Getting Closer to the Consumer, The Evolution of Commerce

Chris Messina wrote a well elucidated post this Friday on the benefits of a more “connected commerce.” Advertisers, web services, and web geeks alike, have been excited for years about the possibilities presented by a mobile, real time, and location based web, yet the tendency is to carry over an advertising paradigm from a generation of web services that may no longer be relevant.

Messina summarizes:

By giving individuals more control over their experience and over the kinds of data that they can share, the need to “target” (in the military sense), recedes. Instead, opportunity emerges from being available, on-demand, and ubiquitous. Attention aggregators and identity providers can then broker relationships on behalf of their customers, and both parties will, ideally, end up with a better experience, and stronger, enduring relationships.

Marketing analytics on the web offer a glimpse into consumer behavior to an extent never before thought possible. The remarkable growth in search advertising (i.e. Google) has proven to marketers that the more data web services can expose around past behavior and future intention, the more significantly that web service can drive return on investment. Hence the hype around mobile, real-time, location based advertising. It’s 4pm on a Saturday and some friends of mine and I are shopping in Soho - time for a Starbucks latte? It’s 7pm and my friend checks in on Foursquare at a bar a few blocks from work - care to join him?

The issue that Chris brings up is an important one. These fairy tale scenarios are all well and good in theory, but imagine your favorite social network’s activity stream completely clogged with “Time for a latte?!” and “Come get a beer!”. The smart phone is the closest online advertisers have ever come to the individual - we carry it around all day and share with it some of our most personal data. Advertisers must recognize that this closeness should not be seen as an opportunity to spam harder than they’ve ever spammed before. It’s an opportunity to build lasting, value added relationships with consumers.

We tend to scoff when companies like Google include a few lines in a press release about how this latest and greatest ad technology will provide a great benefit to users looking for more relevant ads. But one needs only to read Messina’s post on Comixology, or follow CupcakeStop for a few days on Twitter, to recognize the potential value in connecting with advertisers. What’s missing is a common understanding on both sides - consumers and advertisers - about what the connection might look like.

Consider the traditional relationship between consumers of web services and advertisers:

In this traditional model, the user exchanges attention and data for some kind of valued service. For example -

I might say, “Mint, please take my bank account history and show me where I can do a better job of saving.”

Mint then turns to the advertiser and says, “Hey Charles Schwab, I’ve got all this attention and data - by using this data I can show you how to find the attention of the right users; if you pay me, I’ll let you advertise to them.”

Charles Schwab replies, “Sounds like a deal,” then shouts over Mint’s head, “Excuse me, Jake, would you like to buy my product?”

While perusing my account information one day on Mint.com, I am met with a fancy Charles Schwab banner advertisement to open up a 401k. Chances are I won’t click on it, but enough users will to make that banner ad worth Charles’ time and money.

Now consider a different way of thinking about the relationship between consumer and advertiser:

In this model I have established a direct connection to the advertiser, using the web service as a platform for that connection, as opposed to a middle man. For example -

Having read about CupcakeStop in NYMagazine, I reach out one day to the company on a mobile platform that consumes real time data about my location.

I might say, “Hi CupcakeStop, here’s all my information, please let me know when your mobile cupcake service is nearby as I love cupcakes and think you do a pretty good job of making them.”

The web service takes my note, passes it along to the advertiser and says, “Hey CupcakeStop, Jake wants to connect with you. If you pay me some money every month, I’ll let you connect with consumers on my mobile, real time, location based platform.”

CupcakeStop, hardly able to contain itself, responds happily that it would love to do business with that web service.

As advertisers are met with the opportunity (read: challenge) of being closer than ever to the consumer, they must adapt their best practices if they want to generate that significant improvement in ROI that they expect.

Web services or “attention aggregators” tackling that same opportunity/challenge should keep in mind the proper prioritization of Messina’s two rules:

They need to first be the friend to and advocate of the individual (their customer), and second, to the advertiser or brand. Companies that don’t get this prioritization right will fail.

LinkedIn, Twitter, and the Future of Social Syndication

LinkedIn and Twitter made the digital headlines yesterday announcing a partnership to connect LinkedIn’s status updates with Twitter’s tweets.

The idea is simple: When you set your status on LinkedIn you can now tweet it as well, amplifying it to your followers and real-time search services like Twitter Search and Bing. And when you tweet, you can send that message to your LinkedIn connections as well, from any Twitter service or tool.

What is truly big news for me however, is the way that tweets are selected to be sent to LinkedIn. The user will have the option to either send all tweets to LinkedIn as status updates, or only those tweets marked with #in or #li:

This is exactly the kind of segmented social syndication that I have been harping on these last few weeks.

In the offline world users present different personalities to different groups. My brand/reputation/identity at work is different than my brand/reputation/identity among my friends from school. As the social web moves forward, users will expect to be able to replicate these dynamics in online relationships. This should take two forms. First, I should be able to segment the consumption of data along different groups. Twitter has recently implemented a feature called Lists that allows me to do that. Second, I should be able to segment the syndication of data along different groups - and for the first time, the partnership between Twitter and LinkedIn has made this incredibly easy.

What is missing is the ability to replicate this dynamic across social web services, and here is where data portability becomes so important. The hope is that social web services will adopt open solutions that allow for the emergence of a ‘social layer’ across all networks.

Still, this is a fantastic step in the right direction. I wonder if we will begin to see a “race” for hash tags. Will #ggl=google profile and #ms=myspace? It’s at this point that I begin to question whether or not Twitter as a company might be at odds with Twitter as a technology - when the platform becomes too important for singular ownership. More on this later.

Please let me know your thoughts in the comments.

Mad Men: The JFK Assassination

Incredibly moving episode this past Sunday portraying the assassination of JFK.

The show is successful in illuminating the paradox of American democratic capitalism, as the murder of a culturally significant political figure drives a wedge into the daily struggle for upward mobility. Meanwhile, allusions throughout the season to the violence in Vietnam (bloody foot, burning monk, Greg joining the army) come to an abrupt culmination as we watch Ruby murder Lee Harvey Oswald on live TV (and then in slow motion). The Draper marriage dissolves as JFK is buried, and guests force themselves to attend the marriage of a couple they hardly know, nobody really sure even where to sit. Great television.