We’re Becoming Intellectually “Obese”

Humans are defined by scarcity. All our evolutionary adaptations tend to be built to ensure survival in harsh environments. This can sometimes backfire on us in times of abundance.

For example, humans are great at foraging. We have built-in algorithms that tell us which patches are most promising and when we should give up on the patch we’re in and move to another patch.

We’re also good at borrowing strategies that evolution designed for one purpose and applying them for another purpose. This is called exaptation. For example, we’ve exapted our food foraging strategies and applied them to searching for information in an online environment. We use these skills when we look at a website, conduct an online search or scan our email inbox. But as we forage for information – or food – we have to remember, this same strategy assumes scarcity, not abundance.

Take food for example. Nutritionally we have been hardwired by evolution to prefer high fat, high calorie foods. That’s because this wiring took place in an environment of scarcity, where you didn’t know where your next meal was coming from. High fat, high calorie and high salt foods were all “jackpots” if food was scarce. Eating these foods could mean the difference between life and death. So our brains evolved to send us a reward signal when we ate these foods. Subsequently, we naturally started to forage for these things.

This was all good when our home was the African savannah. Not so good when it’s Redondo Beach, there’s a fast food joint on every corner and the local Wal-Mart’s shelves are filled to overflowing with highly processed pre-made meals. We have “refined” food production to continually push our evolutionary buttons, gorging ourselves to the point of obesity. Foraging isn’t a problem here. Limiting ourselves is.

So, evolution has made humans good at foraging when things are scarce, but not so good at filtering in an environment of abundance. I suspect the same thing that happened with food is today happening with information.

Just like we are predisposed to look for food that is high in fats, salt and calories, we are drawn to information that:

  1. Leads to us having sex
  2. Leads to us having more than our neighbors
  3. Leads to us improving our position in the social hierarchy

All those things make sense in an evolutionary environment where there’s not enough to go around. But, in a society of abundance, they can cause big problems.

Just like food, for most of our history information was in short supply. We had to make decisions based on too little information, rather than too much. So most of our cognitive biases were developed to allow us to function in a setting where knowledge was in short supply and decisions had to be made quickly. In such an environment, these heuristic short cuts would usually end up working in our favor, giving us a higher probability of survival.

These evolutionary biases become dangerous as our information environment becomes more abundant. We weren’t built to rationally seek out and judiciously evaluate information. We were built to make decisions based on little or no knowledge. There is an override switch we can use if we wish, but it’s important to know that just like we’re inherently drawn to crappy food, we’re also subconsciously drawn to crappy information.

Whether or not you agree with the mainstream news sources, the fact is that there was a thoughtful editorial process, which was intended to improve the quality of information we were provided. Entire teams of people were employed to spend their days rationally thinking about gathering, presenting and validating the information that would be passed along to the public. In Nobel laureate Daniel Kahneman’s terminology, they were “thinking slow” about it. And because the transactional costs of getting that information to us was so high, there was a relatively strong signal to noise ratio.

That is no longer the case. Transactional costs have dropped to the point that it costs almost nothing to get information to us. This allows information providers to completely bypass any editorial loop and get it in front of us. Foraging for that information is not the problem. Filtering it is. As we forage through potential information “patches” – whether they be on Google, Facebook or Twitter – we tend to “think fast” – clicking on the links that are most tantalizing.

I would have never dreamed that having too much information could be a bad thing. But most of the cautionary columns that I’ve written about in the last few years all seem to have the same root cause – we’re becoming intellectually “obese.” We’ve developed an insatiable appetite for fast, fried, sugar-frosted information.

 

Searching for Leaders

I was planning on writing a very erudite column on how our consumption of news has drastically changed when I decided to do a research check on Google Trends and found something interesting. It should come as no surprise to learn that Donald Trump is dominating news searches on Google. But what was surprising was that the number one audience with an appetite for “Trumpie Tidbits” is Canadians. That’s right, my fellow countrymen can’t get enough of the guy. We, as a nation, search more for news on Donald Trump than any other place on earth, even the U.S. We out search you Americans on Google by margin of almost 25% (mind you, that margin reverses for web searches for Trump, but we’re still number 2 in the world).

Why?

I could offer some psychologically plausible reasons having to do with morbid curiosity, voyeurism, schadenfreude or even the Stockholm Syndrome, but honestly I have no idea why we’re submitting ourselves to this. Maybe it’s giving us something to do during our abnormally long winters and seeing as we’re already miserable as hell, we feel we have nothing to lose?

This is somewhat ironic, given that according to several highly reputable online polls, we have the hottest leader in the world right now – one Monsieur Trudeau. But even as photogenic as Justin is, when it comes to launching a Google search, our vote still goes to Trump. When you compare searches for Trump during his election to searches for Trudeau during his election – in Canada, no less – Trump wins by a margin of 2 to 1.

But it’s not just us. Trump’s domination of the search zeitgeist is historic. Google shows relative volumes – with 100 representing the peak popularity. For Trump, this peak corresponded with his election, in November. A second peak, at 65, came with his inauguration. Never in the entire length of Barack Obama’s presidency did he ever come close to this. The nearest was during his first election in 2008, when he peaked at 55. So, in one category at least, Trump would be accurate in claiming a historic win.

I thought I’d see if this pattern holds up globally. Angela Merkel is barely a blip on Google’s search radar. Worldwide she has never peaked above 1 compared to Trump’s peak score of 100. Perhaps that’s why he refused to shake her hand. Even in Deutschland itself, she peaked at a paltry 17 in the last 5 years against the Trump standard of 100.

Poor Theresa May, the new leader of the United Kingdom, can’t catch a break either. Even on the week she assumed power Donald Trump gained more searches worldwide by a solid 3 to 1 margin.

So let’s put this to the acid test. Trump vs Putin. Worldwide over the past 5 years it was no contest. Trump: 100, Putin: 3 (scored the week of March 2 – 8, 2014, when Putin was making noises about reclaiming Crimea). And yes, even if we restrict the searches to those coming only from Russia, Trump’s best outscored Putin’s best (in June of 2013) by a margin of 2 to 1.

This probably shouldn’t surprise me. According to Google, Donald Trump outscored everyone when it came to searches in 2016. In fact, he came third on Google’s list of most popular searches of any kind, just after Pokémon Go and iPhone 7. The world is locked in a morbid fascination with all that is Trump.

I’d love to wrap up this column with something philosophical and enlightened. It would be good to pass on some tidbit of behavioral wisdom that would put all this search activity into perspective. But that’s not going to happen. All I know is that I’m as guilty as anyone. Since November 8, I search almost daily for ‘Trump” just to see what the last 24 hours hath wrought. I call it my Daily WTF Round Up.

Apparently I’m not alone.

Yahoo and the Transitory World

The writing has been on the wall for some time. But where once it spelled out Yahoo, it now says Altaba.

The Yahooligans are no more, have ceased to be, bereft of life, they rest in peace. Marissa Mayer may be riding off into the Silicon Valley sunset with her golden parachute trailing behind. The parking lot attendants at 701 First Avenue, Sunnyvale, CA could soon be sandblasting her name off the CEO’s reserved parking spot. And, predictably, we Internet codgers are mourning the loss of yet another digital pioneer.

But here’s the thing. For the last 150 years the point of a corporation is to not be a permanent fixture. And, in this world, that’s truer than ever. So we’d better get use to stepping around a growing pile of corporate corpses.

The notion of a corporation has been around since Roman times. The name comes from the Latin corpus (body) and means “body of people.” The original idea was that a corporation would live on beyond the lifespan of any of its members. This has certainly been true of the Stora Kopparberg, a mining community in Sweden, the oldest corporation in the world. It started in 1347.

But things changed in 1855 with the passing of the Limited Liability act in England. This flipped the idea of the perpetuity of a corporation on its head. This legislation allowed shareholders to walk away from the wreckage of a failed corporation without assuming any personal liability. It enabled serial entrepreneurialism and lowered the threshold of tolerable risk.

In short, corporate limited liability law made it okay for business people to try and possibly fail.

In the century and a half since the passing of the limited Liability Act (and similar legislation in most US states) we somehow believed that corporations existed to build size and scale, as befits a market that’s pre-occupied with mass. Economist Ronald Coase said the reason corporations exist is that because in imperfect markets, there is less friction doing things inside an organization than outside, making corporate structures more profitable than open markets. That was true in markets that built physical things from raw materials scattered around the world and then also had to distribute those things to distant markets.

But that’s not the world we live in. The world we live in is the world of rapid iteration and Eric Ries’ “Minimum Viable Product”. Increasingly, these products are not made of physical stuff but of digital bytes, where there is very little in the way of transactional costs.

I think we have to start thinking of the Minimum Viable Company – companies that can be assembled quickly around a market need but also can be disassembled and repurposed quickly. In today’s world, that’s the purpose of an organization and it’s a transitory thing.

In their book Creative Destruction, Richard Foster and Sarah Kaplan envision a new corporate structure more like a venture capital fund. A corporation should be made up of a number of transitory operating units that explore market opportunities in a Darwinian fashion. Arguably, this is closer to the model adopted by Google with Alphabet and, ironically, the new corporate structure of Altaba.

But even here, corporate hubris tends to get in the way. At some point, inevitably, the powers that be begin to believe they’re smarter than the market and build an illusion of sustainability. As economist Joseph Schumpeter said, “The problem that is usually being visualized is how capitalism administers existing structures, whereas the relevant problem is how it creates and destroys them.” Corporations have a vested interest in the status quo. Cognitive biases being what they are, we’ll always favor on the side of what we have rather than what we should build. For this reason, I think Coase’s justification for the corporation might be on its last legs.

That was definitely true of Yahoo. It was a corporation that lived beyond its time. Sooner or later, that had to catch up with it.

 

 

The Rise of the Audience Marketplace

Far be it from me to let a theme go before it has been thoroughly beaten to the ground. This column has hosted a lot of speculation on the future of advertising and media buying and today, I’ll continue in that theme.

First, let’s return to a column I wrote almost a month ago about the future of advertising. This was a spin-off on a column penned by Gary Milner – The End of Advertising as We Know It. In it, Gary made a prediction: “I see the rise of a global media hub, like a stock exchange, which will become responsible for transacting all digital programmatic buys.”

Gary talked about the possible reversal of fragmentation of markets by channel and geographic area due to the potential centralization of digital media purchasing. But I see it a little differently than Gary. I don’t see the creation of a media hub – or, at least – that wouldn’t be the end goal. Media would simply be the means to the end. I do see the creation of an audience market based on available data. Actually, even an audience would only be the means to an end. Ultimately, we’re buying one thing – attention. Then it’s our job to create engagement.

The Advertising Research Foundation has been struggling with measuring engagement for a long time now. But it’s because they were trying to measure engagement on a channel-by-channel basis and that’s just not how the world works anymore. Take search, for example. Search is highly effective at advertising, but it’s not engaging. It’s a connecting medium. It enables engagement, but it doesn’t deliver it.

We talk multi-channel a lot, but we talk about it like the holy grail. The grail in this cause is an audience that is likely to give us their attention and once they do that – is likely to become engaged with our message. The multi-channel path to this audience is really inconsequential. We only talk about multi-channel now because we’re stopping short of the real goal, connecting with that audience. What advertising needs to do is give us accurate indicators of those two likelihoods: how likely are they to give us their attention and what is their potential proclivity towards our offer. The future of advertising is in assembling audiences – no matter what the channel – that are at a point where they are interested in the message we have to deliver.

This is where the digitization of media becomes interesting. It’s not because it’s aggregating into a single potential buying point – it’s because it’s allowing us to parallel a single prospect along a path of persuasion, getting important feedback data along the way. In this definition, audience isn’t a static snapshot in time. It becomes an evolving, iterative entity. We have always looked at advertising on an exposure-by-exposure basis. But if we start thinking about persuading an audience that paradigm needs to be shifted. We have to think about having the right conversation, regardless of the channel that happens to be in use at the time.

Our concept of media happens to carry a lot of baggage. In our minds, media is inextricably linked to channel. So when we think media, we are really thinking channels. And, if we believe Marshall McLuhan, the medium dictates the message. But while media has undergone intense fragmentation they’ve also become much more measurable and – thereby – more accountable. We know more than ever about who lies on the other side of a digital medium thanks to an ever increasing amount of shared data. That data is what will drive the advertising marketplace of the future. It’s not about media – it’s about audience.

In the market I envision, you would specify your audience requirements. The criteria used would not be so much our typical segmentations – demography or geography for example. These have always just been proxies for what we really care about; their beliefs about our product and predicted buying behaviors. I believe that thanks to ever increasing amounts of data we’re going to make great strides in understanding the psychology of consumerism. These  will be foundational in the audience marketplace of the future. Predictive marketing will become more and more accurate and allow for increasingly precise targeting on a number of behavioral criteria.

Individual channels will become as irrelevant as the manufacturer that supplies the shock absorbers and tie rods in your new BMW. They will simply be grist for the mill in the audience marketplace. Mar-tech and ever smarter algorithms will do the channel selection and media buying in the background. All you’ll care about is the audience you’re targeting, the recommended creative (again, based on the mar-tech running in the background) and the resulting behaviors. Once your audience has been targeted and engaged, the predicted path of persuasion is continually updated and new channels are engaged as required. You won’t care what channels they are – you’ll simply monitor the progression of persuasion.

 

A Possibly Premature Post-Mortem on Yahoo

Last Thursday, Yahoo held it ‘s annual shareholder meeting. At that meeting, CEO Marissa Mayer dealt the company a doubled down kiss of death. She stated the goals of the board are fully aligned with one clear priority: “delivering shareholder value to all of you.” She further mentioned, when dealing with the divesture of all that once was Yahoo, that she’s “been very heartened by the level of interest in Yahoo. It validates our business processes as well as our achievements to date.”

It’s fancier language, but it’s basically the same as the butcher saying, “This cow is no longer viable as a cow, so I’m looking at it as a collection of rump roasts, T-Bones and hamburger. I’m hoping we have more of the former and less of the later.”

Yahoo_1996I first encountered Yahoo in 1995, shortly after it’s brief life as Jerry and David’s Guide to the World Wide Web. I think it was probably still parked on Stanford’s servers at the time. At the time, the Internet was like the world’s biggest second-hand store – a huge collection that was 95% junk/5 % useful stuff with no overarching order or organization. David Filo and Jerry Yang’s site was one of the very first to try to provide that order.

As an early search marketer in the run up to the dot-com bubble, you couldn’t ignore the Yahoo directory. The Yahooligans walked with typical Valley swagger. Hubris was never in short supply. They were the cocks of the walk and they knew it.

It was a much-humbled post-bubble Yahoo that I visited in 2004. They had got their search asses soundly kicked by Google, who was now powering their non-directory results. The age of the curated directory was gone, replaced by the scalability of algorithmic search.

As a culture, the Yahooligans were struggling with the mixed management signals that came from then CEO Terry Semel and his team. Sunnyvale was clouded in a purple haze. The Yahooligans didn’t know who the hell they were or what they were supposed to do. Where they a tech company or an entertainment company? The answer, as it turned out, was neither.

I met with the remnants of the once mighty search team to talk about user behaviors. I didn’t know it at the time, but Yahoo was gearing up to relaunch their search service. A much vilified paid inclusion program would also be debuted. It was one of many ill-fated attempts to find the next “Big Thing.”

Marissa Mayer continues to put a brave face on it, but the Yahoo engine ran out of steam at least a decade and a half ago. What amazes me is how long the ride has been. There is a message here for tech-based companies.

If you dig down to the critical incubation period of any tech company, you find a recurring pattern. Some technologically mediated connection allows people to do something they were previously unable to do. This releases pent up market demand. It’s like a thin sliver trying to poke through a water balloon. If successful, this released market demand creates an immediate and sizable audience for whomever introduced the innovation. Yahoo’s directory, Google’s PageRank, Facebook’s “Facemash”, AirBnB’s accommodation directory, Uber’s ridesharing app – they all share the same modus operandi – a tech-step forward creates a new audience and market opportunity.

In hindsight, once you strip away all the hype, it’s amazing how tenuous and unimpressive these technological advances are. Luck and timing typically play a huge part. If the conditions are right, the sliver eases through the balloon’s membrane and for a time, there is a steady stream of opportunity.

The problem is that is that as easily as these markets form, they can just as easily evaporate. When the technological advantage passes to the next competitor, as it did when Yahoo gave way to Google, all that’s left is the audience. When you consider that Yahoo has been coasting on this audience for close to two decades, it’s rather amazing that Mayer still has any assets at all to sell.

 

How We Might Search (On the Go)

As I mentioned in last week’s column – Mediative has just released a new eyetracking study on mobile devices. And it appears that we’re still conditioned to look for the number one organic result before clicking on our preferred destination.

But…

It appears that things might be in the process of changing. This makes sense. Searching on a mobile device is – and should be – significantly different from searching on a desktop. We have different intents. We are interacting with a different platform. Even the way we search is different.

Searching on a desktop is all about consideration. It’s about filtering and shortlisting multiple options to find the best one. Our search strategies are still carrying a significant amount of baggage from what search was – an often imperfect way to find the best place to get more information about something. That’s why we still look for the top organic listing. For some reason we still subconsciously consider this the gold standard of informational relevancy. We measure all other results against it. That’s why we make sure we reserve one slot from the three to five available in our working memory (I have found that the average person considers about 4 results at a time) for its evaluation.

But searching on a mobile device isn’t about filtering content. For one thing, it’s absolutely the wrong platform to do this with. The real estate is too limited. For another, it’s probably not what we want to spend our time doing. We’re on the go and trying to get stuff done. This is not the time for pausing and reflecting. This is the time to find what I’m looking for and use it to take action.

This all makes sense but the fact remains that the way we search is a product of habit. It’s a conditioned subconscious strategy that was largely formed on the desktop. Most of us haven’t done enough searching on mobile devices yet to abandon our desktop-derived strategies and create new mobile specific ones. So, our subconscious starts playing out the desktop script and only varies from it when it looks like it’s not going to deliver acceptable results. That’s why we’re still looking for that number one organic listing to benchmark against

There were a few findings in the Mediative study that indicate that our desktop habits may be starting to slip on mobile devices. But before we review them, let’s do a quick review of how habits play out. Habits are the brains way of cutting down on thinking. If we do something over and over again and get acceptable results, we store that behavior as a habit. The brain goes on autopilot so we don’t have to think our way through a task with predictable outcomes.

If, however, things change, either in the way the task plays out or in the outcomes we get, the brain reluctantly takes control again and starts thinking its way through the task. I believe this is exactly what’s happening with our mobile searches. The brain desperately wants to use its desktop habits, but the results are falling below our threshold of acceptability. That means we’re all somewhere in the process of rebuilding a search strategy more suitable for a mobile device.

Mediative’s study shows me a brain that’s caught between the desktop searches we’ve always done and the mobile searches we’d like to do. We still feel we should scroll to see at least the top organic result, but as mobile search results become more aligned with our intent, which is typically to take action right away, we are being side tracked from our habitual behaviors and kicking our brains into gear to take control. The result is that when Google shows search elements that are probably more aligned with our intent – either local results, knowledge graphs or even highly relevant ads with logical ad extensions (such as a “call” link) – we lose confidence in our habits. We still scroll down to check out the organic result but we probably scroll back up and click on the more relevant result.

All this switching back and forth from habitual to engaged interaction with the results ends up exacting a cost in terms of efficiency. We take longer to conduct searches on a mobile device, especially if that search shows other types of results near the top. In the study, participants spent an extra 2 seconds or so scrolling between the presented results (7.15 seconds for varied results vs. 4.95 seconds for organic only results). And even though they spent more time scrolling, more participants ended up clicking on the mobile relevant results they saw right at the top.

The trends I’m describing here are subtle – often playing out in a couple seconds or less. And you might say that it’s no big deal. But habits are always a big deal. The fact that we’re still relying on desktop habits that were laid down over the past two decades show how persistent then can be. If I’m right and we’re finally building new habits specific to mobile devices, those habits could dictate our search behaviors for a long time to come.

In Search- Even in Mobile – Organic Still Matters

I told someone recently that I feel like Rick Astley. You know, the guy that had the monster hit “Never Gonna Give You Up” in 1987 and is still trading on it almost 30 years later? He even enjoyed a brief resurgence of viral fame in 2007 when the world discovered what it meant to be “Rickrolled”

google-golden-triangle-eye-trackingFor me, my “Never Gonna Give You Up” is the Golden Triangle eye tracking study we released in 2005. It’s my one hit wonder (to be fair to Astley, he did have a couple other hits, but you get the idea). And yes, I’m still talking about it.

The Golden Triangle as we identified it existed because people were drawn to look at the number one organic listing. That’s an important thing to keep in mind. In today’s world of ad blockers and teeth gnashing about the future of advertising, there is probably no purer or more controllable environment than the search results page. Creativity is stripped to the bare minimum. Ads have to be highly relevant and non-promotional in nature. Interaction is restricted to the few seconds required to scan and click. If there was anywhere where ads might be tolerated, its on the search results page

But…

If we fully trusted ads – especially those as benign as those that show up on search results – there would have be no Golden Triangle. It only existed because we needed to see that top Organic result and dragging our eyes down to it formed one side of the triangle.

eyetracking2014Fast forward almost 10 years. Mediative, which is the current incarnation of my old company, released a follow up two years ago. While the Golden Triangle had definitely morphed into a more linear scan, the motivation remained – people wanted to scan down to see at least one organic listing. They didn’t trust ads then. They don’t trust ads now.

Google has used this need to anchor our scanning with the top organic listing to introduce a greater variety of results into the top “hot zone” – where scanning is the greatest. Now, depending on the search, there is likely to be at least a full screen of various results – including ads, local listings, reviews or news items – before your eyes hit that top organic web result. Yet, we seem to be persistent in our need to see it. Most people still make the effort to scroll down, find it and assess its relevance.

It should be noted that all of the above refers to desktop search. But almost a year ago, Google announced that – for the first time ever – more searches happened on a mobile device than on a desktop.

eyetracking mobile.pngMediative just released a new eye-tracking study (Note: I was not involved at all with this one). This time, they dove into scan patterns on mobile devices. Given the limited real estate and the fact that for many popular searches, you would have to consciously scroll down at least a couple times to see the first organic result, did users become more accepting of ads?

Nope. They just scanned further down!

The study’s first finding was that the #1 organic listing still captures the most click activity, but it takes users almost twice as long to find it compared to a desktop.

The study’s second finding was that even though organic is still important, position matters more than ever. Users will make the effort to find the top organic result and, once they do, they’ll generally scan the top 4 results, but if they find nothing relevant, they probably won’t scan much further. In the study, 92.6% of the clicks happened above the 4th organic listing. On a desktop, 84% of the clicks happened above the number 4 listing.

The third listing shows an interesting paradox that’s emerging on mobile devices: we’re carrying our search habits from the desktop over with us – especially our need to see at least one organic listing. The average time to scan the top sponsored listing was only 0.36 seconds, meaning that people checked it out immediately after orienting themselves to the mobile results page, but for those that clicked the listing, the average time to click was 5.95 seconds. That’s almost 50% longer than the average time to click on a desktop search. When organic results are pushed down the page because of other content, it’s taking us longer before we feel confident enough to make our choice. We still need to anchor our relevancy assessment with that top organic result and that’s causing us to be less efficient in our mobile searches than we are on the desktop.

The study also indicated that these behaviors could be in flux. We may be adapted our search strategies for mobile devices, but we’re just not quite there yet. I’ll touch on this in next week’s column.