Here are a few I’ve tweeted just in the last few minutes:
- Message to #marketing: There are no “brands I love”. There are lots I like, or respect, but none I love. Why should anybody? Really. #vrm— Doc Searls (@dsearls) September 22, 2014
- Message to #marketing: Loyalty programs are coercive. If you want customers to love you, don’t force them to carry a card. Let them go. #vrm — Doc Searls (@dsearls) September 22, 2014
- Message to #marketing: Having an interest in some brands doesn’t mean I want tweets, emails or pitches of any kind from any of them. #vrm — Doc Searls (@dsearls) September 22, 2014
- #Extranatives: Reference to the future as “going forward,” and the word “experience” when applied to design. Both are crutches & clichés. — Doc Searls (@dsearls) September 22, 2014
- Message to #marketers: If you “acquire,” “control,” “manage,” “own” or “lock in” customers, you share lingo with ranchers and slave-holders. — Doc Searls (@dsearls) September 23, 2014
- Message to #marketers We are not fish, and advertising is not food: http://t.co/q0A4EIJZeQ #vrm — Doc Searls (@dsearls) September 23, 2014
I just didn’t want to let those go un-blogged.
(On the technical front, I’m also experimenting with the new 4.0 WordPress upgrade. It doesn’t work like I expected with sourced tweets, but it still works better than the last version.)
Google recently made some changes in Chrome that required changes in the Customer Commons Web Pal. Our good friends at Emmett Global have completed most of those changes, which you’ll see in by going into Window -> Extensions, and clicking on the “Enable” box next to “Customer Commons Web Pal.”
The layout on your Web Pal start page (where you are when you open a new page or tab) is still going through some changes. So bear with us as we work those out. We’ll also put up an FAQ (Frequently Asked Questions list) explaining some of the changes and new capabilities.
Meanwhile, stay tuned for some exciting news about what we’ll be doing at Customer Commons over the coming months.
Privacy in the physical world has been well understood and fairly non-controversial for thousands of years. We get it, for example, with clothing, doors, curtains and window shades. These each provide privacy by design, because they control visibility and access to our private places and spaces.
The virtual world, however, is very young, dating roughly back to 1995, when the first graphical browsers and ISPs came along. Thus, on the scale of civilization’s evolution, the Net is not only brand new, but in its infancy (the stage in life when it’s okay to go naked and pee and crap all over the place.) On the Net today, manners are almost completely absent. We see this, in a strange and mundane way, in corporate and government obsessions with gathering Big Data from consumers and citizens, mostly without their knowledge or conscious permission.
Companies today are moving budget to the Chief Marketing Officer (a title that didn’t exist a decade ago), so she or he can hire IBM, or SAP or some other BigCo to paint million-point portraits of people, with a palette of pixels harvested by surveillance, all so they can throw better marketing guesswork at them.
This isn’t new in marketing. It’s just an old practice (data-fed junk mail) that has fattened on Big Data and Big Fantasy. As a result we’re all drowning in guesswork, most of which is off the mark, no matter how well-understood we might be by the Big Data mills of the world.
Normally we would look to government to help us comprehend, guide and control infrastructures on which we utterly depend. (e.g. electricity, gas, water, sewage treatment, roads and bridges). But no one entity, including government, can begin to comprehend, much less monitor and regulate, the wild and wooly thing the Net has become (even at its lower layers), especially when so much of what we do with it depends on inside giant black or near-black boxes (Google, Facebook, Twitter, et. al.). But, thanks to Edward Snowden, we now know that the U.S. government itself — via the NSA and who knows what else — is doing the same thing, and also muscling private sector companies to cooperate with them.
But that’s a problem endemic to what Gore Vidal called the “national security state”, and plain old market forces won’t have much influence on it. Democratic and political ones will, but they’re not on the table here.
At Customer Commons, our table is the marketplace, and our role in it as customers. Whatever else we do, it can’t hurt to recognize and expose practices that are just plain rude.
This is how the Internet looks to the online advertising business today:
This is how they approach it:
And this is the result:
What’s wrong with this view, and this approach, is the architectural assumption that:
- We are consumers and nothing more. Fish in a bowl.
- The Net — and the Web especially — is a container.
- Advertisers have a right to target us in that container. And to track us so we can be targeted.
- Negative externalities, such as data pollution, don’t matter.
- This can all be rationalized as an economic necessity.
Yet here is what remains true, regardless of the prevailing assumptions of the marketing world:
- We are not fish. Rather, as Cluetrain put it (in 1999!), we are not seats or eyeballs or end users or consumers. we are human beings and our reach exceeds your grasp. deal with it.
- The Net was designed as a wide open space where all the intelligence that matters is at its ends, and each of us sits (stands, walks, drives) at one.
- Even if advertisers have a legal right to target us, their manners are terrible and doomed for correction.
- Negative externalities matter. A lot. As Fred said in his talk, we eventually dealt with the pollution caused by industry, and we’ll deal with it in the virutal world as well.
- The larger economic necessity is for a well-functioning marketplace. We’ll get that online once free customers prove more valuable than captive ones.
The key is to replicate online the experience of operating as a free and independent customer in the physical world.
For example, when you go into a store, your default state is anonymity. Unless you are already known by name to the people at the store, you are nameless by default. This is a civic grace. There is no need to know everybody by name, and to do so might actually slow things down and make the world strange and creepy. (Ask anybody who has lived in a surveillance state, such as East Germany before it fell, what it is like to be followed, or to know you might be followed, all the time.) We haven’t yet invented ways to be anonymous online, or to control one’s anonymity. But that’s a challenge, isn’t it? Meaning it is also a market opportunity.
We’ve lived in a fishbowl long enough. Time to get human. I guarantee there’s a lot more money coming from human beings than from fish whose only utterances are clicks.
eMarketer — always a source of great statistics — buries its lead in Discounts Drive Some US Consumers to Disregard Privacy Concerns. Same goes for the subhead, which reads “41% are willing to let marketers use personal data for discounts.”
Those are minority glosses on a majority fact: 59% aren’t willing to let marketers use personal data for discounts — and much higher percentages go out of their way to avoid what marketing does constantly, which is snarf up personal data. Here’s eMarketer’s graphic from the same piece:
And, as we see, the numbers are going up. Also, if you go back to the source (TRUSTe) at the bottom of that graphic, you’ll find this and this, as well as the 2013 Consumer Data Privacy Report, all of which tell the same story: most consumers don’t like giving up data or privacy.
Getting that report, by the way, requires filling out a form and yielding a pile of personal data (so a salesperson can call and pitch you something); but if you don’t want to do that, here are the two stats they use to tempt the reader:
- 35% of consumers stopped doing business due to privacy concerns
- Only 1 in 4 are willing to share data for free services
And this graphic from the summary page could hardly be clearer about where the market stands in respect to privacy and trade-offs:
Earth to Marketers: This is the market speaking to you. It’s saying the personalized advertising glass is more than 3/4ths empty. Calling it any % full is delusional.
The thing is, you can’t solve this yourselves. The solutions you need are ones that come from us: the customers of your advertisers. Not from you. We don’t care how hard you work to “deliver a better advertising experience.” You’ve poisoned the advertising well already. Olive branches like the ad choices icon are too little and too late.
But don’t worry. We’ll still buy stuff. We’ll still want good economic signaling from companies. But we’re done with all the agency living on your side of the demand/supply divide. What we both need is better signaling from us to you — in our ways and on our terms. Stay tuned for those.
It’s time to draw the line on surveillance.
Today nearly every commercial website infects our browsers with tracking files that report our activities back to parties we may not know or trust.
So we’re providing a way to draw that line: Web Pal — a browser extension that blocks tracking and advertising*, eliminating the browser slowdowns caused by both.
Download the Web Pal here, from the Chrome Web Store
And click on the donate button to support our work.
Web Pal was developed for Customer Commons by Emmett Global, which provides privacy solutions to nonprofits. It combines Adblock Plus and Tampermonkey — two open source code bases — in one simple install that requires no additional work or maintenance. It also gives you a Customer Commons start page, which carries updates of news about surveillance and other topics of interest to Customer Commons members.
We offer the Web Pal on Chrome. This gives you one safe browser with maximized protection, and the opportunity both to try out other protection systems on other browsers and to compare performance. Here is a list of those systems, from ProjectVRM at Harvard’s Berkman Center for Internet and Society:
Abine † Do Not Track Me, DeleteMe, MaskMe PrivacyWatch: privacy-protecting browser extensions and services AdBlock Plus Ad and tracking blocking. Emmett † “An easy to install browser plugin that protects your privacy online” Collusion Firefox add-on for viewing third parties tracking your movements Disconnect.me † browser extentions to stop unwanted tracking, control data sharing Ghostery † browser extension for tracking and controlling the trackers Privacyfix † “One dashboard for your Facebook®, LinkedIn®, and Google® privacy. Blocks over 1200 trackers.” PrivacyScore † browser extensions and services to users and site builders for keeping track of trackers Privowny † – “Your personal data coach. Protect your identity/privacy. Track what the Internet knows about you.”
Note that these are maintained on a wiki and subject to change. In fact, we invite Customer Commons members to participate in ProjectVRM, and help drive development of these and other tools.
And, of course, we welcome feedback and suggestions for improving the Web Pal. And we encourage everybody to support development of all tools and services that make customers liberated, powerful and respected in the open marketplace.
* What Adblock Plus calls acceptable ads are passed through by default, but you can change it to block all ads. Just go to Chrome’s Windows menu and click down through Extensions / Emmett Web Pal / Options / Adblock Plus / Filter List. Then uncheck “Allow some non-intrusive advertising”.
NOTE: The venue is now at Stanford University, in conjunction with the United Nations Association Film Festival, and will be followed by a panel discussion on the “Future of Online Privacy.” Cullen will be there as well.
- DATE: Monday, Oct 21
- LOCATION: Room 101, Ceras BuildingStanford University School of Education, 485 Lasuen Mall
- TIME: 6:00 PM Reception with the filmmakers; 7:00 PM TERMS AND CONDITIONS MAY APPLY (USA, 79 min); and 8:20 PM Panel “Future of Online Privacy”
- PRICE: Single tickets $10 cash only at the venue. First come, first serve. You can also buy advance tickets here. (Additional costs may apply.)
- PARKING: Parking Structure 6 (beneath Wilbur Field) is closest. It’s free after 4pm in the lots and at the meters along the campus streets More info on visitor parking at Stanford http://transportation.stanford.edu/parking_info/VisitorParking.shtml.
COME EARLY. Since we are combining two showings into one, it’s possible this will sell out, and space is limited.
About the peak:
Worryingly, advertising is not well. Though companies supported by advertising still dominate the landscape and capture the popular imagination, cracks are beginning to appear in the very financial foundations of the web. Despite the best efforts of an industry, advertising is becoming less and less effective online. The once reliable fuel that powered a generation of innovations on the web is slowly, but perceptibly beginning to falter.
And the theory:
The theory of Peak Advertising relies on a simple proposition: online advertising will continuously decline in effectiveness going into the future, to the extent that it makes existing models unsustainable.This will, in turn, eventually force a broad transition in the financial models supporting the web. There are a few reasons to believe that this will be the case.
First, the changing demographics of web users do not favor advertising…
Second, ad blocking is increasingly ubiquitous…
Third, click fraud remains a severe and growing problem…
Finally, ever escalating advertising density may itself erode effectiveness.
The Theory of Peak Advertising is a working paper, so I’ll volunteer some additional sources.
First is Don Marti‘s corpus of writing about business, and advertising in particular. (For the latest, watch Part I and Part II of Don’s interview with Slashdot on “Why Targeted Ads Don’t Work.” There’s a transcript in Part II.)
Second is The Intention Economy: When Customers Take Charge (Harvard Business Review Press, 2012), which contains a chapter titled “The Advertising Bubble,” to which Don contributed some valuable research, digging deep into Harvard’s world-record-size collection of scholarly works. Here’s an excerpt:
The etymologist Douglas Harper calls mania “mental derangement characterized by excitement and delusion,” adding that it has been used in the “sense of ‘fad, craze’” since the 1680s and since the 1500s “as the second element in compounds expressing particular types of madness (cf. nymphomania, 1775; kleptomania, 1830; megalomania, 1890).”
We have that in advertising, so in a blog post I volunteered advertimania to Harper’s lexicon. Let’s unpack it here:
- An overly generous infusion of liquidity, in the form of venture capital. This capital is invested both in companies that expect to make money through advertising, and in advertising for those companies and others. This was rampant in the dot-com boom, and is again today.
- Faith in endless growth for advertising, and in its boundless capacity to fund free services to users.
- Herd mentality—around advertising itself, and in faith that “social” media, supported by advertising as a business model, will persist and grow indefinitely. (And the herd is large too.)
- Huge increase in trading. This is happening with user data bought and sold in back-end markets, employing the same kind of “quants” who worked on Wall Street during the housing bubble.
- Low quality of personal information, despite the claims of companies specializing in personalization.
And that’s just on advertising’s side of the Chinese wall. Over here on our side, we can add to that list (especially the last item) six delusions, inclusive of the ones listed above by Professor Clemmons:
- We are always ready to buy something. We’re not. In fact, most of the time we’re not about to buy anything. Even if we don’t mind being exposed to advertising when we’re not buying, nearly all of us do mind being watched constantly—especially by parties whose only interest is in selling us stuff.
- People will welcome totally personalized advertising. Even if people allowed themselves to be tracked constantly through the world, and to be understood in great detail (a privilege that advertisers have done nothing to earn) the result would still be guesswork, which is the very nature of advertising. For customers, rough impersonal guesswork is tolerable, because they’re used to it. Totally personalized guesswork is not. At least not by advertising. To become totally personal, advertising needs to cross an existential bridge, to become a different corporate function. It must become sales, without the human sound or the human touch.
- The market for tracking-based advertising is large enough to justify the huge investments being made in it. Christopher Meyer, founder of MonitorTalent and author of many books on market optimism (including Blur: The Speed of Change in the Connected Economy and Future Wealth, co-authored with Stanley M. Davis) says, “It’s a classic bubble. Investments in tracking-based advertising far exceed even the most optimistic projected returns. The whole business just won’t be that big. In fact the whole advertising category is starting to plateau.”
- Advertising is something people actually like, or can be made to like. It’s not. With a few all-too-rare exceptions (such as Superbowl ads, which are typical mostly of themselves), advertising is something people tolerate at best and loathe at worst. Improving a pain in the ass does not make it a kiss. Nor does putting a thumbs-up “like” button next to an ad that gets ignored 99.9 percent of the time—as happens with display ads on Facebook, for example. (It’s also worth noting that Facebook originally put thumbs-down symbols next to ads, but quickly got rid of them. It’s easy to guess why.)
- The client-server structure of e-commerce will persist unchanged. It won’t. We’ll explain why in the next chapter, meanwhile, here’s Phil Windley: “There are a billion commercial sites on the Web, each with its own selling systems, its own cookies, its own way of dealing with customers, and its own pile of data about each customer. This whole architecture will collapse as soon as customers have their own systems for dealing with sellers, their own piles of data, and their own contexts for interaction.”
- Companies have to advertise. In fact advertising is not an essential function of any company. The difference between an advertiser and an ordinary company is zero. Even if we call advertising an investment, it’s on the expense side of the balance sheet, and an easy item to cut.
Each of those delusions is a brick in the Chinese wall between the industry’s mentality and the larger marketplace outside of it. You could call that wall a blind side, but it’s more than that. It’s a screen on which an industry that smokes its own exhaust has long been projecting its fantasies. It sees those projections rather than the real human beings on the other side. It also fails to see what those human beings might bring to the market’s table, beyond cash, credit cards and coerced “loyalty.”
Tim and Adi are concerned about The Future of the Web (the second half of their title) because so much of what we frequent there is funded by advertising, which is getting to be post-peak:
The central importance of advertising to business online means that Peak Advertising will impact more than just media buyers and vendors. As the value of advertising inventory collapses, it will fundamentally change our experience of the web: everything from the diversity of services that we might choose from to our notions of privacy online will be affected.
One can imagine some breakthrough innovation that eliminates this problem wholesale and maintains the status quo. Someone might develop a behavioral targeting system that perfectly delivers compelling ads to the right customer flawlessly. The current failure to do so even with massive data about user behavior seems to discount this scenario.
In the alternative, someone might innovate an entirely different business that provides margins and revenue flow comparable or better than advertising. It is likely that such a transition would require significant changes in how we experience the web. Go with the models that we know: an Internet where the most massive companies ran on subscriptions, for example, would grow significantly slower, be more subject to user demands, and would likely feature smaller user bases than the ones that we see today. This avoids the obvious issue, too, that not all existing businesses would be able to transition successfully in time, particularly those that have built the most successful businesses on advertising.
We may very well reach and pass the point of Peak Advertising without any significant innovation emerging to maintain and grow the flow of revenue supporting the Internet. What will be left with is a stagnant and ever eroding flow of revenue from the primary sources of advertising, and the inadequate substitution of new forms of advertising in its place. Of the few players that remain, they will produce a web experience that engineers the erosion of user privacy and the blurring of the line between real content and advertising.
The future we end up with is partially a matter of technological innovation, but also a matter of human choice. To those designing platforms and using those platforms, the issue is: what kind of Internet do we want to have?
Ultimately, what Peak Advertising suggests is that the fundamental economics of the web increasingly force this consequential decision on all participants, user and platform alike.
The Intention Economy sees a consequential future in which we still have advertising, but in which more Net-aligned market interactions prevail — and out-perform what we have today with Web services and sites primarily funded by advertising:
Advertising may fund lots of stuff that we take for granted (such as Google’s search), but it flourishes in the absence of more efficient and direct demand-supply interactions. The Internet was built to facilitate exactly those kinds of interactions. This it has done since the mid-‘90s—but only within a billion different silos, each with its own system for interacting with users, and each with its own asymmetrical power relationship between seller and buyer. This system is old, broken and long overdue for a fix.
The Internet, meanwhile, has always been a symmetrical system. Its architecture, defined by its founding protocols (which we’ll visit in the Net Pains chapter) embodies “end-to-end” principles. Every end on the Net has equal status, whether that end is Amazon.com, the White House, your laptop or your phone. This architectural fact is a background against which advertising’s asymmetries, and its delusional assumptions, have always stood in sharp relief.
When the backlash is over, and the advertising bubble deflates, advertising will remain an enormous and useful business. We will still need advertising to do what only it can do. What will emerge, however, is a market for what advertising can’t do. This new market will be defined by what customers actually want, rather than guesses about it.
The Intention Economy also reports on work toward that future, fostered by ProjectVRM and allied work toward liberating customers and increasing their ability to engage, resulting in far more widespread and effective direct market interactions than advertising’s highly indirect Attention Economy can produce.
Since the book came out, the number and variety of VRM development projects, companies and infrastructural code bases has multiplied. It’s still early in their evolution, but their direction gets clearer every day.
Remember: the commercial Web is only eighteen years old. It is easy to assume, in these early years, that the first widespread business model is the only one. It’s not. Ecommerce itself is doing fine. Subscriptions are messy and silo’d, but showing signs of widespread normalization. And we’re starting to see signs that companies value service as much as sales, which opens a vast greenfield of new economic opportunities.
Most importantly, we — the customers — are just starting to liberate ourselves. When we finally do throw off the shackles, an abundance of new solutions will also show up: ones that will do far more than just patch cracks in the walls of online advertising’s castle.
Healthy markets depend on powerful customers, not just powerful companies. Both help each other. That didn’t happen much in the Attention Economy, which valued captive customers more than free ones. It will in the Intention Economy, which values free customers more than captive ones.
In AT&T Ridding Some Retail Stores of Cash Register, Counters and Other Clutter, John McDermott of AdAge explains how the company is making its stores “warmer” to improve the “shopping experience” there. Which is all fine, as far as it goes.
Where it doesn’t go is toward fixing AT&T’s pricing. I explain that in a comment under the piece, which I’ll format in a “warmer” way here:
Nice as these showrooms may be, they are still just a paint job on the complicated shell game called “plans.” Right now AT&T is pushing “mobile share” plans, which are confusing in the extreme, and pointless if you’re single. Then you’re here with individual plans, or here if you’re new and solo.
Look closely at the small print. You can pay $30/mo for 3Gb of data or $50 for 5Gb. The overage charge for both is $10 per Gb. So you’re a sucker if you go with the 5Gb plan, and you use only 3 or 4 Gb. I mean, buy the 3Gb and you’ll also pay 50 if you use 5Gb. Confused? Sure. That’s the idea. AT&T, like Verizon and most other mobile carriers, is a confusopolist. See Dilbert for the definition.
AT&T runs these shell games to confuse the customer. Here’s how your mileage may vary::: If you have an iPhone, go to Settings/General/Usage/Cellular usage. See how much Cellular Network Data you’ve used since the Last Reset. Even if you’re a heavy data user, I’m betting it’s way less than 3Gb/mo, which would mean you’re overpaying. But if you want to save by paying for a lower level, there’s only one: $14.99 for 250Mb, or 1/4 of a Gb. The overage charge at that level is $14.99 per 250 MB. That means you pay 4¢ less than $60 per Gb.
Now, how many of us actually look at what we use? And what is the first cost of a bit in any case? (Operations have costs; bits cost ~$0.)
Back when I consulted BT in the UK, an executive there told me the core competence of phone companies was not telephony or communications, but billing. Or, you might say, bilking. Fortunately for the marketplace, Sprint has ceased being a confusopolist and offers unlimited data. If AT&T is truly serious about being good to customers, it should do the same.
Reasonable customers don’t just want a “better shopping experience.” They want a best possible service experience, especially from companies that bill them every month. They also don’t begrudge any business from making money. In fact there are plenty of studies — as well as ample experience in the world — suggesting that people will gladly pay more for better service and human-to-human engagement. For example: Apple stores.
Here’s hoping that AT&T’s new changes are deeper than the paint job they appear to be so far.