Sunday, January 14, 2007

Good Friction: Authority vs. Score

I've often used the following definition of marketing with my students:

Good marketing removes friction from an economic process.

That is, you can sell a great product with no marketing. But there will be friction between a possible sale and potential customers. You have to show the horse an ad with a pretty picture of the water. Offer a discount on the water. Have a map on your website so that he can be led to the water, etc. All ways to remove various frictions.

Here's a question, though: does removing friction actually ever become a bad thing from a marketing/economic standpoint? My gut reaction is to say, "No." Because friction is bad, right? It slows things down. In business terms, it costs money to overcome all kinds of friction (geographic, time-related, information and language barriers, etc.). For centuries of business development, the manipulation of various "frictional deltas" is what has allowed companies to make profits (sometimes insane ones) not necessarily based on the merits of products or services, but on the relative inability of consumers to utilize or even understand those relative frictions.

For example, if there is any kind of monopoly in a given market, you have the issue of "information friction," where the lack of competition will keep the monopoly provider from really needing to be in any way open with data about products. Trade regulations that encourage competition help inject transparency and remove that friction.

Another example: better communication and transportation. If the only thing that allows me to make a profit on "Product X" is my ability to move it quickly from the point of manufacture to the point of sale, then the only friction I am overcoming is geographic. That is certainly not inconsiderable, and (until we have Star Trek transporters) will never be eliminated. But if a company relies on that as its sole value proposition, then it is at the mercy of anyone who can move stuff with less friction.

The same for communication... which is the basis of most marketing and advertising. If I can do a better job of informing you about the benefits of my product than can my competition, I've decreased friction in my process more than have they. That should help smooth the way for customers to get to me. Whether we talk about hard-sell, data-specific, promotional communications (product benefits, costs, FAQs, where-to-buy, etc.) or emotional, branding communications... both types provide, when done well, the means for customers to more smoothly identify the products in which they have an interest.

So, again... I'm sitting here thinking, "There's no such thing as good friction." Any time you can get something out-of-the-way and make it easier to get that horse to the water, or help the horse decide which water he wants... hooray for marketing, the economic lubricant. All friction is bad.

Except... when you want to slow down.

I've been thinking about the way we measure stuff recently. Both online and off, in games and on Web pages, in real life and in our virtual lives. All the stuff I've been writing here about social networking is, really, an attempt to get my head around ways to measure how we now interact, as individuals and groups, in this new medium. Here are some things that have been bopping around in my brain:

  • A good, solid article in Newsweek by Robert J. Samuelson on economic productivity; that being one of the most basic, gross measures we use as a society. One of the numbers he quotes is, "A century ago, Americans spent 43 percent of their incomes on food and another 14 percent on clothing. By 2002, those shares were 13 percent and 4 percent."

  • An interview at "Boxes and Arrows" with Barry Schwartz, author of The Paradox of Choice. Barry talks about how when you give someone a choice, it's good... until that choice goes up too high.

  • Yet another discussion of the evils of RMT, this one over at Amber's blog.

  • An article on experimenting with ratings from "Life with Alacrity," by way of Raph.

Plus the usual stuff in my head from work about ontologies, folksonomies, etc. etc. Here's how it's breaking down in my noggin' at the moment, and I'm not sure I have any conclusions, but that's not always what this space is for, and you can have your money back if that's what you came her expecting...

RE Samuelson's point about people spending 43% of income on food around 1900, and only 13% now... let's put that into perspective with current stats related to obesity in this country; the CDC estimating that 65% of people over the age of 25 are either overweight or obese. If productivity is partly measuring how well we get food from the farm to the table, well we're doing a bang-up job. Perhaps too bang-up. Perhaps waaaayy too bang-up. Do we maybe need some friction in there?

In the Barry Schwartz interview, he makes the point that when faced with too many choices, consumers just stop choosing. Or they "...choose on the basis of criteria that may be easy to evaluate—even though they aren’t necessarily the most important criteria. The result is what turns out to be a worse decision." There are so little friction between the myriad of producers and consumers (how many results for "weight loss" on Google?), that consumers insert some kind of friction based on criteria that they invent, or on a system that is provided for them (search engine ranking) that may not be appropriate. In an article a few years ago, Barry called this "The Tyranny of Choice." What is apparent, is that plenty of people are willing to work for that tyrant and ride his coattails. If you can present a method of narrowing the confusing array of choices... you may become a trusted source. Even if your method and reasons are suspect.

I won't go into the whole RMT thing in detail, but the basic point I made in a comment on Amber's blog is the same one I make all the time there, on TN and elsewhere: when some players play the game using the internal rules, and others use money to buy skills and game objects, you confuse the essential nature of the game. Is it a game where the rules that were created and balanced by the designers are what encompasses our experience? Or is it a game that also includes real-world economic markers? I don't have anything against a game that uses the latter mode explicitly. That's fine. But if some of the players are mixing money and points, and some aren't, and nobody knows who is doing what... that's messing with the pith and troth of the whole idea of "game."

Lastly... on ratings. The "Collective Choice" article says something at the beginning that's incredibly important. They are trying to "...highlight a number of theories about how to make rating systems more useful." Useful. Most important word in the marketer's lexicon, imho. Give me "useful" over "good" any day.

Because "useful" implies that you are trying to accomplish something. And that means going back to the root reasons for measuring whatever the heck it is that you're measuring.

Which brings me back to friction.

Is "productivity" a measurement that we want to be tracking by percent-of-income spent on food, if that turns into obesity, and that turns into higher health care bills? Do we need a measurement of a different kind of economic "speed?" Can we now take it as a given that we can get food from farms to the plate using less than 1% of the population's time/effort? Not that we don't have hungry people in this country. But they aren't hungry because of macro economic and productivity issues as much as policy ones.

So... is "productivity" an authoritative measurement, or just a score? I mean, it certainly measures something. But is it like a 40th level character in WoW that I bought on eBay or tricked out using purchased loot? Is it "fake tough?"

Is the search engine ranking or Amazon rating an authoritative measurement... or just a score? Does it have a basis in some reality that is meaningful, or is it just easier than slogging through 20, 50, 200 reviews myself? Or actually reading a few pages of a couple dozen books?

How do we build systems that work any kind of authority into them? Do we want to?

Because, I am now thinking, that authority = friction. Not everyone has a degree in or has been granted a PhD in XYZ. It took time, effort, expertise and some kind of mojo to get there. Not everyone has worked as a VP for XYZ company. And not everyone has a blog or site with X thousands of readers, either.

These are different kinds of authority. Some can be faked or pretty easily dummied up, eh? I mean, I'm the president of Sanestorm Marketing, for the love of pete. What does that mean? It means that I decided that that's the name of my consulting business, that I registered that name with the State of Ohio, and that I built the Web site. Anybody who buys into that level of authority gets what they deserve. Which is why I never introduce myself as, "Hi, I'm the President of Sanestorm Marketing." It's true, but it's fake authority.

Score vs. rank. Or authority. Or whatever we want to call it. Because sometimes there is a value in friction; in slowing down. There is a need to not have everything on the plate assume the same level.

How do we judge how to judge? In the old days, the authorities told us that they had authority. Same as the folks who had control over the physical frictions set the rules about how we'd pay for what they controlled. Now we have eliminated more communicative and transportation frictions than ever before. We, the consumers, are communicating with each other, and with the authorities, more than ever.

Who do we want to listen to?

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