The Amazon Coat: Popularity, Power Laws and Network Effects
Brands and influencers are using social media and shopping platforms in a way that breaks down the rich get richer dynamic, but this time with advantages for small brand products so that with the right methods, lesser known brands’ product can be just as popular as a Canada Goose jacket.
How does this happen? An example of this is an olive colored winter coat, later dubbed The Amazon Coat – that took over the internet and became a must-have item in 2019, with news outlets suggesting that even Canada Goose should watch out. This coat is not from a high-fashion or well-known brand, and in fact, was fairly cheap and made-in-China. It started out with several high-class women on the Upper East Side of NYC owning this coat which had initially spread by word of mouth through weak and strong ties – for example, friends of creative directors and stylists or a teacher of one of the women’s kids. Other stylish women saw their peers wearing it and when a news outlet got the word out, thousands of others outside of Upper East Side bought it as well – after all, all these stylish women must have a reason for owning this coat, right? In this way, imitation created a rich get richer dynamic for this obscure product that pushed it into popularity and even further. People copied the early decision of these women and it created a snowball effect. Suddenly, this coat became a best seller on Amazon and even got its own Instagram. At the same time, this goes against the rich get richer model because Orolay (the coat’s brand) was not initially rich at all. Tens of thousands of people who might’ve initially bought popular winter coat brands like The North Face chose to get this off-brand coat instead, pushing it from the tail end to the head.
There was another factor to the success of this coat. The article states, “But a funny thing happens when a ton of publications tell people that a certain coat is going viral: It actually does go viral. (Jennings, 2019)” But this isn’t surprising at all. We learned about the concept of Networks Effect in which there is a self-fulfilling expectations equilibrium in which people have expectations that lead to those expectations coming true. People saw the thousands of reviews on Amazon, the claims of virality, and the pictures of people wearing the coat on Instagram, so they expect the coat to have a high quality to it and that many people are purchasing it. Therefore, they are willing to buy it themselves. It helps even further that this jacket has a fairly low price, so the tipping point z is accessible to those who aren’t Upper East Side residents.
With the modern design of platforms, customer reviews and low-cost posts on social media have changed the way brands advertise their ware and how we find new items and shop for products. This may also have some implications for the graph of the power law 1/k^c where the number of copies is the y axis and x is the order of items in order of popularity from most to less popular. We might find that the graph is slightly less steep and the exponent less than perhaps that from a decade ago (shorter tail and larger exponent) and that there are more items that can be extremely popular rather than a select few popular items and many not so popular items (short head, long tail). It is much easier for random small products from off-brands to gain popularity and decrease the inequality gap solely through social media and recommendation algorithms, which can also be beneficial to startup companies.
Source: https://www.vox.com/the-goods/2019/2/25/18233597/orolay-amazon-coat-upper-east-side