What the business book of the year gets wrong about digital marketing
“The Age of Surveillance capitalism” by Shoshana Zuboff, a Harvard Business School professor emerita, is a detailed critique of how we’ve allowed powerful corporations to acquire an increasing knowledge of our every digital move, at a depth and breath that threatens to undermine the core of what it means to be human, all in the pursuit of “behavioral modification at scale.”
Its also one of the most recommended business books of 2019, making the New York Times, Bloomberg’s, The Guardian’s, The Financial Times’ and former President Barack Obama’s end of year best-of lists.
The future of business is future prediction
Zuboff’s argument is that modern business is now about collecting vast amounts of data on every aspect of human experience, and that this data, coupled with insights from behavioral economics, is used to identify our future behavior and sell predictions about that behavior to marketers.
That’s a pretty fair assessment of what modern marketing has become. But Zuboff goes one step further. She believes that the breath of data collected and the depth of behavioral modification that can be sold to marketers is threatening people with the ability to make autonomous decisions, undermining our free will and sense of independence. Marketers increasingly know more about consumers than they know about themselves and they have the data, technology and psychological insights to “herd people” around cities at their whim, to achieve their marketing goals.
In Zuboff’s own words “we now face the moment in history when the elemental right to the future tense is endangered by a panvasive digital architecture of behavior modification owned and operated by surveillance capital.”
Are consumers losing their ability to write their own future?
This is where Zuboff goes too far. Advertising has always been a relatively ‘weak force,” because influencing human behavior is really hard. Digital marketing has made us more efficient and accountable in how we target our spend, but has not fundamentally changed the role of marketing in human decision making.
Today, success for the smartest marketers is getting the occasional category shopper to at least consider their brand when doing an online search or reduce the complexity of choosing their brand. Any of these results has a huge impact on marketers’ bottom line. But if we asked the consumers who were involved in these programs, they’d shrug their shoulders with indifference. Did they check out the product reviews on Amazon? Did they shift their arm from the right to the left when they arrived in the aisle. Did they get around to downloading that app? Most of the time they honestly don’t care enough to remember.
Modern marketing remains a “weak force”
When shoppers are broadly indifferent between different types of brands, marketers can be most effective by just making their brands top of mind and/or easier to purchase. But that only works if you’re broadly indifferent about the choice. If you aren’t, banner ads and push notifications, no matter how data driven and targeted, won’t be stealing anyone’s free will anytime soon.
And we see this in the business results of some of the most data-savvy marketers out there today. Despite the billions spent by marketers, most revenue for most brands come from relatively infrequent purchasers. A recent report from McKinsey estimates that only about 13% of most category buyers can be considered truly loyal. For example, even top class marketers like P&G’s Dove brand makes most of its money from people who buy Dove less than once a year. If marketers are gaining what Zuboff calls a “god-view” of consumers behavior and intentions, we’d expect those marketing deities to deliver slightly higher levels of consumer engagement.
Marketers’ ability to understand consumers has been balanced by consumers’ ability to avoid marketers
There’s even an argument to be made that marketers “control” over people has reduced over time. American’s now spend over 50% of their media time in ad-free environments. Older declining forms of advertising like broadcast television and cinema, still deliver higher ROIs than advertising on mobile and desktop platforms. The reason? Its easier to influence people’s behavior when the advertising you’re delivering is on a big screen with the audio on versus a small screen with the audio defaulted to off. Brands as diverse as Pepsi, The Gap and Adidas, that have walked away from more traditional approaches, and gone all in on purely digital marketing channels, have all reported disappointing results.
Ultimately, when it comes to marketers’ ability to influence consumer choice, a fairer assessment of the last ten years would be to call it a tie. For most marketers an increasing understanding of how to influence choice has occurred at the same time that their channels for influencing that choice have become less effective.
The biggest problem with digital platform is ironically their lack of power
What about things people really care about? Hasn’t the rise of digital media been a key factor in political polarization? It has, but for precisely the opposite reason’s Zuboff’s suggests. Rather than living in a world where digital platforms are all-powerful, our current political environment is the result of those digital platforms lack of control over the type of content that is spread on their platforms. This collapse of gate keeper control did not alter people’s preferences, it revealed them. Once marginal actors were able to organize online, reducing the social costs of sharing racist/sexist/nationalist ideologies, revealing new opportunities for political coalitions.
Why is all this important? Zuboff’s book is one of the most comprehensive reviews of how digital has transformed marketing. It raises really, really, important issues. Transparency and control over what data is collected, how it is used is and who has access is to it. The growth of powerful monopolies, raising economic inequality and the psychological stresses of social media. All of these are real issues that need to be address.
Focus on the real problems, not the new hidden persuaders
But instead on focusing on these issues we get sidetracked into 1950s style panic about the new hidden persuaders. Subliminal advertising didn’t deliver mind control in the 1950s, banner ads, personalized emails and push notifications won’t be delivering mind control anytime soon either. We have enough real problems to deal with, let’s not invent new ones.
John, your review is thought-provoking but I think there is a difference in scale: you’re talking about nudges at the individual level, whereas Zuboff is concerned with macro/demographic/social implications. Yet, there is much evidence on how algorithms determine product supply and demand. Ironically, the rise of the occasional consumer you refer to attests to the success of digital marketing in manipulating behavior beyond the heavy user. At the end of the day, the most effective nudges operate at the unconscious level. I feel the future as being both hopeful and sinister. Cheers.