Summary of The Transformational Power of Recommendation

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The Transformational Power of Recommendation summary

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Recommendation engines have come a long way since the early days of and Pandora. Expert Michael Schrage offers an overview of recommenders’ role in e-commerce and workplace productivity in a helpful article in MIT Sloan Management Review. The article covers recommenders’ uses, benefits and risks, and offers examples of recommenders’ outsize role in the growth of companies such as Spotify and Stitch Fix. 

About the Author

Michael Schrage is a research fellow at the MIT Sloan School of Management’s Initiative on the Digital Economy. 


Recommendation engines create value by shaping people’s choices.

Choice has exploded. Platforms such as Amazon, Youtube and Spotify offer thousands or millions of options for watching or listening. For employers and employees, technological innovation creates new opportunities. Recommendation engines, platforms and systems help people make decisions amid vast options.

People now turn to recommenders for help choosing entertainment, writing texts, setting priorities at work, choosing investments, planning their day, selecting food and clothing, and more. Recommenders don’t aim to enforce specific options, but to empower users and increase their agency. 

Recommendations have been central to building profitability and customer loyalty for e-commerce sellers.

Recommendation engines increase customer lifetime value. E-commerce giants such ...

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