The Last Era — Surveillance, Complexity, Fraud, and Disastrous Unintended Consequences
You could call it the era of the “mega-monopoly” that siphoned off the power and influence of marketers worldwide by convincing marketers to “rent access” to their customers — and everybody jumped on the “big data, big tracking, behavioral micro-targeting including cookies for desert.” See the graphic above with the thousands of middlemen in the digital marketing food chain? Marketers put their money in one end and whatever results came out the other — of which they owned almost none of it.
Surveillance-based Tracking (SBT) — after 20+ years, online marketing is a $500+ billion industry of “surveillance capitalism,” — accused of monetizing lying, cheating, stealing, manipulation, and fraud on a global scale. SBT is surveillance-based ad tech, behavioral manipulation, and filter bubbles that was supposed to improve online advertising — not generate billions for organized crime.
While providing the benefits of convenient “free” services (search, social, and selling) SBT extracted significant indirect “costs” from consumers, marketers, and society at large in the form of:
Invasive Surveillance
Reduced Personal Privacy
Exploitation w/o Permission
Destructive/Extractive/Fraudulent Ad Tech Supply Chains
Exploitive Opaque Mega-Monopolies
Value of Personal Data Goes to Third Parties
Increased Supply-Side Manipulation
Increased Information Asymmetry
Narrowing Choices w/Algorithmic “Echo Chambers”
Increased Cyber Insecurity (data breaches, hacking, ID theft, etc.)
Disastrous Unintended Consequences
Pending/Increasing Worldwide Regulation
All the companies in the top image are middlemen members of supply chains that feed mainly into two mega-monopolies that take the lion’s share of all global online ad revenues. And despite knowing exactly how divisive the effects of what they were doing would be on consumers — nothing stood in the way of revenue or growth.
SBT is exactly what it says — “surveillance-based tracking” where companies spy on everyone, everywhere, and everything, all the time — without permission, disclosure, or recourse. Everything you do online, everything you buy, everywhere you go, everyone you talk to or about, is collected with the goal of targeting millions of moving targets and manipulating them into doing something they otherwise wouldn’t do. SBT’s stated goal is to eliminate “uncertainty” (another word for “choice”).
It sounded logical enough, and marketers bought into the mega-monopolies that unleashed SBT on the world. 21st-century big tech + 21st-century big data + 21st-century AI = more “right person, right message, right time — at the cheapest cost” — and everyone in the chart was getting their “cut” of the new “shiny objects.” (Principle-agent problem.) However, the process remained opaque, its claimed efficacy in question, and it produced some truly disastrous unintended consequences. Some believed SBT could cause the destruction of consumer choice, privacy, democracy, and free markets. “We’re building a dystopia just to make people click on ads,” with levels of complexity and fraud that mirror the 2008 subprime mortgage bubble.
Marketers and consumers were never told specifically how the “big data algorithms” would be designed or used, nor could anyone have foreseen the magnitude of the unintended consequences of so much data in so few unaccountable hands. “Surveillance Capitalism” had become the default, if not sole, internet business model. Even while experts continued to sound the alarm, the marketers (the old “Kings”), surrendered ever more consumer influence to the mega-monopolies (the new “Kings”) they funded. (Monopolies are not a good thing if you’re the buyer.)
The mega-monopolies are now producing “smart connected devices” that cannot be blocked to observe and report on consumers 24/7/365. Consumers will be surrounded by these “smart-everything devices” (including VAPAs — voice-activated personal assistants — Alexa, Siri, Cortana, Google, etc.), home security systems, children’s toys, smart watches, cell phones, and many more all designed to collect personal information, package that personal information and rent it to anyone who wants it. All without consumer knowledge, permission, control, or recourse. For marketers, VAPAs are particularly worrisome, potentially cutting brands out of the loop when VAPAs select what to buy.
SBT is unstable because it’s an extractive model monetizing lying, cheating, stealing, and manipulation of consumers. The success of this model depends on no one finding out the real costs, and there is mounting evidence that SBT does not work nearly as well as claimed.
SBT marketing is not consumer, marketer, or free-market aligned. By design SBT is extractive, manipulative, and dependent upon consumers being unaware. Include the unintended consequences and there is little upside. Many tech experts, scholars, consumers, governments, and economists believe (The Social Dilemma) that SBT presents an existential threat to democracy, free markets, and human rights. And governments are beginning to agree by seeking to regulate SBT and the associated practices. Here is an article in the Wall Street Journal about the state of online marketing in the 21st century and one expert’s view of online marketing.
Because of the risks and more government regulation, marketers and consumers need something better than SBT. (“So once again we see a historic opportunity for an alliance of companies to found an alternative ecosystem — one that returns us to the earlier promise of the digital age as an era of empowerment and the democratization of knowledge.”)
The Next Era — Truth, Credibility and the Marketers Get Their Power Back
A “credibility optimization algorithm” gives consumers and marketers what they both want. Consumers get the truthful marketing information they want, and marketers receive intentional consumer engagement with that truthful information that marketers want. A “credibility optimization algorithm” automatically maximizes marketers’ credibility and multiplies marketing “voice and tone” to amplify all (past, present, and future) marketing exposures, unlocking increased returns from all “past” exposures and creating a consumer “point-of-need” (PON) marketing platform more powerful than any “point-of-interruption” (POI) ad-based platform — where marketing is the message and the media, not the interruption.
A simple “credibility optimization algorithm” that automatically and continuously maximizes a marketer’s credibility is the only thing that makes everything a marketers has done or will do — work better. Marketer gain the power and control that they have surrendered to the mega-monopolies over the past two decades and establish a powerful and permanent defense against all future “network effects” and AI-driven processes intended to reduce marketer power and influence.
“It’s time for companies to accept that consumers have become very savvy and very demanding.
Today’s consumer (B2B or B2C) does their homework, is well informed, and buys…they are not sold,”
Mike Myatt, Forbes Magazine, May 1, 2012.