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What’s wrong with bots is they’re not ours

June 7, 2018 in bots, Business, Internet, IoT, Quote, VRM | 6 comments

In Chatbots were the next big thing: what happened?, Justin Lee (@justinleejw) nicely unpacks how chatbots were overhyped to begin with and continue to fail their Turing tests, especially since humans in nearly all cases would  rather talk to humans than to mechanical substitutes.

There’s also a bigger and more fundamental reason why bots still aren’t a big thing: we don’t have them. If we did, they’d be our robot assistants, going out to shop for us, to get things fixed, or to do whatever.

Why didn’t we get bots of our own?

I can pinpoint the exact time and place where bots of our own failed to happen, and all conversation and development went sideways, away from the vector that takes us to bots of our own (hashtag: #booo), and instead toward big companies doing more than ever to deal with us robotically, mostly to sell us shit.

The time was April 2016, and the place was Facebook’s F8 conference. It was on stage there that Mark Zuckerberg introduced “messenger bots”. He began,

Now that Messenger has scaled, we’re starting to develop ecosystems around it. And the first thing we’re doing is exploring how you can all communicate with businesses.

Note his use of the second person you. He’s speaking to audience members as individual human beings. He continued,

You probably interact with dozens of businesses every day. And some of them are probably really meaningful to you. But I’ve never met anyone who likes calling a business. And no one wants to have to install a new app for every service or business they want to interact with. So we think there’s gotta be a better way to do this.

We think you should be able to message a business the same way you message a friend. You should get a quick response, and it shouldn’t take your full attention, like a phone call would. And you shouldn’t have to install a new app.

This promised pure VRM: a way for a customer to relate to a vendor. For example, to issue a service request, or to intentcast for bids on a new washing machine or a car.

So at this point Mark seemed to be talking about a new communication channel that could relieve the typical pains of being a customer while also opening the floodgates of demand notifying supply when it’s ready to buy. Now here’s where it goes sideways:

So today we’re launching Messenger Platform. So you can build bots for Messenger.

By “you” Zuck now means developers. He continues,

And it’s a simple platform, powered by artificial intelligence, so you can build natural language services to communicate directly with people. So let’s take a look.

See the shift there? Up until that last sentence, he seemed to be promising something for people, for customers, for you and me: a better way to deal with business. But alas, it’s just shit:

CNN, for example, is going to be able to send you a daily digest of stories, right into messenger. And the more you use it, the more personalized it will get. And if you want to learn more about a specific topic, say a Supreme Court nomination or the zika virus, you just send a message and it will send you that information.

And right there the opportunity was lost. And all the promise, up there at the to of the hype cycle. Note how Aaron Batalion uses the word “reach” in  ‘Bot’ is the wrong name…and why people who think it’s silly are wrong, written not long after Zuck’s F8 speech: “In a micro app world, you build one experience on the Facebook platform and reach 1B people.”

What we needed, and still need, is for reach to go the other way: a standard bot design that would let lots of developers give us better ways to reach businesses. Today lots of developers compete to give us better ways to use the standards-based tools we call browsers and email clients. The same should be true of bots.

In Market intelligence that flows both ways, I describe one such approach, based on open source code, that doesn’t require locating your soul inside a giant personal data extraction business.

Here’s a diagram that shows how one person (me in this case) can relate to a company whose moccasins he owns:

vrmcrmconduit

The moccasins have their own pico: a cloud on the Net for a thing in the physical world: one that becomes a standard-issue conduit between customer and company.

A pico of this type might come in to being when the customer assigns a QR code to the moccasins and scans it. The customer and company can then share records about the product, or notify the other party when there’s a problem, a bargain on a new pair, or whatever. It’s tabula rasa: wide open.

The current code for this is called Wrangler. It’s open source and in Github. For the curious, Phil Windley explains how picos work in Reactive Programming With Picos.

It’s not bots yet, but it’s a helluva lot better place to start re-thinking and re-developing what bots should have been in the first place. Let’s start developing there, and not inside giant silos.

[Note: the image at the top is from this 2014 video by Capgemini explaining #VRM. Maybe now that Facebook is doing face-plants in the face of the GDPR, and privacy is finally a thing, the time is ripe, not only for #booos, but for the rest of the #VRM portfolio of unfinished and un-begun work on the personal side.]

Wanted: Online Pubs Doing Real (and therefore GDPR-compliant) Advertising

May 30, 2018 in adtech, advertising, VRM | 18 comments

This is what greets me when I go to the Washington Post site from here in Germany:

Washington Post greeting for Europeans

So you can see it too, wherever you are, here’s the URL I’m redirected to on Chrome, on Firefox, on Safari and on Brave. All look the same except for Brave, which shows a blank page.

Note that last item in the Premium EU Subscription column: “No on-site advertising or third-party tracking.”

Ponder for a moment how the Sunday (or any) edition of the Post‘s print edition would look with no on-paper advertising. It would be woefully thin and kind of worthless-looking. Two more value-adds for advertising in the print edition:

  1. It doesn’t track readers, which is the sad and broken norm for newspapers and magazines in the online world—a norm now essentially outlawed by the GDPR, and surely the reason the Post is running this offer.
  2. It sponsors the Post. Tracking-based advertising, known in the trade as adtech, doesn’t sponsor anything. Instead it hunts down eyeballs its spyware already knows about, no matter where they go. In other words, if adtech can shoot a Washington Post reader between the eyes at the Skeevy Lake Tribune, and the Skeevy is cheaper, it might rather hit the reader over there.

So here’s the message I want the Post to hear from me, and from every reader who values what they do:

That’s what I get from the print edition, and that’s what I want from the online edition as well.

So I want two things here.

One is an answer to this question: Are ANY publishers in the online world selling old-fashioned ads that aren’t based on tracking and therefore worth more than the tracking kind? (And are GDPR-compliant as well, since the ads aren’t aimed by collected personal data.)

The other is to subscribe to the Post as soon as they show me they’re willing to do what I ask: give me those real ads again. And stop assuming that all ads need to be the tracking-based kind.

Thanks in advance.

Tags: , , ,

GDPR will pop the adtech bubble

May 12, 2018 in adtech, advertising, Business, Cluetrain, Customertech, Journalism, personal data, problems, publishing, Research, Technology, VRM | 74 comments

In The Big Short, investor Michael Burry says “One hallmark of mania is the rapid rise in the incidence and complexity of fraud.” (Burry shorted the mania- and fraud-filled subprime mortgage market and made a mint in the process.)

One would be equally smart to bet against the mania for the tracking-based form of advertising called adtech.

Since tracking people took off in the late ’00s, adtech has grown to become a four-dimensional shell game played by hundreds (or, if you include martech, thousands) of companies, none of which can see the whole mess, or can control the fraud, malware and other forms of bad acting that thrive in the midst of it.

And that’s on top of the main problem: tracking people without their knowledge, approval or a court order is just flat-out wrong. The fact that it can be done is no excuse. Nor is the monstrous sum of money made by it.

Without adtech, the EU’s GDPR (General Data Protection Regulation) would never have happened. But the GDPR did happen, and as a result websites all over the world are suddenly posting notices about their changed privacy policies, use of cookies, and opt-in choices for “relevant” or “interest-based” (translation: tracking-based) advertising. Email lists are doing the same kinds of things.

“Sunrise day” for the GDPR is 25 May. That’s when the EU can start smacking fines on violators.

Simply put, your site or service is a violator if it extracts or processes personal data without personal permission. Real permission, that is. You know, where you specifically say “Hell yeah, I wanna be tracked everywhere.”

Of course what I just said greatly simplifies what the GDPR actually utters, in bureaucratic legalese. The GDPR is also full of loopholes only snakes can thread; but the spirit of the law is clear, and the snakes will be easy to shame, even if they don’t get fined. (And legitimate interest—an actual loophole in the GDPR, may prove hard to claim.)

Toward the aftermath, the main question is What will be left of advertising—and what it supports—after the adtech bubble pops?

Answers require knowing the differences between advertising and adtech, which I liken to wheat and chaff.

First, advertising:

    1. Advertising isn’t personal, and doesn’t have to be. In fact, knowing it’s not personal is an advantage for advertisers. Consumers don’t wonder what the hell an ad is doing where it is, who put it there, or why.
    2. Advertising makes brands. Nearly all the brands you know were burned into your brain by advertising. In fact the term branding was borrowed by advertising from the cattle business. (Specifically by Procter and Gamble in the early 1930s.)
    3. Advertising carries an economic signal. Meaning that it shows a company can afford to advertise. Tracking-based advertising can’t do that. (For more on this, read Don Marti, starting here.)
    4. Advertising sponsors media, and those paid by media. All the big pro sports salaries are paid by advertising that sponsors game broadcasts. For lack of sponsorship, media—especially publishers—are hurting. @WaltMossberg learned why on a conference stage when an ad agency guy said the agency’s ads wouldn’t sponsor Walt’s new publication, recode. Walt: “I asked him if that meant he’d be placing ads on our fledgling site. He said yes, he’d do that for a little while. And then, after the cookies he placed on Recode helped him to track our desirable audience around the web, his agency would begin removing the ads and placing them on cheaper sites our readers also happened to visit. In other words, our quality journalism was, to him, nothing more than a lead generator for target-rich readers, and would ultimately benefit sites that might care less about quality.” With friends like that, who needs enemies?

Second, Adtech:

    1. Adtech is built to undermine the brand value of all the media it uses, because it cares about eyeballs more than media, and it causes negative associations with brands. Consider this: perhaps a $trillion or more has been spent on adtech, and not one brand known to the world has been made by it. (Bob Hoffman, aka the Ad Contrarian, is required reading on this.)
    2. Adtech wants to be personal. That’s why it’s tracking-based. Though its enthusiasts call it “interest-based,” “relevant” and other harmless-sounding euphemisms, it relies on tracking people. In fact it can’t exist without tracking people. (Note: while all adtech is programmatic, not all programmatic advertising is adtech. In other words, programmatic advertising doesn’t have to be based on tracking people. Same goes for interactive. Programmatic and interactive advertising will both survive the adtech crash.)
    3. Adtech spies on people and violates their privacy. By design. Never mind that you and your browser or app are anonymized. The ads are still for your eyeballs, and correlations can be made.
    4. Adtech is full of fraud and a vector for malware. @ACFou is required reading on this.
    5. Adtech incentivizes publications to prioritize “content generation” over journalism. More here and here.
    6. Intermediators take most of what’s spent on adtech. Bob Hoffman does a great job showing how as little as 3¢ of a dollar spent on adtech actually makes an “impression. The most generous number I’ve seen is 12¢. (When I was in the ad agency business, back in the last millennium, clients complained about our 15% take. Media our clients bought got 85%.)
    7. Adtech gives fake news a business model, because fake news is easier to produce than the real kind, and adtech will pay anybody a bounty for hauling in eyeballs.
    8. Adtech incentivizes hate speech and tribalism by giving both—and the platforms that host them—a business model too.
    9. Adtech relies on misdirection. See, adtech looks like advertising, and is called advertising; but it’s really direct marketing, which is descended from junk mail and a cousin of spam. Because of that misdirection, brands think they’re placing ads in media, while the systems they hire are actually chasing eyeballs to anywhere. (Pro tip: if somebody says every ad needs to “perform,” or that the purpose of advertising is “to get the right message to the right person at the right time,” they’re actually talking about direct marketing, not advertising. For more on this, read Rethinking John Wanamaker.)
    10. Compared to advertising, adtech is ugly. Look up best ads of all time. One of the top results is for the American Advertising Awards. The latest winners they’ve posted are the Best in Show for 2016. Tops there is an Allstate “Interactive/Online” ad pranking a couple at a ball game. Over-exposure of their lives online leads that well-branded “Mayhem” guy to invade and trash their house. In other words, it’s a brand ad about online surveillance.
    11. Adtech has caused the largest boycott in human history. By more than a year ago, 1.7+ billion human beings were already blocking ads online.

To get a sense of what will be left of adtech after GDPR Sunrise Day, start by reading a pair of articles in AdExchanger by @JamesHercher. The first reports on the Transparency and Consent Framework published by IAB Europe. The second reports on how Google is pretty much ignoring that framework and going direct with their own way of obtaining consent to tracking:

Google’s and other consent-gathering solutions are basically a series of pop-up notifications that provide a mechanism for publishers to provide clear disclosure and consent in accordance with data regulations.

Specifically,

The Google consent interface greets site visitors with a request to use data to tailor advertising, with equally prominent “no” and “yes” buttons. If a reader declines to be tracked, he or she sees a notice saying the ads will be less relevant and asking to “agree” or go back to the previous page. According to a source, one research study on this type of opt-out mechanism led to opt-out rates of more than 70%.

Meaning only 30% of site visitors will consent to being tracked. So, say goodbye to 70% of adtech’s eyeball targets right there.

Google’s consent gathering system, dubbed “Funding Choices,” also screws most of the hundreds of other adtech intermediaries fighting for a hunk of what’s left of their market. Writes James, “It restricts the number of supply chain partners a publisher can share consent with to just 12 vendors, sources with knowledge of the product tell AdExchanger.”

And that’s not all:

Last week, Google alerted advertisers it would sharply limit use of the DoubleClick advertising ID, which brands and agencies used to pull log files from DoubleClick so campaigns could be cohesively measured across other ad servers, incentivizing buyers to consolidate spend on the Google stack.

Google also raised eyebrows last month with a new policy insisting that all DFP publishers grant it status as a data controller, giving Google the right to collect and use site data, whereas other online tech companies – mere data processors – can only receive limited data assigned to them by the publisher, i.e., the data controller.

This is also Google’s way of scraping off GDPR liability on publishers.

Publishers and adtech intermediaries can attempt to avoid Google by using Consent Management Platforms (CMPs), a new category of intermediary defined and described by IAB Europe’s Consent Management Framework. Writes James,

The IAB Europe and and IAB Tech Lab framework includes a list of registered vendors that publishers can pass consent to for data-driven advertising. The tech companies pay a one-time fee between $1,000 and $2,000 to join the vendor list, according to executives from three participating companies…Although now that the framework is live, the barriers to adoption are painfully real as well.

The CMP category is pretty bare at the moment, and it may be greeted with suspicion by some publishers.There are eight initial CMPs: two publisher tech companies with roots in ad-blocker solutions, Sourcepoint and Admiral, as well as the ad tech companies Quantcast and Conversant and a few blockchain-based advertising startups…

Digital Content Next, a trade group representing online news publishers, is advising publishers to reject the framework, which CEO Jason Kint said “doesn’t meet the letter or spirit of GDPR.” Only two publishers have publicly adopted the Consent and Transparency Framework, but they’re heavy hitters with blue-chip value in the market: Axel Springer, Europe’s largest digital media company, and the 180-year-old Schibsted Media, a respected newspaper publisher in Sweden and Norway.

In other words, good luck with that.

[Later, 26 May…] Well, Google caved on this one, so apparently Google is coming to IAB Europe’s table.

[And on 30 May…] Axel Springer is also going its own way.

One big upside for IAB Europe is that its Framework contains open source code and an SDK. For a full unpacking of what’s there see the Consent String and Vendor List Format: Transparency & Consent Framework on GitHub and IAB Europe’s own FAQ. More about this shortly.

Meanwhile, the adtech business surely knows the sky is falling. The main question is how far.

One possibility is 95% of the way to zero. That outcome is suggested by results published in PageFair last October by Dr. Johnny Ryan (@JohnnyRyan) there. Here’s the most revealing graphic in the bunch:

Note that this wasn’t a survey of the general population. It was a survey of ad industry people: “300+ publishers, adtech, brands, and various others…” Pause for a moment and look at that chart again. Nearly all those proffesionals in the business would not accept what their businesses do to other human beings.

“However,” Johnny adds, “almost a third believe that users will consent if forced to do so by ‘tracking walls’, that deny access to a website unless a visitor agrees to be tracked. Tracking walls, however, are prohibited under Article 7 of the GDPR…”

Pretty cynical, no?

The good news for both advertising and publishing is that neither needs adtech. What’s more, people can signal what they want out of the sites they visit—and from the whole marketplace. In fact the Internet itself was designed for exactly that. The GDPR just made the market a lot more willing to start hearing clues from customers that have been laying in plain sight for almost twenty years.

The first clues that fully matter are the ones we—the individuals they’ve been calling “users,” will deliver. Look for details on that in another post.

Meanwhile::::

Pro tip #1: don’t bet against Google, except maybe in the short term, when sunrise will darken the whole adtech business.

Instead, bet against companies that stake their lives on tracking people, and doing that without the clear and explicit consent of the tracked. That’s most of the adtech “ecosystem” not called Google or Facebook.

Google can say it already has consent, and that it is also has a legitimate interest (one of the six “lawful bases” for tracking) in the personal data it harvests from us.

Google can also live without the tracking. Most of its income comes from AdWords—its search advertising business—which is far more guided by what visitors are searching for than by whatever Google knows about those visitors.

Google is also also relatively trusted, as tech companies go. Its parent, Alphabet, is also increasingly diversified. Facebook, on the other hand, does stake its life on tracking people. (I say more about Facebook’s odds here.)

Pro tip #2: do bet on any business working for customers rather than sellers. Because signals of personal intent will produce many more positive outcomes in the digital marketplace than surveillance-fed guesswork by sellers ever could, even with the most advanced AI behind it.

For more on how that will work, read The Intention Economy: When Customers Take Charge. Six years after Harvard Business Review Press published that book, what it says will start to come true. Thank you, GDPR.

Pro tip #3: do bet on developers building tools that give each of us scale in dealing with the world’s companies and governments, because those are the tools businesses working for customers will rely on to scale up their successes as well.

What it comes down to is the need for better signaling between customers and companies than can ever be possible in today’s doomed tracking-fed guesswork system. (All the AI and ML in the world won’t be worth much if the whole point of it is to sell us shit.)

Think about what customers and companies want and need about each other: interests, intentions, competencies, locations, availabilities, reputations—and boundaries.

When customers can operate both privately and independently, we’ll get far better markets than today’s ethically bankrupt advertising and marketing system could ever give us.

Pro tip #4: do bet on publishers getting back to what worked since forever offline and hardly got a chance online: plain old brand advertising that carries both an economic and a creative signal, and actually sponsors the publication rather than using the publication as a way to gather eyeballs that can be advertised at anywhere. The oeuvres of Don Marti (@dmarti) and Bob Hoffman (the @AdContrarian) are thick with good advice about this. I’ve also written about it extensively in the list compiled at People vs. Adtech. Some samples, going back through time:

  1. An easy fix for a broken advertising system (12 October 2017 in Medium and in my blog)
  2. Without aligning incentives, we can’t kill fake news or save journalism (15 September 2017 in Medium)
  3. Let’s get some things straight about publishing and advertising (9 September 2017 and the same day in Medium)
  4. Good news for publishers and advertisers fearing the GDPR (3 September 2017 in ProjectVRM and 7 October in Medium).
  5. Markets are about more than marketing (2 September 2017 in Medium).
  6. Publishers’ and advertisers’ rights end at a browser’s front door (17 June 2017 in Medium). It updates one of the 2015 blog posts below.
  7. How to plug the publishing revenue drain (9 June 2017 in Medium). It expands on the opening (#publishing) section of my Daily Tab for that date.
  8. How True Advertising Can Save Journalism From Drowning in a Sea of Content (22 January 2017 in Medium and 26 January 2017 in my blog.)It’s People vs. Advertising, not Publishers vs. Adblockers (26 August 2016 in ProjectVRM and 27 August 2016 in Medium)
  9. Why #NoStalking is a good deal for publishers (11 May 2016, and in Medium)
  10. How customers can debug business with one line of code (19 April 2016 in ProjectVRM and in Medium)
  11. An invitation to settle matters with @Forbes, @Wired and other publishers (15 April 2016 and in Medium)
  12. TV Viewers to Madison Avenue: Please quit driving drunk on digital (14 Aprl 2016, and in Medium)
  13. The End of Internet Advertising as We’ve Known It(11 December 2015 in MIT Technology Review)
  14. Ad Blockers and the Next Chapter of the Internet (5 November in Harvard Business Review)
  15. How #adblocking matures from #NoAds to #SafeAds (22 October 2015)
  16. Helping publishers and advertisers move past the ad blockade (11 October 2015 on the ProjectVRM blog)
  17. Beyond ad blocking — the biggest boycott in human history (28 Septemper 2015)
  18. A way to peace in the adblock war (21 September 2015, on the ProjectVRM blog)
  19. How adtech, not ad blocking, breaks the social contract (23 September 2015)
  20. If marketing listened to markets, they’d hear what ad blocking is telling them (8 September 2015)
  21. Apple’s content blocking is chemo for the cancer of adtech (26 August 2015)
  22. Separating advertising’s wheat and chaff (12 August 2015, and on 2 July 2016 in an updated version in Medium)
  23. Thoughts on tracking based advertising (18 February 2015)
  24. On marketing’s terminal addiction to data fracking and bad guesswork (10 January 2015)
  25. Why to avoid advertising as a business model (25 June 2014, re-running Open Letter to Meg Whitman, which ran on 15 October 2000 in my old blog)
  26. What the ad biz needs is to exorcize direct marketing (6 October 2013)
  27. Bringing manners to marketing (12 January 2013 in Customer Commons)
  28. What could/should advertising look like in 2020, and what do we need to do now for this future?(Wharton’s Future of Advertising project, 13 November 2012)
  29. An olive branch to advertising (12 September 2012, on the ProjectVRM blog)

I expect, once the GDPR gets enforced, I can start writing about People + Publishing and even People + Advertising. (I have long histories in both publishing and advertising, by the way. So all of this is close to home.)

Meanwhile, you can get a jump on the GDPR by blocking third party cookies in your browsers, which will stop most of today’s tracking by adtech. Customer Commons explains how.

Facebook’s Cambridge Analytica problems are nothing compared to what’s coming for all of online publishing

March 23, 2018 in adtech, advertising, Berkman, Business, Customertech, Ideas, infrastructure, Internet, Journalism, Law, Links, marketing, News, Personal, privacy, problems, publishing, Research, Technology, VRM | 72 comments

Let’s start with Facebook’s Surveillance Machine, by Zeynep Tufekci in last Monday’s New York Times. Among other things (all correct), Zeynep explains that “Facebook makes money, in other words, by profiling us and then selling our attention to advertisers, political actors and others. These are Facebook’s true customers, whom it works hard to please.”

Irony Alert: the same is true for the Times, along with every other publication that lives off adtech: tracking-based advertising. These pubs don’t just open the kimonos of their readers. They bring readers’ bare digital necks to vampires ravenous for the blood of personal data, all for the purpose of aiming “interest-based” advertising at those same readers, wherever those readers’ eyeballs may appear—or reappear in the case of “retargeted” advertising.

With no control by readers (beyond tracking protection which relatively few know how to use, and for which there is no one approach, standard, experience or audit trail), and no blood valving by the publishers who bare those readers’ necks, who knows what the hell actually happens to the data?

Answer: nobody knows, because the whole adtech “ecosystem” is a four-dimensional shell game with hundreds of players…

or, in the case of “martech,” thousands:

For one among many views of what’s going on, here’s a compressed screen shot of what Privacy Badger showed going on in my browser behind Zeynep’s op-ed in the Times:

[Added later…] @ehsanakhgari tweets pointage to WhoTracksMe’s page on the NYTimes, which shows this:

And here’s more irony: a screen shot of the home page of RedMorph, another privacy protection extension:

That quote is from Free Tools to Keep Those Creepy Online Ads From Watching You, by Brian X. Chen and Natasha Singer, and published on 17 February 2016 in the Times.

The same irony applies to countless other correct and important reportage on the Facebook/Cambridge Analytica mess by other writers and pubs. Take, for example, Cambridge Analytica, Facebook, and the Revelations of Open Secrets, by Sue Halpern in yesterday’s New Yorker. Here’s what RedMorph shows going on behind that piece:

Note that I have the data leak toward Facebook.net blocked by default.

Here’s a view through RedMorph’s controller pop-down:

And here’s what happens when I turn off “Block Trackers and Content”:

By the way, I want to make clear that Zeynep, Brian, Natasha and Sue are all innocents here, thanks both to the “Chinese wall” between the editorial and publishing functions of the Times, and the simple fact that the route any ad takes between advertiser and reader through any number of adtech intermediaries is akin to a ball falling through a pinball machine. Refresh your page while reading any of those pieces and you’ll see a different set of ads, no doubt aimed by automata guessing that you, personally, should be “impressed” by those ads. (They’ll count as “impressions” whether you are or not.)

Now…

What will happen when the Times, the New Yorker and other pubs own up to the simple fact that they are just as guilty as Facebook of leaking data about their readers to other parties, for—in many if not most cases—God knows what purposes besides “interest-based” advertising? And what happens when the EU comes down on them too? It’s game-on after 25 May, when the EU can start fining violators of the General Data Protection Regulation (GDPR). Key fact: the GDPR protects the data blood of what they call “EU data subjects” wherever those subjects’ necks are exposed in borderless digital world.

To explain more about how this works, here is the (lightly edited) text of a tweet thread posted this morning by @JohnnyRyan of PageFair:

Facebook left its API wide open, and had no control over personal data once those data left Facebook.

But there is a wider story coming: (thread…)

Every single big website in the world is leaking data in a similar way, through “RTB bid requests” for online behavioural advertising #adtech.

Every time an ad loads on a website, the site sends the visitor’s IP address (indicating physical location), the URL they are looking at, and details about their device, to hundreds -often thousands- of companies. Here is a graphic that shows the process.

The website does this to let these companies “bid” to show their ad to this visitor. Here is a video of how the system works. In Europe this accounts for about a quarter of publishers’ gross revenue.

Once these personal data leave the publisher, via “bid request”, the publisher has no control over what happens next. I repeat that: personal data are routinely sent, every time a page loads, to hundreds/thousands of companies, with no control over what happens to them.

This means that every person, and what they look at online, is routinely profiled by companies that receive these data from the websites they visit. Where possible, these data and combined with offline data. These profiles are built up in “DMPs”.

Many of these DMPs (data management platforms) are owned by data brokers. (Side note: The FTC’s 2014 report on data brokers is shocking. See https://www.ftc.gov/reports/data-brokers-call-transparency-accountability-report-federal-trade-commission-may-2014. There is no functional difference between an #adtech DMP and Cambridge Analytica.

—Terrell McSweeny, Julie Brill and EDPS

None of this will be legal under the #GDPR. (See one reason why at https://t.co/HXOQ5gb4dL). Publishers and brands need to take care to stop using personal data in the RTB system. Data connections to sites (and apps) have to be carefully controlled by publishers.

So far, #adtech’s trade body has been content to cover over this wholesale personal data leakage with meaningless gestures that purport to address the #GDPR (see my note on @IABEurope current actions here: https://t.co/FDKBjVxqBs). It is time for a more practical position.

And advertisers, who pay for all of this, must start to demand that safe, non-personal data take over in online RTB targeting. RTB works without personal data. Brands need to demand this to protect themselves – and all Internet users too. @dwheld @stephan_lo @BobLiodice

Websites need to control
1. which data they release in to the RTB system
2. whether ads render directly in visitors’ browsers (where DSPs JavaScript can drop trackers)
3. what 3rd parties get to be on their page
@jason_kint @epc_angela @vincentpeyregne @earljwilkinson 11/12

Lets work together to fix this. 12/12

Those last three recommendations are all good, but they also assume that websites, advertisers and their third party agents are the ones with the power to do something. Not readers.

But there’s lots readers will be able to do. More about that shortly. Meanwhile, publishers can get right with readers by dropping #adtech and going back to publishing the kind of high-value brand advertising they’ve run since forever in the physical world.

That advertising, as Bob Hoffman (@adcontrarian) and Don Marti (@dmarti) have been making clear for years, is actually worth a helluva lot more than adtech, because it delivers clear creative and economic signals and comes with no cognitive overhead (for example, wondering where the hell an ad comes from and what it’s doing right now).

As I explain here, “Real advertising wants to be in a publication because it values the publication’s journalism and readership” while “adtech wants to push ads at readers anywhere it can find them.”

Doing real advertising is the easiest fix in the world, but so far it’s nearly unthinkable for a tech industry that has been defaulted for more than twenty years to an asymmetric power relationship between readers and publishers called client-server. I’ve been told that client-server was chosen as the name for this relationship because “slave-master” didn’t sound so good; but I think the best way to visualize it is calf-cow:

As I put it at that link (way back in 2012), Client-server, by design, subordinates visitors to websites. It does this by putting nearly all responsibility on the server side, so visitors are just users or consumers, rather than participants with equal power and shared responsibility in a truly two-way relationship between equals.

It doesn’t have to be that way. Beneath the Web, the Net’s TCP/IP protocol—the gravity that holds us all together in cyberspace—remains no less peer-to-peer and end-to-end than it was in the first place. Meaning there is nothing about the Net that prevents each of us from having plenty of power on our own.

On the Net, we don’t need to be slaves, cattle or throbbing veins. We can be fully human. In legal terms, we can operate as first parties rather than second ones. In other words, the sites of the world can click “agree” to our terms, rather than the other way around.

Customer Commons is working on exactly those terms. The first publication to agree to readers terms is Linux Journal, where I am now editor-in-chief. The first of those terms is #P2B1(beta), says “Just show me ads not based on tracking me,” and is hashtagged #NoStalking.

In Help Us Cure Online Publishing of Its Addiction to Personal Data, I explain how this models the way advertising ought to be done: by the grace of readers, with no spying.

Obeying readers’ terms also carries no risk of violating privacy laws, because every pub will have contracts with its readers to do the right thing. This is totally do-able. Read that last link to see how.

As I say there, we need help. Linux Journal still has a small staff, and Customer Commons (a California-based 501(c)(3) nonprofit) so far consists of five board members. What it aims to be is a worldwide organization of customers, as well as the place where terms we proffer can live, much as Creative Commons is where personal copyright licenses live. (Customer Commons is modeled on Creative Commons. Hats off to the Berkman Klein Center for helping bring both into the world.)

I’m also hoping other publishers, once they realize that they are no less a part of the surveillance economy than Facebook and Cambridge Analytica, will help out too.

[Later…] Not long after this post went up I talked about these topics on the Gillmor Gang. Here’s the video, plus related links.

I think the best push-back I got there came from Esteban Kolsky, (@ekolsky) who (as I recall anyway) saw less than full moral equivalence between what Facebook and Cambridge Analytica did to screw with democracy and what the New York Times and other ad-supported pubs do by baring the necks of their readers to dozens of data vampires.

He’s right that they’re not equivalent, any more than apples and oranges are equivalent. The sins are different; but they are still sins, just as apples and oranges are still both fruit. Exposing readers to data vampires is simply wrong on its face, and we need to fix it. That it’s normative in the extreme is no excuse. Nor is the fact that it makes money. There are morally uncompromised ways to make money with advertising, and those are still available.

Another push-back is the claim by many adtech third parties that the personal data blood they suck is anonymized. While that may be so, correlation is still possible. See Study: Your anonymous web browsing isn’t as anonymous as you think, by Barry Levine (@xBarryLevine) in Martech Today, which cites De-anonymizing Web Browsing Data with Social Networks, a study by Jessica Su (@jessicatsu), Ansh Shukla (@__anshukla__) and Sharad Goel (@5harad)
of Stanford and Arvind Narayanan (@random_walker) of Princeton.

(Note: Facebook and Google follow logged-in users by name. They also account for most of the adtech business.)

One commenter below noted that this blog as well carries six trackers (most of which I block).. Here is how those look on Ghostery:

So let’s fix this thing.

[Later still…] Lots of comments in Hacker News as well.

[Later again (8 April 2018)…] About the comments below (60+ so far): the version of commenting used by this blog doesn’t support threading. If it did, my responses to comments would appear below each one. Alas, some not only appear out of sequence, but others don’t appear at all. I don’t know why, but I’m trying to find out. Meanwhile, apologies.

Mics Matter

February 7, 2018 in Apple, audio, marketing, Personal, problems, Technology, VRM | 7 comments

Sometimes you get what you pay for.

In this case, a good microphone in a bluetooth headset.

Specifically, the Bose Soundsport Wireless:

I’ve had these a day so far, and I love them. But not just because they sound good. Lots of earphones do that. I love them because the mic in the thing is good. This is surprisingly rare.

Let’s start with the humble Apple EarPods that are overpriced at $29 but come free with every new Apple i-thing and for that reason are probably the most widely used earphones on Earth:

No, their sound isn’t great. But get this: in conversation they sound good to ears at the other end. Better, in my judgement than the fancy new AirPods. (Though according to Phil Windley in the comments below, they are good at suppressing ambient noise.) The AirPods are also better than lots of other earphones I’ve used: ones from Beats, SkullCandy, Sennheiser and plenty of other brands. (I lose and destroy earphones and headphones constantly.) In all my experience, I have have not heard any earphones or headphones that sound better than plain old EarPods. In fact I sometimes ask, when somebody sounds especially good over a voice connection, if they’re using EarPods. Very often the answer is yes. “How’d you guess?” they ask. “Because you sound unusually good.”

So, when a refurbished iPhone 7 Plus arrived to replace my failing iPhone 5s two days ago, and it came with no headphone hole (bad, but I can live), I finally decided to get some wireless earphones. So I went to Consumer Reports on the Web, printed out their ratings for Wireless Portable Stereo Headphones (alas, behind a subscription wall), went to the local Staples, and picked up a JBL E25BT for $49 against a $60 list price. I chose that one because Consumer Reports gives it a rating of 71 out of 100 (which isn’t bad, considering that 76 is the top rating for any of the 50 models on the list)—and they called it a “best buy” as well.

I was satisfied until I talked to my wife over the JBL on my new phone. “You’re muffled,” she said. Then I called somebody else. “What?” they said. “I can’t hear you.” I adjusted the mic so it was closer to my mouth. “What?” they said again. I switched to the phone itself. “That’s better.” I then plugged the old EarPods into Apple’s Lightning dongle, which I also bought at Staples for $9. “Much better.”

So the next day I decided to visit an Apple Store to see what they had, and recommended. I mean, I figured they’d have a fair chance of knowing.

“I want a good mic more than I want good sound,” I said to the guy.  “Oh,” he replied. “I shouldn’t say this because we don’t sell them; but you need a Bose. They care about mics and theirs are the best. Go to the Best Buy down the street and see what they’ve got.” So I went.

At Best Buy the guy said, “The best mic is in the Bose Soundsport Wireless.” I pulled my six-page Consumer Reports list of rated earphones out of my back pocket. There at the top of the ratings was the Soundsport. So I bought a blue one. Today I was on two long calls and both parties at the other ends said “You sound great.” One added, “Yeah, really good.” So there ya go.

I’m sure there are other models with good mics; but I’m done looking, and I just want to share what I’ve found so far—and to implore all the outfits that rate earphones and headphones with mics to rate the mics too. It’s a kindness to the people at the other end of every call.

Remember: conversations are two-way, and the person speaking has almost no idea how good they’re sounding to the other person over a mobile phone. So give the mics some weight.

And thanks, Bose. Good product.

Dear DSCC: unsubscribe means unsubscribe

October 29, 2017 in Politics, VRM | 4 comments

I have unsubscribed from the DSCC mailing list, which I never joined, multiple times. Here’s a screen shot of my last unsubscribe session, dated 21 October:

That’s the third screen, after others that mute the unsubscribe option. At this point, “Take a break” is their euphemism for what I really want, which is a divorce. Here’s the confirmation:

And here is the confirming email:

I have earlier ones from June, July and August.

But the DSCC emails keep coming. Here’s just the top of the latest:

So here’s a question for the DSCC, or anyone else who knows: Is this deliberate on the DSCC’s part?

I do believe one should never ascribe to __________ what can also be ascribed to incompetence.

But this is a long time for any incompetence to persist. At a certain point this kind of shit gets hard to read as anything other than intentional. That point was passed two unsubscribes ago.

Whatever the reasons, it’s a great way to piss off voters.

I just completed my fifth known unsubscribe attempt. In the text box under “Please tell us why you are unsubscribing (optional), I just wrote,

See what I wrote here http://blogs.harvard.edu/doc/2017/10/29/… and tweeted here: https://twitter.com/dsearls/status/92468… This will be my 5th unsubscribe attempt. I have no faith it will work any better than the last four, which all failed.

I have no faith this will work. Please prove me wrong, DSCC.

By the way, I’ve long been a political independent, and have found my ass on political sucker lists from both major parties. The difference with the DSCC is that unsubscribe fails with them. Always.

[Later…] Since some have suggested that I only unsubscribed from one mailing, here’s a screenshot I left out of the post:

By the way, it doesn’t say what “ONTRAPORT” is, and the domain is http://demolinks.us/, which goes to an unready wordpress site by the ONTRAPORT name. Strange.

[Later again…]

I got another DSCC email…

…and decided to go through the unsubscribe routine again, because well, hell, why not.

As you see, the choice to unsubscribe is muted:

Then, instead of unsubscribing me when I hit “No, continue unsubscribing,” it gives me this:

Besides suggesting that the reader’s clear intention to unsubscribe actually means “Receive fewer emails,” they make the option to continue unsubscribing barely visible. But I hit it, and got this:

Hitting the red box then got me this:

No confirming email came this time.

I haven’t received another DSCC email yet, but it’s only been a few hours. I have no faith that they won’t keep mailing me shit.

Tags: , ,

Let’s get some things straight about publishing and advertising

September 9, 2017 in adtech, advertising, Broadcasting, Business, Customertech, personal data, VRM | 2 comments

symbiosis

Synopsis—Advertising supported publishing in the offline world by sponsoring it. In the online world, advertising has been body-snatched by adtech, which tracks eyeballs via files injected into apps and browsers, then shoots those eyeballs with “relevant” ads wherever the eyeballs show up. Adtech has little or no interest in sponsoring a pub for the pub’s own worth. Worse, it incentivizes fake news (which is easier to produce than the real kind) and flooding the world with “content” rather than old-fashioned (and infinitely more worthwhile) editorial. When publishers agreed to funding by adtech, they sold their souls and their readers down a river full of fraud and malware, as well as indefensible manners. Fortunately, readers can bring both publishers and advertisers back into a soulful reunion. Helpfully, the GDPR makes it illegal not to, and that will be a huge issue as the deadline for compliance (next May 25th) approaches.

Yesterday Digiday published The GDPR will help or hurt publishers, depending on who you ask, by Ross Benes (@RossBenes). I was one of the people Ross asked, and the piece includes a quote from me. His question went this way:

I saw this blog you wrote about the topic.

http://blogs.harvard.edu/vrm/2017/09/03/good-news-for-publishers-and-advertisers-fearing-the-gdpr/

Do you think advertisers will pay enough for SafeAds to offset the losses publishers will have from selling fewer targeted ads due to privacy regs?

It’s a good question. (That’s what people say when they don’t have an answer, or can’t think of an easy one right away. But…) I thought about it, and replied with this:

Yes, and then some.

They’ll do it because there is more brand value to SafeAds.

The bigger question is for publishers: what business do they want to be in?

Do they want to operate barrels of “content” full of tracked fish baited there so adtech can shoot them with “interest-based” ads?

Or do they want to operate actual publications with good editorial that advertisers sponsor so their ads can be seen by readers who know those ads support the publication and are appropriate without being personal?

That’s the choice.

It helps that the second business — actual publishing — has been around for a couple hundred years, and even worked fine on the Web before publishers fell for the adtech sell.

Publishers sold a big piece of their soul when they consented to having their readers’ privacy violated, and with rampant impunity, by adtech. They also chose to ignore the fact that adtech is in the business of chasing eyeballs, not of sponsoring the good work publishers do, or of building brand reputation. (Which can’t be done by shooting people constantly with “interest-based” ads that mostly creep people out if they hit a bulls-eye.)

The GDPR, if it works like it should, will force publishers to fire adtech and normalize their relationship with readers. When that happens, publishers, advertisers, readers and agents for all three can start working out better business models than the creepy one we’ve had with adtech.

More of that in my People vs. Adtech series: http://j.mp/adbwars.

Ross quoted the first sentence of the second-to-last paragraph, which is probably the best one of the bunch he could have used. Most of the quotes he gathered from other folks in the biz were also very good. I study this topic a lot, and I still learned some new things. Hats off for that.

While I’m saluting what I just learned from Ross, however, I also want to visit some assumptions that surface in his piece. They aren’t his, but rather pretty much everybody’s, and that’s a problem. Here are four of them.

1) Consent can only go one way, meaning each of us should always be the ones consenting to terms proffered by sites and services. Here’s how Ross puts it:

The General Data Protection Regulation, which prevents brands from using a person’s data unless they have explicit permission to do so, could send more ad dollars to premium publishers that are more likely to obtain user consent than lower-quality publishers.

In fact consent can go the other way, meaning the publisher or advertiser can consent to our terms.

It is only because we made a Faustian bargain with client-server in 1995 that we remain stuck inside a model that assumes we “users” should always be second (and second-class) parties, with no choice but to agree as “clients” to terms proffered by server operators.

It helps that the Internet was designed so any one of us can be peers. This is an especially good design feature in the age that (at least I hope) begins with the GDPR.

One reason why I’m encouraged about the GDPR is that it says each of us can be “data controllers” as well as “data subjects.” (White & Case have a good unpacking of that, here.)

I visit the possibilities in Good news for publishers and advertisers fearing the GDPR (3 September in ProjectVRM), How to plug the publishing revenue drain (9 June 2017 in Medium), Why #NoStalking is a good deal for publishers (11 May 2016, and in Medium), How customers can debug business with one line of code (19 April 2016 in ProjectVRM and in Medium) and An invitation to settle matters with @Forbes, @Wired and other publishers (15 April 2016 and in Medium).

2) The choice is between “acceptable” and “unacceptable” ads (as Adblock Plus believes) or between “intrusive” ads and those that aren’t.

In fact the real choice is between ads based on tracking and those that aren’t (which I call #SafeAds in Good news for publishers and advertisers fearing the GDPR, and which are what you see in all non-digital commercial media).

Tracking is the reason ad blocking, which has been around since 2003, didn’t hockey-stick toward the sky until 2012. That was when publishers and advertisers, led by the IAB, gave the middle finger to Do Not Track, which was merely a polite request not to be tracked that people could express in their browsers.

I wrote about this in Ad Blockers and the Next Chapter of the Internet (5 November in Harvard Business Review) and Beyond ad blocking — the biggest boycott in human history (28 Septemper 2015). Here’s a graphic showing what happened:

I also unpack the difference between SafeAds and tracking based ones (aka adtech) in Separating advertising’s wheat and chaff (12 August 2015, and on 2 July 2016 in an updated version in Medium).

3) The best advertising is the most measurable, and is looking for a response from an individual.

That’s not true for advertising, but it is for direct response marketing (the wheat and chaff I talk about in the last cited piece). Unfortunately, as I say in that piece, “Madison Avenue fell asleep, direct response marketing ate its brain, and it woke up as an alien replica of itself.”

The outlines of that alien replica can be seen in what Ross cites here:

Eric Berry, CEO of native ad platform TripleLift, said the GDPR could lead to a reduction in programmatic ad spend because ad buyers will struggle to measure whether their ads lead to purchases. There’s uncertainty about how the law will be enforced, but if users have to give consent to individual publishers, demand-side platforms and attribution vendors, the attribution companies won’t likely have enough data to make accurate measurements, which will lead ad buyers to shift their dollars to other marketing tactics. This would hurt publishers that rely on programmatic ad revenue, he said.

There is a reason perhaps a $trillion has been spent on adtech and not one worldwide brand everyone can name has been created by it, much less sustained or helped in any way.

As Don Marti says, only real advertising can carry the full economic and creative signals required to create and sustain a brand. And, as Bob Hoffman hammers home constantly (and very artfully) in The Ad Contrarian, the ad industry’s equation of “digital” with tracking is based entirely on bullshit. (His term, and the right one.)

Direct response marketing, which began as junk mail, and which looks to measure results for every message, wasn’t designed for that, and can’t do it.

Calling direct response marketing advertising was one of the biggest mistakes the ad industry ever made and masks the real problem the GDPR invites, which is that we risk throwing out the SafeAds baby with the FakeAds (adtech) bathwater.

If all the GDPR leads publishers to do is (as Ross says in his piece) “use intrusive messages — like pop-ups or interstitials — to get user consent,” and the EU fails to fine publishers and their adtech funders for violating the spirit as well as the letter of the GDPR, the GDPR will be as big a fail as the useless cookie consent notices people see on European sites.

4) There’s nothing really wrong with adtech.

Pretty much everything is wrong about adtech, but perhaps the wrongest of the wrong is the problem Siva Vaidhyanathan (@sivasaid) visits in a NY Times piece titled Facebook Wins, Democracy Loses. Here’s a pull quote:

A core principle in political advertising is transparency — political ads are supposed to be easily visible to everyone, and everyone is supposed to understand that they are political ads, and where they come from. And it’s expensive to run even one version of an ad in traditional outlets, let alone a dozen different versions. Moreover, in the case of federal campaigns in the United States, the 2002 McCain-Feingold campaign-finance act requires candidates to state they approve of an ad and thus take responsibility for its content.

The bold-face is mine (or actually my wife’s, who found and highlighted it for me).

The economic signaling value of an ad comes from what it costs. Only a brand with a lot of heft can afford to sponsor a publication or a mainstream broadcaster. But it’s super-cheap to run ads that narrowcast to just a few people. Or to put up a fake news site. (Both are big reasons why journalism is now drowning in a sea of content. Adtech is what paid publishing to trade journalism for “content generation.” This is a cancer on advertising, publishing and journalism, and makes adtech the Agent Smith of digital.)

What’s more, adtech has created environments where micro-targeted ads and adtech-funded fake news can work very effectively to destroy brands.

Consider this possibility: Trump and his sympathizers succeeded in destroying Hillary Clinton’s brand, and there wasn’t a damn thing any of her own big-budget and big-media branding efforts (#SafeAds all) could do about it. (And try, if you are a Trump sympathizer, to ignore whatever you think about how much Hillary brought it on herself or deserved it. In badness of the smear-worthy sort, she has plenty of company, especially Trump. In using modern adtech and fake news methods, the Trump campaign and those helping it were very smart and effective.)

As Siva says in his Times piece,

Ads on [Facebook] meant for, say, 20- to 30-year-old home-owning Latino men in Northern Virginia would not be viewed by anyone else, and would run only briefly before vanishing. The potential for abuse is vast. An ad could falsely accuse a candidate of the worst malfeasance a day before Election Day, and the victim would have no way of even knowing it happened. Ads could stoke ethnic hatred and no one could prepare or respond before serious harm occurs.

Can the GDPR address that problem?

Yes, by supporting individuals (not mere “users” or “consumers”) operating as first parties, getting the good publishers to agree not to run ads like the ones Siva describes, and to open the floodgates to brand ads that actually sponsor those publications, rather than regarding them as bait for shooting tracked eyeballs.

I explain how this will work in What if businesses agreed to customers’ terms and conditions? (28 April 2017 in Medium) as well as in a number of posts in my People vs. Adtech series.

In the long run only the targets of advertising can stop advertisers and publishers from driving drunk on digital, and to start respecting the very people they’ve been abusing.

If that fails, we’ll finally get one answer to the question I asked in January of last year: What if we don’t need advertising at all?

How the personal data extraction industry ends

August 26, 2017 in adtech, advertising, Business, data, Ideas, infrastructure, Internet, Law, marketing, News, Technology, VRM | 6 comments

Who Owns the Internet? — What Big Tech’s Monopoly Powers Mean for our Culture is Elizabeth Kolbert‘s review in The New Yorker of several books, one of which I’ve read: Jonathan Taplin’s Move Fast and Break Things—How Facebook, Google, and Amazon Cornered Culture and Undermined Democracy.

The main takeaway for me, to both Elizabeth’s piece and Jon’s book, is making clear that Google and Facebook are at the heart of today’s personal data extraction industry, and that this industry defines (as well as supports) much of our lives online.

Our data, and data about us, is the crude that Facebook and Google extract, refine and sell to advertisers. This by itself would not be a Bad Thing if it were done with our clearly expressed (rather than merely implied) permission, and if we had our own valves to control personal data flows with scale across all the companies we deal with, rather than countless different valves, many worthless, buried in the settings pages of the Web’s personal data extraction systems, as well as in all the extractive mobile apps of the world.

It’s natural to look for policy solutions to the problems Jon and others visit in the books Elizabeth reviews. And there are some good regulations around already. Most notably, the GDPR in Europe has energized countless developers (some listed here) to start providing tools individuals (no longer just “consumers” or “users”) can employ to control personal data flows into the world, and how that data might be used. Even if surveillance marketers find ways around the GDPR (which some will), advertisers themselves are starting to realize that tracking people like animals only fails outright, but that the human beings who constitute the actual marketplace have mounted the biggest boycott in world history against it.

But I also worry because I consider both Facebook and Google epiphenomenal. Large and all-powerful though they may be today, they are (like all tech companies, especially ones whose B2B customers and B2C consumers are different populations—commercial broadcasters, for example) shallow and temporary effects rather than deep and enduring causes.

I say this as an inveterate participant in Silicon Valley who can name many long-gone companies that once occupied Google’s and Facebook’s locations there—and I am sure many more will occupy the same spaces in a fullness of time that will surely include at least one Next Big Thing that obsolesces advertising as we know it today online. Such as, for example, discovering that we don’t need advertising at all.

Even the biggest personal data extraction companies are also not utilities on the scale or even the importance of power and water distribution (which we need to live), or the extraction industries behind either. Nor have these companies yet benefitted from the corrective influence of fully empowered individuals and societies: voices that can be heard directly, consciously and personally, rather than mere data flows observed by machines.

That direct influence will be far more helpful than anything they’re learning now just by following our shadows and sniffing our exhaust, mostly against our wishes. (To grok how little we like being spied on, read The Tradeoff Fallacy: How Marketers are Misrepresenting American Consumers and Opening Them Up to Exploiitation, a report by Joseph Turow, Michael Hennessy and Nora Draper of the Annenberg School for Communication at the University of Pennsylvania.)

Our influence will be most corrective when all personal data extraction companies become what lawyers call second parties. That’s when they agree to our terms as first parties. These terms are in development today at Customer Commons, Kantara and elsewhere. They will prevail once they get deployed in our browsers and apps, and companies start agreeing (which they will in many cases because doing so gives them instant GDPR compliance, which is required by next May, with severe fines for noncompliance).

Meanwhile new government policies that see us only as passive victims will risk protecting yesterday from last Thursday with regulations that last decades or longer. So let’s hold off on that until we have terms of our own, start performing as first parties (on an Internet designed to support exactly that), and the GDPR takes full effect. (Not that more consumer-protecting federal regulation is going to happen in the U.S. anyway under the current administration: all the flow is in the other direction.)

By the way, I believe nobody “owns” the Internet, any more than anybody owns gravity or sunlight. For more on why, see Cluetrain’s New Clues, which David Weinberger and I put up 1.5 years ago.

Great Coffee vs. Awful Marketing

June 23, 2017 in advertising, Boston, Business, marketing, new york, Personal, Santa Barbara, Technology, Travel, VRM | 2 comments

favorite-peets

My loyalty to Peet’s Coffee is absolute. I have loved Peet’s since it was a single store in Berkeley. I told my wife in 2001 that I wouldn’t move anywhere outside the Bay Area unless there was a Peet’s nearby. That pre-qualified Santa Barbara, where we live now. When we travel to where Peets has retail stores, we buy bags of our favorite beans (which tend to be one of the above) to take to our New York apartment, because there are no Peets stores near there. When we’re in New York and not traveling, we look for stores that sell bags of one of the bean bags above.

Since our car died and we haven’t replaced it yet, we have also taken to ordering beans through Peet’s website. Alas, we’re done with that now. Here’s why:

screen-shot-2017-06-22-at-11-34-17-pm

I ordered those beans (Garuda and New Guinea) two Thursdays ago, June 16, at 7:45am. A couple days after I ordered the beans, I checked my account online to see where the shipment stood, and the site said the beans would be shipped on Monday, June 19. According to the email I got yesterday (a section of which I show above), the beans didn’t ship until the following Wednesday, June 21. Now the estimated delivery is next Wednesday, June 28.

While this isn’t a big deal, it’s still annoying because we just ran out of our last batch of beans here and we’ll be gone when that shipment arrives. Subscribing (which Peet’s e-commerce system would rather we do) also won’t work for us because we travel too much and don’t settle in any one place for very long. True, that’s not Peet’s problem, and I’m a sample of one. But I’ve experienced enough e-commerce to know that Peet’s shipping thing isn’t working very well.

And maybe it can’t. I don’t know. Here’s what I mean…

Way back in the late ’90s I was having lunch in San Francisco with Jamie Zawinski, whose work as a programmer is behind many of the graces we take for granted in the online world. (He’s a helluva writer too.) At one point he said something like “Somebody should figure out what Amazon does, bottle it, and sell it to every other retailer doing e-commerce.” And here we are, nearly two decades later, in a world where the one e-commerce company everybody knows will do what it says is still Amazon. (I’ll spare you my much worse tale of woe getting new air conditioners bought and shipped from Home Depot.)

So that’s a problem on the service side.

Now let’s talk marketing. A while back, Peet’s came out with an app that lets you check in at its stores for rewards when you buy something there. You do that this way at the cash register:

  1. Find the app on your phone.
  2. Click on Check In, so a QR code materializes on your phone’s screen.
  3. Aim the QR code at a gizmo by the cash register that can read the QR code.
  4. Hope it works.

I’ve done this a lot, or at least tried to. Here are just some of the problems with it, all of which I offer both to help Peet’s and to dissuade companies everywhere from bothering with the same system:

  1. It doesn’t work at every Peet’s location. This is annoying to customers who break out their phone, bring up the app, get ready to check in, and then get told “It’s not here yet.”
  2. Workers at the stores don’t like it—either because it’s one more step in the ordering process or because, again, “it’s not here yet.” Some employees put a nice face on, but you can tell many employees consider it an unnecessary pain in the ass.
  3. The customer needs to check in at exactly the right point in the purchase, or it doesn’t count. Or at least that’s been my experience a time or two. Whatever the deal is, the narrow check-in time window risks bumming out both the customer and the person behind the counter.
  4. The customer reviews are bad, with good reason. On the app’s page in iTunes Preview it says, “Current Version: 17 Ratings (1.5 stars) All Versions: 94 Ratings (2 stars).” The only published 4-star review reads, “They are a little vague on the rewards system – do I get a point per visit, or a point per drink? Also not a very rewarding system, esp when compared to starbucks or non chains I know of. However, I’ve had no problems with the app malfunctioning, so although I dislike the system it’s not the apps fault.”
  5. It sometimes doesn’t work. I mean, bzzzt: no soap. Or worse, works poorly. For example, when I opened the app just now, it said “Hi, Peetnik” and told me I have 0/15 reward points, meaning I’ve checked in zero times. Then, when I clicked on the “>”, it said “15 more & your next cup’s on us.” Finally, when I fiddled with the app a bit, it woke up and told me “4 points until your next reward.”

Here’s the thing: None of this stuff is necessary. Worse, it’s pure overhead, a value-subtract from the start. And Peet’s is one of the all-too-rare retailers that doesn’t need this kind of crap at all. It has already earned, and keeps, the loyalty of its customers. It just needs to keep doing a better job of making better coffee.

In The Intention Economy I tell the story of Trader Joe’s, another retailer that does a good job of earning and keeping its customers’ loyalty. You know how they do that? With approximately no marketing at all. “We don’t do gimmicks,” Doug Rauch, the retired President of Trader Joe’s told me. No loyalty cards. No promotional pricing. No discounts for “members.” (In fact they have no discounts at all. Just straightforward prices for everything.) Almost no advertising. Nothing that smacks of coercion. And customers love them.

My recommendation to Peet’s on the service side is to ship as fast and well as Amazon, or to stop trying and let Amazon handle the whole thing. Amazon already carries a variety of Peet’s beans and other coffee products. Either way, there is no excuse for taking almost two weeks to deliver an order of beans.

On the marketing side, I suggest dropping the app and the gizmos at the stores. Save the operational costs and reduce the cognitive overhead for both personnel and customers. Personal data gathered through apps is also a toxic asset for every company—and don’t let any marketers tell you otherwise. Like Trader Joe’s, Peet’s doesn’t need the data. Make the best coffee and provide the best service at the stores, and you’ll get and keep the best customers. Simple as that.

You’re in the coffee game, Peet’s. Keep winning that way. For everything that isn’t doing what you’ve always done best, less is more.

 

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Google enters its chrysalis

June 16, 2017 in adtech, advertising, Apple, Business, Customertech, Future, infrastructure, marketing, News, problems, Technology, VRM | 1 comment

crysalisIn The Adpocalypse: What it Means, Vlogbrother Hank Green issues a humorous lament on the impending demise of online advertising. Please devote the next 3:54 of your life to watching that video, so you catch all his points and I don’t need to repeat them here.

Got them? Good.

All of Hank’s points are well-argued and make complete sense. They are also valid mostly inside the bowels of the Google beast where his video work has thrived for the duration, as well as inside the broadcast model that Google sort-of emulates. (That’s the one where “content creators” and “brands” live in some kind of partly-real and partly-imagined symbiosis.)

While I like and respect what the brothers are trying to do commercially inside Google’s belly, I also expect them, and countless other “content creators” will get partly or completely expelled after Google finishes digesting that market, and obeys its appetite for lucrative new markets that obsolesce its current one.

We can see that appetite at work now that Google Contributor screams agreement with ad blockers (which Google is also joining) and their half-billion human operators that advertising has negative value. This is at odds with the business model that has long sustained both YouTube and “content creators” who make money there.

So it now appears that being a B2B creature that sells eyeballs to advertisers is Google’s larval stage, and that Google intends to emerge from its chrysalis as a B2C creature that sells content directly to human customers. (And stays hedged with search advertising, which is really more about query-based notifications than advertising, and doesn’t require unwelcome surveillance that will get whacked by the GDPR anyway a year from now.) 

Google will do this two ways: 1) through Contributor (an “ad removal pass” you buy) and 2) through subscriptions to YouTube TV (a $35/month cable TV replacement) and/or YouTube Red ($9.99/month for “uninterrupted music, ad-free videos, and more”).

Contributor is a way for Google to raise its share of the adtech duopoly it comprises with Facebook. The two paid video offerings are ways for Google to maximize its wedge of a subscription pie also sliced up by Apple, Amazon, Netflix, HBO, ShowTime, all the ISPs and every publication you can name—and to do that before we all hit Peak Subscription. (Which I’m sure most of us can see coming. I haven’t written about it yet, but I have touched hard on it here and here.)

I hope the Vlogbrothers make money from YouTube Red once they’re behind that paywall. Or that they can sell their inventory outside all the silos, like some other creators do. Maybe they’ll luck out if EmanciPay or some other new and open customer-based way of paying for creative goods works out. Whether or not that happens, one or more of the new blockchain/distributed ledger/token systems will provide countless new ways that stuff will get offered and paid for in the world’s markets. Brave Payments is already pioneering in that space. (Get the Brave browser and give it a try.)

It helps to recognize that the larger context (in fact the largest one) is the Internet, not the Web (which sits on top of the Net), and not apps (which are all basically on loan from their makers and the distribution systems of Apple and Google). The Internet cannot be contained in, or reduced to, the feudal castles of Facebook and Google, which mostly live on the Web. Those are all provisional and temporary. Money made by and within them is an evanescent grace.

All the Net does is connect end points and pass data between them through any available path. This locates us on a second world alongside the physical one, where the distance between everything it connects rounds to zero. This is new to human experience and at least as transformative as language, writing, printing and electricity—and no less essential than any of those, meaning it isn’t going to go away, no matter how well the ISPs, governments and corporate giants succeed in gobbling up and spinctering business and populations inside their digestive tracts.

The Net is any-to-any, by any means, by design of its base protocols. This opens countless possibilities we have barely begun to explore, much less build out. It is also an experience for humanity that is not going to get un-experienced if some other base protocols replace the ones we have now.

I am convinced that we will find new ways in our connected environment to pay for goods and services, and to signal each other much more securely, efficiently and effectively than we do now. I am also convinced we will do all that in a two-party way rather than in the three-party ways that require platforms and bureaucracies. If this sounds like anarchy, well, maybe: yeah. I dunno. We already have something like that in many disrupted industries. (Some wise stuff got written about this by David Graeber in The Utopia of Rules.)

Not a day goes by that my mind isn’t blown by the new things happening that have not yet cohered into an ecosystem but still look like they can create and sustain many forms of economic and social life, new and old. I haven’t seen anything like this in tech since the late ’90s. And if that sounds like another bubble starting to form, yes it is. You see it clearly in the ICO market right now. (Look at what’s lined up so far. Wholly shit.)

But this one is bigger. It’s also going to bring down everybody whose business is guesswork filled with fraud and malware.

If you’re betting on which giants survive, hold Amazon and Apple. Short those other two.

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