Infosurv Launches v2.0 of the iCE Prediction Market System

New prediction market technology allows marketers to leverage employees, customers, or targeted consumer groups to accurately predict new product success

Atlanta, GA – Infosurv, Inc., a global leader in online market research, has recently launched version 2.0 of its patent-pending iCE (Infosurv Concept Exchange) prediction market system. The new release allows iCE clients to quickly and inexpensively collect feedback from employees, customers, or virtually any consumer group to accurately predict consumer preference for new product or marketing concepts.

What separates iCE 2.0 from other prediction market products is that it functions much like a survey, but with the actual buying of “virtual shares” in the new product, design or marketing concepts that are being tested. Just like in a stock market, concept share prices rise or fall with each trade. By examining how share prices move over time, iCE can accurately predict that concepts that customers will prefer in the real-world.

Though Infosurv is a full-service market research conducting hundreds of survey projects a year, they launched a prediction market product that competes head-on with online concept screening surveys.

“It’s our goal to obsolesce ourselves before a competitor does,” says Jared Heyman, Infosurv’s Founder & President. “Prediction markets have been proven to have higher predictive validity than surveys for many applications, at a lower cost and greater speed. Market research buyers are demanding innovative new technologies that enhance the accuracy, speed, and cost-effectiveness of their research. The iCE prediction market is exactly such a technology.”

To test and validate their new iCE 2.0 system, Infosurv partnered with a major consumer packaged goods (CPG) company specializing in health and beauty products. The test was a great success, with iCE accurately predicting the market acceptance of 9 new product concepts in 2 separate product categories.

“What our client found most compelling about iCE,” says Mr. Heyman, “was the cost savings. Using this tool, they can cut their concept screening budget in half without any sacrifice of accuracy or speed. Further, respondent engagement is enhanced since iCE traders find the experience more fun, interesting, and challenging than responding to an online survey.”

Prediction markets have been used for years to accurately predict other real-world outcomes. The Iowa Electronic Market (IEM) has been used since the early-1990’s to predict political election outcomes more accurately than surveys or polls. The Hollywood Stock Exchange (HSX) is a popular prediction market designed to predict movie box office receipts, and has been doing so with great precision for over a decade.

iCE is the first prediction market designed to predict outcomes of interest to market researchers, such as new product or marketing concept success.

- to “help doctors and patients gain insights into the safety and efficacy of specific drugs at the early stages of clinical trials beyond information that is publicly available.”

Complete B.S.

The officials would be able to count the number of similar suggestions and in that way they would approximate aggregation. It’s just not as automatic as what Emile imagines.

[Read Emile's comments here.]

NewsFutures suggests that the SAVE Award approach just scratches the surface of the possible benefits of crowdsourcing innovation. (Noted earlier in this post at Midas Oracle.) Here is their diagnosis and recommendation:

What’s wrong with this process?

There is no aggregation of the collective wisdom. The crowd is called on only to submit ideas, not to help evaluate them, which is the critical step in the delicate wisdom of crowd recipe. Instead, a bunch of political appointees in the OMB will decide which ideas get on the short list that the President will see. Needless to say, we would not dare propose such a simplistic process to our enterprise clients looking to harvest and select innovative ideas from their employees.

Here’s how it should be done: After everyone has proposed their ideas, ask everyone to bet (not vote) on which idea the President will ultimately select – or alternatively, on which ideas will be short-listed by the OMB officials. The crowd’s betting will quickly and efficiently produce a ranking of the best-to-worst ideas, and the result will be less arbitrary than what you can expect form a close-knit group of bureaucrats. Now, it doesn’t mean that the OMB officials cannot have the ultimate say on what ends up on the short list that goes to the Oval Office, but their choice is at least informed by the crowd’s aggregate choice.

Let’s ask NewsFutures’s question again: “What’s wrong with this process?”

Since the crowd is being asked to bet on which idea(s) will be chosen, not which ideas would actually produce the best productivity improvement, the betting will not “quickly and efficiently produce a ranking of the best-to-worst ideas.” Instead, it will produce a ranking of which items the bettors believe are more likely to be selected by the OMB and President.

If the short list was actually determined by the betting rather than independently selected by the OMB, the process takes on elements of a Keynesian beauty contest. No longer would bettors be betting on which ideas would be best, nor which idea among all submissions is most likely to be chosen by the President. Instead, the winning bettors would be those that best predicted which idea would be chosen from among those ideas most heavily favored by other bettors.

Rather than aggregating collective intelligence to identify the best idea, the process instead becomes one in which, in Keynes’ words, “we devote our intelligences to anticipating what average opinion expects the average opinion to be.” Perhaps a prediction market or other mechanism for collecting the “wisdom of the crowd” could improve the SAVE Award process, but a Keynesian beauty contest seems the wrong way to go.

[The post was originally published in slightly different form at Knowledge Problem.]

Robin Hanson:

If H1N1 were more deadly, there’d be more interest in forecasting the number of victims. So far it seems about as deadly as an ordinary flu, which ordinary folks also aren’t very interested in tracking. Now if there a market in the chance of very high death rates, that might gain more public interest.

Here is another question:

- Have the public prediction markets ever been taken seriously by the media and the decision makers during the 1988–2009 period?

My answer:

- The reach of the political election prediction markets have been limited to some business media. They very rarely got infiltrated in the popular, general news media.

- Overall, the media are ignoring the prediction markets, my good doctor Hanson. And the world has had a series of grave, deadly incidents since 1988 —9/11 being one among many.

Here is the e-mail I have just received:

Dear Sir/Madam,

WisdomOfTheNet.com is a new website that predicts lottery numbers.

On 9th September, Derren Brown successfully predicted the National Lottery numbers using a technique called the wisdom of the crowds. The wisdom of the crowds is the process of collecting the opinions of many individuals and producing an answer. This answer is deemed to be better than any that the individuals alone would produce. An application of this process, as demonstrated by Derren Brown, is in the prediction market.

Following much speculation regarding the recent lottery prediction, this new site was launched to see whether this method could really predict the lottery numbers. The site will be the largest experiment of it’s kind using this technique. Our main focus will be the EuroMillions draw on Friday night for 85 million Euros.

WisdomOfTheNet.com is a simple to use site where users simply enter their predicted numbers for the forthcoming draws. Based on the predictions received a set of anticipated results will be generated for that draw. Users can log in at any time to view the most up to date lottery prediction. The site exemplifies the four requirements to form a wise crowd, which are: diversity; independence; decentralization; and, aggregation [*].

WisdomOfTheNet.com was developed by Advanced Presence. Advanced Presence is a web and media design company based in Nottingham, England. The company has already created identities for a small number of national organisations.

For further information about WisdomOfTheNet.com please contact us via email (contact@wisdomofthenet.com). Alternatively, you may contact Mr Rozbeh Nassab on 07515355801.

[*] Needless to say, we are highly skeptical. There is nothing to aggregate when you try to divine the lotto numbers. Nothing. Nada.

Previously:

- Why did illusionist Derren Brown invoke the “wisdom of crowds” in his lottery win explanation?

- Derren Brown’s lottery win = A split camera trick disguised as “wisdom of crowds”

For example one PM blog traffics in deliberate Balkanization of the market. It pretends to be community. It uses lurid narcissism. Some PM stakeholders honor this anal-expulsive PM sideshow. Problem is, there are serious consequences for the fanboys of provocative, quarrelsome technical PM bloviating, no matter how amusing. It exhibits their own overbearing, juvenile focus on technology and promotion of divisive themes. Quite simply, supporting willfully adolescent ranting stunts PM market development. It immediately precludes it from serious enterprise consideration.

Midas Oracle aims at publishing the truth about prediction markets —and we probably succeed only 50% of the times.

The San Francisco clown makes money by selling phone-booth conference services to the enterprise prediction market software vendors. I have recently told my readers that I have become highly skeptical about the usefulness of those enterprise prediction markets. (It is a too complex and too costly truth-seeking mechanism, in my view.) So, it is logical that that San Francisco guy attacks me. I can take it. I think that it is the role of an independent publication like Midas Oracle to debunk the prediction market vendors’ marketing discourse, when we think that it is shallow. Our Google Analytics web stats (June 2009 to September 15, 2009) show that our readers understand that.

Midas Oracle is the most popular prediction market blog on Earth.

P.S.: And Midas Oracle is proud to focus on technology and innovation. It is so important.

On 9 September 2009, [British illusionist] Derren Brown conducted a live TV broadcast in which he suggested that he had successfully predicted the winning National Lottery numbers prior to them being drawn. During the broadcast a number of blank lottery balls were displayed on a glass stand in clear view of the camera, and after the lottery draw had been made, the balls were rotated to reveal the winning numbers. It was claimed by Derren Brown that the only other people in the studio were two camera operators, to avoid legal issues, and that the stunt had been authorised by Camelot, the National Lottery operators.

Great Britain is buzzing like crazy about the stunt.

He claimed it was based on an old trick which tells how a crowd of people at a country fair accurately estimated the weight of an ox when their guesses were all averaged out. He gathered a panel of 24 people who wrote down their predictions after studying the last year’s worth of numbers. Then they added up all the guesses for each ball and divided it by 24 to get the average guess. On the first go they only got one number right, on the second attempt they managed three and on the third they guessed four. By the time of last week’s draw they had honed their technique to get six correct guesses, and these were the numbers shown on the Wednesday night programme. [Derren] Brown claims that the predictions were correct because of the “wisdom of the crowd” theory which suggests that a large group of people making average guesses will come up with the correct figure as an average of all their attempts. He also suggested that if the people were motivated by money, it may not work.

Well, we know a lot about the “wisdom of crowds“, here, as Midas Oracle specializes in collective intelligence. The idea of the “wisdom of crowds” is to aggregate bits of information that are dispersed in a population of independently minded individuals. The result of that information aggregation is a predictive power slightly superior (on average, over the long term) to what one single individual can produce —even a gifted one. However, the “wisdom of crowds” is not powerful enough to predict the future with 100% certainty. For that, you would have to reverse the psychological arrow of time —so as to remember the future as opposed to the past. Physicists tell us this is impossible in our universe. Hence, Derren Brown used a trick [WATCH THE 3RD VIDEO BELOW] —and concealed it with some blahblah about the “wisdom of crowds”.

“Check the ball on the right after Derren Brown says ’23′. Notice it mysteriously jumps up and is slightly higher than the other 5 balls. (apologies for the camera wobble but my camera is on a tripod, the wobble is from the camera on the show which is programmed to wobble so you can’t see the switch of the balls). So no magic, NLP, psychology or mind-tricks. Just good old fashioned camera trickery. ”

How Derren Brown ‘divined’ the lotto numbers:

For the tip, thanks to Emile Servan-Schreiber of NewsFutures —we’re impatient to see the new version of their software / prediction market website.

Next: Why did illusionist Derren Brown invoke the “wisdom of crowds” in his lottery win explanation?

UPDATE:

His next event: Trying to beat the casino.

Science Of Scams – Advert from Phillis Dorris on Vimeo.

Another video

Another video