“How data analytics help to monetise the user base in telecoms, social networks media and advertising in a converged ecosystem”

Ajit Jaokar, Brian Jacobs, Alan Moore and Jouko Ahvenainen

This is an airplane book, easy to read and you can get through it in a round trip to Barcelona.   It is not a detailed read as it is about setting up a framework and moves the discussion forward.

The books takes time to set out in the first few chapters that markets are conversations and how if you can understand who is talking to who about what, you have the basic armoury to go into battle.  To understand this you need to appreciate that all those tracks, trails, clicks, messages, blogs, comments that you leave behind in a digital world are there to be collected and harvested. The more data, the more analysis the more value you should be able to create.  The book looks at social networks and there is a brief look at how media agencies work and how they are reacting (or not) to change.

Page 65 starts to look at the telco market and makes the valid point that operators think they own the customer, whereas they should be thinking the could get to know the customer ( difference between monopoly and loyalty!)

In getting to know the customer there are three rules to follow:- give the customer an incentive, an open platform or ecosystem and touch points.  These are then explored.

From Page 75 there is a good summary of Alan Moores Book “Communities Dominate Brands” and brings out the key point of alpha users, those who are most influential in attracting and keeping friends as part of the customer base. 

On page 94 there is a move from the economics and marketing into psychology and emotional behaviour as the book moves to talk about trust and reputation.

On page 112 the book points out that due to the social network, social data and life stream mean that we now have a living profile.  Once the bedrock of marketing, demographic segmentation and lifestyle categorisation; which was fixed for a period of your life and describes strata’s of the population, will now possibly become redundant.  Our new profile built on digital footprints will be living real time representations.  The eternal issue facing us all, however, is how do we extract the value from the data!

The later parts of the book drift into privacy and identity and the impact on people willingness to provide or give up data.

Overall well worth a flight read as it is likely to stimulate new ideas and ways of looking at your customers and the data you have (or should have) and the analysis you do do ( or should do)

Migrating some original work - May 2009

http://myfootprintsd.com/index.html

I am delighted that “Digital Footprints” is a common conversation in the world of teaching.  Most of the material, as with this one, are focussed on asking our kids to take care with what they say about themselves.   I would like to see this conversation extend to help them understand that this is the data that they control.  What others say about you, you cannot control; but what others say also contributes to your digital footprint. 

I understand that conceptually it is hard to teach that digital footprints also include data that describes what you are doing and your behaviour (location, attention, purchases, key strokes, search terms, clicks, time, activity …) but this hidden data is as important, and in many cases more important)

I believe that those teaching need to understand that the model of “public” has shifted.  Digital natives have grown up with the internet and the presentence of data; it is us old guys who harp back to the days of broadcast TV and newspapers where yesterday’s news is already forgotten. 

Going viral is the part of a digital footprint that provides the opportunity and threat.  You want it if your content is fabulous but not to become infamous!

After discover there are 4 phases of digital footprint evolution; on the path to understanding the value of your digital data and how Brands have to re-think segmentation in the digital social media age and focus on the “rainbow of trust”

Discovery. As the title suggests this is the phase where you discover Facebook, Twitter, Flickr, Youtube and you engage with full throttle in this new and exciting social media experiment.

Ø1  Fear. The first impact of digital footprints occurs on the personal realisation that all your digital data can be gathered and analysed. The fear phase represents the understanding that you must be careful about what you say about yourself and others. This is where the digital immigrants focus, spending a lot of time on the education of the digital natives.

Ø2  Spring clean. The second stage is when you wake up and understand that digital footprints are actually what you say, what you do, how you do it, where you do it and also critically important what your social crowd say about you and your information, data and content. This is the spring clean phase where you choose carefully who your family, friends and associates and what content you will post and link to. This could also be known as the un-link phase where you un-link “friends.”

Ø3 Selective. The third awaking is when you realise you are the product of a barter and that web services companies are actually trading your digital footprint data for services.  If you want free services you need to share more and more data and information. Further the web services companies continually want to cross your personal privacy barrier. This becomes the selective phase where you decide to focus on a few web services rather than leave data everywhere.

Ø4 Value.  The next phase of your digital footprint evolution is now less to do with you and your social crowd but is to do with the analysis of your data.  Few people reach this level of understanding as it is about who influences you and who you influence. This is where value can be realised for Brands. 

and the link between digital footprint and segmentation is…

Demographic segmentation leads to the placement of ads in your Facebook profile.  Depending on your age, sex and location you will have a certain propensity to selective ads. As you share more data and information, which builds your digital footprint, you also reveal preferences.  This helps further focus traditional advertising. 

However the analysis of how you behave online and who you watch and listen too starts a whole new process of discovery of who influences you and who you influence. This allows advertisers to create new value for brands as they shift from traditional placement to influence based on a rainbow of trust. Who do you trust and who trust you.  Think recommendation.

The assumption is that the rainbow of trust is a continuum and shows that people have a different propensity of trust, from untrusting to very trusting, and who they trust: a brand, the government, people, things, friends or relationships. The key to gaining value from this segmentation is the analysis of digital footprint data as this allows a Brand to determine the chain of influence.  Who listens to the first message, who passes it on and who it affects?  The analysis determines influence based on value by trust and risk, and not by product or lifestyle.

Conceptually within a rainbow of trust based segmentation, there is no market aligned to age, lifestyle, income, demographics, early adopters or followers. It moves the ideas from the young who explore, and the old who stay with what they know, even if it is not the best. It will be (is now) possible to determine trust as we now have access to the very data needed to determine it.

more reading …. http://www.mydigitalfootprint.com/footprint-cms/MY_DIGITAL_FOOTPRINT_AND_CONVERGED_SERVICES.html

In the book "My Digital Footprint" eight business models were explored, this blog is an update to model 5. If the balance of value is not already in favour of web companies, as they barter free services for your privacy and data it soon will be, as they need more data to continue their growth and seek differentiation but are unable to offer more in return.  The blog presents that there is now a continuous test on the consumer resolve for privacy, the unmarked boundaries of private and thresholds of liberty as web companies find routes to extract more information on you, without you realising.

Content Creation leads to Value Creation

In March 2010 Facebook was estimated to be worth $11.5bn, Twitter $1.4bn, Linkedin $1.3bn and Google $170bn. But why? In simple terms these web companies and many more like them, consist of millions of users creating and sharing large amounts of content which is subsequently monetised through advertising to create these public valuations.

Symbiotic Relationships

When studying the bonds and bridges between the users and these web companies, in the context of privacy, trust, identity, reputation and digital footprints, it clear that there are complex inter-dependencies. Indeed the relationship between the users and the web companies could even be described as symbiotic, as the users and web companies are mutually beneficial participants.

The implied contract between web companies and their users is simple; they'll provide users with free web services in exchange for "permission" to datamine and monetise the users "public" data via related advertising. This is a digital data trade as show in diagram.

Constant Tension

However, there is a hidden cost of this seemingly beautiful symbiotic relationship, the more that users make "public" their data, the more they relinquish their privacy.

It is this tension between the users desire to protect their privacy and limit their "public" data, that contrasts with the monetary needs of a web service business  to access and liberate more of the users "private" data; that is constantly testing the symbiotic relationship. 

Money Talks and Privacy Walks

Although this freemium model is working well during this Web 2.0 era,  advertisers are seeking to maximise their ad budgets through improved targeting and behavioural advertising. A mechanism to make this happen is if web services can convince their users to either make public more personalised information or to unilaterally force through privacy policy changes. To do so might result in users abandoning the web service, to not do so might result in the advertisers spending their budgets elsewhere.

For example Facebook has for sometime been changing their users privacy settings in order to test the users elasticity of acceptability.  On more than one occasion users have protested so vehemently against the changes, ironically using Facebooks own Fan pages, that Facebook have rolled back the privacy settings, only for them to make smaller incremental privacy policy changes later on which the users then seemingly accept.

Only recently Facebook unilaterally chose to remove its users' ability to control who can see their own interests and personal information. Certain parts of users' profiles, "including your current city, hometown, education and work, and likes and interests" will now be transformed into "connections," meaning that they will be shared publicly. If you don't want these parts of your profile to be made public, your only option is to delete them." 

Source: Open Rights Group - 21.04.10

Facebook may have reached a tipping point where the potential value from forcing more openness, by unilateral changes to privacy, for user data outweighs the potential lose of users to an alternative.

Privacy Talks and Money Walks

Of course the fight to retain user privacy remains a tender point as proved by the recent introduction of Google Buzz and the scant disregard that Google placed on users privacy. 

The draconian way in which Google forced every GMail user to adopt Buzz was bad enough but to then set the privacy setting to "public" as a default meant that everyone's email contacts where exposed publicly. Only a deafening outcry across the blogosphere and beyond led to Google publicly apologising for their faux pas and resetting the privacy policy of every user back to private as a default.  Google's monetisation of Buzz may take a lot longer now that users will be more cautious to open up their privacy settings.    

It is not difficult to comprehend that there is a balance between the amount of data that users will or can give up and the level of data that businesses demand for monetisation.

For a symbiotic relationship to develop this balance between brand, trust, privacy, security, risk, identification and value needs to be understood and analysed.  Fear, uncertainty and doubt go hand in hand with the erosion of privacy and liberty, get the balance wrong and the user will not give you data and the web business will not survive. Finding and pushing the balance is the new executive skill.

Adding value through social CRM

Companies, such as Kontagent, Klout, Gravity, Rapportive, Etacts, Grader and Flowtown are building analytical tools that track and interpret the way users behave on Facebook, Gmail and Twitter i.e the Public Interest Graph, particularly how they interact with third-party applications. Such analysis tools help figure out, for instance, which invitations lead to the most registrations and why. Collecting data is one thing, making it useful quite another and that’s the key challenge for every business in this digital era, indeed AMF Ventures would go as far as to say this is the next battle ground of the web.

Disruptive change to a status quo

A well published fact from the dark side of digital footprint data is that the invasion of liberty or privacy, snooping, identity fraud and the subsequent abuse of your data costs £25 per person in the UK Source Identity Theft

Counter to this cost is the economic value created by user data, which is in the order of £100 per user.  Market cap of Google (March 2010) divided across the number of users.  Each user value will increase if Youtube, Facebook and other social media valuations are added to the equation.

Your digital data has value – it is fragmented but users may realise that they don't get a fair trade.  The value created by them is far greater than the free service reward.  Free may be good, free plus cash or share of an IPO for my privacy could be an alternative model for a new entrant who wants to cross the next boundary of user privacy, but at least there is an exchange value.  This could leave those who want to hide their privacy having to pay, rather than free-riding.

The Way Forward

ideas please … and watch facebook’s like button unravel

image from

From previous blog are digital natives poor decision makers

Surly a bigger worry is that the digital natives are not poor decision makers but lose social skills and believe that it can be downloaded.  A digital footprint is not a social life.

More shocking than the next generation is my generation.  At a conference recently I got most annoyed when instead of people talking and networking over a cup of tea (purpose of going to a conference), my 40 something generation got out iPhones and BB and did email and surfed. 

Image from

My comments on the blog post from Michael Arrington of TechCrunch

I am comment 248 in a long line or rant and raves at TechCrunch, in true Arrington style he asserted that individual opinions are so wide spread that you cannot control or mange your online reputation and ultimately the public will grow immune to any indiscretions. 

From what I read the post and the comments miss some critically important points:

1. the web is a live feedback model – what is described in the original post and many of the comments hark back to the old linear print model, simple in and out. The web is feedback, hone, improve, context and build.
2. reputation is not just about “PC, in whatever form it is” generated data, it is about unique mobile data, PC and TV data and mobile data that adds to your reputation is way more important than some small blog about that party lsat week …..     PC crew, get over it, mobile is the new black
3. Reputation is an output from analysis – not an input
4. Reputation is partly about what you say, do and who you do it with and when, but also and importantly what others say and do about and with you. Who do you influence and who influences you.  Some old rant and rave is not important, where you did it and with who is the data that remains and becomes reputation.
5. Reputation is not about control – it is about the ability to trade and barter – your reputation is more that your pictures, it is the “key” or “passport” to services and value.
6. Digital data, Digital Footprint, Digital reputation, Digital Identity is about collecting data, analysing the data and as a business creating value for the user. Taking the feedback from immediacy of use (web, mobile value) from you and your social crowd to improve or create new.

Therefore part agree with the no control and don’t bother trying, however disagree, this data set is the next battle ground for the web.