Blog #5

I had never heard of Rapleaf until reading that WSJ article, and I am little bit weirded out. I am not that surprised really, and I actually would have been more surprised if a company like that didn’t exist. Personally, I don’t really like the idea that I am being tracked in any way and I would really like to live my life more anonymously, and I do think that is my right. However, in a more general sense, I don’t really see what the big deal is about data collection given all the value that we get from it. Business school has certainly made me more acutely aware of what data is actually being collected and what it is being used for, but I don’t think it has really changed my attitudes about privacy issues.

What business school has changed is my attitude about marketing. This sounds completely absurd, but marketing is beautiful. Obviously, different people have slightly different definitions of what marketing is, but my high-level definition is finding out what groups of people are interested in your product, finding out how you can tweak the product for your customers’ maximum benefit, and figure out the best way to get it to them. Everybody wins. And what better way to find out what people want than mounds and mounds of data?

One thing I don’t think the articles did a very good job of was highlighting the benefits of all this data that is being collected. The real-time traffic information that Google provides was mentioned, and that is a notable one. Product improvement and fraud detection are others, and the list continues. In class we were talking about the issues with digital medical records; there are obviously many thorny privacy issues there, but imagine the good that could come out of having all records digitized. There would probably be better outcomes for each patient on an individual basis, but if we had a single database with millions of medical treatments and outcomes the science of medicine could grow by leaps and bounds, which would benefit the entire world. Beyond that, services like social media can only be free if they can monetize something, and data will likely continue to be that something.

Targeted advertising is one area that people (including myself) find creepy. The WSJ article mentions how Rapleaf has been used in political campaigns to target swing voters, which at first seemed inappropriate to me. But upon reflection, it seems stupid to do it any other way. Why should anyone other than an undecided voter have to be bothered with an election ad? And why should a campaign waste resources on somebody that has made up their mind? (The caveat here is that those ads need to be truthful, which is a big ‘if’.) But move that situation out of the political realm and into the realm of business and it seems much more appropriate. I don’t want to see ads for Polydent or lingerie, but I wouldn’t mind knowing what the best deals for laptops targeted at business school students are. It is just efficiency.

The big question then becomes, are there real privacy concerns or are we just creeped out? By and large, I think we are just creeped out. Yes, there are some horrible things that could happen if data got into the wrong hands. Aside from clearly illegal things like identity theft, concerns that insurance companies would deny coverage based on ostensibly private data and similar sorts of discrimination are real concerns. But up until this point, we have benefited tremendously from all the data collection going and I am not aware of any truly systemic problems it has caused. Lots of concerns, but no real problems.

So what should we do about privacy in the future? I have absolutely no idea. My gut tells me privacy is very important and should be protected, but intellectually it seems to me like the benefits far outweigh the risks. Government regulation is certainly not the answer. Some broad consumer protections make sense, but this issue is moving way too fast for government to intervene in a beneficial manner. I sure would like a switch on my devices that allowed me to be anonymous, but I think that it is only fair that companies that offer free services would not be obligated to serve a device in ‘anonymous’ mode. That certainly might be part of a solution.

Ultimately, we are getting much less concerned with privacy and I think that could really be a good thing. Everybody loves to say how great transparency is; well, it is time to walk the walk. We are rapidly moving towards extremely transparent lives. In order to be truly transparent you have to have self-confidence and behave in an ethical manner and neither one of those are bad things. And when your entire life is out in the open for everyone to see, you are probably going to be much more forgiving of other peoples mistakes lest you be judged by them. It is a little pie in the sky to suggest that losing our privacy will make the world a better place, but I don’t think it is completely insane either. 

Lightning in a Bottle

Dr. Stephen Walls stole my thunder. Before the lecture yesterday I had a pretty good idea of what I wanted to write for my blog on creativity, but in class we covered most of what I initially planned to discuss. In particular, creativity is all about making connections (maybe Steve Jobs was actually the one that stole my thunder). The most useful creative ideas rarely come out of thin air, they are just a new synthesis of previously disparate ideas or products or whatever. In the rare instances when creative ideas do come out of thin air they often cannot be realized; no matter how good they are, nobody else can understand them and they end up being too far ahead of their time. 

In class we also discussed the idea of mastery and the 10,000 hour rule in relation to creativity, and that is something I find particularly interesting. Having started out as a performer in the music industry at a fairly young age (and being totally obsessive) I got my 10,000 hours on the guitar in pretty early, and I certainly believe there is a lot to the idea that mastery of something leads to creativity. If you don’t understand every little nuance of something, then how are you supposed to make these disparate connections and create something new and original? But on the other side of the coin, if you have spent 10,000 hours doing something how can you possibly see it in a new light? This was actually a major motivator in my decision to enroll in the MBA program at McCombs-I was bored. My hands could do just about anything I wanted them to on the guitar, but my brain often wouldn’t tell them to do anything very interesting because I was playing so much of the day I often wasn’t paying much attention. Since I started school I have had a lot less time to play, and it is the best thing I have ever done for my guitar playing. I may not have the same chops that I did before, but the music I make is often way better and for the first time in years I am really engaged virtually every time I play.  

In class, we also discussed the benefits and pitfalls on working on creative projects in a group, which is something I have also done a lot of. I’ll focus on my music experience here since that is probably the most relevant. Recording sessions and performances are the two places that you most frequently do creative group in music, although they are very different. Performances are interesting because everything is in the moment and you can’t stop or discuss much. As interesting as they are, I think the creative process in the studio is much more applicable to our discussion here. Every session is different, but in one typical type of session the singer will play a song for everybody once and their might be a little discussion on the general feel they are looking for, and then the musicians will start playing through it (musicians are very good at rapid prototyping and failing quickly, although you would never hear those terms). After a couple of passes through when everyone has their parts worked out then you start recording until you get a version you like. One thing that I have really learned is that it is important to know who you are working with, for a number of reasons. For one, once you have established trust with people you can question their ideas more easily and point out the flaws in order to improve the idea. Also, you start to understand someone’s world view, and when they put forth an idea it is easier to see where they are coming from. This “E.S.P.” makes it a lot easier to fully understand someone else idea and saves a lot of time, and eventually broadens your own world view.

Continually to work with the same people and develop this sort of telepathy is great, until it is not. After a certain point, you know what somebody is going to say (or play) before they even do it, which does not do much for creativity. The creative benefits of working in a group come from having someone else make a connection that you didn’t see, which in turns allows you to make a further connection that someone else didn’t see. When you know somebody’s idea before they even articulate it, the group is probably not making more creative connections than they would have otherwise. What the group is doing is working more efficiently, which obviously has its own, although different, benefits.

There is a pattern developing here that was also prevalent in class; mastery fosters creativity until it doesn’t, group work fosters creativity until it doesn’t, tight timelines foster creativity until they don’t, etc. There is a good reason for this, new situations foster new connections. Stephen Bruton used to say his job as a producer was capturing lightning in a bottle, and that is exactly what harvesting creativity is like. The problem is lightning doesn’t often strike in the same place twice, which creates a major dilemma in the business world. As any good Ops guy will tell you, variation is the enemy of efficiency. Unfortunately, variation is also the key ingredient to creativity. Your company needs creative solutions? No problem. They want them fast and efficiently this year? No problem. They want them fast and efficiently for the next five years? That’s a problem. Variation is going to have to be introduced at some point in the system if you want to maintain creativity, at which point you will start to lose speed and efficiency.

Creativity is making new connections, and creating new connections requires a new situation. Expecting new connections out of a mature situation is foolish. In fact, I believe that has been called the definition of insanity. 

I would like to save the world. That might be a little unrealistic for a research paper on consumer insights, but I don’t see any reason to play small ball at this point in the process. The following is an exploration of a potential paper topic…

Obesity is clearly one of the biggest threats facing American society, and the rest of the world is following in the deep footprints of our growing waistlines. The problems that obesity is causing in this country (and the rest of the world) are well-known; heart disease, diabetes, cancer, etc., are all linked to being overweight. These are very expensive chronic diseases to treat and are a major contributing factor to rising health care costs in this country, although the cost of prevention is very low. You want to solve this country’s fiscal crisis? Start with the obesity epidemic.

I am interested in this topic for several reasons. I do feel that obesity is a big threat to our country’s physical, emotional and financial well-being, but I also absolutely love good food. My mother is a great cook, and spent most of her career in the catering business. When I was eight, she took me on catering jobs and I worked as a prep cook, and as soon as I was old enough to legally work she got me a job bussing tables at one of the nicest hotels in town. She certainly had to work late a lot and we ordered pizza so often the delivery people knew us by name, but when she was home she could walk into the kitchen and walk out fifteen minutes later with a fantastic meal.

I also love healthy food, although the definition of healthy has gotten a little bit murky. I generally fall in the Michael Pollan school of thought and believe that ‘food’ actually has a definition beyond being something you put in your mouth. Food should grow out of the ground, not be a science project. I often describe myself as a recreational dieter, and I have tried everything from the paleo diet to being a vegan. Now I am a true omnivore, but I care deeply about the quality of food I eat. Most importantly, I believe that eating home cooked meals with your family is emotionally important. It is not always practical, and I am no purist, but sitting at a table together is an extremely effective way for a family to connect.

The causes of the obesity epidemic are commonly thought to be increased caloric intake coupled with a sedentary lifestyle. They are both factors, but research by David Cutler and a group of Harvard economists point to the real cause being increased caloric intake. Cutler also asserts that the problem is an increased number of meals, not an increased number of calories at each meal. The basic idea here is that lowering in the cost of food, both in terms of money and preparation time, encourages people to eat more, and with Americans increasingly hectic schedules it is more efficient to purchase meals than to prepare them yourself. Of course ready-to-eat food, whether from a restaurant or processed food from a grocery store, is more calorically dense, which makes matters worse.

So, how do you reduce caloric intake? According to Harry Baltzer, a market researcher specializing in the food industry, the answer is simple: cooking. If you prepare all of your meals you eat fewer of them, and they tend to be healthier. When you prepare your own meals, you are more aware of what goes in them and, generally speaking, it is more work to prepare unhealthy food. Stopping by KFC on the way home is easy; breading and frying ten pieces of fried chicken and then cleaning up afterwards is a real hassle.

Michael Pollan has an interesting article on America’s changing relationship with cooking and quotes Harry Baltzer frequently. Baltzer’s view is that cooking is dead. I find that pretty depressing, although I have a hard time believing that he is wrong. After working in the music industry and watching it practically disintegrate because it wasn’t willing to accept a paradigm shift, I am acutely aware of the importance of accepting what is and not pretending things are what you want them to be. That said, I think there is a segment to serve here.

There are people who absolutely love to cook, and that small group will always prepare most of their own meals. There are people who really don’t care where there food comes from and, for the moment at least, we need to accept that. I want to focus on the people who care, but just don’t have the time to prepare all of their own meals. These are people who basically like to cook and understand the health benefits of eating well, but have demanding jobs, kids, and other activities that limit the time they have to spend preparing food.

Many businesses have started to look at this group and there are increasingly products and services designed for them. In grocery stores you see items such as pre-washed salad greens and pre-cut vegetables. There are also an increasing number of businesses specializing in healthy take-out meals designed to be taken home and reheated as well as grocery delivery businesses specializing in produce. However, I don’t get the sense that anybody has cracked the code for this consumer segment yet. They need convenience, but also real food. What is the balance? What does convenience mean for these people?

I want to understand who these people are, and what products and services they need to in order to start cooking and eating well at home. And I want to save the world.

Taylor's social media world

This one isn’t quite as easy for me. In the past I have treated social media as an obligation, not a diversion or as a way to stay in touch with friends. I think there are two main reasons for this. For one, I am the type of person who likes to sit down with one friend and talk for an hour in order to really catch up with them; I am less excited about talking to thirty friends for two minutes each. Second, since I come from the music industry a social media presence is considered part of the job. As a result my Facebook friends list has a sizable percentage of people that I have never met, and I haven’t felt real personally connected to the experience.

My group and I have talked about how our persona, Taylor, does use social media however, and she would be a much better subject for this blog than I. First, a little bit about Taylor and her social media use in order to frame this discussion. Taylor is 30, lives in San Francisco with her boyfriend, and is successful in her sales career. She does use social media; Facebook, Twitter, Instagram, foursquare, etc. One of her characteristics is that she is the last of the early adopters. She knows when something is becoming cool and she jumps on board before it explodes to the masses, but not before it has been somewhat proven.

Taylor keeps a close eye on her social media outlets, but she just doesn’t initiate much or take big risks. She ‘likes’ a lot of things, says happy birthday to people, and posts pretty pictures of the Bay Area-all in all pretty safe stuff. She doesn’t make edgy comments or even that many jokes, mainly because although she knows she is smart, she does not perceive of herself as particularly witty or original.

So what kind of insights can you glean from Taylor’s social media usage in terms both of content and interaction patterns? I mentioned that Taylor is one of the last early adopters for a trend, and this describes a certain kind of person. It is kind of person who needs to be current for current’s sake, and she doesn’t have time to waste fiddling with new trends that aren’t going to stick. She is not an ‘influencer’ in the sense of having a lot of Twitter followers or other similar metrics, but she is an influencer in the sense that she has clout. When she adopts something new people around her know it is going to stay and it is worth looking into. This applies to phone apps, social media sites, fashion, whatever. People like Taylor are important bellwethers of what is going to be taking off in the next two months. When she likes a company on Facebook, it is worth noticing.

People like Taylor are on the cusp of major life-changing decisions. She lives with her boyfriend, but they aren’t married. She thinks they will tie the knot eventually, but isn’t sure if they will have kids. She is career conscious but not sure if she wants to let her career define her, and now is the time of her life she needs to decide. Social media is a very easy way to find people on the cusp of life changing decisions and watch as they make the transition into the next phase of their life. There are a lot of interesting questions you could ask about people here. When they make these transitions, do they really decide on their path and pursue it or do they let their path unfold in front of them? These are very different types of people. Do they make their decisions publicly (ie post about their thought process) or are they more private? Do they make decisions similar to their peers’ or do they strike out on their own path?

These sites can also point to where people are focused in their life. Some people are very internally focused. They rely on their family and close friends to fulfill their emotional needs and there interactions are much more focused on family and close friends. They predominantly post pictures of their kids and family. Then there are the people that are more outwardly focused. They tend to tend to post pictures of places and events and groups of friends in bars. They tend to explore the world to fulfill their emotional needs. There is of course overlap, and this distinction can change as a person moves through life, but it is interesting to think about the differences of people who gain satisfaction from searching and experiencing new things and people who gain satisfaction from focusing on the environment that they live in.

Thinking about the potential of Facebook makes my head explode. One eighth of the world’s population resides there, and they segment themselves for you on an infinite number of characteristics. Did they like Williams-Sonoma? That certainly conjures an image of a certain type of person. Did they like Abercrombie? That conjures another. Did they like them both? And what the hell does that mean?!? The potential for uncovering customer insights is vast, and with no playbook on how to decode them the most important insights will be found by people that can most creatively piece together the amazing amount of information now available.

Customer Insights Blog #1

Big day today! Not only do I get to write to write my first Customer Insights blog, I get to write my first blog ever. I’m pretty happy about this foray into blogging-I’ve got lots of things to say and there is really only so much my wife can reasonably be expected to listen to.

My subject is Michelle. She is the wife of a former co-worker; when we worked together I got to know both of them quite well and continue to stay in touch with them. Michelle is in her early to mid-forties, has been previously married, has no children, and has been very successful in her career. To sum her up in a word, Michelle is awesome. She is smart, attractive, and funny, and one of those people that you are always happy to see. She knows how to handle herself in any venue; whether she is in a dive bar or an uppity lawyers’ conference she can charm the entire room.

What does she think and feel?

Despite her ability and success, once you get to know her better you become aware of this uneasiness she has about herself. She is smart and capable and she knows it, and she knows that everybody else knows it too. But somehow she is afraid that she might not actually be as capable as she should be, or that other people think she is not as capable as she should be. She is constantly preoccupied with impediments she faces at work. Michelle knows what is best for her organization and she has the authority to take action, but there are enough subordinates (and a few board members) who don’t see things the same way and become obstructionist. This drives her crazy.

Michelle is ambitious and she has always wanted a position of responsibility and authority. Of course, the closer you get to the top the closer you get to being fired, and now that she is at the top she misses the security and affirmation she previously enjoyed. Her organization is struggling, and she is worried that she might lose her job even though she has dramatically improved the financial situation of her organization.

More importantly, and probably at the heart of her professional anxiety, is her worry that she might end up alone in this world. She didn’t ever have children, and although she would never say it, she is regretful. She has close siblings with nieces and nephews, but she knows that when you get old your children are the ones visiting you in the retirement center, not your nieces and nephews. She loves her husband, but they have only been married a couple of years, and since her first marriage never gave her any real love and support she doesn’t know if this one will either. She longs for that sense of security, the comfort that no matter what happens somebody will be there for you.

What does she see?

Michelle sees opportunity. Professionally, she is always ready to meet people and make them part of her network. Personally, she is ready to try new things and see what they have to offer. Rock climbing? Sure. Exotic dancing? Absolutely. What Michelle doesn’t see a lot of are her friends, mainly because she doesn’t have many. She has business relationships that she meticulously cultivates, but aside from her siblings the people that she genuinely cares for and trusts are the people she talks to the least.

One of the most amazing things about Michelle is that despite some of her insecurities, when she looks at the market she sees a world that is hers for the taking. When she needs something-a job, a boyfriend, anything-she is confident she has the ability to go out there and get it.

What does she say and do?

As much as it pains her, Michelle always does and says the right thing. Not the right thing in a moral sense, but the right thing in the political sense. She is always in a good mood and always knows what to say, and always dresses the part; but she is not always happy about it. She rebels where she can-she has a tattoo that no one can see and she has some edgier piercings she wears when she can get away with it. She will play the part she needs to play, but she needs to occasionally prove to herself that she is still her own woman.

She is very gracious and forgiving when she likes you, or when she sees you as a business asset. But if you happen to be a jerk and unimportant to her career, Michelle doesn’t have time for you and you’ll know it. 

What does she hear?

Michelle hears a lot of politically correct BS at work, and she doesn’t like it. She would much rather cut to the chase and have an honest dialogue with about what needs to happen at her organization. When she talks to her friends she does get to have an open and honest dialogue, and because of that they are the biggest influencers in her life. Unfortunately her friends don’t have a good understanding of her life because they don’t talk to her very often and they can’t give her good advice. The do tell her how impressed they are with her achievements and her abilities, but they are not able to be the sounding board she needs.

What are her pain points?

In a material sense, her life is very comfortable. Her pain points are her worries and preoccupations mentioned earlier. She is doesn’t feel a real sense of security, both in her professional life and her personal life and that is what she longs for more than anything.

What does she hope to gain?

She wants success, even though she has already achieved it. Like many driven people, she is never satisfied with her achievements and she feels compelled to continually push herself harder. What she really wants to gain is satisfaction, and she doesn’t yet know how to achieve that.