Google to hand out devices to local businesses

Recently Techcrunch had a piece on Google giving away 8M devices to local businesses to facilitate checkins, reviews and more…Now to be honest, I actually had a little insider info about his coming down the Google pike. Now that I have had the time to process all the info, following are my thoughts:

1. This device could be

  • A customer-facing  tablet kind of device running android with build-in integration of Google places for reviews and checkins
  • A device to verify your location (ala ShopKick) so that users running a Google app on their phone or other devices can easily receive notifications (key), do checkins, validate coupons and write reviews. Something like this would be pretty cool but might require some standards work to get it working across different devices
  • A device that not only enables user interaction but also allows businesses to run business apps like POS apps etc. on Google infrastructure

2. At the end of the day, this move by Google is about getting more data. Google is really worried about Facebook getting all the user/local data because of FB apps and they want to distribute these devices (they will be expensive to send and maintain) to get some of this data.

3. The important point here is what is in it for local businesses? I think they will be able to see much richer data on their own customers and Google will share the data they collect with each of the merchants.

4. The Apps delivered via such a device could be really powerful as these apps will enable Google to get their hands on the all important sales/market basket data. Businesses won’t mind as the traditional business apps are old and expensive to buy and maintain. If Google can deliver these apps cheaply and easily, it would be powerful.

All in all this looks like a huge gamble on part of Google (could be over several billion dollars worth), but might be justified given the size of the market we are talking about. Still though not having a social graph will likely handicap Google in making sense of this data because  most of the local business customers are driven by word-of-mouth.

Loyalty links of the day

In defense of distraction

Fascinating feature in New York Magazine about how we are dealing with all these technologies that require constant attention and apparently we are not very good at multi-tasking

Over the last twenty years, Meyer and a host of other researchers have proved again and again that multitasking, at least as our culture has come to know and love and institutionalize it, is a myth. When you think you’re doing two things at once, you’re almost always just switching rapidly between them, leaking a little mental efficiency with every switch. Meyer says that this is because, to put it simply, the brain processes different kinds of information on a variety of separate “channels”—a language channel, a visual channel, an auditory channel, and so on—each of which can process only one stream of information at a time. If you overburden a channel, the brain becomes inefficient and mistake-prone. The classic example is driving while talking on a cell phone, two tasks that conflict across a range of obvious channels: Steering and dialing are both manual tasks, looking out the windshield and reading a phone screen are both visual, etc. Even talking on a hands-free phone can be dangerous, Meyer says. If the person on the other end of the phone is describing a visual scene—say, the layout of a room full of furniture—that conversation can actually occupy your visual channel enough to impair your ability to see what’s around you on the road.

The only time multitasking does work efficiently, Meyer says, is when multiple simple tasks operate on entirely separate channels—for example, folding laundry (a visual-manual task) while listening to a stock report (a verbal task). But real-world scenarios that fit those specifications are very rare.

But why do we have this urge to do multiple things?

I’m not ready to blame my restless attention entirely on a faulty willpower. Some of it is pure impersonal behaviorism. The Internet is basically a Skinner box engineered to tap right into our deepest mechanisms of addiction. As B. F. Skinner’s army of lever-pressing rats and pigeons taught us, the most irresistible reward schedule is not, counterintuitively, the one in which we’re rewarded constantly but something called “variable ratio schedule,” in which the rewards arrive at random. And that randomness is practically the Internet’s defining feature: It dispenses its never-ending little shots of positivity—a life-changing e-mail here, a funny YouTube video there—in gloriously unpredictable cycles. It seems unrealistic to expect people to spend all day clicking reward bars—searching the web, scanning the relevant blogs, checking e-mail to see if a co-worker has updated a project—and then just leave those distractions behind, as soon as they’re not strictly required, to engage in “healthy” things like books and ab crunches and undistracted deep conversations with neighbors. It would be like requiring employees to take a few hits of opium throughout the day, then being surprised when it becomes a problem. Last year, an editorial in the American Journal of Psychiatry raised the prospect of adding “Internet addiction” to the DSM, which would make it a disorder to be taken as seriously as schizophrenia.

The most promising solution seems to be meditation to get your executive attention control in shape

The most promising solution to our attention problem, in Gallagher’s mind, is also the most ancient: meditation. Neuroscientists have become obsessed, in recent years, with Buddhists, whose attentional discipline can apparently confer all kinds of benefits even on non-Buddhists. (Some psychologists predict that, in the same way we go out for a jog now, in the future we’ll all do daily 20-to-30-minute “secular attentional workouts.”) Meditation can make your attention less “sticky,” able to notice images flashing by in such quick succession that regular brains would miss them. It has also been shown to elevate your mood, which can then recursively stoke your attention: Research shows that positive emotions cause your visual field to expand. The brains of Buddhist monks asked to meditate on “unconditional loving-kindness and compassion” show instant and remarkable changes: Their left prefrontal cortices (responsible for positive emotions) go into overdrive, they produce gamma waves 30 times more powerful than novice meditators, and their wave activity is coordinated in a way often seen in patients under anesthesia.

Gallagher stresses that because attention is a limited resource—one psychologist has calculated that we can attend to only 110 bits of information per second, or 173 billion bits in an average lifetime—our moment-by-moment choice of attentional targets determines, in a very real sense, the shape of our lives. Rapt’s epigraph comes from the psychologist and philosopher William James: “My experience is what I agree to attend to.” For Gallagher, everything comes down to that one big choice: investing your attention wisely or not. The jackhammers are everywhere—iPhones, e-mail, cancer—and Western culture’s attentional crisis is mainly a widespread failure to ignore them.

Author suggests that some of the predictions associated with the attention problem might be overblown and may be our brains will just adapt to the new stimulus environment…I am not sure but I hope certainly that we can cope.

Tons of data, but does it help?

Some interesting data via mediapost sourced from Andreas Weigend, over at the Harvard Business Blog.

In 2009, more data will be generated by individuals than in the entire history of mankind through 2008. Information overload is more serious than ever.

Andreas is the former Chief Scientist at Amazon.com and an expert in data mining and computational marketing. He currently teaches the graduate course Data Mining and Electronic Commerce at Stanford University.

The second data revolution brought about a new dimension to data creation: users started to actively contribute explicit data such as information about themselves, their friends, or about the items they purchased. These data went far beyond the click-and-search data that characterized the first decade of the web.

There is no doubt that this data is going to help researchers better understand the human network and interactions. But will all this data help companies make money by enabling better targeting?

Well so far, opposite seems to be happening. The places where there is most amount of data – like Facebook etc. – are really struggling with their monetization efforts. In fact not only are these companies not profitable, they are also lagging well behind other traditional media properties in terms of CPM rates they can generate. Could it be that these companies really don’t know how to process this data and once they figure out the right ways to process the data, they will be rich?

I suspect the monetization woes of Facebook et al are not really related to inadequate processing of the data but rather motivation of the users. Its almost like the users of most social media platforms are equipped with a Tivo that ignores all ads no matter how relevant. As such I suspect that even though the ads on social media platforms are more relevant because of all the data, but they get far less traction because of the motivation issues.

So while this huge amount of  data will help us better understand our behaviors, it is unlikely to help resolve the monetization issues plaguing so many social applications.

Google maps targets ads based on addresses

Today I looked up an address for a watch repair shop in Google Search. Then I went to maps.google.com to get a map. Lo and behold, there is an ad for another watch repair shop below the directions.

t1To experiment, I changed the address to one shop before and I am seeing another ad:

t2I changed to a third address…again different ads based on the shop.

t3

So if you look up the address of a shop in Google, google is going to show you an ad of a competing service (I guess one that paid Google)…Isn’t this the crux of trademark case against google? Can an address be a trademark? I would be annoyed if I owned any of these businesses…What do you think?

How we decide?

Just finished reading “How we decide?“, a fine book by Jonah Lehrer

A lot of good stuff in this book…My summary below:

  • Interesting information about the role of automatic nervous system and emotions in controlling human responses to events. It turns out the role of emotions is pretty pivotal in helping us make decisions and in reducing the time it takes to decide. Emotions provide pre-processed chunks of wisdom (I am copyrighting this :-)) and value judgements that obviate the need for a time-consuming and sometimes impossible top-down analysis.
  • Even though emotions are critical, they are not infallible. There are a number of cases when emotions can lead to wrong decisions. E.g. Just think of people voting for Bush because he is guy who one would like to have beer with or people claiming that being anti-torture is the same as being pro-terrorists or people making irrational statements like fight terrorists in Iraq so we don’t have to fight them in the US.
  • Humans are different from other animals because in addition to the emotions we have a powerful pre-frontal cortex that allows us to examine and at times control our emotions. In the book there are a lot of astonishing examples of imagination and creativity shown by people under duress. These people were able to subjugate their emotions in tough situations and come up with solutions that were not prescribed.
  • While the pre-frontal cortex is very powerful, it also is not infallible. The books lists a lot of examples when over-thinking a situations can interfere with the natural emotional response and can result in “choking”. Also by over-thinking we can at times get distracted by irrelevant or marginally-relevant things and end up making wrong decisions.
  • It turns out that our emotional machine is a freaking amazing pattern matching machine…It has a keen knack (based on pre-processed chunks of wisdom) to cut to the chase and quickly focus on the important stuff. The books lists a lot of great examples, studies and experiments that highlight different aspects of the brain.
  • Expectations are key to how our emotional brain works. No wonder they stress so much on managing people’s expectations in business schools.
  • Our emotional brain cannot handle randomness or the freaking amazing pattern matching machine cannot be turned off. Try seeing a list of random number one after the other. Now observe that even though you know that the numbers you are looking at are random, your emotional brain would try to find a pattern and predict the next number. One a new number comes up, again the emotional brain would try to fit that into some patterns and predict again…
    I suspect this inability to handle randomness is a big reason for the popularity of religion. A few weeks back I was having a conversation with a buddy of mine who has become fairly religious. He pointed out a number of coincidences. “These coincidences are signal from god and proof that god exists”, he concluded. I proposed that maybe these signals might be all random events and that he might just be selecting the events that fit into his theory. His response to me pointing out our brain’s inability to handle randomness – but you know god created the brain too (and he wasn’t smiling) – won him the debate.
    Another example of our inability to handle randomness is all these theories about stock market that rely on the shape and direction of the stock chart. Again I suspect people are coming up with these theories like market bottom, symmetrical triangles etc. because of the underlying urge of the emotional brain.

All in all, its one hell of a book. I highly recommend it. Also check out author’s blog for the latest updates on the subject.

Repost from Mashable: Putting Social Media Monetization in “Context”

Reposting an old article that I wrote for Mashable…Reposting it here for context 🙂

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In his post on why the traditional CPM model doesn’t work anymore, Dave McClure breaks the CPM denial balloon, noting that the popular content-centric, keyword-based Google Adword model delivers a click-through rate of less than 1%. Dave posits that the problem is not Google-specific, but reflects the problem with the CPM model in the new world of social networks and distributed conversations.

As an answer to the problem with lackluster clicks, especially within social networks like Facebook, Dave looks to widgets to serve up content based on the interests of individuals:

“The Revolution Will Not Be Televised. It will be Widgetized. Fortunately, that revolution is already happening… it’s called widgets. and Facebook apps. it’s about engaging users via application workflow, and discovering intent. then you don’t have to advertise anymore, you just serve up the stuff that users find interesting.”

Social Networks

What’s clear is that while the appeal of social networks is growing — with 44.3% of U.S. Internet users expected to participate by year’s end according to eMarketer — the CPM model as a means to evoke a response from consumers is not just flailing, but failing.

Ad networks like Lookery, which target Facebook users, have cut ad rates nearly in half. It’s a move that has worked for Lookery in the short term—at least in providing relief to frustrated application developers.

However, cutting ad rates is not exactly the hallmark of a solid revenue model. These guarantees are more like a Band-Aid than the full-scale surgery that is required of online advertising.

Why CPMs Don’t Work

The reason CPMs don’t work in social networks is that they are trying to target new media users using old media technology and thinking. The CPM model asks, “What is the content on the page?” But social media conversations aren’t ON any one page anymore. They jump from one site to another, they take place on a variety of platforms and media types, across blogs and Twitter and FriendFeed and Facebook and MySpace.

In this AdAge article, Steve Rubel talks about the role of social search in the changing role of online advertising:

“Social-network advertising to date… has been a mixed bag. Everyone is innovating, but the draw on social networks is your group of friends. That makes it harder to be distracted by ads. Enter search. Watch for contextual advertising and programs such as Facebook’s social ads. New models will emerge where social algorithms and keywords trigger contextual ads.”

Finding a Solution

It’s clear that a solution to the social media monetization puzzle cannot be solved by content alone. Tools that track the context within which the social media participant engages within various communities are important. Context-based discovery and social search play a role in bringing relevant content to receptive audiences. Interest-based user engagement — based on user context, not content -– tracks interest across various conversations and among the plethora of social media sites.

Knowing – based on her participation across social sites – that a social media participant is a New England Patriots fan who vacations frequently in Hawaii and loves water sports and high-tech gadgets is invaluable to creating a tailored interaction between that participant and companies with offers that are relevant to her.

Universal Profiles

Universal user profiles can inform and strengthen the relationship between social media users, third-party application developers, and advertisers. In contrast to the fragmented identities we maintain in all of the social sites we participate on, universal profiles present a hyperlinked record of users’ participation across sites.

Universal profiles have supercharged the idea of “context” as it relates to the distributed Web, offering the best of both worlds. These profiles track and present the activity of users across communities, while leaving control of the data in the hands of the community or site owner. They are proving to increase traffic for site owners while providing the community with non-intrusive ways to monetize content and build reputation.

This context-based approach to social media advertising offers a creative, secure way to breathe new life into an old model. With a new way to seamlessly present meaningful offers, and even customized environments, to users, advertisers can now understand and appeal to an individual’s online and offline interests based on the fullness of their participation across social media sites. Greeting users on their own terms –- rather than force-feeding them ads based on key words and content — can, over time, transform Internet users from “mouse clicks” and “targets” to fully engaged participants and willing customers.

As founder and CEO of SezWho, Jitendra Gupta brings 13 years of experience in developing and managing software solutions. He holds an MBA from the University of and a B.Tech in EE from IIT Kanpur, India. Jitendra speaks frequently on the topic of context-based search, distributed conversations, and the changing nature of the social web. He has been blogging for nearly two years and occasionally contributes to ReadWriteWeb.com. Jitendra can be reached at jitendra [at] jitendragupta [dot] com.