Intention Economy

Wallets are personal

wallet-smallA lot of big companies are eager to get their hands in your pockets — literally. They want your mobile phone to work as a digital wallet, and they want the digital wallet app you use to be theirs.

Naturally, this looks like it should be a big business — and to some degree it is already. But it also hasn’t met promotional expectations. This became clear a few days ago, when comScore released Digital Wallet Road Map 2013, a $4995 report on the digital wallet business. In a press release highlighting the report’s findings, Andrea Jacobs, comScore Payments Practice Leader, said “Digital wallets represent an innovative technology that has not yet reached critical mass among consumers due to a variety of factors, including low awareness and a muddied understanding of their benefits.” Here’s how the release unpacks that:

The current digital wallet landscape remains fragmented among providers because of low consumer adoption outside of PayPal, with only 12 percent of consumers claiming to have used a digital wallet other than PayPal. However, study results indicated that the digital wallet market opportunity could eventually reach 1 in 2 consumers as consumers become more aware of the offerings and educated on their benefits.

Consumer Awareness and Usage of Digital Wallet Offerings
November 2012
Source: comScore Digital Wallet Road Map 2013
Digital Wallet Percentage of Total Respondents Aware of Digital Wallet Percentage of Total Respondents Who Used the Digital Wallet
PayPal 72% 48%
Google Wallet 41% 8%
MasterCard PayPass Wallet 13% 3%
Square Wallet 8% 2%
V.me by Visa 8% 2%
ISIS 6% 1%
Lemon Wallet 5% 1%
LevelUp 5% 2%

One clear barrier to use of digital wallets is that the concept is often difficult to convey and prone to misinterpretation. Even after being asked to review the websites of particular digital wallets, respondents across all wallet brands still scored an average of just 45 percent in terms of demonstrated level of understanding.

Here’s the problem: wallets are personal. Even if you have a wallet with a brand name on it (say, Gucci or Fossil), it isn’t their wallet. It’s yours. What you keep in it, and how you use it, are none of their business. In fact, those companies would never think of making it their business, because all they’re providing you is a place to put your credit cards, your cash, or whatever other flat things you feel like carrying around in your pocket or purse.

So far, all the digital wallets out there are not yours. They belong to some company. You merely use the app. The wallet is their business, not yours. In this respect they aren’t much different than credit cards or various loyalty cards, which are things you put in your wallet; not the wallet itself. The wallet itself should be agnostic, if not oblivious, to what you put in there. It should be like a toolbox, where you can store lots of different tools, made by lots of different companies, made for serving different purposes.

All the digital wallet companies in comScore’s chart have isolated, proprietary and silo’d ways of providing payment benefits to users. Imagine buying a tool box from Sears that could only hold its own brand of tools, which would only work with devices from companies that were partners of Sears. That’s what we have with digital wallets so far. It’s the same problem we had with online systems (AOL, Compuserve, Prodigy, etc.) before the Internet came along. They were closed silos.

The Net works because it is a general purpose system. It isn’t run by any one company. Likewise, PCs are also general purpose systems. The company making them doesn’t insist that it only works with certain other partner companies. In that respect it’s open, just like the wallet in your pocket or purse. Smartphones, on the other hand, are general purpose to a more limited degree. Apple tells you what apps can and can’t run on your phone. Google makes sure some of  its own apps (such as its wallet) run only on Android phones — or run better on Android than on Apple’s or other companies’ phones (as it did for years with Google maps for Apple).

I suggest that the digital wallet might be best thought of as something that’s part a general-purpose thing called the personal cloud.

Your personal cloud is your personal space, which you run for yourself in the networked world. In it you define the ways that your personal data interacts with the world of things, and of services from companies and other entities. That may sound complicated, but it’s actually no different than the personal space you call your house, your car, and your body. In fact, you can think of a personal cloud as something akin to all three, but in the networked world rather than in the physical one. For more on this read Phil Windley, starting here; and follow what Kuppinger-Cole says about Life Management Platforms (which I recently visited here).

So, to sum up, the main thing wrong with digital wallets today isn’t what they do. It’s that they are called “wallets.” Instead they should be called what they really are, which is payment services. (Yes, they do more, but the main thing they do is facilitate transactions.)

The notion that something so personal as a wallet should be provided for you, as a service, by a company, is typical of the calf-cow thinking that has dominated computing for the duration. There is nothing wrong with this, if it’s still 1995. But it’s now 2013, and it’s time we moved on. And, to do that, I’d like to see real digital wallets — personal ones — come up as a feature of personal clouds. So, let the conversation begin. Then the development.

Bonus link: Google’s Wallet and VRM.

 

 

 

 

 

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The Personal Revolution

individualWhile the history of computing and communications often appears to be one led by big entities in business and government, the biggest revolution has actually been a personal one.  Each of us, as individuals, have acquired abilities that were once those of organizations alone — and have done far more with those abilities than the big players ever could — for those big players as well as for ourselves.

It started in the early ’80s, when the IBM PC became host to thousands of new applications for individuals. Personal computers suddenly proved to be a far more fertile ground for application development and new ueses than were the old corporate mainframes and minicomputers. Computing was no longer only about calculating and data processing. It was about everything one could imagine. The result was a profusion of new capabilities for individuals that also brought great benefits to organizations of all kinds and sizes.

A little more than a decade later, in the mid-’90s, the Internet did for communications what the PC did for computing. It gave individuals abilities that went far beyond those enjoyed by big organizations anywhere. Thanks to the Net, anybody could connect with anybody (or anything), anywhere in the world, using protocols that nobody owned, everybody could use, and anybody could improve. Even though there were many owned networks within the Internet, none governed the whole, and the result was a system that put every connected thing at zero functional distance from every other thing, at costs that could often be treated as zero. The positive economic and social externalities of the Internet today are beyond calculation. Again, as with PCs, this owes to new power in the hands of individuals that proved good for organizations as well.

Then in the late ’00s, smartphones and tablets put personal computing and communications advances — won by the PC and the Internet — into devices that fit in pockets and purses, running on platforms that invited millions of new applications. Once again, the increase in personal power and freedom proved essential to organizations as well. Initial resistance to BYOD (bring your own device) has ended, and companies now develop their own apps for employees and customers to use on their smartphones and tablets.

The upward trend in personal empowerment will move next to the “Internet of things,” as more of those objects and devices become equipped with computing and communication abilities — and as individuals gain the power to combine and program interactions between those things and the many services available through APIs ( application programming interfaces) and apps. Each of us will be able, either by ourselves or with the help of “fourth parties” (ones that work for us, as do brokers and banks) to control our identities, secure our privacy, and manage our many interactions in the world, without having to rely on any one platform, vendor or other enabling party. Far better economic signaling will move in both directions between demand and supply. Genuine, trusting and productive relationships will develop, and earned loyalty will prove far more useful than the coerced kind. In sum, the market will discover that free customers and citizens will prove more capable and productive than captive ones, and that this will be good for both business and society.

Progress in this direction will not be easy or even. All through the history just outlined, there have also been constant efforts to contain and limit what individuals can do with their computing and communications abilities. Large incumbent players have worked to create dependencies from which we cannot escape, and to resist competition in open markets. In spite of the many advances they have brought to the market’s table, phone and cable companies today still operate actual or virtual monopolies, and have been working from the start — aided by captive legislators and regulators — to subordinate the Internet’s boundless positive economic externalities to their own legacy business interests. Copyright and patent absolutists have also pushed successfully for laws and regulations that thwart or stop innovation and growth outside their own virtual castles.

And now, in many countries that value neither free markets nor free citizens, efforts are afoot to move Internet “governance” (an oxymoron from the angle of the Internet’s founding protocols) from organizations such as ICANN to the ITU (International Telecommunications Union, now part of the U.N.), where they can partition the Net along national lines, censor it (as in China today), and impose tariffs on data traffic across borders — enriching governments at great expense to economic growth and prosperity, and the welfare of citizens.

Yet the computing, communications and programming genies continue to do their magic for individuals and the organizations they comprise and support. Those genies will not go back in their old bottles. Thus the way to bet in the long run is on personal and economic freedom, and the general prosperity that arises from both. The only way to make that bet pay off, however, is to work on the side of individuals and the developers that empower them. That’s our job here at Customer Commons, and we invite you to join us in that work.

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Personal vs. Personalized

In Worth The Deal? Groceries Get A Personalized Price, Ashley Gross on NPR says,

Heather Kulper is one of those people who really wants to get a good deal. She’s a mom in a suburb north of Seattle who writes a blog about coupon clipping and saving money.

On a recent shopping trip to Safeway, Kulper pulls up a special Safeway app on her phone called Just For U. It shows her deeper discounts on products that she’s likely to buy based on her shopping history. The deals are lower than the club card discount listed in the aisle. When she checks out, she gets that personalized sale price.

“This is the artisan caramelized onion bread, which is normally $4.29. Priced with the Safeway club card, it’s $2.99,” Kulper says. “But with the Just For U personalized deal, it’s 99 cents.”

Kulper says it feels a little bit like she’s getting a secret deal.

It’s kind of like the old days, when you walked into a relative’s small grocery store, and they gave you the family discount. Except now, this is a big corporation using computers to calculate exactly your propensity to buy and at what price.

She concludes,

On this most recent trip, Kulper saved 41 percent with the Just for U app and coupons — $21 altogether — on her purchases. She says she’s happy with her discount, and she doesn’t mind that Safeway knows every tiny little detail of what groceries she buys. To Kulper, it’s worth it, as long as she can save money.

I can’t find Heather Kulper’s blog (the story doesn’t provide a link, and searches go mostly to the story), but it’s clear that she’s one kind of shopper: the aggressive bargain hunter. Is Safeway trying to turn all customers into full-time bargain hunters? Hard to say at this point, because it’s not clear whether a card-carrying Safeway customer is hunting for bargains, or simply forced to use the card to avoid paying the inflated “normal” price. It’s also not clear whether a personalized discount is any different than a coupon. The image above is one I shot of a Stop & Shop scanner, telling me about one in a series of discounts it offered me, based (presumably) on past purchases at the store.

Let’s think about about turning this around, to a system you control as a customer. You share your shopping list with the stores where you like to shop, and they come back with information about what they’ve got. Maybe they tell you they’ll give you a discounted price, or maybe they’ll tell you something is out of stock, or maybe they try to switch you to buying something else. In any of those cases you should also be able to tell them what you like or don’t like about what they’re telling you, and why. What matters in this alternative system is that the system is yours, not theirs. You take the lead, you control the information you share, and you aren’t trapped into many separate relationships, each with its own system for relating with you. In other words, it’s personal — by you —rather than personalized for you.

This is VRM, for Vendor Relationship Management. It’s how you run your relationships with many different companies, rather than how they run their relationships with many different customers. (Those are called CRM, for Customer Relationship Management, a many-$billion business.)

It’s still early, so there’s lots of room for customers to take the lead in helping develop VRM tools and services. You’ll find a list here, in the ProjectVRM wiki.

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Let’s help NBC prep for the 2014 Winter Olympics

ice crystals and olympics symbol

The 2012 Summer Olympics are almost over, but not the challenge of a world where more and more customers are looking to watch coverage — especially of the live kind — on devices other than TVs, and through connections other than cable and satellite.

This has proved hard for many cable and satellite TV customers (myself, for example.) who would also like to watch NBC’s coverage on computers, smartphones, tablets, or large screens connected directly over the Internet.

For example, in spite of NBC’s good efforts (in the form, for example, of smartphone and tablet apps), it has often proven hard for cable and satellite TV customers to authenticate with their providers, or to find what programming packages are required to obtain NBC’s coverage services for the olympics.

No doubt NBC will soon be sitting down with itself, and with its distribution partners, to discuss what they have learned over the last few weeks, and to begin preparing for the 2014 Winter Games in Sochi, Russia. Customer Commons wishes to help with that, by convening an independent forum where all of us can discuss what we’ve learned, and where customers can offer constructive help.

This will not be the place to complain, or to assume that the only parties in a position to come up with good ideas and solutions are NBC and its distribution partners. Out here in the long tail, we have plenty of good ideas too, and are willing to help any way we can. (In fact, I did that for NBC’s Winter 2010 Olympics in Vancouver, by contributing ice crystal images that appeared on screen throughout the event.) We are mindful that the goods are not free for the taking, and that improvements must be worthwhile for everybody, starting with NBC and its bottom line.

We’ll start with comments here, while we set up the forum. If the forum proves successful, we will also have a body of experience that can be leveraged in other markets where meeting demands of a fast-arriving future are daunting for everybody involved. We also invite ProjectVRM and PDE.Cc developers to come help out too. (These are developers working to solve market problems from the customer side, in cooperation with sellers.)

We have a unique opportunity here, while the olympics are still going on, to direct everybody’s interests in a positive and mutually helpful direction, a year and a half before the next olympics begin. So let’s go for it.

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A question of intent

The concepts behind Facebook’s rumored “WANT” button are rooted in the idea of the “intention economy” and are generalizable beyond the Facebook ecosystem. Both customers and enterprises, using today’s existing infrastructure and conventions, can create and listen for intention signals using open, lightweight mechanisms, with customers creating those signals and enterprises listening for them. The approach described here outlines one such mechanism.

The Facebook “WANT” button is the canary in the coal mine for the “intention economy”

On June 27, 2012, blogger Tom Waddington discovered that Facebook had included the ability to create a “WANT” button in its software development kit (SDK). According to reports from Waddington, as well as others including Inside FacebookGizmodoVentureBeat and Mashable, the button will be a way for individuals to indicate their desire to purchase a product.

Inside Facebook had the following to say:

“Just as the Like button allowed Facebook to collect massive amounts of data about users’ interests, the Want button could be a key way for the social network to collect desire-based data. A Want button plugin will make it easy for e-commerce and other sites to implement this type of Facebook functionality without having to build their own apps.”

The fact that Facebook may be testing the “WANT” button is the clearest indication to date that we are on the path to the “intention economy.” Doc Searls has described the intention economy as “an economy driven by consumer intent, where vendors must respond to the actual intentions of customers.” Others, such as John Hagel, have stated that this thinking around the intention economy “is a graphic demonstration of the shift from push to pull that is disrupting our business world.

The “WANT” button, however, is hobbled by the fact that it only works in the Facebook ecosystem and, more importantly, appears as if it’s going to require a non-trivial bit of work to implement. Additionally, the “WANT” button is 100% driven by vendors who are selling items – if the vendor hasn’t indicated through a bit of arcane code that the “WANT” button is available for an item, the button will not appear. There is no way for an individual to initiate the conversation around desire for an arbitrary product or service.

Although definitely a step in the right direction, indicating interest through the proprietary “WANT” button within Facebook is a relatively coarse-grained way for a customer to signal intent.

Internet culture has already created conventions for signaling

That said, there are other pieces of the intention puzzle already in place that can be used. The expression of intention is, at its core, a signal. For the past few decades in particular, however, most of the “signaling” between vendors and customers has come from the vendor in the form of advertising, PR and the like. (In fact, one could argue that the whole discipline around creating “messaging platforms” for large enterprises is, at its core, an attempt to create clear, differentiated signals from the vendor side.) However, as more customer-driven publishing and communication methods have been created, first with blogs and more recently with customer-created conventions on top of proprietary platforms such as Twitter, Facebook, Instagram and Pinterest, individuals have started to introduce their own signaling mechanisms into the fray. Here are two examples:

The hashtag (#) is a signal of topic, organization or keyword. For instance, including a hashtag of #bacon in a post or tweet makes it easy to search for posts that are about bacon.

In the example above, the #bacon hashtag makes it easy to find this post.

The interesting thing about the hashtag construct is that is was created organically. It wasn’t created by a committee, it wasn’t designed by an organization, it wasn’t created as part of a marketing campaign. The hashtag was simply proposed by Chris Messina (@chrismessina) in a single tweet in 2007 as a way to easily find related conversations about BarCamp that were happening online at that time.

You can learn more about the history of the hashtag here.

Since then, the humble hashtag has become the de facto signal that the text that follows it is related to a topic or is a concept of importance to the author of that post. In contrast to the “WANT” button, which needs to be supported by Facebook and explicitly supported by the vendors of products or services that a customer might “want,” it’s important to note that there is no central organization that creates or approves hashtags. Hashtags follow the “NEA” protocol of the open internet:

 

  • Nobody owns them
  • Everybody can use them, and
  • Anybody can improve them

The NEA concept is important. If something conforms to NEA, it can scale, grow, evolve and morph as a market evolves, without constraint. This enables the possibility of a very fast, very efficient process of innovation and improvement.

If the hashtag is a signal of topic and organization, then the at-reply (@reply) is the de facto signal of social connection. The at-reply convention has evolved to signal that the message contains information that is of particular interest to a particular individual or entity.

Lou really, really loves Zappos and wants to make sure that Zappos knows it.

Like the hashtag, the concept of an “at-reply” evolved organically, though a conversation of individuals on Twitter. You can learn more about the history of the at-reply here.

Sometimes these conventions get combined. For example, Micah Baldwin (@micahproposed the concept of a “Follow Friday” online event, when he sent a tweet and named a number of individuals with the at-reply notation. In doing so, he started a ritual that many people invoke every week on Friday. Now, every week tens or hundreds of thousands of people recommend others in their networks as individuals who are worthwhile to follow on the Twitter service using the #followfriday and #ff hashtags coupled with those individuals’ Twitter handles.

Although both the hashtag and at-reply conventions were initially invoked on Twitter, they are concepts that are platform agnostic at their core. Since then, both concepts have jumped to other platforms including Facebook, Pinterest, Instagram and Google+, underlining the fact that useful, simple solutions to individuals’ needs are not constrained to any one technology silo.

A question of intent

In the same way that the hashtag is a signal of organization and the at-reply is a signal of connection, the question mark (?) could be a signal of intent. For example, including ?rentalcar in a post could indicate that the poster has intent to procure a rental car, the inclusion of ?flight could indicate that the poster is looking for airfares for an upcoming trip, and so forth.

The first example of this I’ve seen in the wild occurred earlier this week.

For vendors, this approach triggers a number of things, the first of which is that it turns on a lead-generation mechanism with extremely high fidelity. If an individual has explicitly stated intent via this mechanism, that individual is the hottest possible prospect. This mechanism is beacon to vendors: “Here is a customer who wants to buy what you’re selling.”

Organizations are already using tools such as Radian6, Sysomos, Attensity, and even free tools such as Tweetdeck and basic Twitter search to seek out individuals who are mentioning their brands. The extension of those listening efforts to additionally listen for intent signals of this type are nominal. (Listening tools like NeedTagger are already starting to move in this direction.) From the customer’s side, there is a similarly minimal learning curve required. Anyone can state intent in this manner using existing tools in a matter of moments.

We saw that explicit technical support for concepts such as the hashtag and at-reply did, after a period of time, eventually become a part of the systems upon which they were built. It is a similarly straightforward effort for platforms such as Twitter, Facebook and Pinterest to support this question mark based notation for intent. In doing so, those platforms would be also able to generate highly valuable trend information on the types of intention signals that are “trending” across various geographies and demographics, in the same way that Twitter and Google+ today highlight trending topics within their services based on the frequency of use of particular hashtags.

A statement of permission

There’s a flip side to this idea of unambiguously indicating intent with a statement such as ?flight. By explicitly indicating intent, an individual is indicating interest and is also explicitly giving permission for vendors to contact them. This is the grail for marketers. In the current state of affairs, there is still a huge differential between what vendors, advertisers and publishers of information believe that a particular individual is interested in, and the actual reality of the situation. We’ve all received “targeted” ads on social platforms that are so off the mark to be laughable. With clear intention signals, however, that guesswork is reduced to near-zero; the interaction is all signal and no noise. (Huge kudos to @lisastone for this insight on how the flip side of intention is permission.)

So…what do folks think about using the ? as an indicator of intent, in the same way that we’ve used other signaling mechanisms as noted above?

This post originally appeared at http://socialcustomer.com

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