Privacy comes up more and more in our work. In the last couple of weeks two clients have mentioned feeling slightly disturbed by the way data is being used in marketing. One, a German, felt quite strongly that brands that ‘overuse’ data run the risk of alienating customers.
Which reminded us of Google location – just click on www.google.co.uk/locationhistory/ and, if you are logged into Google, up will pop a map like the one above, with a calendar, so you can see exactly where you went on a particular day. (The random day I picked from last summer happened to be the last time I went to Facebook and – being before Citymapper launched in that city – I was probably the only person to turn up on the bus)
You can also run it as a movie, showing exactly how you travelled around that day – presuming you had a smartphone with Google turned on. Of course Apple also know quite a lot as does Facebook who are poised to launch hyper local location based ads.
Now we are all watched over in many other ways; if you drive in London your number plate is recorded and checked constantly to see if you have paid the congestion charge/ taxed your car/ have valid insurance. And in the city with (probably) more CCTV than anywhere else on Earth , you can be tracked as you move around the city as improving facial recognition makes this easier and easier.
But the depth and breadth of what digital firms know is worrying people. A good Wired piece on data and how it is used was picked up by the Standard this week. It’s a really good take on the subject.
Tim Berners Lee argues that this data should be owned by the individual, as it is really useful to that person;
“In general … if you put together all that data, from my wearable, my house, from other companies like the credit card company and the banks, from all the social networks, I can give my computer a good view of my life, and I can use that. That information is more valuable to me than it is to the cloud.”
The idea of Vendor Relationship Management where a person has control of their data and capture the value themselves has been around for quite a while – we featured it in our 2002 futurology video – but it has never caught on and one wonders if it’s now too late?
A good piece in Quartz points out the rapid growth in social login, where access to a site or app is given when the user logs in with Facebook, Google, Twitter etc rather than registering with the app itself. Some US research says 77% of people had used social login, up from 53% the previous year. Other research says Google and Facebook account for over 80% of all social logins.
Talk to any good growth hacker and they’ll tell you that social logins are a great product feature as people find them convenient – and perversely some think privacy is better protected this way.
As brands understandingly migrate to vendors who have first party data, enabling cross device tracking, and Google and Facebook extend their ad networks, the monetary benefit for the app owner to favour social logins will only increase.
The strong are going to keep getting stronger and their favoured diet is our data. Hard to see anyone changing this in the short term.
But Apple may have a go; a friend spotted this now pops up on iOS8.
The new IAB figures show burgeoning growth of UK mobile adspend continues. The figures for the first half of 2014 are up 68% with video doing incredibly well.
Agencies are increasingly adding online video to traditional TV campaigns, with Omnicom recommending US clients switch between 10% and 25% to online video. Much of this still flows to the big broadcasters for their catch up services but clearly lots gets directed to newer players. Which is why Yahoo are so focused on video – much of their European management team has a TV background and Marissa sees the future as video;
Probably the most intriguing advertising news this week (other than the Facebook local play) is that SnapChat are ready to offer advertising. Given they have a lot of reach and not much data, there won’t be too much targeting and users will be able to skip ads
Sounds like the need for smart creative in mobile is back. News that Google are pushing tools that measure the brand effect of digital ads supports this. Brand Lift isn’t that revolutionary but making it a core tool rather than an add-on is a significant move.
One of the emerging tools to measure the longer term effect of mobile advertising is to look for a sales effect and much of the energy around mobile money and wallets is that they could be the best attribution measure ever. Imagine person a saw the Facebook ad on their mobile, watched a YouTube video on their mobile, clicked on a mobile banner and subsequently visited the store and buy the product using their mobile wallet. Data doesn’t get much more compelling than that.
That’s why we think Google will buy PayPal or Square to accelerate their mobile wallet. And it’s why Facebook hired the PayPal CEO and have a payments product ready to go.
Apple however has a different agenda and ads don’t seem that big a part of it. Tim Cooks note on privacy a few weeks ago set the tone. They want to sell great products and build what we call Anchors – services so compelling that moving to Android would be a huge effort.
Apple Pay is clearly an Anchor and they have eschewed the opportunity to harvest data from these transactions. This plays nicely to privacy but also to security. When the Target CEO gets fired because hacker stole 40m credit card profiles, security is moving front and centre and Apple don’t want to risk their reputation. The breach of iCloud to steal celeb selfies was damaging but containable. A similar scandal with Apple Pay would not be.
In this in depth look at Apple Pay we can see that the system is built around a new way to handle payments. Whilst complicated, its benefits are really clear. This is much safer than using a credit card in the normal way. (And the fingerprint recognition on the device is also hugely impressive for users)
All the other players are going to have their approach compared to Apple Pay and we suspect people like Zapp will struggle, despite signing up retailers well in advance of their launch.
That doesn’t mean we aren’t going to see real innovation in FinTech –Marc Andreesen believes the whole system is ripe for reinvention
“We have a chance to rebuild the system. Financial transactions are just numbers; it’s just information. You shouldn’t need 100,000 people and prime Manhattan real estate and giant data centers full of mainframe computers from the 1970s to give you the ability to do an online payment.
‘‘You would not today, starting from scratch, invent any of these financial businesses in the same way. To me, it’s all about unbundling the banks. There are regulatory arbitrage opportunities every step of the way. If the regulators are going to regulate banks, then you’ll have nonbank entities that spring up to do the things that banks can’t do. Bank regulation tends to backfire, and of late that means consumer lending is getting unbundled.”
One start up that has been able to disrupt the market is Square – the $billion side project of Twitter founder Jack Dorsey. Despite some negative commentary recently, they have raised more money – $150m at a valuation of $6billion.
And picking up the point we made regarding Starbucks last week, they recognise that payments in and of itself isn’t a problem that needs solving – it’s the areas around it where you find friction. So Square are getting into pre ordering - just like Starbucks. I guess this takes Square into the same space as JustEat and HungryHouse.
A look at the changing music industry. As we have discussed in the past, the future is really good as streaming delivers increased revenues. Its just that the sharing out of these riches may prove controversial.
Finally …we are out and about next week. I’m on a mobile panel at the Facebook Upfronts on Monday morning then talking about location and mobile at an Omma conference in the afternoon. As ever, if you are there come and say hello.