Social Scoring

Have you ever imagined how you will be perceived based on your interactions and behaviors on digital media? And what are the advantages and disadvantages of the perceptions and behaviors of others towards me?

In today’s networked environment, social ranking systems are getting popular and applied for various situations at various levels of society. “Both the private and public sectors are utilizing social ranking systems as a mechanism to engineer human behavior, creating a form of digitally induced social control”.

This article will address the widespread usage of social ranking systems in our society and discuss the potential psychological and behavioral consequences.

“Although the benefits and attractiveness of review systems are widely cited in business, they raise some big questions.”

How does the traditional scoring system work?

Lending institutions including banks have identified the benefit of using transactional data and credit histories and other data on income, age, sex, family situation etc to forecast default behavior combined with other economic data like GDP, unemployment rate, housing price index amongst others. Furthermore, sometimes banks also use private information about one’s social network to assess and monitor the risk of default on loans they provide.  It seems that the people you associate with are a key indicator of your own behavior.

Modern social ranking systems still use similar demographic and behavioral data. However, with the advent of the internet and online social networks, it’s now possible to use various data sources like social media, e-commerce platforms, entertainment streaming sites, online reviews and in some cases Uber and Spotify. The data is then processed through sophisticated machine learning techniques to determine one’s position within a social system. This provides new ways of utilizing social ranking mechanisms in the online space, far beyond the realm of loan loss provision norms presented by accounting norms like IFRS9.

Customer reviews

Social score -Social media sites, mobile apps, hospitality providers, travel organizations, and other types of businesses readily use social ranking systems to help categorize products, services, and experiences.

AIRBNB uses guest reviews and scores to recommend improvements in property, inside and outside services which influence host to take certain actions to improve the likelihood of more bookings. Similarly, TripAdvisor and allow customers to provide a review of the service they experienced. And these user-generated reviews act as a form of social-validation and authority.

Reviews not only affect the likeability and demand of service but also impose a level of control over how service providers and customers should interact with each other, based on expected behaviors governing the system.

Influencer marketing

The present young generation is fully integrated with social media. The number of online followers equates to online influence, reflecting one’s reach, impression, and influence.

Many consumer brands, hospitality providers, and media channels have recognized the power that “influencers” (someone with over 20,000 followers) have on specific target groups (e.g. #fashion, #travel, #food). Influencer-based marketing has a viral and deep impact than commercial traditional marketing.

With a little financial investment and clever targeting, you can generate high brand awareness quickly and organically, something that aligns well with a search engine and social media algorithms.

Social credit score - reciprocal

More recently, we are seeing the application of dual-review ranking systems (DRRS).

In a growing number of mobile applications, we are seeing DRRS being used. Uber’s dual-ranking system allows not only for the passenger to rate the service, quality, and behavior of the driver but also for the driver to rate the passenger.

The purpose of DRRS is to ensure that both parties behave with themselves in a mutually acceptable manner. This allows for certain behaviors to be flagged as an above or below average score. The benefit is that it gives the service provider an immediate power to take certain actions that improve service quality.

Social score - influencer

Other than banks and lending companies, other brands, governments, and public agencies have also shown a deep interest in the application of online social ranking systems. The purpose of a social score is to socially engineer acceptable behaviors, promote responsible and accountable public behavior and code of conduct, and control a society based on the norms and values.

China currently has a plan to launch a working social score system by 2020, in order to rate more than 1 billion citizens and assess their trustworthiness. According to various media outlets, this social score system evaluates citizen trustworthiness based on a complex combination of personal data, like demographics, online and offline behaviors, and social networks.

This means that if someone forgets to pay a fine, says something unacceptable online, buys a certain product, cheats on a state exam, leaves a bad review, or just mingles with the wrong type, it could negatively affect their social credit score and limit their access to specific public resources (e.g. travel, financial loans, housing, and education).

The Chinese government has been rolling out its online system for the past several years, collaborating with local tech giants and experimenting with different variations of its credit system to test its efficacy as a social control mechanism. Recently, the media has reported that China’s social ranking system is already having an effect on society and that people living in China appreciate the implemented ranking system as they are noticing positive changes in public behavior.

“The purpose of a social score system is to socially engineer acceptable behaviors.”

Credits to AuthorAli Fenwick

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