: Design

• Canvass student tenants: “would you be prepared to not pay your rent if 1000 other students did the same?”

• Focus on one hall: “ for this strike to go ahead there needs to be a 100 tenants in this hall committed to it – there are 60 now – can you give a commitment as well?”

• In a randomised controlled trial commitment to strike without CC was 49% - with CC 80%!

UCL Rent Strike: The Results

• 115 conditional commitments by the deadline – it’s on! 150 in total following the deadline, out of 300 tenants. First pre planned rent strike in London since the 1970s.

• Publicity goes viral online – top Guardian story – 35,000 shares

• Collective action passed tipping point – 700 more tenants commit to strike – half on line, half from off line canvassing. Happening this week!

2016 UK national tax strike: Design

• In response to Panama Paper scandal• Proposed Collective action: refuse to pay £50

of your tax bill.• 5000 conditional commitments to go ahead• All conditional commitments made on online

platform• National promotion in the Press

UK national tax strike: Results

• After 1 week• 1500 views of site/promotional video• 25 people make a conditional commitment.

(its not going to get to critical mass of 1,500 – i.e. 30%)

Hybrid model of conditional commitment design for medium risk political collective action

• Off line communication of collective action target

• Off line/ on line collection of conditional commitments – viable 30% critical mass.

• On line conformation that target has been reached and collective action is going ahead.

• Goes viral on line due to social information/ demonstration effects

Conclusion

• Successful collective action requires kickstarting conditional commitments off line FIRST.

• Then progressively supplementing it with online promotion.

• … through progressive iterations, conditional commitment becomes part of the new

“repertoire of contention” for the digital age. (no more “suffering in silence”)

And a final word from Zeb my research assistant…

Papers/References/Links

go to radicalthinktank.wordpress.com