Research Topics:

Decision Research Consultation

Content Type:

Glossary

Decision Markets Definition

Decision markets are speculative markets in which participants buy and sell prediction shares of whatever is trying to be predicted. The current market prices can then be interpreted as predictions of the probability of the event or the expected value of the parameter. Also known as predictive markets, information markets, prediction markets, idea futures or virtual markets.

Decision markets are where individuals or groups make predictions or decisions related to marketing outcomes using a market-based approach. In these speculative markets, participants buy and sell shares representing different possible outcomes of whatever is trying to be predicted, whether it be a marketing event or strategy. Current market prices can be interpreted as predictions of the probability of the event or the expected value of the parameter. They could reflect the collective wisdom and insights of participants, thus providing a way to aggregate information and forecast marketing trends. Decision markets foster a decentralized and inclusive environment for prediction making, unlike traditional methods that might not capture such diverse perspectives effectively. What’s more, decision markets provide a quantitative method to predict marketing outcomes, which reduces guesswork.

Who relies on decision markets?

Marketing professionals, researchers and analysts, as well as companies seeking insights into consumer behavior, product performance, or the success of marketing campaigns, utilize decision markets to gather opinions and predictions.

Why should I care about decision markets?

Decision markets rely on the wisdom of crowds and diverse opinions to generate accurate predictions and enhance strategic planning. They provide real-time insights that lead to informed decisions and timely adjustments to strategies.