What is HERD BEHAVIOR?
bird behavior describes how individuals in a group can act collectively without centralized direction the term can refer to the behavior of animals and herds packs bird flocks fish schools and so on as well as the behavior of humans and demonstrations riots and general strikes sporting events religious gatherings episodes of mob violence and everyday decision-making judgment and opinion forming rolla fact shatter and fritz proposed an integrated approach to herding describing two key issues the mechanisms of transmission of thoughts or behavior between individuals and the patterns of connections between them they suggested that bringing together diverse theoretical approaches of herding behavior illuminates the applicability of the concept to many domains ranging from cognitive neuroscience to economics a group of animals fleeing from a predator shows the nature of herd behavior in 1971 in the oft cited article geometry for the selfish herd evolutionary biologist W D Hamilton asserted that each individual group member reduces the danger to itself by moving as close as possible to the center of the fleeing group thus the herd appears as a unit in moving together but its function emerges from the uncoordinated behavior of self-serving individuals the philosopher søren kierkegaard and Friedrich Nietzsche were among the first to criticize what they referred to as the crowd jerky guard and herd morality and the herd instinct Nietzsche in human society modern psychological and economic research has identified herd behavior in humans to explain the phenomena of large numbers of people acting in the same way at the same time the British surgeon Wilfred Trotter popularized the herd behavior phrase in his book instincts of the herd peace and war 1914 in the theory of the leisure class Thorstein Veblen explains economic behavior in terms of social influences such as emulation where's the members of a group mimic other members of higher status in the metropolis and mental life 1903 early sociologist georg simmel referred to the impulse to sociability in men and sought to describe the forms of association by which a mere sum of separate individuals are made into a society other social scientists explored behaviors related to hurting such as Freud crowd psychology carl jung collective unconscious ed Gustave Le Bon the popular mind swarm theory observed in non-human societies is a related concept and is being explored as it occurs in human society large stock market trends off and begin and end with periods of frenzy buying bubbles or selling crashes many observers cite these episodes as clear examples of herding behavior that is irrational and driven by emotion greed in the bubbles fear in the crashes individual investors join the crowd of others in a rush to get in or out of the market some followers of the technical analysis school of investing see the hurting behavior of investors as an example of extreme market sentiment the academic study of behavioural finance has identified hurting in the collective irrationality of investors particularly the work of Nobel laureates Vernon L Smith Amos Tversky Daniel Kahneman and Robert Shiller hay and more on 2004 analyzed a model of herd behavior in a market context their work is related to at least two important strands of literature the first of these strands is that on herd behavior in a non market context the seminal references are banarjee 1992 and bit Chandni Hersh lifer and Welch 1992 both of which showed that herd behavior may result from private information not publicly shared more specifically both of these papers showed that individuals acting sequentially on the basis of private in formation and public knowledge about the behavior of others may end up choosing the socially undesirable option the second of the strands of literature motivating this paper is that of information aggregation in market contexts a very early reference is the classic paper by Grossman and Stiglitz 1976 that showed that uninformed traders in a market context can become informed through the price in such a way that private information is aggregated correctly and efficiently in this strand of the literature the most commonly used empirical methodologies to test for hurting toward the average are the works of Christian Wong 1995 and Chang Chang and Khurana 2000 overall it was shown that it is possible to observe her type behavior in a market context the results refer to a market with a well-defined fundamental value even if her behavior might only be observed rarely this has important consequences for a whole range of real markets most particularly foreign exchange markets one such her dish incident with surprise volatility that surrounded the 2007 uranium bubble which started with flooding of the cigar Lake Mine in Saskatchewan during the year 2006 crowds that gather on behalf of the grievance can involve hurting behavior that turns violent particularly when confronted by an opposing ethnic or racial group the Los Angeles Riots of 1992 New York draft riots and Tulsa Race Riot are notorious in US history the idea of a group mind or mob behavior was put forward by the French social psychologists Gabriel tarde and Gustave Le Bon benign hurting behaviors may occur frequently in everyday decisions based on learning from the information of others as when a person on the streets decides which of two restaurants to Dinan suppose that both look appealing but both are empty because it is early evening so at random this person chooses restaurant a soon a couple walks down the same street in search of a place to eat they see that restaurant ax has customers while B is a and choose on the assumption that having customers makes it a better choice because other passers-by do the same thing into the evening restaurant a does more business at night than be this phenomenon is also referred as an information cascade heard behavior is often a useful tool in marketing and if used properly can lead to increases in sales and changes to the structure of society whilst it has been shown that financial incentives cause action in large numbers of people herd mentality often wins out in a case of keeping up with the Joneses communications technologies have contributed to the proliferation to consumer choice and the power of crowds consumers increasingly have more access to opinions and information from both opinion leaders and formers on platforms that have largely user-generated content and thus have more tools with which to complete any decision-making process popularity is seen as an indication of better quality and consumers will use the opinions of others posted on these platforms as a powerful compass to guide them towards products and brands that align with their preconceptions and the decisions of others in their peer groups taking into account differences and needs and their position in the socialization process Lessig and PARCC examined groups of students and housewives and the influence that these reference groups have on one another by way of herd mentality students tended to encourage each other towards beer hamburger and cigarettes whilst housewives tended to encourage each other towards furniture and detergent whilst this particular study was done in 1977 one cannot discount its findings in today's society a study done by Burk leakin li and jiang in 2014 on the social influence on shopper behavior shows that shoppers are influenced by direct interactions with companions and as a group size grows herd behavior becomes more apparent discussions that create excitement and interest of greater impact on touch frequency and purchase likelihood grows with greater involvement caused by a large group person this Midwestern American shopping outlet were monitored and their purchases noted and it was found up to a point potential customers preferred to be in stores which had moderate levels of traffic the other people in the store not only served as company but also provided an inference point on which potential customers could model their behavior and make purchase decisions as with any reference group or community social media can also be a powerful tool in perpetuating herd behavior it's immeasurable amount of user generated content serves as a platform for opinion leaders to take the stage and influence purchase decisions and recommendations from peers and evidence of positive online experience all served to help consumers make purchasing decisions gonna wat and who Orton's 2015 study concluded that social influence is essential in framing attitudes towards brands which in turn leads to purchasing tension influencers form norms which their peers are found to follow and targeting extroverted personalities increases chances of purchase even further this is because the stronger personalities tend to be more engaged on consumer platforms and thus spread word-of-mouth information more efficiently many brands have begun to realize the importance of brand ambassadors and influencers and it is being shown more clearly that herd behavior can be used to drive sales and profits exponentially in favour of any brand through examination of these instances marketing can easily transcend beyond commercial roots in that it can be used to encourage action to do with health environmentalism and general society herd mentality often takes a front seat when it comes to social marketing paving the way for campaigns such as Earth Day and the variety of anti-smoking and in the obesity campaign seen in every country within cultures and communities marketers must aim to influence opinion leaders who in turn influence each other as it is the herd mentality of any group of people that ensures a social campaign success a campaign run by Psalm l'Opera in Spain to combat teenage obesity that campaigns runnin schools are more effective due to influence of teachers and peers and students high-visibility and their interaction with one another opinion leaders in schools created the logo and branding for the campaign builds content for social media and led in school presentations to engage audience interaction it was thus concluded that the success of the campaign was rooted in the fact that its means of communication was the audience itself giving the target audience a sense of ownership and empowerment as mentioned previously students exert a high level of influence over one another and by encouraging stronger personalities to lead opinions the organizers of the campaign were able to secure the attention of other students who identified with the reference group heard behavior not only applies to students in schools where they are highly visible but also amongst communities where perceived action plays a strong role between 2003 and 2004 California State University carried out a study to measure household conservation of energy and motivations for doing so it was found that factors like saving the environment saving money or social responsibility did not have as great an impact on each household as the perceived behavior of their neighbors did although the financial incentives of saving money closely followed by moral incentives of protecting the environment are often thought of as being a community's greatest guides encompass more households responded to the encouragement to save energy when they were told that 77% of their neighbors were using fans instead of airconditioning proving that communities are more likely to engage in the behavior if they think that everyone else is already taking part herd behavior is shown in the two examples exemplify that it can be a powerful tool in social marketing and if harnessed correctly has the potential to achieve great change it is clear that opinion leaders and their influence achieve huge reach amongst their reference groups and thus can be used as the loudest voices to encourage others in Collective direction
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