Due to a special request I have made Part 2 of Aimee’s interview last week freely available. Feel free to share with non-subscribers.
This week’s briefing is light on traditional marketing stuff this week, but lots of Marketing BS-themed material, especially related to privacy and changes in the world due to COVID - and an amazing GTP-3 application. Enjoy!
- Bureaucratization: In my essay on “Plausible Deniability” I wrote about how Twitter claimed the decision to ban Trump was “out of its hands” as it was just “following its policies”. Never mind that they were changing those policies as they went along and applying them very differently to different accounts. Now Facebook is taking the “bureaucratization of decision making” even further and pushing the decision to ban Trump to their oversight board. These platforms do not want to be forced to make decisions (that are sure to angry someone), so they create policies and then hide behind the policies like they were not the ones to create the policies to begin with (feels a lot like a call center employee telling you “there is nothing they can do”)
- China and Twitter: The Chinese Embassy has been locked out of their Twitter account for violating policy (“dehumanizing”)
- Clubhouse: The (still in beta, invite-only-mode) audio app just raised their Series-B funding round from Andreesen at an estimated $1B valuation (according to the Information). Clubhouse is “live audio” that is getting rave reviews from the elite beta-users. They have recently added subscriptions, “tipping” and recorded audio. The bull case for Clubhouse is that they could disrupt the entire podcast ecosystem, and even leverage messaging (and tipping) to become a platform, any of which would make them worth more than $1B - just need to adjust that for probability of achieving that…
- Apple headset: Facebook has already said their upcoming glasses product will NOT be AR. Now it has leaked that Apple’s new headset will be VR and Apple’s headset will also not be AR. It will be a “fully immersive” high end (expensive) VR experience. I expect, like Facebook, this is just a step to where they want to go (which is full AR)
- Amazon search: Amazon has announced changes to their search algorithm. Going forward it will give more weight to the amount of traffic to a product page from off-site (and therefore less weight to things like product reviews and CTR/purchase rate on site). This doe two things for Amazon: (1) Allows it to coast off of Google’s search investments (I expect much of the offsite traffic will come from Google. And Google’s search is still MUCH better than Amazon’s - When I can’t find something on Amazon, I will often resort to searching on Google); (2) There is now an incentive for merchants to improve the Google SEO for their Amazon products and drive that traffic to Amazon - which is obviously good for Amazon.
- China: Digital is now 36% of the country’s GDP!
- Stripe: TheDiff’s free newsletter last week explored international payment technologies. But I think this paragraph is relevant to Marketing BS readers: “A competitive moat measured in basis points doesn’t sound durable, but piling up these tiny improvements is very hard to compete with. Every time Stripe reduces one incremental bit of fraud, or onboards one more set of potential purchasers, it’s a slightly easier default for merchants. One compounding advantage leads to another.” — Doing a lot of simple stuff well is incredibly powerful even if it is not sexy.
- Lyft: Uber introduced surge pricing, which, in theory, allowed price insensitive customers to subsidize everyone else during peak demand times. It was great economics and terrible PR. Lyft is not flipping the model and allowing drivers to select into “priority mode” where they agree to a lower take rate in exchange for more drives. Also good economics, but bad PR…
- Airbnb - Airbnb used social media to identify people who might be potential terrorists and banned them from the site. Any time you attempt to identify a rare group (and I expect terrorists in America are still very rare), you will end up with a LOT of false positives. But Airbnb is okay with this because the downsides are so much worse than the upside of a few more bookings. And no one is going to defend a “potential terrorist” (I expect the people falsely identified are not going to be society’s leading lights in any case…)
- Facebook Memo: A leaked memo from Chris Bozworth told employees that going forward Facebook needs to prioritize privacy “even to the detriment of user experience”. He goes on, “The public’s expectations on privacy were changing, he said, and Facebook's old approach wasn’t cutting it anymore”. In reality, as I have said many times, the public does not care about privacy, but the media landscape messaging around privacy HAS changed, and internal Facebook employees (and their friends and family) expectations have changed.
- Google: The search engine has threatened to shut down in Australia if the country passes the proposed law which would require the company to pay local media for the privilege of linking to them. The Australian government has issued a statement saying they will not back down. Non-American governments have been aggressive over the last half decade in trying to extract money from American tech giants. Mostly the companies have paid up. But sooner or later they will feel they need to take a stand. Better to do it in a small market like Australia than a country like Germany or France. Developing.
- Boston Globe: The paper is allowing people to petition to remove (or anonymize) old coverage in their archive, so that a minor negative story from your past will not follow you forever. A much better way to deal with this than the “right to be forgotten” law in Europe.
Marketing to Employees
- Alphabet Workers Union:The union, which was announced earlier this month, has decided they will NOT attempt to be certified or ask for collective bargaining. Instead they will use protest, publicity and pressure campaigns to get the company to do what they want done.
- Facebook lockdown: When I write about “Marketing to Employees” I usually focus on external marketing that is actually directed (or partially directed) to employees and potential employees. But there is another kind of marketing to employees that is focused 100% internally. I was recently corresponding with Byrne Hobart (author of TheDiff) and he gave me a couple of examples of the latter kind. Facebook had a “lockdown” when Google launched Google+ where employees were not allowed to leave the campus. Bill Gates was not as extreem when he pushed out hid “roadkill on the information highway” memo, but the idea was similar - get a large number of employees focused on the thing you care about.
AI, Machine Learning and GPT-3
- Medical Advice: This is a great GPT-3 story. A man has a shoulder injury when he is a child that causes serious chronic problems through his entire life. He sees many doctors and other medical specialists over the years, but it never gets better. Then in his late 30s a doctor thinks he has figured out the problem. The man has a special surgery and his shoulder is healed. Last week he plugged a description of the initial situation into a GPT-3 diagnostic tool, and well…
COVID and the New World Order
- eCommerce acceleration: Remember those stories about how COVID led to a decade worth of acceleration in ecommerce penetration? It looks like it DID accelerate, but then it pulled back. 13% -> 19% -> 16%. Note a +3pp increase is still HUGE
- Following the rules: ~90% of people surveyed all over the world claim to be following the “COVID rules”, but everyone also believes most other people are NOT following the rules.
- Zoom re-imaged: Anyone who has ever been on a large Zoom call knows how terrible the experience is. It does NOT simulate a group of people getting together for dinner. Pluto aims to solve that problem. It creates a “virtual space” where you can move your avatar around. The sounds you hear are a function of how far you are from the other avatars - so you can actually have one-on-one conversations in a big group setting.
- Post COVID Travel: United airlines says it expects demand will overshoot supply once borders reopen (which will mean higher prices). Meanwhile TripActions, a business travel booking tool, just got a $5B valuation from investors betting that business travel will come back with a vengeance. Related: Netjets (private aircraft booking) says leisure travel was flat YoY by July and memberships are up 3x in 2020.
- Bond, delayed Bond: The latest Bond film has been pushed back again, this time to late October 2021…. Related: Glastonbury music festival (the largest in Europe) is being cancelled again this summer. Meanwhile there are rumors that the Tokyo Olympics will be shelved completely. Currently those rumors are being denied. But if I had to bet…
- Scotland: Scotland did much better than the rest of the UK in avoiding the worst of COVID. It has become almost impossible to disentangle why one country has done better than another in the last year, but this theory is interesting at least. It argues that people paid far more attention to the directions they should be following because a famous Scottish comedian did voiceovers on all the announcements. Marketing!
- Counter-Narrative: Sports viewership dropped off dramatically across all sports during the pandemic. Main explanation for this was the drop off in both group viewing, and social touch points around shared experience. But that does not explain this NBA season being 35% up vs last year.
- Excess savings: When people are able to spend again, they will have the money to do it… The last ten months have seen Americans save $2T over run rate… That money will go somewhere. Have you baked it into your Q4 projections?
- Tinder Profiles: Katie Hempenius, a software engineer at Google, scraped 10,000 Tinder profiles to find out the most common words used by men and women related to interests, their bodies and their personalities. Worth checking out all three charts, but my favorite copied below. It is pretty revealing in what young people think makes them attractive to the opposite sex and how much it varies by gender (Note: No one is allowed to call my daughters “shy”)