Future Thoughts

A few days ago, the world was shocked to discover that the NSA has obtained direct access to the systems of Google, Facebook, Apple and other US internet giants in order to harvest personal intelligence, including the content of emails and internet search histories.  This latest drama reminds us, if any reminder was needed, that the future of online privacy will be one of the defining battles of the digital age.

Much has been written about the future of online data exchange and the implications for the future of the information economy.  Our take on this fundamental topic has been a trend we have coined Consumer Capital: a story of consumer empowerment, where consumers start to realise the intrinsic value of their data and seek new ways to store, safeguard and exchange their own personal intel for personal advantage.

This narrative is based on the growing evidence that: 1) consumers would like more control over the information they share with companies; and 2) consumers are starting to view their personal data as an asset that can be used to barter for better deals and offers.  Indeed, we have recently come across an excellent example of this trend being brought to life, where a dedicated consumer has been painstakingly collecting his own personal data and selling it for $2 a day.

What’s more, tales of gross data intrusions, such as that leaked this month, will only heighten consumer fears over the use of their online information and encourage them to seek new ways to guard against online snooping.

But I think it is important at this stage of the big data debate to pause and be frank about what scenarios we are likely to see emerging in the short to medium future.  Will we see new waves of people collecting and exchanging their data?  Or will this just be an interesting experiment carried out by the few who have the know-how and dedication?  I am leaning towards the latter.

Indeed, I expect that most of the key developments in data exchange over the next decade or so will be more brand-led than consumer-led.  This will still be a story of consumer empowerment. But the advantages that consumers will most likely receive will be primarily down to brands looking to find new ways of incentivising the sharing of consumer data, in response to mounting public and regulatory pressure.

In the longer term, episodes such as the NSA story this month will raise the more fundamental question about whether the current model of data exchange is sustainable – if we truly wish to build a future information economy which is in the best interests of all.  Will people, if they ever have, continue to accept the mining of their data in return for notions of free content or national security?  Or, as Jaron Lenier argues, will we need to cast off the default notion that data should be free and only through the monetization of data will we all benefit from an information economy that will become ever more encompassing?

What is certain is that, as more stories akin to the NSA controversy hit the headlines, we will be forced to decide what kind of system of data exchange we wish to build.  And whatever the outcome, this will be the fundamental question for the future of our information economy.

Future Foundation will be partnering with Interel to present The Big Data Dilemma thought leadership event on Thursday 20 June.  The event will explore how businesses and government can come together to create viable, long-term policies that allow organisations and consumers to reap the benefits and avoid a stiflingly over-regulated environment. See more at: http://www.interelgroup.com/sector-expertise/technology/big-data/#sthash.EdJEbzT6.dpuf

During the late 20th century and early 00s it became a truism to observe that globalization – in its various guises – was marching forward apace. However, with offshoring strategies now subject to intense scrutiny and consumers placing considerable emphasis on product provenance, it is now proper to talk of a counter-trend : de-globalization.

For several decades, the strategy of moving work and jobs to countries where labor costs were lower proved fruitful; but this is now changing. In recent times, while wages in China have been rising inexorably, labor costs associated with manufacturing in America have stagnated. The result? Reshoring.

According to a recent publication by McKinsey, the number of firms looking to reshore their manufacturing operation has increased sharply since 2009, whereas offshoring intentions have fallen. Examples of this trend are easy to come by: Peerless Industries, Intertech Plastics and Karen Kane have all taken the decision to relocate their manufacturing bases to America from China.

The effect of rising wages hasn’t been solely to encourage reshoring to the USA, but also to catalyze offshoring to other low-cost countries. As China has become less competitive, so second-tier emerging economies have benefitted. For example, bilateral trade agreements with Mexico, combined with its low labor and transport costs, have made the country an attractive proposition for US manufacturers. And to a lesser extent, this dynamic is also playing out in Thailand, Indonesia, Cambodia et al.

But what of the consumer perspective? Motivated by a willingness to protect and support domestic producers in lean economic times, the consumer’s antenna has become acutely conscious of product origin. According to nVision, a majority of US consumers agree that it is important for the good of the economy to purchase items that are “Made in America”, and nearly 1 in 2 say they are more likely to buy products if they are produced stateside.

So where does this leave globalization as a key global driver? Well, it remains exactly that: according to the DHL Global Connectedness Index, numerous second-tier and emerging economies are (unsurprisingly) becoming progressively more globalized. However, the premium that consumers are placing on product origin in tandem with changing attitudes towards reshoring suggests that de-globalization is a genuine force in the USA. And as sluggish growth at home combines with an increasingly uncompetitive China abroad, so this trend gains momentum.

Patrick Fagan, one of our behavioural economics experts, explores what makes the MailOnline the world’s most popular news site and how the subconscious mind loves a juicy tidbit.

In January 2011, much was made of the ComScore data which placed MailOnline at the top of the internet news tree: it had just beaten The New York Times to become the world’s most popular news website. Since then, the Audit Bureau of Circulations stated the website’s unique visitors were up from 66 million in March 2011 to a striking 106 million in August 2012. For perspective, BBC News received 60 million.

So why is the site so popular?

The answer, perhaps, can be found in a study by Jonah Berger and Katherine Milkman which analysed the popularity of New York Times articles published online over a period of 3 months. Controlling for how surprising, interesting and visually salient the articles were, the researchers found that virality correlated significantly and positively with the emotional valence of the story. In other words, stories with strong emotional arousal (e.g. awe, anger, anxiety) were much more likely to be read and shared.

Consider also a study by Chip Heath of Made to Stick fame. They found the extent to which an urban legend was shared could be directly related to how disgusting it was. Have you heard the one about the woman who ate a taco containing spider eggs, and the eggs burrowed into her gums before hatching? Of course you have.

At Future Foundation we have first-hand experience of this (not the spiders in gums, the study of engagement via arousal). At our UK conference in May, head of research Katie Toll unveiled a brand new nVitro, Brainstorms at Bedtime, which studies the growing use of connected devices at times previously reserved for relaxation. The story was picked up by the press and went somewhat viral, but only after the Mail had taken the story and worked its magic, saying that “half of 16 to 34-year-olds would rather check their emails in bed than make time for love”. There is not much that is more emotional than sex, and sex sells.

This is where any insight professional outside of publishing says, “That’s great, but so what?”

Insights such as these speak to a new, burgeoning world of marketing; a way of engaging and nudging consumers with a level of efficacy marketers could only ever dream of before now. It tells us how to get brands noticed – and bought. BrainJuicer’s John Kearon, talking at Digital Shoreditch 2013, recently summed up the most successful adverts in two words: “pure emotion”. Think the Cadbury gorilla, the Three moonwalking pony or the Guinness horses. These adverts make no rational sense, yet they have been inordinately successful thanks to their profound use of emotion (and surprise and curiosity, but that’s another blog entry).

The most powerful marketing strategies are formed by those who understand Kahneman’s System 1 and System 2 distinction – and by those who realise that System 1 (conscious, deliberative processes) makes up a tiny fraction of attention and judgment. The popular figure states that our brain consciously processes 40 bits of data out of every 11,000,000; the rest happens under the surface of awareness and control. The effective strategies of MailOnline, Cadbury, et al. demonstrate the awesome power of understanding the unconscious mind.

Today is the 69th anniversary of the D-Day Landings, the day when 150,000 Allied soldiers plunged headlong into the chaos and bloodshed of the Normandy beaches in an attempt to wrestle control of France from the Nazis.  It was the biggest seaborne invasion the world has seen.

Today is also the day Channel 4 goes live with a hugely ambitious, humbling and utterly compelling campaign – D-Day: As It Happens will follow the stories of seven individuals involved in the Normandy landings. Regular updates via TV, social media and the internet over 24 hours will recreate the events of the pivotal battle in real time.

Factually, this is the tear-jerker to end all tear-jerkers – the photos of soldiers wading through the surf, the contents of letters and official records, the painstaking research by amateur historian Colin Henderson all combine to create a heart-rending account of one of the most significant battles in history.  The grainy black and white images are a far cry from our modern rolling, as-it-happens, experience-every-second-live news experience – and yet somehow feel far more real.

Technologically, this is an outstanding feat of ingenuity by Channel 4 – billed as a ‘twenty-four hour history event’, viewers can switch between multiple mediums to track the progress of real soldiers in real time, experiencing the terror as the same time as the D Day seven did.  This is second screening at its best – complex, layered, engaging, brilliant.  At a time when nearly half of all consumers have a smartphone; when 70% of 16-24s use the mobile internet daily; when 84% go online whilst watching TV and 6 in 10 online consumers use social media while they are watching TV – a campaign that reaches consumers at every touchpoint is an incredibly powerful way of creating engagement

This isn’t the first example of real time history – @HistoryNeedsYou @TitanicRealTime @RealTimeWWII, have been thriving for years; but for a generation of people moving farther and farther away from the events of our past, this is history brought vividly to life, lest we forget. 

http://www.channel4.com/programmes/d-day-as-it-happens/4od