Encouraging Predictive Markets

Validity is the only way to get accurate results in a PM.  To encourage more users, however, incentives and rewards are the only way get better participation.  Participation is the key to producing accurate results.  As Surowiecki implies, the larger the sample size, the better the accuracy in a Predictive Market.  Surowiecki calls it the wisdom of the group. 

If a member in an organization believes the results from the Predication can be beneficial, not just monetary, then they are more likely to participate.  Factor in the chance for some type of reward or recognition, then an individual is likely to stay and participate.  Again, data validity and the belief that the analysis can be applied is essential for increased participation.

LINKEDIN

My recommendation is for LinkedIn to continue serving the Professional Market, but open its platforms to outside vendors and developers.  To do so, the platform developed would need to allow for business networking/Socializing at a cost for “free”.  For a premium price, LinkedIn could expand and foster human resourcing such as job search and resume services.  With its already established professional clientele, this is a market they could easily enter and dominate.  It is important to take steps to differentiate from FB and other Networking sites if they want to be successful.  They, however, must open up its platform to other channels in order to be successful in the future. Opening up will allow the company to grow into other markets while keeping its base.  Unexplored markets such as clothing, exercise equipment and professional music all  are viable options for LinkedIn.  There is a chance that opening up the platform could drive customers away, but the chances are slim; high switching cost for its members.