New Role for Prediction Markets: Guessing Kardashian Plans

Will Kim Kardashian reconcile with Reggie Bush following the end of her 72-day marriage to Kris Humphries?, a new Web site, is giving visitors $25,000 in play money to bet on pop culture. It’s designed to appear as a game for people who are interested in celebrities, fashion and pop culture. Yet, beneath the surface, it’s a way to predict future consumer tastes.

“For most people it’s just a fun site, but down the road we hope to work with companies so they can tap into this method to get good insight on how to make better products,” says Brent Stinski, CEO of parent company Media Predict.

The underlying mechanism of the site is a prediction market that works much like a stock market, except that players use fantasy money. Hollywood Stock Exchange (HSX), a subsidiary of Cantor Fitzgerald, was an early example that let visitors place bets on which films and stars would be the most successful.

Yet, while may ask visitors to bet on celebrities, the bets are a bit different than what fans might find on HSX. For example, there’s a 52.6 percent chance that George Clooney will play a prank on fellow nominee and friend Brad Pitt at the Oscars. There’s also a 58.8 percent chance the Michael Kors Collection will be worn on the red carpet at the Academy Awards. Users suggest topics for bets and editors post the best ones.

Like the Hollywood Stock Exchange, will make money by selling its research to companies that want to reach the same demographic as the site’s audience. While heavily hyped initially, it’s not clear how well that strategy has succeeded for HSX. The last press mentions on the website for HSX Research, the unit that sells data based on HSX, is from two years ago, and some of the clients listed on the website, such as VideoIPO, seem to no longer be in operation.

The difference between Hollywood Stock Exchange and, though, may be that while asks users for their predictions, it’s really tapping into their desires. asks users to make simple bets on those instincts. In this way it’s much easier than HSX, which asks users to invest in stocks, bonds and derivatives. So is really refining the prediction market model to ask audiences about a subject they’re uniquely qualified to judge.

Down the road, the best predictors may be invited to focus groups in which they would be paid to participate. Participants can’t use real money to place bets on because of gambling laws.

In a way, it’s what fashion magazines have been doing for years. “All this money is spent on A to B testing and focus groups and we never know who is involved,” says Ann Brady, editor in chief and co-founder of

Celebrities themselves may want to pay attention to Take Reggie Bush. His mother, Denise Griffin reportedly didn’t want Bush and Kardashian to reunite. Bush told TMZ today that he has not gotten back together with Kardashian. He can keep listening to his mother. Or to his fans. odds of the couple reconciling rose through most of today, hitting 58.2 percent this afternoon. If Reggie and Kim are at all influenced by what her audience wants, they have a pretty clear signal.

What do you think about this article? Comment below!