What parking lots can teach us about better marketing

(I'm sorry for the formatting.  I just couldn't make it work. GS)

The term “homophily” was coined by Lazerfeld and Merton in 1954. It means "love of same" and describes the tendency for people with greater common knowledge to interact. Or, to put it another way, birds of a feather really do flock together. Homophily is like gravity—invisible and powerful. It pulls consumers out of the mass market and causes them to gather with others who share their passion or interest in groups called affiliation networks. As odd as it may sound, parking lots illustrate the effect quite nicely.

A typical parking lot is a pretty good representation of the mass market. It’s large and diverse, like the audience you might get with a Super Bowl commercial. It’s filled with all kinds of cars; big, small, foreign, domestic, coupes, sedans, trucks, and SUV’s of every imaginable color concentrated in the spaces nearest the building. This shot, taken in Franklin, Tennessee last Saturday, is pretty representative..

Suppose your product had special appeal to car enthusiasts but were limited by a budget that only allowed you to cover a quarter, or even a half of the parking lot. Where would you focus your efforts?

If you took a mass marketing approach you might focus your efforts on this portion of the parking lot because it has the highest number of vehicles. On its face that seems like a perfectly reasonable decision. After all, this portion of the lot has the greatest number of cars and that should increase the odds of reaching the target. What’s more, this portion of the lot looks like a good value since the high density of cars provides the lowest cost per thousand.

But what if none of these people are interested in your product? If none of them care does it matter how many of them you reach? You need car enthusiasts. Fortunately, there is another way.

Maybe you’ve noticed this before, or perhaps you will realize it the next time you go to the grocery store, but not every car parks with the others. Some cars park at the periphery of the lot. They are often sports cars and we all know why they do this. Their owners are car enthusiasts who care a bit more deeply for their car than most other people. Some say they’re fanatical and they might be right, but that fanaticism makes them much more likely to buy your product. It also drives them to voluntarily separate themselves from the masses, making them much easier to identify like the lone Corvette I spied in the remote reaches of the lot.

Car enthusiasts park farther away to avoid damage caused by wandering shopping carts and doors opened carelessly by people who don’t love their cars to the same extent, but that is not the only force at play. The desire to avoid damage explains why they park away from the masses, but does not account for the other thing they do. Have you noticed that once they get away from the masses they want to be near other sports cars?

If avoiding damage was the only motivator then they would park at the edges of the lot and they would avoid all other cars. But what do they do instead? They park right next to other sports cars─cars owned by other enthusiasts─though they may never meet the person who owns the other car. They are kindred spirits who form an affiliation network of car enthusiasts by choosing to park next to other sports cars. They are drawn toward others like themselves by the irresistible pull of homophilly.

And if they can define their allegiance more precisely, they will.

The owners of these two 350 Z’s felt the need to park away from more pedestrian cars, but also the need to park near each other. By gathering this way they declare they are more than mere car enthusiasts, they are Z enthusiasts too. And as I took this picture…

…the BMW pulled up and joined the club.

So here’s the point for marketers. Homophily is not limited to cars and parking lots. It affects every one of us. It drives football fans to find and gather with other football fans, and Harley owners to congregate with other Harley owners. It affects your customers too.

So why waste your money on the mass market when you can get better results with fewer resources by concentrating your efforts on the driest tinder in the affiliation networks where they gather? You can engage many more of them at a dramatically lower cost and a with a radically higher conversion rate. You can also count on them to take your message to their car enthusiast friends.

Let your competition look for a spot close to the building. Let them get dents in their doors. Tap into the power of homophily, find the most likely customers where they gather in affiliation networks and spread the fire. GS

Comments

[Tac]

Awesome post Greg! This is a perfect example of Homophilly (we really need to come up with a marketing buzz word for that I get really weird looks when I mention Homophilly)

[Brian Critchfield]

Great illustration Greg. In a B2B sense, there is literally a trade association for everything. Case in point, the Word of Mouth Marketing (WOMMA) conference was held at the same resort as the Sports Turf Management Association. Mass marketers would put an ad on TV trying to talk to everyone who might have a lawn. The smart marketer with a product for fields and grass would focus on this association.

[Sociology PhD Student]

Great conception of the term!
Just FYI, the concept and term "homophilly" is traditionally attributed to the social psychologist Fritz Heider, from his 1958 book "The psychology of interpersonal relations."

[Greg Stielstra]

Soc PhD student, thanks for the correction. I'll revise the post. GS

[Janne]

Actually, the word is spelled "homophily" and it was used already by Lazarsfeld and Merton in 1954. See for example Wikipedia for more information on the topic:
http://en.wikipedia.org/wiki/Homophily

[Greg Stielstra]

Thanks for the help Janne. I've corrected the spelling and the reference in the post. GS