Ged Carroll

Category: consumer behaviour | 消費者行為 | 소비자 행동

Consumer behaviour is central to my role as an account planner and about how I look at the world.

Being from an Irish household growing up in the North West of England, everything was alien. I felt that I was interloping observer who was eternally curious.

The same traits stand today, I just get paid for them. Consumer behaviour and its interactions with the environment and societal structures are fascinating to me.

The hive mind of Wikipedia defines it as

‘the study of individuals, groups, or organizations and all the activities associated with the purchase, use and disposal of goods and services.’

It is considered to consist of how the consumer’s emotions, attitudes and preferences affect buying behaviour. Consumer behaviour emerged in the 1940–1950s as a distinct sub-discipline of marketing, but has become an interdisciplinary social science that blends elements from psychology, sociology, social anthropology, anthropology, ethnography, marketing and economics (especially behavioural economics or nudge theory as its often known).

I tend to store a mix of third party insights and links to research papers here. If you were to read one thing on this blog about consumer behaviour, I would recommend this post I wrote on generations. This points out different ways that consumer behaviour can be misattributed, missed or misinterpreted.

Often the devil is in the context, which goes back to the wide ranging nature of this blog hinted at by the ‘renaissance’ in renaissance chambara. Back then I knew that I needed to have wide interests but hadn’t worked on defining the ‘why’ of having spread such a wide net in terms of subject matter.

  • Persuasive Technology by B.J. Fogg

    Persuasive Technology was published in 2003. It is still the bible for captology ( from Computers as Persuasive Techologies). Back when I was working inhouse at Yahoo!; copies of the book could be found on the desks of some product managers and designers. It has since gained a certain amount of notoriety. Questions are asked around the addictive behaviour of social network and gaming app users. Some consumers even find it hard to stop swiping dating apps.

    Persuasive Technology
    Persuasive Technology – Using Computers to Change What We Think and Do by B.J. Fogg

    Fogg realised that computers offered new challenges and opportunities. Persuasive Technology was written almost 20 years ago. How well does it now hold up?

    Relevant content

    Right from the start when Fogg starts going into the advantages of persuasive technology you can see the evergreen nature of the content.

    Some of the content is quite prescient with a section on surveillance technology creating persuasion through observation. The comments on simulation are equally applicable to modern VR environments, which has been proven in the treatment of PTSD amongst combat veterans. The application ‘In My Steps’ (page 76) designed to facilitate empathy among doctors for cancer patients echoes through the patient centric work that pharma companies are currently funding.

    Chapter 5 on computers as persuasive social actors is playbook for the way modern apps from freemium games to Tinder work effectively. If you don’t read anything else read this chapter.

    Tired?

    A cursory skim of the book would yield examples that are Windows Vista-era screenshots of crude applications. You have to remember that the book was written before mainstream social networks or the New York Times paywall. Back then, it was right at the end of the banner ad golden age in online advertising; surviving on ads was still considered an option for news media.

    Whilst the context has changed around the web and the way that we use it; the examples are still illustrative. They’re worthwhile sticking with when reading though the book.

    Misinformation

    The modern issue of misinformation gets a relatively small mention. Fogg realised the impact that misinformation could have on future computer credibility. He felt that as computers lost their ‘aura, their mystique, their presumed credibility’. He thought that computing ubiquity would make computing credibility more complex due to purpose and form-factor.

    He also worried about bad actors; though this largely seems due to hacker Adrian Lamo hacked the Yahoo! News content management system from his browser and was able to alter the quotes in stories. At the time subtly altering mainstream news stories was seen as the greatest risk

    …Peter Sommer, an expert in computer crime at the London School of Economics, says that carefully changing information posted to a major web site could be far more serious. 

    “If it is done in a subtle way then this could spread misinformation,” Sommer told New Scientist. “It’s unfortunate that Yahoo! is the largest and most important portal in the world.”

    Yahoo! is one of the most popular destinations on the internet. In June 2001 the site had more than 200 million visitors. Yahoo! takes news feeds from a wide range of news agencies and web sites. 

    Lamo says he was disturbed to have had access to the system during recent terrorist attacks on America, when internet news sites were in great demand. 

    “At that point I had more potential readership than the Washington Post,” Lamo told Security Focus. “It could have caused a lot of people who were interested in the day’s events a lot of unwarranted grief if false and misleading information had been put up.”

    Hacker re-writes Yahoo! news stories – New Scientist (September 20, 2001)

    In some ways Fogg’s vision came true. The Macedonian fake news publishing during the 2016 US election wasn’t driven by bad actors; but ad revenue hungry teens. The effect was the same as Lamo’s Yahoo! News hack a decade and a half earlier.

    Ethics

    The thinking in Persuasive Technology was weaponised in various products and services. Yet, the book, was ethically driven by design. Fogg had a good understanding of how his work could be used by bad actors. He devoted a whole chapter to the ethics of captology and pointed out times when an act would be unethical throughout the book. Fogg starts off with ethics in the preface on page XXVI right before the acknowledgements section.

    Chapter 9 goes into the various ethical pitfalls that may await the designer and the user. It’s interesting that many of the case studies focus on getting personal information out of children. Protecting children online has consistently been an issue since the start of the commercial web.

    It is also interesting in this chapter that he emphasises the role of education in protecting future users from the unscrupulous.

    Conclusion

    Yes rereading Persuasive Technology was like taking a time machine back to the post dot com bust web. But the lessons to be learned are still the same. We might have more stylish web design and responsive pages; but we still have the same problems. Whether you work in digital transformation, user experience or content strategy, this book deserves a place on your bookshelf

    More book reviews can be found here.

  • Amazon returns + more things

    Hidden cameras and secret trackers reveal where Amazon returns end up | CBC News – interesting aspect of Amazon’s business model. It does make me wonder how much of a drag is returns on Amazon’s business? Retail returns are usually running at 10 percent of products bought. With e-tailing; this rate is thought to be as high as 40 percent according to the programme. That sounds like an extremely high rate of returns. Back when I was in college 25 percent was quoted as a returns rate for catalogue businesses.

    Inside Palantir, Silicon Valley’s Most Secretive Unicorn – “Where you get into trouble is when the software gets so complicated that you have to send people in to manage it,” said one former CIA official who is complimentary of Palantir. “The moment you introduce an expensive IT engineer into the process, you’ve cut your profits.” Palantir, it turns out, has run headlong into the problem plaguing many tech firms engaged in the quest for total information awareness: Real-world data is often too messy and complex for computers to translate without lots of help from humans – to be fair enterprise software companies have always sold a good deal of smoke and mirrors in terms of over-exaggerated claims – sounds a lot like IBM’s Watson in this respect

    Apple’s New 5G IPhones May Be Left on the Shelf | Yahoo! Finance – 5G lacks a killer app for consumers

    Exposure to TV ads up 15% during height of lockdown – Even children were watching more broadcast TV and exposed to a greater volume of advertising in the weeks following the lockdown in March.

    Alibaba Group – investors day presentations – some interesting insight into Chinese e-tailing, retailing and internationalisation of these models

    Blockbuster Chinese games said to boycott Huawei and Xiaomi app stores over revenue tax | South China Morning Post – two Chinese gaming startups, Lilith Games and miHoYo, said they won’t sell their would-be autumn hits via app stores pre-installed on smartphones made by Huawei and Xiaomi. Instead, they’ve opted for stores charging smaller fees or none at all—including Apple’s App Store, which levies the same 30% charge in China as it does everywhere else. While the duo didn’t say outright they were unhappy about the 50% rule set by the Chinese Android stores, many gamers and developers see them as the good guys stepping up against tech’s behemoths

    How to Monitor Facebook Pages – Meltwater Help Center – now allows users to monitor Facebook pages that they’re in charge of. The limit is 50 specific Facebook pages. It pulls out the Facebook analytics data into a Meltwater interface

    European Semiconductor Sales Drop, Global Sales Rise – EE Times Europe – not surprising given the disruptions to manufacturing

    Google Chrome remains China’s most popular web browser, even with Google search and other apps blocked | South China Morning Post – consumer backlash against some domestic browsers can be attributed to their aggressive user acquisition tactics, such as being deliberately difficult to uninstall. But he said that a shift in consumer tastes might also play a role. When Chinese internet companies first started designing websites and applications in the late 90s, the minimalist aesthetic was unpopular, he said a friend told him at the time. “Chinese consumers wanted stores where all the merchandise was crammed onto the shelves at maximum capacity, with narrow aisles where people were just bumping into one another,” he said. “It felt like plenitude.” “Those early design preferences endured for a surprisingly long time online, and I think there’s still a much higher tolerance for it than we’d see in the US or other Western countries,” he added. “I think as consumers get more sophisticated, though, they’re looking for a retail experience that doesn’t feel like a fire sale all the time.”

    Opinion: How Can Luxury Brands Successfully Price In The Post-COVID World? – In these challenging times of lockdowns and demand contraction, luxury brands have increased – even more than usual – the prices of their bestselling products to offset part of the compression of margins due to the pandemic. Take for instance, Chanel which earlier this year confirmed it had brought the prices up of its iconic handbags (11.12, 2.55, Boy, Gabrielle) ranging between 5 and 17 percent in euros and Louis Vuitton which also raised the prices of some of its products in March and May. It is not a surprise that brands like Chanel, Louis Vuitton, Hermès and Dior, whose handbags are products that are considered iconic and perceived by consumers as investment pieces, can be more bold in increasing prices to protect their margin. But not all companies have such strong brand positioning and therefore cannot raise their prices so easily.

    Bulgari CEO Jean-Christophe Babin: “Millennials Don’t Want Formal Luxury.” | Luxury Society – I suspect that this is across age cohorts but the blend of streetwear and luxury is a key sign of it

    Is online advertising subprime? Contagious – interesting thought experiment

    South Korean Activists Accuse China of Using Huawei to Hack Their Election | Daily Beast – of course Samsung is looking to pick up 5G smartphone and infrastructure sales from Huawei….

    New info about Facebook-Instagram deal delays antitrust report: source | CNBC – it will be interesting to see what comes out

    Axios China – Top German official hushed up report on China’s influence – not terribly surprising when you read books like Hidden Hand. More China related posts here.

    The end of the American internet — Benedict Evans – more precisely. The end of Americans being the dominant users and culture on the internet

    Brussels drafts rules to force Big Tech to share data | Financial Times – grab the popcorn

    State of AI Report 2020 – interesting report on the hype

    The great uncoupling: one supply chain for China, one for everywhere else | Financial Times – Untangling supply chains that have built up over a generation is a complex and difficult task and the multinational companies which sell into the Chinese market will stay and even expand. But if companies that once used the mainland to make goods for export do decide to depart in significant numbers, it will represent a major reversal of five decades of economic integration between the US and China

  • Weight lightening + more things

    Midgards Messer Shop – interesting weight lightening techniques in their product designs. It reminds me of the weight lightening techniques racing cars used to use. Drilling out metal on parts like bonnet hinges to retain strength but not the weight. More design related content here.

    In U.S. and UK, Globalization Leaves Some Feeling ‘Left Behind’ or ‘Swept Up’ | Pew Research Center – which gives a good idea of where populism came from

    Rolex Panerai 3646 Service Invoice from 1955 – Vintage Panerai and other iconic timepieces under the loupe at Perezcope – interesting implications on brand provenance and heritage

    Mulberry warns on sales after falling to £14m loss | FT – the comments on online shopping by the CEO in my opinion don’t ring true.

    Facebook to defy new Turkish social media law | Financial Times – Facebook must feel that the Turkish market isn’t worth taking negative PR in the US and EU. It must have relatively meagre advertising revenues for them to make this decision. Why put their foot down in Turkey and not in other markets like Hong Kong or Russia?

    People love products with rituals – Ariyh – the role of rituals in product consumption can drive sales, interesting research. Examples would be:

    • The different ways one would eat a Cadbury’s Creme Egg
    • Twisting to separate the biscuit from the filling on an Oreo
    • Waiting for the head to settle on a pint of Guinness
    • Cadbury’s Flake bath adverts the emphasised enjoying the bar in private ‘me time’ moment

    Facebook Says Government Breakup of Instagram, WhatsApp Would Be ‘Complete Nonstarter’ – WSJ – interesting that the 14-page briefing document was leaked to the Wall Street Journal. Tim Wu’s takes on the claim are interesting ‘A government antitrust case against the company would likely rely on the argument that Facebook made serial acquisitions to reduce competition, a question that wasn’t considered when the Federal Trade Commission originally chose not to oppose the Instagram and WhatsApp deals‘

    Reebok teams up with fashion brand Yoshiokubo for traditional-culture-inspired sneakers | SoraNews24 -Japan News – interesting how they’re incorporating Japanese culture motifs

    Winston Privacy – ad blocker as hardware appliance

  • Rival device makers on Amazon + more

    Amazon Restricts How Rival Device Makers Buy Ads on Its Site – WSJ – interesting that his is confirmed by both according to Amazon employees and executives at rival companies and advertising firms. Would rival device makers have an antitrust case? It would be harder for Amazon to argue that it doesn’t have a monopoly position in retail. More on Amazon here.

    China’s Sina Agrees to Go Private in Deal Valued at $2.6 Billion – Bloomberg – will probably list on a home stock market like Shanghai, Shenzhen or Hong Kong

    Oxford moves to protect students from China’s Hong Kong security law | The Guardian – one can see this is a direct reaction to Hong Kong’s national security law and also as a reaction to Chinese influence operations on campuses across the western world

    Will The Chinese-Owned French Luxury Brand Baccarat Survive? | Jing Daily – combination of bad management and circumstances. It is interesting that the owner Coco Chu has disappeared

    Mark Riston: It’s time for ‘share of search’ to replace ‘share of voice’ – Peckham’s Formula posits that when you launch a brand you should set its advertising budget based on your desired share of market. Specifically, your initial share of voice should be 1.5 times the desired market share you want to achieve by the end of the brand’s second year.

    Older People Have Become Younger – Neuroscience News – in terms of their mental faculties

    Netflix called out for “Three-Body” author Liu Cixin’s Xinjiang remark — Quartz – Mulan seems to have become a verb in US media in a similar way to ‘it’s all gone Pete Tong’ in late 1980s vernacular English. Although originally ‘gone Pete Tong’ meant that something had gone commercial and mainstream – in effect a sellout, which was a bad thing in the 1990s, when credibility was everything. Netflix might be able to see dramas into China a la the BBC and Sherlock; but I can’t see it being allowed to be a platform. China already has QQVideo iQiyi and PPTV

  • The merge

    I first heard of the merge from Sam Altman’s blog. He said that it was a popular topic of conversation in Silicon Valley to guess when (not if) humans and machines will merge. In a meaningful way rather than just a Johnny Mnemonic-style walking data storage unit.

    When I heard of this definition of the merge, I immediately thought of the digital series H+.

    H+ The Digital Series

    H+ told the tale of a technological hack that killed people by disrupting the implants in their heads. Some of the few survivors were out of cellular network reach in the basement of multi-story car park.

    He went on to explain that it may not be a hybridisation of humans literally with technology but when humans are surpassed by a rapidly improving (general purpose) AI. The third possibility was a genetically enhanced species surpassing humans in the same way that homo sapiens surpassed the neanderthal.

    What’s interesting is that some of the people don’t give ‘the merge’ a name at all. Back during the dot com boom, when Ray Kurzweil published his book Age of Spiritual Machines it was given the name The Singularity.

    Part of the resistance to this established term was that The Singularity implies a single point in time. I don’t think Kurzweil meant it in that way. But its been almost 20 years since I read Age of Spiritual Machines, and I suspect most of the debaters have only read about it from a Wikipedia article.

    Alton points out that in some ways the merge has been with us for a good while.

    The contacts app on our devices and social networks take the place of us remembering telephone numbers. I can remember my parents landline number and the number of the first family doctor that we had. But I wouldn’t be able to tell you my parents current cell phone number; or the number of my current doctor.

    On a grander scale; general knowledge and desire to read around has been depreciated by Google and Wikipedia. Our phones, tablets and laptops are not implanted in us, but at least one of them will be seldom out of reach. I learned to touch type and I am now not conscious of how I input the text into this post. It goes from my thought to the screen. Only the noise of the keys gives away illusion of mind control as I stare at the screen. Ironically voice assistance makes me more conscious of ‘the other’ nature of the device.

    But it no longer just about memory and our personal connectedness of the devices. Our device control us and suggest what to do and when. Social media platform curation affects how we feel.

    As Altman puts it:

    We are already in the phase of co-evolution — the AIs affect, effect, and infect us, and then we improve the AI. We build more computing power and run the AI on it, and it figures out how to build even better chips.

    This probably cannot be stopped. As we have learned, scientific advancement eventually happens if the laws of physics do not prevent it.

    Sam Altman – The Merge

    Innovation often spits out the same process in several waves before it works. Before Siri, Alexa and Google home there was Wildfire. Before Wildfire there were various speech recognition technologies including Nuance for call centres, Lernout & Hauspie, Dragon Systems and Kurzweil Computer Systems. The last two were founded in the mid-1970s. SRI International’s AI research started delivering results in the mid 1960s.

    AI in its broadest terms has gone through several research booms and busts. The busts have their own name ‘AI winters’. The cadence of progress could easily be far slower than Altman imagines.

    One could easily argue that machine learning might run its natural course to technical maturity without much more improvement. Google and other technology companies are basing their work on research done at Canadian universities in the 1980s during an ‘AI winter’ characterised by a lack of basic research funding. Canada continued to support the research when others didn’t.

    Silicon Valley companies not engaging in basic research themselves. As Judy Estrin observed in her book Closing The Innovation Gap back in 2008, Silicon Valley no longer engages in ‘hard innovation’. Without that basic research; a general purpose AI envisioned by Kurzweil and Altman maybe out of reach. Which is why Silicon Valley pundits put the merge as somewhere in a 50-year window.

    Altman also caveats his prediction based on the laws of physics. Aaron Toponce : The Physics of Brute Force provides an idea of the physical limits imposed by cracking cryptography. It would not be inconceivable that a general purpose AI may hit similar challenges. More on machine learning and innovation here.