Re: Aw: Re: Re: [projectvrm] Some possibly VRooMy stuff from the NYTimes R&D lab… Realising Consumer Rights

["Bart Stevens" < >]

Graham,

I hear you. But one thing you forget to react (or what i forgot to mention) are "different types of products for different levels of intentions".

An energy contract is clearly a commodity, same for sms/data/voice or even certain financial products like a savings account.

These marketing people try to sound extremely busy, with an air like they invented sliced bread. But (not so) deep down, they know they sell just commoduties.
They should be able to do the math Attention vrs Intention economy marketing.

And for this math/reasoning I still stand with my earlier email of this morning.

Best (still from the beach in Kenya),

Bart

—
Sent from my phone

On Fri, Apr 18, 2014 at 1:44 PM, Graham Reginald Hill < " target="_blank"> > wrote:

Hi Bart

 

I hear your message. But I am not so sure about the marketing maths.

 

If consumers only bought based upon their explicit cognitive intentions then on balance, I would agree with you. There would only be so many purchases available in the market for customer intentions and the expense spent on marketing to customers to say 'buy from me' could be diverted into facilitating the transaction at lower cost. Cos would save money on marketing expenses and customers would get exactly what they asked for. But this is not how the market for customer intentions actually works.

 

If you look at the consumer decisoning literature you see a number of other factors that confound the explicit cognitive intentions approach. The most obvious of these is that marketing also creates additional consumer intentions. Whether we like it or not, marketing demonstrably works. It creates incremental demand for products and services that otherwise wouldn't exist. The Bass Diffusion model, a standard tool used by new product marketers, shows how it works. Otherwise marketing and marketers wouldn't exist. And neither would brands.

 

Customers are not rational optimisers either. The behavioural economics literature shows consumers often make purchases based on emotional decisoning that they are often not fully aware of (even if they try to rationalise it cognitively afterwards). Emotion sells! The less involving the product, the less likely they are to use cognitive decisioning to make decisions. They might sign up to a Big Switch to collectively switch to the best energy deal, or use an aggregator to get the best car insurance deal, but that isnt going to work for the majority of their weekly household spend where established buying patterns, incentives and impulse rule the roost.

 

And customers are social buyers. The recent Social Physics book by Sandy Pentland highlights how much local social networks drive individual customer decisoning. Up to 50% of purchase decisions according to Pentland's empirical research. I socialise, therefore I am! It also highlights the problems of neo-classical free market models of competition economics, at least for customers and their social networks. If customers buy socially, they limit themselves to the market addressed by their network. They in-effect shut themselves out of the oppportunities afforded by the larger market. The impications should be obvious.

 

There are numerous other confounding factors at play as well. Too many for this short response to cover.

 

Collectively, the market for customer intent is both significantly bigger and significantly different to that predicted by customers' explicit cognitive intentions. And thus by MeCommerce. Marketing actively expands the size of the market. Affective decisioning means consumers don't always buy the cognitively optimal products. Even for high involvement purchases where it may be in their interest to do so. And social decisioning means consumers follow others as often as they choose for themselves. And that is just three of many factors.  

 

Cos are at a crossroads. They can follow their current marketing-driven pathway. As a marketer, it saddens me to say that this the pathway leads to the tragedy of the marketing commons. Alternatively, they can follow the pathway that would seek to replace the implied intentions of marketing with the explicit intentions of MeCommerce. This is the pathway to rack and ruin, both for marketers and for consumers. Or they can follow a hybrid pathway using MeCommerce for some high-involvement decisions where consumer intentions are explicit, whilst improving the efficiency, effectiveness and productivity of marketing where consumer imtentions can be reasonably implied.

 

You can probably tell which pathway I prefer.

 

Best regards from the Consumer Safari in Cologne, Graham
 

-- 
Dr. Graham Hill

UK +44 7564 122 633
DE +49 170 487 6192
http://twitter.com/GrahamHill
http://www.linkedin.com/in/grahamhill
http://www.customerthink.com/graham_hill

Partner
Optima Partners
http://www.optimapartners.co.uk

Senior Associate
Nyras Capital
http://www.nyras.co.uk

 

 

Gesendet: Freitag, 18. April 2014 um 10:30 Uhr
Von: "Bart Stevens" < >
An: "Graham Hill" < >
Cc: "Don Marti" < >, "ProjectVRM list" < >
Betreff: Re: Aw: Re: [projectvrm] Some possibly VRooMy stuff from the NYTimes R&D lab… Realising Consumer Rights

Graham,

Just a brief remark on your last remark.

If you will be able to "sell" the idea to suppliers of a world shift from Attention economy (like shirt sponsoring of ManUnited) towards Intention econony, then your remark is not completely correct.

They will spend less on marketing and are even able to offer a better price/conditions @ no cost to consumers.

Best (from Kenya)

Bart

bjt.stevens.tumblr.com

On Apr 18, 2014 10:20 AM, "Graham Reginald Hill" < > wrote:

Hi Don

 

The blog post was very interesting. It reminds me a lot of a recent Consumer Futures report on 'Realising Consumer Rights: From JFK to the Digital Age' (http://www.consumerfutures.org.uk/files/2014/03/Realising-consumer-rights.pdf). The report took JFK's four rights taken from his 1962 spage on consumer rights, added four newer ones and showed how they were being enabled by a range of technology-driven consumer behaviours. One of the consumer behaviours is Radivcal Transparency. The report is well worth reading and triggered a lot of thought on my 90 minute  flight home yesterday.

 

I agree entirely with you about consumers and transparency. All of the studies suggest that consumers would like to opt-out of much of the tracking that they know they are subject to but don't know the extent of. Fixing this requires consumers to take responsibility for managing how they are marketed at, for the marketing industry to change its targeting approach, or for an intermediary to sit between them to mediate on the consumer's behalf. Each brings their own challenges.  The challenge for consumers in taking responsibility for managing how they are marketed at is that to do so requires a degree of technical knowledge and skill on the part of consumer and the time to use it. Your Average Joe has none of these. So he isn't going to change. The challenge for marketers to change their targeting approach is the fear that the process of change will put marketers at a temporary or permanent conpetitive advantage. Targeted marketing clearly works for marketers. It's purpose is short-term sales in support of marketers' product P&L focus. A customer-responsive intent-driven MeCommerce model would clearly work better for those consumers who express their intent, but it would practically rule out all market-making activities where marketing creates response that otherwise wouldn't exist. So marketers aren't going to change. The challenge for an intermediary sitting between consumers and marketers is that they have to win the trust of both parties for their business model to work. As intermediaries are a fundamentally a cost to the market as a whole, they have to be paid for either out of the customer or the marketer's pocket. They are the most likely source of change in the zero-sum game that has become marketing today. That is not without its problems. A quick look at current markets where intermediaries play a significant role suggests that they often capture cashflows in the market to the detriment of other actors, including consumers. Just look at the airline travel and car insurance markets.

 

We should be careful what we wish for; we might get it!  

 

 

Easter greetings from Cologne, Graham

 

-- 
Dr. Graham Hill

UK +44 7564 122 633
DE +49 170 487 6192
http://twitter.com/GrahamHill
http://www.linkedin.com/in/grahamhill
http://www.customerthink.com/graham_hill

Partner
Optima Partners
http://www.optimapartners.co.uk

Senior Associate
Nyras Capital
http://www.nyras.co.uk

 

 

Gesendet: Donnerstag, 17. April 2014 um 23:09 Uhr
Von: "Don Marti" < >
An: "Doc Searls" < >
Cc: "ProjectVRM list" < >
Betreff: Re: [projectvrm] Some possibly VRooMy stuff from the NYTimes R&D lab

begin Doc Searls quotation of Thu, Apr 17, 2014 at 03:51:08PM -0400:
>
> <http://blog.nytlabs.com/2014/04/07/in-the-loop-designing-conversations-with-algorithms/>
>
> Angles: market conversations and the Internet of Things.
>
> Thoughts?

"Transparency" seems to be the first thing that
people come up with when they start thinking about
surveillance marketing. Let's make the vendors be
"transparent" about what they're doing, and the users
can decide whether or not to participate.

But the problem with transparency is exactly that
it does require people to spend time thinking about
surveillance marketing. This doesn't seem like a
problem to people who already spend time thinking
about surveillance marketing. It doesn't impose any
extra work on them. But for normal people there are
only so many hours in the day, and little time to
think about some new business model.

In the best case -- secure, well-communicated
transparency -- privacy becomes limited not by the
user's technical skill, but by the cognitive load
on the user of understanding how he or she is being
tracked in more and more situations.

Jonathan Levitt, at Advertising Age...
"In-Store Cell Phone Tracking Pits Consumers Against
Retailers"
http://adage.com/article/digitalnext/store-cell-phone-tracking-pits-consumers-stores/292628/

"Industry research shows that consumers overwhelmingly
reject cell phone tracking. In a recent OpinionLab
study of 1,042 consumers, 77.0% said that in-store
cell phone tracking was unacceptable, and 81.0% said
that they didn't trust retailers to keep their data
private and secure."

So here's the VRM-ish part of all this. Users are
already communicating about their privacy norms.
There are vacant niches for information technology
products and services to help the users enforce
these norms.

--
Don Marti
http://zgp.org/~dmarti/