iPlot

“Brands in the Connected Age” Event in Dubai, Hosted By Sandbox

I'm delighted to participate in the event below in Dubai, curated and organized by my friend Sagarika Sundaram. Looking forward to a hopefully animated discussion!

Press Release

Sandbox Invites Global Leaders of Innovation and Design to Examine “Brands in the Connected Age”

 Gathering Brand and Design Thought Leaders for a Panel Discussion on the Eve of World Economic Forum in Dubai

Dubai-UAE: 31 October 2012 -- A day before the World Economic Forum (WEF) Summit on the Global Agenda takes centre-stage in Dubai, Sandbox, an exclusive global community of entrepreneurial spirits, will bring three members of WEF Global Agenda Councils and the Managing Director of brand consultancy Wolff Olins together in a panel discussion to address the changing dynamics of business and branding.

The panelists will include Tim Leberecht, CMO of global design and innovation firm frog (WEF Global Agenda Council on Values); Brian Collins, chairman and chief creative officer of COLLINS in NYC (WEF Global Agenda Council on Design Innovation); Sujata Keshavan, chairman and executive creative director of The Brand Union in Bangalore (WEF Global Agenda Council on Design Innovation), and Charles Wright, managing director of Wolff Olins in Dubai, UAE.

The thought-provoking discussion will take place on Sunday, 11 November at The Pavilion Downtown Dubai on Emaar Boulevard. Sagarika Sundaram and Fereshteh Amarsy, Sandbox ambassadors in Dubai, will host the evening.

Sundaram, who is a creative strategist at Wolff Olins, will moderate the panel discussion. She says, “Businesses need to get over standardisation – been there, done that. What’s next though? In a world where online peer reviews are the only true advertisements, brands need to genuinely touch a consumer’s heart. Paradox and ambiguity challenge and excite humans, and it’s time for brands to embrace these qualities in order to earn trust. We’re honoured and excited to have pioneers and opinion-makers from across the world explore whether this holds true in different geographies.”

Amarsy, founder of Community Cinema and Director of Special Projects at Meydan IMAX theatre, will introduce members of the first Dubai Sandbox class that evening.

For more information on the event, please visit http://goo.gl/8X2jz

Five Keys To Building A Business That Doesn’t Bury The Humans At Its Core

As business leaders speak of the “Human Age” and claim that capitalism is being replaced by “talentism” -- defined as access to talent as a key resource and differentiator -- many companies have embarked on initiatives to “unleash their human potential.” Those are big words and noble ambitions, and naturally they seem worth striving for. But as one of the hosts of a hackathon in San Francisco this weekend, which invites developers, designers, and other creative minds to “reinvent business,” I have been wondering: What is a “human” business, anyway?

You might argue that the notion of a human business is a category error. Organizations are bureaucracies at their core, and it is hard to think of any formalized collective human endeavor, and especially any business, as being free of rules, structures, and processes. After all, these factors are what ultimately makes corporations (and nonprofits alike) reliable and trustworthy, and grants them their authority. Consequently, there appears to be a fundamental chasm between individual human behavior -- which is expansive and multifaceted, ranging from the rational to the wildly irrational, sentimental, and unpredictable -- and the design of organizations: rational, practical, results oriented, and engineered to perform consistently.

And yet, companies are made up of people who are loving, caring, generous, forgiving, and wildly creative at their best, and incoherent, inconsistent, moody, selfish, arrogant, aggressive--and yes, even violent at their worst (not coincidentally, the corporation, when contextualized as a “person,” has been diagnosed a psychopath in a popular 2004 documentary). Inarguably, every corporation under the sun (well, maybe except for Foxconn’s robot-powered manufacturing lines) is made of and run by humans, and quintessentially based on human relationships. So how can any enterprise not be human?

I prefer the term humanist business. “Human” describes what we are, “humanist” signifies what we want to be. A business might be human because it best caters to the actual, realistic human needs (articulated, for example, by Maslow’s Pyramid of Needs but it becomes humanist only by aspiring to a greater purpose that enables the ideal human condition through its very pursuit.

Humanist businesses offer a community of sympathetic individuals a unique collaboration model to realize what I would consider the five categories of distinctively human potential. They also reflect five qualities that are necessary for any organization looking to redesign how they operate to be more productive and prosperous. These are:

EMPATHY

Empathy is the ability to put oneself into someone else’s mind, to truly feel with and for them. And indeed, if we humans are neurologically “wired to care,” as Dev Patnaik asserts, then organizations need to be wired to care, too. This requires an emotional understanding of the sentiments, dreams, desires, and ambitions of their employees and customers. Amidst a flood of explicit “big data” and confronted with the constant urge to quantify human relationships, empathetic enterprises preserve and refine their intuition -- an appreciation for the implicit and the opaque. Patnaik points to Harley-Davidson and IBM as examples of “open empathy organizations.” The New York Times writes of a recent study suggesting that giving employees occasional altruistic tasks increases their sense of overall productivity. Design Research, the methodology of the creative ethnographer, is helping companies “bond” with their employees, partners, and customers by understanding their daily lives. Empathetic businesses can sense mood shifts early on and readily adapt to new behaviors, long before intuition becomes knowledge.

CULTURE

From “wired to care” to “wired for culture:” With empathy as the foundation, the evolutionary biologist Mark Pagel contends that we owe our success as individuals and as a species to our “social mind,” defined by our ability to form cultures. He considers it the vehicle for social learning and cooperation with strangers in the context of “mutual aid communities.” These communities are based on trust and like-mindedness, that is, familiar mores, traditions, and customs as well as shared values. Culture is key for collaboration, which is why it is such a fundamental asset to every company. The online retailer Zappos says it “competes on culture,” and Nike, Starbucks, and Virgin have all created distinct narratives and tribal identities that turn their brands into movements. Grant McCracken even demands a chief culture officer in every organization, and companies such as Google, Eileen Fisher, and Affinity Lab already have one in place.

MORALITY

Morality is the ability to act in accordance with moral principles, concepts of good and bad, right and wrong. As hyper-connectivity and radical transparency expose all of our behavior in broad daylight, integrity is the only sustainable position in today’s business. Dov Seidman (who is a fellow host of the upcoming “Reinvent Business” hackathon) contends that in our more interdependent world, questions of “how much” matter much less than the question of “how” (how we think, behave, lead, govern, operate, consume, engender trust, and relate to others). As a result, moral businesses match internal and external character, purpose and action, words and deeds, and they no longer tolerate a gap between idealism and pragmatism, between principles and practical reasons. In fact, morality becomes their most powerful product, forging a lasting connection with constituents by “out-behaving” (Seidman) their competition. Case in point: Outdoor clothier Patagonia encouraged potential buyers to check out eBay for its products and to resole their shoes before purchasing new ones. In an even more radical stance against consumerism, the company placed a “Don’t Buy This Jacket” advertisement in The New York Times during the ‘Black Friday’ shopping frenzy. Moral businesses don’t do things right; they do the right thing.

CREATIVITY

Humans create--not only positive things like ideas, things, relationships, stories but also confusion and chaos. Traditional business wisdom holds that trust is earned by predictable behavior. But as most process efficiencies have been exploited over the past decades, variation trumps standardization. To counteract boredom, the “new work stress,” as CNN defines it, successful creative businesses constantly reinvent themselves. For Virgin’s Richard Branson, for example, everything is an experiment. Others vary their marketing presence, guerrilla-style: UK-based Interflora monitored Twitter to identify users who needed cheering up and then sent them a free bouquet of flowers. Similarly, Dutch airline KLM launched a “surprise” campaign, seemingly randomly handing out small gifts to passengers. Amex’s travel service Nextpedition relies on serendipity to create open-ended, custom “mystery trips.” All of these creative enterprises embrace unpredictability as the new consistency. Their leaders are not measured by how much uncertainty they can eliminate but how much of it they can tolerate. Moreover, such enterprises crowdsource the creation process and invite their employees and customers to co-create -- from Dell’s IdeaStorm to Wikimedia’s five-year strategic plan. They are hyper-social organizations but also ones that create space for solitude, moments for the individual to be alone with their thoughts. Original ideas are very lonely, at the end of the day. Or as the choreographer Alonso King once put it: “What is interesting about you is you.” As trite as it may sound, creative businesses give people time and space to be themselves.

You may have noticed that while I have mentioned creativity, I have avoided the term “innovation.” It is because I agree with Bill Taylor when he writes in a recent Harvard Business Review blog post that people don’t want to innovate. They want to dream, empathize, bond, do the right thing, and create. In doing so, they may end up innovating (or as Tim O’Reilly says, “Innovation starts with people having fun”) but what truly drives them is something different.

ASPIRATION

This can be characterized as the quest to work toward a unique mission, whether it is individual advancement, spiritual enlightenment, or social progress. The prerequisite of aspiration is imagination, and its immediate product is hope. Only an organization with vivid imagination, both individual and collective, can envision a bigger and brighter future--and thus provide a sense of hope, the lifeblood of any human endeavor. Aspirational businesses are constantly changing, and they treat their employees as entrepreneurs or “social intrapreneurs,” as autonomous decision-makers and leaders who are inspired (and not just motivated) to act as changemakers across all levels of the organization. (I always ask job candidates: “What is it that you want to change?”) This requires a different kind of alignment--not the traditional one between goals and execution, but one between organizational aspiration and employee passions. At frog, we have established loosely structured “centers of passion,” wary that a too formal setup might stifle the very informality in which passions thrive.

Humanist businesses provide the community and resources for realizing the key human potentials of empathy, culture, morality, creativity, and aspiration. As the new millennial workforce demands meaning over money, and prefers employers that are different by making a difference, humanist businesses shift their organizational rationale from productivity to impact, from excellence to significance.

[image: Janaka Dharmasena]

This post was first published by Fast Company.

The Opposite House

Otherness and other pillars of a new moral economy

“So, what is the reason for your existence?” the German professor at a Chinese business school reception in Shanghai asked me, to start a conversation. I felt like ad man Don Draper in the TV series Mad Men when his false identity is unveiled. Who are you really? Caught off guard, I answered: “I’m a marketer.” The conversation moved on, others had wittier sound bites to contribute, and my unease continued. It had been weighing on me since I had put my foot on Chinese soil a few days earlier, and here in this beautiful mansion, confiscated by the government from the corrupt former mayor of Shanghai, it was a steady companion.

You may think that the homogenized cosmopolitan settings of the tier one cities Beijing and Shanghai would seem familiar and comforting to a seasoned Western business traveler like me, but this time the glitzy, uber-capitalist façade did not alleviate my profound sense of dislocation and alienation. I was a stranger and everything was strange to me. This sentiment was exacerbated when I checked into the Opposite House, a chic designer hotel in Beijing’s Sanlitun village district that literally comprises of two opposing halves, each housing generous rooms, connected through a vast space underneath, which is used as both art gallery and lobby. Designed by the Japanese architect Kengo Kuma and catering to the ‘global soul,’ it was meant to make you feel at home in an open, accessible space of kindness, but it did the opposite to me. It manifested the Otherness of my being here, in the heart of this strange city, with other strangers, who, like me, probably had no clue and so, like me, just marveled at the strangeness of it all.

It occurred to me that the Opposite House was a metaphor for some of the issues I had been pondering for the past few months. “The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function,” wrote F. Scott Fitzgerald, and while his words were infinitely wise, I thought that a more intelligent mind than mine may very well hold the two opposites, in Beijing or anywhere, but perhaps even the most intelligent mind would not necessarily be happy in doing so. It’s hard to be happy if you are denied a happy ending, and it’s an unpleasant, arduous task to withstand the temptation to reconcile dual or multiple truths. We are hardwired to believe – and to believe in one truth.

Having just worked through the intricacies of integrating a marketing function and harmonizing two brands (and very different business cultures), I know how exhausting it can be when there is always ‘the other side of the story.’ This ‘other side’ can be the externalization of effects (responsibility), or it can mean putting yourself in someone else’s shoes (empathy). What the other side rarely appreciates is how hard you have worked to be on yours, and how much effort it has been for you to truly believe in it. Whatever it takes then to make you switch sides (or at least recognize the opposite one), it must include some kind of reimbursement for the intellectual and emotional work that went into asserting and upholding your one truth. The grass may or may not be greener on the other side of the fence – the path there, the ‘empathy dividend,’ better be worthwhile. This is true for conflict management at the individual, institutional, societal, and international level: Israel and the Arab world, Shiites and Sunni, Pakistan and India, China and the US, North and South Korea, Occupy Wall Street versus the 1%, and the list goes on – the world is conveniently framed by antagonisms, by dualities that stubbornly resist both reconciliation and the parallel truths that Fitzgerald heralded.

China resolves dualities by grasping Yin and Yang as complementary, interconnected forces, and its defiance of dichotomous moral judgments is not always easy to accept for the Western mind. Henry Kissinger’s views On China are a notable exception to the many books (e.g. Martin Jacques’ When China Rules the World and James Kynge’s China Shakes the World) that have recently examined how an ascendant and increasingly confident China could affect the rest of us. Kissinger seeks to understand China’s place in the world from the conditions of China’s complicated history and rich culture, not through the lens of Western morale. Kissinger does not portray China as hegemonial power but as an introverted nation that aims at protecting its ideal of a ‘harmonious society’ by making calculated offensive moves. He compares them to the Chinese board game Weiqi where the onus is on strategic encirclement rather than the black and white of absolute victory or defeat. Morality, essentially, deals with the question of how we treat the Other – the one who is not identical with us. Empathy, or even sympathy, is its foundation. With respect to China, this raises the question: To what extent can you leave your comfort zone, your moral center of gravity, to understand the Other before your absolute truth becomes relative, your ethical behavior situational, and your moral compass rudderless?

Moreover, a concept of morality based on Otherness presumes the Cartesian continuum of Ego and Self. But what if the line between Self and Other is fuzzy? In his writings, the British moral philosopher Derek Parfit (who became famous through his teleporter thought experiment and was recently portrayed in this stunning New Yorker article) rejects the integrity of personal identity and instead proposes a reductionist view of human life that renders the Kantian concept of the Self’s moral autonomy obsolete. If parts of your brain cells were to be transplanted into another body, he wonders, what would that do to yours and the other body’s personal identity? Who would be you? Parfit claims there would be two Selves (or none). Consequently, morality, in his view, is meta-personal and non-relational, and can only be derived from universal truths. To him, the loss of the concept of a separate Self is liberating, which puts him him in close proximity to Buddhists, who identify and recognize themselves in the Other:

“My life seemed like a glass tunnel, through which I was moving faster every year, and at the end of which there was darkness... [However] When I changed my view, the walls of my glass tunnel disappeared. I now live in the open air. There is still a difference between my life and the lives of other people. But the difference is less. Other people are closer. I am less concerned about the rest of my own life, and more concerned about the lives of others.” [Derek Parfit]

Sam Harris’ latest book The Moral Landscape: How Science Can Determine Human Values covers reductionist terrain as well, albeit from a very different vantage point. Harris seeks to constitute moral relevance from the alleged objectivity of scientific findings. But do we really want to entrust science all of our moral decisions? Science is not an authority on morality; it is its very subject. The moral landscape is not as flat as Harris wants us to believe. Or to riff on William Gibson: “Morality is here, it is just not very evenly distributed.”

Steven Pinker, in his recent book The Better Angels of Our Nature: Why Violence Has Declined, argues that the spread of literacy led to a “circle of empathy,” propelled by many rights movements of 20th century that brandished immoral behavior as anti-social and by doing so accomplished to largely ban it from Western societies. If you look at the Occupy Wall Street movement – as nascent as it may appear – one wonders if we may see a similar social norm-shifting phenomenon emerge in the corporate world. Writer and Techonomy conference curator David Kirkpatrick wrote a poignant piece on how the new social power we witnessed in the Arab Spring may lead to a corporate revolution, and indeed one may wonder: Will the American Fall usher in the demise of the corporation as we know it?

Trade is an arbiter of peace, as Pinker argues. Collaboration and inclusion produce morale, an effect that is amplified by the tremendous amount of social capital generated by social media and in particular through the principle of reciprocity at work on social networking sites. Facebook, through this lens, can be viewed as the biggest morale producer of our times, not in the sense of giving to charities or supporting causes one click at a time – the so-often-derided ‘clicktivism’ – but through rich interactions and an appreciation and experience of Otherness that is made possible through the voyeurism emanating from the transparency of individual behaviors at public display.

On the other hand, hyper-connectivity may yield the opposite effect: When everything and everyone is connected all the time, will the individual moral Self be neutralized by a seamless collective that absorbs Otherness into Sameness? In this vein, Eli Pariser argues that the Social Web is a self-selecting Filter Bubble, and that rather than experiencing the Other, we’re just experiencing an increasingly narrow projection of ourselves, so that our social graph, based on our web history of purchases, clicks, friends, and likes, will ultimately become congruent with the social universe of One. Then our lives and the lives of others will be identical, and even with our identity spread beyond our Selves, it will not occur in the way Parfit envisioned it.

This debate on the Other is the main debate we ought to have in light of the crisis of our economies. A ‘moral economy’ puts the Other at the center of all its activities, and if it truly does, it will no longer need the qualifier ‘moral.’ However, our largely secularized and rationalized economy is struggling to restore its moral and spiritual acumen (see Umair Haque’s musings on The Meaning Organization and my own piece on the Chief Meaning Officer), and simply borrowing best practices from religion as proposed by Alain de Botton’s “Atheism 2.0” (see a good rebuttal here) won’t suffice when what we are really lacking is not a practical “god-free” tool kit but an idealistic and spiritual vision, a social contract that is meaningful at the personal level. Economist Robert C. Solomon described it aptly: “Markets systems are justified not because of efficiencies and profits but because humans are first and foremost social and emotional beings, and markets provide a sympathetic community for social exchange.” Consequently, Brad McLane, in a recent Huffington Post article, makes the case for the role of a “Chief Community Officer,” a leader who can reconcile individual interests with the satisfaction of trusted cooperation (research has shown that trust and trustworthiness produce oxytocin, the “hormone of love”).

Embracing Otherness has been the foundation for business since its inception – business serves the Other, as in the customer, or the stakeholders of today and tomorrow (future generations), but it has gained new relevance. Another, perhaps more important side to it is innovation. Otherness is the very source of innovation. The deviation from the normal, the conventional, and the routine is how new and different ideas are born – ideas that change the world for the better, which at the end of the day is the entrepreneur’s fundamental moral obligation. This is the legacy of Steve Jobs and other “fools” who “saw the world as it is not” – and changed it.

The new moral leadership starts with business school education. Harvard Business School professor Rakesh Khurana therefore asks for a “reprofessionalization of the manager,” so that he can overcome the self-interest-driven homo economicus, the self-inflicted Machiavellian mechanisms of competition and short-term gain, and instead focus again on his true task – to build and nurture long-term cooperative relationships that allow an economy, a plurality of interactions and transactions between trusted and trusting Others guided by shared values, to thrive.

Back to the initial question: what justifies my existence? As a marketer, it is my responsibility to understand the Others and connect them through many parallel truths – even if it’s just for a moment, a flickering desire, a shared passion and experience, or a common purpose. I am an engineer of trust, and I enjoy communicating for the very act of communicating. I can create and cultivate “sympathetic communities” that rely on “woven interactions” rather than “vector communications.” In the best case, I can help build a house of opposites on the basis of the social capital and goodwill generated by meaningful brands that serve as moral stewards, embrace paradox, and balance the dialectic forces of competition and cooperation, codified behavior and open-ended innovation. I am not here to generate impressions; I am here to reward attention with lasting value.

(c) picture by Coolhunting

Digital Innovation Workshop for Germany’s Largest Newspaper, Sueddeutsche Zeitung

“Journalism is not a profession anymore, it’s an activity,” I heard someone say at a conference in Paris a few weeks ago. Assuming that’s indeed the case – with news breaking on Twitter, commentary provided by popular bloggers, and both distributed via aggregators and social networks – you can imagine newsrooms becoming panic rooms, and the gatekeepers of the public turning into the horsemen of the apocalypse in private.

The profession’s common objection to the burgeoning social web paradigm is “We may all be publishers, but we’re not all editors.” But that claim can be easily countered: Do we still need editors? “If the news is important, it will find you,” asserts Marissa Mayer of Google, and she refers to the emergence of hyper-personalized (maybe also hyper-local) news streams that you can opt into without an intermediary and that come to you via one of the myriad social channels. Just one data point: In January 2010, visitors to nytimes.com spent an average 14 minutes on the site, whereas Facebook users stayed on Facebook.com for an average of seven hours. This begs the question of what’s more important to the newly empowered news consumer: Speed or credibility? Social aggregation or expert curation? Location-based delivery or correspondents on location?

Moreover, content farming (i.e. Demand Media) and other forms of on-demand journalism (i.e. Spot.Us) are fundamentally challenging the agenda-setting oligopoly of traditional media. Then there is the rise of the Mobile Internet: A recent Morgan Stanley report forecasts that it will have outgrown the Fixed Internet by 2015. And of course there is now the iPad and other tablets.

The future of journalism will be social and mobile, whether you like it or not, and it might likely require cross-platform storytelling. Consequently, news organizations are not only rushing to launch tablet versions, they are also shifting their expectations towards reporters: “Aggregating and curating content with attribution should become part of a BBC journalist’s assignment; and BBC’s journalists have to integrate and listen to feedback for a better understanding of how the audience is relating to the BBC brand. If you don’t like it, if you think that level of change or that different way of working isn’t right for me, then go and do something else, because it’s going to happen. You’re not going to be able to stop it.’” Said Peter Horrocks, Director of Global News, BBC.

In light of all these trends, innovation is no longer an extracurricular activity for newspapers; it has become a mandatory task for rescuing the profession of journalism. “Innovate or die” seems to be the only real option. Or, put more mildly: If newspapers don’t just want to age (and ultimately die) with their traditional readership, how do they render themselves relevant for future readers, that is, the generation of digital natives, and their vastly different media consumption habits? (see the random sample of interviews below, polled on the streets of Munich: “How do you receive your news?” – in German).

The good news is that the future of journalism doesn’t have to look all that grim. Every abundance creates scarcity, and for every asset given away for free there are assets for which you can charge. Whether these assets will still be content, well, that’s another question – one of the many questions we asked in an all-day digital innovation strategy workshop that frog held last week at the headquarters of Sueddeutsche Zeitung, Germany’s largest newspaper, in Munich. The paper is read throughout Germany by 1.1 million readers daily and boasts a high circulation abroad. Attendees of the workshop included, among others, the paper’s managing directors as well as the managing editors of the print and online newsroom (which are – unlike at many other news outlets – still separated at Sueddeutsche). The discussion was animated, critical of buzzwords and easy solutions, with lots of food for thought for both sides, and ultimately very encouraging.

With its stable circulation and ad revenue, its strong brand, and its immense popularity both among readers and journalists (Germans call it a “Leitmedium” – an agenda-setting publication that in recent surveys was even ranked ahead of the venerable SPIEGEL in terms of “authority”), Sueddeutsche Zeitung is uniquely positioned to view the digitization of content and the transformative principles of the social web less as an existential threat but a historic opportunity to reinvent journalism.

Meaning-Driven Brands

 

A List of Visionaries/Sensemakers/Disruptors/Game Changers/Contrarians

As the world slowly emerges from the economic gloom, and the “hyper-social real-time web” requires new organizational designs, it’s clear that business as usual will not be so usual anymore. Yet fundamental concerns remain, both for business leaders, who face the challenge of innovating in a hyper-transparent and always-on environment, and for consumers, who are increasingly searching for non-economic values amidst the shattered trust in business and the information overload. Smart companies recognize the historic opportunity to transform the way they do business and provide customers with more value-rich, sustainable, and meaningful products, services, and business models. From “un-entitlement” to “disruptive realism” to “for-profit activism” – here are some of the new paradigms that shape meaning-driven brands.

EMPATHY: GE

GE, which is widely known for its rigorous, metrics-based performance management, is changing course and shifting attention to social intelligence, empathy, and listening skills. The company is putting 1,000 managers through their paces to learn how to react to sometimes imperceptible signs of change. While this is not entirely new at GE or any other company, GE is striking a refreshing tone, admitting that: “We don’t have all the answers.” In A Whole New Mind – Moving from the Information Age to the Conceptual Age, Dan Pink wrote several years ago that “Creators and empathizers, pattern recognizers and meaning makers are holding the keys to the new empire,” and GE, humbled by the recession, is catching up with that insight. It emphasizes context over text, the Big Picture over details, listening over brand control and messaging discipline.

UN-ENTITLEMENT: Alibaba

Ma Yun, the president of Alibaba, the world's largest online B2B marketplace, requested that the 18 co-founders resign from current positions in the company and re-apply for jobs – a radical measure to reshape the company’s culture and administration in order to face new challenges in e-commerce after one decade of fast growth.

UN-MARKETING: Costco

The employees of large US retailer Costco are known to be incredibly loyal, which can be attributed to a host of exceptional programs and benefits to motivate them. It doesn’t hurt that Costco pays, on average, $17 an hour, which is 42 percent higher than the average hourly pay of its fiercest rival, Sam’s Club. And Costco's health plan makes those at many other retailers look Scroogeish. Costco’s CEO, James Sinegal, firmly believes that keeping employees satisfied and committed will result in profitability for the organization in the long run. With such a loyal employee base, Costco can maintain the luxury of relying only on word-of-mouth, not having a PR department, and striving to connect with its customers solely through the in-store experience.

RADICAL TRANSPARENCY: Dachis Group

On the Social Web, companies may soon need to share everything about their business, including complaints, profit margins on particular products, and even corporate strategies. In the spirit of Radical Transparency, companies could even make their live email correspondence public. An open and interactive email feed may propel knowledge sharing and collaboration, but also an ongoing conversation that customers, partners, and global media can join. A first step in this direction is the list of outbound emails (“ABC just sent an email to XYZ”) that the Dachis Group, a global social business consultancy, publishes on its web site. It draws the visitor into a stream of real-time events and provides a snapshot of the company’s social graph. This openness, not to mention the implied social references (in a sense, the email recipients vouch with their name), builds trust.

OPEN INNOVATION: Nike + Creative Commons, Best Buy

Nike is committed to developing products that use sustainable materials and are designed for easy disassembly. In its commitment to protecting the environment, the company is sharing its knowledge so other businesses can do the same. Nike has partnered with Creative Commons and Best Buy to support a shared vision of “creating a platform that promotes the creation and adoption of technologies that have the potential to solve important global or industry-wide sustainability challenges.” Together they have formed the GreenXchange. The project aims to develop strategies for using patents and know-how to facilitate and promote open innovation. In late October, 2009, Nike also entered a partnership with social innovation network PopTech as the first participant in the PopTech Labs to “foster open collaboration on key innovation challenges.” Each of the PopTech Labs will bring together a select group of leading scientific researchers, engineers, designers, corporate leaders, policymakers and other key stakeholders around a single topic of research in areas of vital importance to business, society, and the planet.

Best Buy‘s mantra is “the company as wiki.” The company is tapping into its 130,000 employees to market its brand rather than just relying on the marketing staff to do so. It is a great example of how a major company has redefined its attitude towards control and information.

NOWISM: Zara, TCHO, Zappos

Customers always want it faster, that’s not news. But the implications of the real-time web are more profound and affect the way organizations operate and adapt their business models to the new and ever-changing demands of immediacy. Zara, the Spanish clothing chain, uses customer feedback to develop new clothes, in near real-time. TCHO, the San Francisco-based chocolatier, relies on continuous flavor development and customer feedback to drive constantly evolving versions of its dark chocolate, with variations emerging as often as every 36 hours. Zappos, the online shoe retailer, successfully combines real-time customer service on Twitter with near-real-time product delivery.

GLOCALISM: FC Barcelona

FC Barcelona (“Barca”) was one of the first soccer clubs to be founded in Spain, and it became a haven for Catalan sentiment when Catalan self-government and culture were proscribed during Franco’s dictatorship. The club emerged as the playful manifesto of Catalonia’s spiritual independence, and since then, nowhere has soccer been more fundamental to the sense of identity than in Barcelona. It is ironic that a club rooted deeply in Catalan nationalism has such an international following. But Barca’s appeal is so global precisely because its roots are so local. Barca represents the Catalan people while at the same time creating a sense of belonging to “beauty and excellence.” The meaning of Barca transcends the boundaries of sports and nations, and embodies the universal values of sportsmanship and integrity. Barca is fully owned by its members, unlike most other big soccer clubs – which are either in the hands of large corporations or American (Manchester United) and Russian (FC Chelsea) billionaires – and the members possess significant voting power. Based on its spirit of independence, the club has always taken on broader social issues and played a pivotal role in promoting diversity, tolerance, and peace worldwide. Barca’s partnership with UNICEF is a statement of the club's continuing efforts to be at the forefront of solidarity projects with a global reach. Under the agreement, which bears the slogan “Barcelona, more than a club, a new global hope for vulnerable children,” Barca contributes to the financing of UNICEF humanitarian projects and endorses UNICEF on its shirts – it is the only major European team not to wear an advertisement.

COMMUNITY MARKETPLACE: Etsy

Etsy is an online marketplace for buying and selling all things handmade: clothing, music, furniture, software, jewelry, robots. Since launching in June, 2005, the company has experienced incredible growth with hundreds of thousands of sellers globally. A grassroots community has developed amongst its buyers and sellers, and Etsy facilitates these interactions. For example, Alchemy is a space on Etsy where members can post requests for custom handmade items, and sellers submit bids to create them. Etsy also helps bring its online community to real-world teams (organized by location or type of craft) for its sellers to connect and share ideas. Etsy’s mission is “to enable people to make a living making things, and to reconnect makers with buyers. Our vision is to build a new economy and present a better choice. Buy, Sell, and Live Handmade.”

CAN-DOISM: Coca-Cola

With its Expedition 206 campaign, Coca-Cola is tapping regular people to be their “Happiness Ambassadors” and travel the world throughout 2010, documenting their quests via blog posts, tweets, YouTube videos, TwitPics, and other social media tools. The goal of the campaign is to “find happiness” in 206 different countries that sell Coca-Cola products around the globe. The winning three-person team, selected out of numerous applications, began its journey on January 1, 2010 and is attempting to travel more than 150,000 miles in 365 days. On the way, the team will experience the Winter Olympics in Vancouver, the FIFA World Cup in South Africa, and the World Expo in Shanghai. The team’s duty is to engage with locals and uncover what makes them happy, openly document and share their experiences online, and complete tasks in each country as determined by online voters. The campaign connects the ambassadors, and by proxy, the global Coca-Cola customer base, with locals. Through immersion, it will generate empathy and understanding for local cultures. On the web, the campaign will “activate” a dormant network of Coke fans that will follow the ambassadors’ travels and connect with each other. By connecting people from different cultures, Coca-Cola offers a way of looking at the world and creates social wealth: better mutual understanding through enhanced intercultural knowledge.

ONLINE ACTIVISM: Pepsi Co.

For the first time in 23 years, Pepsi Co. decided not to run any advertisements during the Super Bowl in 2010. Instead, the nation’s second-biggest soft drink maker plowed marketing dollars into its Pepsi Refresh Project, an online community that allows Pepsi fans to list their public service projects, which could range from helping to feed people to teaching children to read. Visitors to the site can vote to determine which projects receive money. The program will pay at least $20 million for projects people create to "refresh" communities. Last year, Pepsi Co. spent $33 million advertising products such as Pepsi, Gatorade, and Cheetos during the Super Bowl, according to TNS Media Intelligence, $15 million of it on Pepsi alone. Ad time last year for the NFL championship game cost about $3 million for 30 seconds, on average. Pepsi Co. spokeswoman Nicole Bradley said Super Bowl ads don’t work with the company's future goals: "In 2010, each of our beverage brands has a strategy and marketing platform that will be less about a singular event and more about a movement."

RADICAL CROWDSOURCING: Victors & Spoils (V&S)

Two Crispin Porter + Bogusky alums have launched Victors & Spoils (V&S), “the world's first creative agency built on crowd-sourcing principle.” V&S says it will “provide businesses with a better way to solve their marketing, advertising and product-design problems by engaging the world’s most talented creatives.” V & S is eating its own dog food. The first line you notice on its web site (after the humble “Welcome to Victors & Spoils. Let’s Change an Industry”) is “Why does this site look so plain, Jane?” and the answer is: because the site design, the look and feel, and even the logo are being crowd-sourced. V&S received thousands of applications for crowdsourced projects in the first week after launch.

CREATIVE CONVERGENCE: British Airports Authority and Alain De Botton’s Heathrow Diary

The Swiss writer Alain De Botton was commissioned by the British Airports Authority (BAA) to spend a week in the middle of Heathrow’s bustling Terminal 5 and write about life at the airport. Dan Glover, creative director at Mischief, BAA’s PR agency, said that “If we funded a brochure that said how wonderful the airport was, people would switch off because they’d think they’re being marketed to.” Instead, he added, the Heathrow Diary campaign sought to stimulate “branded conversations” among travelers “through the experience of seeing a top literary figure at the airport — and potentially being a character in the book — and by receiving an exclusive copy to read on your travels. The overarching objective is to make a passenger’s time at Heathrow the best memory of the trip.”

PRESENCE THROUGH ABSENCE: Maison Martin Margiela, +/-0

Instead of crafting a story around its clothing line, Cult fashion brand Maison Martin Margiela (MMM) has remained swathed in anonymity throughout its 20-year history. Namesake designer Martin Margiela chose to remain out of the spotlight, and it was this invisibility that helped to develop the brand. MMM became a household name and its admirers, devout acolytes of the brand. This cult of impersonality spread through the aesthetic of the brand: Stores are never listed in phone books or identified with signage; staff at stores and at Margiela HQ wear standard white lab coats; white is also the ubiquitous color of all stores, MMM’s HQ, and the sheets that cover all in-store furniture and displays; packaging is monochrome and logo-free; models at MMM often appear on the runway with covered faces; seating is mostly first-come, first-served, avoiding the industry standard of seating hierarchy; and the company uses a first person plural response to all inquiries, emphasizing the collaborative, disciple-like consensus of their thoughts.

Japanese brand +/-0 strives to offer “only the things we need.” In response to a belief that many of the products found in the global marketplace are superfluous, +/-0 seeks to design necessities that last a lifetime. The firm has dedicated its business to creating things that “people feel they have truly wanted. Things that seemed like they already existed but didn’t.” These things enter the market without fanfare. The products are carefully designed so the fact that they are unseen makes them appear to have always been there: “Because these things ‘seem to have already existed,’ people feel comfortable with those things, even though they have never seen them before. It is the feeling of having seen the actual shapes of things that people have obscurely, or even unconsciously, felt they have wanted. That is why these things naturally ‘dissolve’ into people’s behavior and into the space around them.” +/-0 began in September, 2003 in Tokyo. The website launched in December of the same year with the quiet unveiling of the first collection by design director Naoto Fukasawa. Since then, the company has garnered widespread attention in the design world for its understated composition. Fukasawa’s personal philosophy is that he’s designing for the gaps, bringing to life a “shared sense” of what should be there.

DISRUPTIVE REALISM: UNICEF

Disruptive Realism is an expression presented in an everyday context that disrupts people’s perceptions about different things. The most prominent example to date has been Orson Welles’s War of the Worlds radio broadcast, which was meant as entertainment and commentary on how evolution had been twisted into Social Darwinism. Regardless of its intention, the broadcast caused mass hysteria. More recent examples include Banksy’s graffiti, Bruno Taylor’s work, which involves physical designs such as the swing set in the bus stop, or Reverse Graffiti artist’s Paul Curtis’ “Pictures by Cleaning.” Disruptive Realism was also used in a campaign conducted by UNICEF in Finland. Wanting to raise awareness of children’s rights, the “Be a Mom for a Moment” campaign placed unattended blue strollers with a crying baby audio track in crowded places in 14 cities. When passers-by looked in the strollers, they found a note with the message: “Thank you for caring, we hope there are more people like you. UNICEF – Be a mom for a moment.” The media and public reaction was overwhelming, with coverage in all major TV, radio, and web news.

FOR-PROFIT ACTIVISM: Virgance

The San Francisco-based venture fund Virgance aims to support social causes through multi-pronged campaign platforms that resemble the way Obama for America mobilized its supporters, and it typically consists of four core elements: A web-empowered network of volunteers, a presence on Facebook, a team of paid bloggers to promote the campaigns, and YouTube viral videos. Virgance is not the first for-profit-do-gooder of course; there have been plenty of others whose business models combine bottom line thinking with social value. But Virgance is more like Facebook Causes. It adopts the forces of amateur self-organization described in Clay Shirky’s Here Comes Everybody and builds its entire business on a social web platform, embracing the principles of open-sourcing, mass collaboration, and transparency: “If a for-profit company did the type of work that non-profits often do, but did it more efficiently, would people trust it the same way they trust non-profits?”

“It's Been Like Walking Into a Forest With a Match”

For Wired UK’s “Work Smarter” issue (just released), I had the pleasure to speak with John Winsor, co-founder and CEO of Victors & Spoils (V&S), the world’s first creative (ad) agency built on crowdsourcing principles. You can find a shortened article in the Wired UK magazine. Here’s the interview in full length.

Q: V&S launched a few months ago. How is it going so far? How many clients do you have, and can you share some of the work that you are doing?

It's going really well. We're working with a half dozen clients and have done a dozen projects, thus far. We've been doing everything from brand strategy work, to developing digital tools, to design projects. We've just started working on a couple of TV spots and an industrial design project. It's been a fast three months. You'll see the work start rolling out the door in the next few months.

Q: I guess it's one thing to have a bold idea like crowdsourced advertising and another to actually do it. What made you believe that this might be a viable business model?

I think what we're doing is bigger than just crowdsourcing. The rise in digital connectivity has fueled new ways to use co-creation, mass-collaboration and open-source innovation as powerful tools for business. I've been a firm believer in these disruptions since I wrote my first book about co-creation, Beyond the Brand, in 2004.

Likewise my career has benefitted from several disruptions. First, the rise of desktop publishing allowed me to start a publishing company, Sports and Fitness Publishing. Without the revolution that Apple started with the Macintosh, along with Quark and Adobe's help, I would have never been able to afford to go into the magazine publishing business. Likewise, the rise of other digital technologies allowed me to build Radar Communications, by combining the worlds of anthropology and journalism to provide a new way to do brand strategy and market research. And now, Victors & Spoils wouldn't even be possible without the communities of talented people that are aggregating online.

Of all the disruptions I've had the opportunity to build businesses upon this is the greatest opportunity in my career.

Q: With Starbucks, Best Buy, and other big brands launching crowdsourcing platforms, some industry observers seem to believe that crowdsourcing has jumped the shark. Is V&S the logical end of the line or are we going to see more crowdsourcing, across other creative disciplines?

I think we're seeing a bigger and deeper change going on in the way we work. Every time a new technology disrupts an industry, there are those who try to protect the current way of thinking. While this current digital disruption might seem like a new and frightening trend to those how hold on deeply to the current paradigm.

Just look at history. During the Renaissance, in the middle of the 15th century, there was a similar disruption happening that was shaking the pillars of the then current media world. The methodology of using movable type on a printing press, developed by Johannes Guttenberg, was spreading like wildfire, making books more accessible throughout Europe, allowing a whole new generation to have the tools that only a few held. At the time, books were produced by an elite group of monks in a few monasteries. These scribes were the media elite of their day. As it became more obvious that the new disruptive technological changes produced by the printing press some felt the need to turn the page back. In 1492, Johannes Trithemius, the Abbot of Sponheim, a well-known monastery, wrote, In Praise of Scribes. In it he wrote, "We must preserve the old order at any cost." Yet, he had a problem. If he used scribes to produce the book it might take too long to stop the tide of the disruption caused by the printing press. Instead, he used a Guttenberg press to print In Praise of Scribes, only accelerating the change.

The same thing is going on now. Agencies are trying desperately to protect the old way of doing business while bigger cultural trends are shifting the sand below their feet.

Q: If the crowd turns out to be more creative than specialized professionals, will that be the end of the creative industry?

It's only the beginning. How much creativity was there when only monks could write books? Likewise, Apple and Adobe have ushered in a new age of democratization of creativity. The current trends of mass-collaboration, co-creation and crowdsourcing, based on mass connectivity are only further democratizes creativity. Just look at You Tube. When digital tools become cheap enough everyone can gets involved. Now, it's a question of what's good content and what's bad content. But often, that's a matter of personal taste.

Q: Some people say that your radical crowdsourcing approach might just be a PR stunt to get some publicity around the launch but that V&S will eventually become a more traditional creative shop or at least a hybrid of crowdsourced and expert services. What do you tell them?

For us, it's been unbelievable. It's been like walking into a forest with a match. Sure, we wanted to start a fire and build a business. The cultural conditions have been right for something much bigger. We've gotten calls from several of the most progressive CMOs in the world. They are tired of paying too much money for too few good ideas. They want change.

It used to be that creative quality and price were diametrically opposed. The more you paid, the better quality you could get and vice versa. It was an "or" relationship. You could get quality or price. Certainly, that's been the way the current advertising and design world works. What we're seeing is the opposite. Two things are happening. First, with our own projects and with projects like Unilever's Peperami's crowdsourced scripts project on Ideabounty, talent rises to the top and wins. Our contention has been that in truly free markets, the best work produced by the most talented people rises to the top. It's not blocked by internal politics or hierarchical competition that can smother the best ideas inside big organizations. And, it's only accelerating, many of the most talented creatives and strategists are starting to play around and do work on the new digital networks that are emerging. We've also found that in an apple to apple comparison with the projects we're working on, clients typically save 75% in their creative fees for the same quality. Projects that used to cost $100,000 now can cost $25,000 (or $1,000,000 is now $250,000) for the same quality. We're seeing that with the same strategic and creative direction, results are very similar. Clients are telling us they want to leverage the power of "and." They want the best creative work and pay the best price. That's what we're trying to do. We're using the latest digital tools to provide the best creative product for the best price. Crowdsourcing is only one of the tools to accomplish that goal.

Q: How do you hire, and how do you manage the crowdsourced creative department? Is it limited to a submission of "big ideas" or do contributors collaborate on projects from start to finish?

The first thing we've noticed is that there are lots of different ways to use co-creation and crowdsourcing to solve marketing and product design problems. We've run projects on Crowdspring, 99designs and GeniusRocket. All of these platforms are good for different things. They get a lot of people involved in a project. But it's easy to get overwhelmed by the number of entries. And, Sturgeon's Law, that only 10 percent of any large group of creative output is good, definitely applies. In these large community crowdsourcing projects it takes a lot of creative direction. One of our core principles is "Victors" instead of "Victor" or paying many winners instead of just one. We do this with every project we run.

Another way we've been using the community for projects is by selecting small groups of people from our 500+ strong creative department, a global network of some of the best creatives and strategists in the world. In these projects we've been inviting 50-100 folks to participate in a project, selecting between 6 and 12 finalists to compete. In these cases, the finalists get a fee for participating. There is then another fee for the winner of the competition. These smaller, swat team efforts have been working well with all kinds of projects from more complicated design projects to strategy and brand platform projects. One of the advantages has been the ability to keep projects more tightly controlled confidentiality and the ability to creatively direct more complicated projects. But, unlike the larger public projects, the sheer number of ideas is more limited. There are lots of tools in the toolbox and surely more are coming.

It still comes down to the strategic and creative direction to make sure the work produced by any crowd, either internal or external, pushes the work forward in the right direction to accomplish a client's objectives.

Q: How do you pay your crowd(s)? Do they receive a percentage of the client fees? Are there several layers of contributors with varying payment levels? Do contributors have any influence on V&S' strategic decisions?

Yes. We have many different payment models, as described above, and are constantly developing new ones. People in our creative department have a ranking based on their reputation. And, we constantly ask the department to participate in decisions. This space is bigger than all of us and is constantly evolving.

Q: You previously worked at Crispin Porter + Bogusky (CP+B), a legendary firm with a distinct brand. With V&S, how can you develop a creative identity over the long term when your creative is crowdsourced? How do you maintain your quality standards?

Working with guys like Alex Bogusky and Chuck Porter was an honor. Alex and Chuck are fearless the way they approach work and life. The attitude is the key ingredient of making CP+B what it has become. Quality and consistency of the V&S brand comes from great strategic and creative direction. My two partners, Evan Fry and Claudia Batten, are two of the best. The three of us spend a lot of time developing the V&S brand. So far, we feel like it's going pretty well.

Q: You write on your blog that "Brands need an alternative to current ad agencies and crowdsourcing platforms. One that offers the strategic direction, engagement and relationship management that agencies deliver today but one that also delivers engagement, connectivity, creativity, and ROI that crowdsourcing platforms have the potential to deliver." How does V&S measure ROI?

We believe that marketing and product design should be judged on how it affects sales and profits for our clients. At the end of the day, that's what they're being judged on. We do work with clients to develop goals for every project. Each project has a different ROI metric. That said, when clients are saving 75% on their creative investment to start with they can achieve their goals much more easily. They also have the ability to try a lot more creative ideas.

Q: At CP+B you launched a product innovation group, and now you have set out to innovate the entire creative industry. In your opinion, what are the biggest barriers and challenges that stand in the way of organizations becoming more innovative?

When Alex Bogusky and I were doing research for our latest book, Baked In: Creating Products and Businesses that Market Themselves, we noticed that the biggest stumbling block to being more innovative for most companies were the internal silos that have been created. Marketing is a silo. Product Design is a silo. Innovation is often its own silo. To be more innovative companies must knock down the internal silos and start to get everyone working together.

Q: What business innovation are you still waiting for?

I'm really looking forward to even more collaborative digital tools, especially video conferencing technology.

[photo credit: David Sykes for Wired UK)

Privacy Is Over. Here Comes Sociality.

As widely discussed by privacy advocates and blogs, Facebook recently changed some of its privacy settings. Users are no longer able to limit the viewing of their profile photos, home towns, and friends lists to only approved friends. Those are all public now by default. Moreover, Facebook’s new default settings “recommend” that dynamic content such as status messages and photos be made public. While the blogosphere still closely scrutinizes these changes and is aghast at Mark Zuckerberg’s ‘privacy is over’ claims made at the Crunchies awards (he didn’t actually say it verbatim but his statements more or less implied it), I have to admit I was surprised that all this stirred such an uproar. Facebook is only reacting to a larger social trend as it strives to become an asymmetrical and therefore more growth-enabled network (or communications platform) – like Twitter. Privacy, at least a more traditional notion thereof, is the collateral damage of this strategic agenda. With the value of reciprocity (narrowcasting) succumbing to the prospect of exponentiality (broadcasting), privacy is no longer commercially exploitable. “No one makes money off of creating private communities in an era of ‘free,’” writes social networking researcher Danah Boyd in a blog post in which she otherwise harshly criticizes Facebook’s move. The age of privacy as we know it might be over indeed. Is it worth fighting for?

Privacy (from the Latin ‘privatus,’ according to Wikipedia: “separated from the rest, deprived of something, especially office, participation in the government”), the “right to be let alone,” is considered a human right in most parts of the world, in spite of all cultural relativism. Historically speaking, privacy has undergone a remarkable evolution. Aristotle distinguished between the public sphere of politics and political activity, the polis, and the private or domestic sphere of the family, the oaks. If a citizen of Athens was a private man, then it meant he was stripped of any political office and therefore considered “inferior.” Later, in the enlightened civil societies of Europe, however, privacy became a hallmark of the bourgeoisie, a hard-earned privilege that marked the delineation between upper and working classes. The latter had work – if they were fortunate – the former “had a life,” because they could afford it. This life tended to be private, by definition. In the emerging information economies of the 20th century, various theories described privacy as control over information about oneself (Parent, 1983), while others defended it as a broader concept crucial for human dignity (Bloustein, 1964), or emphasized the social aspect of it with regards to enabling intimacy (Gerstein, 1978; Inness, 1992).

Throughout their historical mutations, the public and private spheres needed one another like yin and yang. Having a life was a private act, but only if it was publicly earned and respected. This dialectic relationship will always remain. There is no privacy without publicy and vice versa. And yet, while privacy may never go away as a philosophical counterweight to publicy, today it is publicy that counts as the new privilege of the digital upper class. Privacy has been marginalized to the fringes of a society whose modus operandi is based on the very public mechanisms of social sharing. In the digital era, a private life does not exist. Google ergo sum.

The search engine’s recent public stance against the Chinese government, threatening to shut down all its China operations after Gmail accounts of Chinese activists had been hacked, highlights this new power structure and the evolving value of privacy in our ever-connected world. When the privacy of Google’s users was violated, the company decided to respond with a public statement, mounting public pressure to press on an essentially private matter. Good for a company that does not want be evil, many people applauded, but it bore a certain irony that Google acted as de facto digital state with its own foreign policy. Isn’t Google, after all, built on the very principle of making private data public? Isn’t it because of Google’s mission “to organize the world’s information and make it universally accessible and useful” that we have come to terms with the fact that our online lives and afterlives will never be private again and will be perpetually archived in the very public cloud?

In the case of Google vs. China, what was bemoaned as the loss of privacy was in fact the lack of publicy. Privacy is the most precious asset in more or less closed societies in which trust is a scarce resource and true publics don’t exist. But as we live our lives in the openness of the web, isn’t it publicy that we need to enable and protect? An ideal publicy that is so transparent and democratic that it doesn’t need privacy as refuge?

It’s complicated. Stowe Boyd has declared this to be the “Decade of Publicy,” in which he expects “the superimposition of publicy on top of, and partly obscuring, privacy:”

“Publicy says that each self exists in a particular social context, and all such contracts are independent. (…) It’s as if we are gaining the ability to see into the ultraviolet and infrared ends of the social spectrum when we are online, and in some contexts we are dropping out yellows or reds. To those tied to the visible color spectrum we are habituated to, this new sort of vision will be 'irreal.' But ultraviolet has always existed: we just couldn't see it before. (…) This will be a fracturing of the premises of privacy, and a slow rejection of the metaphors of shared space. The principles of publicy are derived from the intersection of infinite publics and our shared experience of time online, through media like Facebook, Twitter and Tumblr. The innate capability we have to shift in a heartbeat from a given public, and our corresponding persona, to another, is now being accelerated by streaming social tools. This will be the decade when publicy displaces privacy, online and off.”

As we struggle to maintain the traditional, monolithic privacy-publicy dichotomy, perhaps we must start using a different terminology altogether and embrace a new concept: sociality. In a hyper-individualized society, sociality is becoming the main object of desire for individuals. Or as Markus Albers puts it in his forthcoming book about what he coins the Meconomy:

“The Meconomy does not entail a purely egoistic philosophy. On the contrary, it promotes a new culture of empathy and social engagement. As we increasingly decide for ourselves how, where, and with whom we work, the search for meaning gains more importance. The trend to combine economical with social engagement grows stronger. We want to do good, be happy, and make money. In the old patriarchal, hierarchical, and inflexible working world, these aims were often mutually exclusive. In the Meconomy, their combination is almost a precondition for success.”

The semantic coincidence is telling. “Me” desires “Meaning.” As much as publicy needs privacy and vice versa, the “Meconomy” needs the “Meaning Economy” – as its co-evolutionary, symbiotic partner. With meaning emerging as the core currency of all market interactions (because it is ultimately what consumers buy; and friends, fans, and followers buy into), people, organizations, and brands that provide meaning will be the power players of the new Me(aning) Economy – brands like Apple, conferences like TED, contests like the Olympic Games, sport clubs like FC Barcelona, media organizations like NPR, non-profits like UNICEF, and, yes, politicians like Obama.

Sociality may succeed privacy because it is a critical precondition for meaning. To be meaningful, meaning needs to be shared, and sharing can only occur in open social settings. Open social settings, however, by definition, compromise privacy, in all its four textbook modes (solitude, intimacy, anonymity, and reserve). Meaning means giving things a name, making sense of “Black Swans,” unexpected events. In other words: Only an event that becomes a story (which still is the most powerful social media of all times, a true evergreen on the social web!) is meaningful.

Thus, it makes sense to replace the strict privacy-publicy opposition with a multi-layered continuum along progressive levels of sociality. Sociality may turn out to be a much better variable for describing and regulating our digital lives. The question then no longer is how private we can be, but how social we want to be. Instead of privacy seetings, we should speak of sociality settings: The maximum number of friends we want to have; and through which channels we want to ‘socialize’ our contents etc. Privacy understood as sociality (as an enabling and not a defensive right) grants us the ability to control who knows what about us and who has access to us, and thereby allows us to vary our social interactions with different people so that we can control our various social relationships at different levels of intimacy.

This new sociality is most visibly manifest in online social networks. It is worth noting that these not only mirror the mechanisms of offline social interactions but actually provide users with more control over their privacy (or sociality) than they would ever have in the physical world. On Facebook and other networks, you can pick and choose the people you want to meet and share ‘presence’ with; in a restaurant, bar, and other public spaces, you can’t. Exclusivity in the real world needs to be earned, whereas online it is a given.

Bill Thompson pledges we should embrace the new liberties that come with this new radical transparency:

“The enlightenment idea of privacy is breaking apart under the strain of new technologies, social tools and the emergence of the database state. We cannot hold back the tide, but we can use it as an opportunity to rethink what we understand by 'personality,’ how we engage and interact with others and where the boundaries can be put between the public and private. Those of us who are ahead of the curve when it comes to the adoption and use of technologies that undermine the old model of privacy have much to teach those who will come after us, and can offer advice and support to those who might be unhappy to have their movements, eating habits, friendships and patterns of media consumption made available to all. But every Twitterer, Tumblr, Dopplr or Brightkite user is sharing more data with more people than even the FBI under Hoover or the Stasi at the height of its powers could have dreamed of. And we do so willingly, hoping to benefit in unquantifiable ways from this unwarranted – in all senses – disclosure. I'll argue that we are in the vanguard of creating not just new forms of social organisation but new ways of being human.”

All this openly shared user data represents not only an enourmous amount of social capital but also a huge collective leap of faith. Whether the big digital platforms and ecosystems will honor this trust to maintain civic publics or if they will choose to exploit it for (private) economic reasons, at any price, will be one of the defining moments of this young decade and the most impactful decision it will have to make. Control (as the catalyst of privacy) is good, but trust (as the catalyst of sociality) is better. We can afford to lose our privacy, but we will not survive the loss of sociality.

[image: Geekologie]

Time for Marketing Innovation 2.0

(video from Rory Sutherland's TEDGlobal talk)

For the first time in 23 years, Pepsi Co. has decided to not run any advertisements during the Super Bowl in 2010. Instead, the nation’s second-biggest soft drink maker is plowing marketing dollars into its "Pepsi Refresh Project," an online community that allows Pepsi fans to list their public service projects, which could range from helping to feed people to teaching children to read. Visitors to the site can vote to determine which projects receive money. The program will pay at least $20 million for projects people create to "refresh" communities. Last year, Pepsi Co. spent $33 million advertising products such as Pepsi, Gatorade, and Cheetos during the Super Bowl, according to TNS Media Intelligence, $15 million of it on Pepsi alone. Ad time last year for the NFL championship game cost about $3 million for 30 seconds, on average. Pepsi Co. spokeswoman Nicole Bradley said Super Bowl ads don’t work with the company's goals next year: "In 2010, each of our beverage brands has a strategy and marketing platform that will be less about a singular event and more about a movement." Pepsi's remarkable decision epitomizes the new paradigms of marketing: Online instead of TV; many-too-many instead of one-too-many; engagement instead of advertising; sharing instead of broadcasting; movements instead of events; communities instead of campaigns.

While one of the world's foremost consumer brands has acknowledged the signs of the times and is making the transition away from one-to-many mass-marketing to social marketing with meaning, marketing theory is struggling to catch up and grasp the new realities. An article on "Rethinking Marketing" (by Roland T. Rust, Christine Moorman, and Gaurav Bhalla) in the January issue of the Harvard Business Review (HBR) is the latest example. HBR deserves credit for recognizing the need to reinvent marketing, but the piece turns out to be far less radical than its title would suggest. The authors are putting the onus on the customer, demanding that marketers focus on the customer as the sole parameter of their efforts. In their eyes, this requires a shift from "pushing individual products to many customers" through the means of one way mass-marketing to "engaging individual customers in two-way communications,” building "long-term customer relationships" that provide value beyond one-off product promotions. Consequently, the authors argue, the marketing department needs to be reinvented as a "customer department," with the Chief Customer Officer replacing the Chief Marketing Officer, and "product and brand managers subservient to customer managers."

What a depressing read! First of all, the article rehashes existing concepts but doesn’t really offer any kind of "rethinking." To engage customers in two-way, personalized communications rather than marketing individual products to broad audiences is a no-brainer, and after hundreds of books and thousands of best practices it has already become so commonplace in the field that it is hard to believe HBR considers this to be an original concept. It's like social media never happened. On which analog planet did the authors live in the past three years? The concept of radical customer focus is not entirely new either and has been well-articulated before (i.e. in the book Chief Customer Officer by Jeanne Bliss in 2006, and most recently, with a more anthropological spin, in Chief Culture Officer by Grant McCracken).

But aside from the lack of originality, I also substantively object to the concept itself. While the authors' emphasis on "customer profitability" rather than product profitability and a long-term view on value creation are in theory good intentions (and a response to the demise of the concept of shareholder value, as Roger Martin lays out in his essay on "The Age of Customer Capitalism," also in the HBR January issue), I don't agree with the conclusion to turn the marketing department into the "customer department." Embracing a naive belief in customer-centrism, the HBR authors downgrade marketing to a discipline of tactical execution when in fact this time of disruptive digital technologies and changing consumer behavior presents a tremendous opportunity for marketing to reassert itself as a key strategic function in the enterprise. An extreme customer orientation, as propagated by the authors, ill-conceives the legitimate and important customer perspective. Of course it is paramount to understand customers' needs, of course companies need to ensure customer satisfaction, and of course CEOs always score when they tout the customer as their company’s raison d'etre. But that doesn’t mean the customer is the measure of all things.

The truth is less simplistic than a "customer happy, all good" approach would suggest. In addition to their customers, businesses have other stakeholders to serve: investors, employees, the community, and the broader public, as well as future generations and other constituents that are indirectly affected by the externalization of a company’s business. In fact, one could argue that the customer's demand is mostly short-term, not to say short-sighted, whereas the corporation can and should pursue a long-term perspective on value-creation that combines individual and social value, even if the latter may at times actually conflict with what customers want. Reducing the role of the company to just responding to customer needs drastically limits the critical role businesses can play in society, and it hampers companies' ability to drive real change. When it comes to innovation and marketing (according to the venerable Peter Drucker, these are the only two basic functions of an enterprise, and – if I may add – in good marketing organizations they are one and the same), companies should be empathetic to customers (that is, "Wired to Care," as Dev Patnaik put it in his book) but not reactive. Innovation – truly disruptive innovation that moves entire industries forward and gives our lives new meaning – never happens by just meeting existing customer needs, nor by anticipating unmet customer desires, as the apostles of customer research would like us to believe.

Don Norman, author of The Design of Future Things, among other books, and a long-time advocate of the business value of design, recently shocked his peers by coming to a similar conclusion. In an outburst of self-criticism, he belittles the impact of observational design research (or "ethnographic research") on innovation. In his eyes, design research may propel incremental innovation, but the only true driver of game-changing disruptive innovation remains technology: "Design research is great when it comes to improving existing product categories but essentially useless when it comes to new, innovative breakthroughs." Design research studies how people live, seeking to unearth unmet needs but Norman insists "Major innovation comes from technologists who have little understanding of all this research stuff: they invent because they are inventors." To support his point he refers to a list of inventions that all occurred without customer research: the airplane, the automobile, the telephone, the radio, the television, the computer, the personal computer, the Internet, text messaging, the cell phone." You might add the iPod and the iPhone, both creations of a company that famously refuses to conduct any customer research. The old Henry Ford line comes to mind ("If I had asked people what they wanted, they would have said faster horses") and along with it the provocative question: Can customers look beyond their individual needs? Can we rely on them to recognize what's good for society? Can we expect customers to dream up future products and services? Can we even expect them to know (or to show, as design researchers would say) what’s good for them now? Unlike Norman, Roberto Verganti would not categorically say no. A skeptical design thinker, Verganti, in his book Design-driven Innovation, emphasizes the need for "interpreters" (who can be designers but also any other species with an interdisciplinary mind- and skill set) to "radically change the meaning of things."

Both Norman and Verganti herald marketing as a creative discipline. If marketing lives up to its mission – creating innovative products and services and finding meaningful ways to make them valuable for customers and society at large – it needs to be a step ahead of customers. Customer research can inspire and validate but it can never replace the inventiveness and ingenuity of excellent marketing. Only mediocre marketers – those who lack fresh ideas and/or the guts to put them into action – rely heavily on research to back up their decisions. They end up as me-too's and yield good enough results with good enough tools. That's fine. But if you set out to "rethink" marketing, you must shoot a little higher.

The rest of the marketing thinkers do not do much better. In a way, the HBR article is indicative of a lack of vision across the industry. Since Malcom Gladwell's Tipping Point, there has not been one single book exerting comparable influence on the profession. CMOs' by-lined articles in industry trades usually play it safe and state the obvious. The myriad social media consultants who have popped up over the past few years, as well as marketing expert bloggers, boutique agencies, and industry outsiders are all preaching the social marketing gospel to the choir (or to those few remaining on the other side of the "new digital divide") in their publications. Even at conferences such as SXSW, next, the Conversational Marketing Summit, or Marketing 2.0, which are usually ahead of the digital curve, marketing thinkers have been beating a dead horse this year, more or less citing the same set of principles, practices, and case studies. At next09 in Hamburg, Get Satisfaction's Lane Becker, who spoke before me, and I were cracking up when we realized that we were referring to the same case studies in our presentations, the usual marketing 2.0 suspects: Zappos, Skittles, Best Buy, Starbuck's My Idea, Threadless, and so on.

As we are entering the new decade, it appears as if the marketing discipline, after undergoing a mesmerizing major transformation in the past two to three years, is facing stagnation. This often occurs when pioneering concepts are fully absorbed by the mainstream: Social marketing is on the way to becoming THE marketing, as social media is becoming THE media (it is always a sign of broad adoption if adjectives are dropped). Authenticity, engagement, meaning, communities, social, conversations, transparency, etc. – they're all accepted across the industry and widely implemented now. What then is the next frontier for marketers? What will be the next big marketing innovation?

The Tears of a Wise Winner

"The future will be dark." Pep Guardiola, coach of FC Barcelona, on the eve of winning the FIFA Club World Cup Championship, the 6th title in row in one year, an unprecedented accomplishment for a soccer club

Going Human with Shy-Tech

I attended the Trendforum in Munich last week (frog was a sponsor), a two-day conference that gathered European innovation, marketing, and R&D executives to explore emerging technologies, social trends, and innovative business models. The program was eclectic and the content mostly of high quality. I was particularly intrigued by the opening session that intersected macro-economic forecasting with geeky trend evangelism as well as a humanistic pledge for meaning-driven business (in fact, the other sessions didn’t even come close, including special guest Ray Kurzweil, whose remote keynote, given by way of 3D-holographic projection, remained utterly flat).

As the first speaker, Dr. Markku Wilenius, Senior Vice President, Economic Research and Corporate Development with Allianz SE, set the framework by introducing overarching future themes, key challenges facing mankind, from climate change to water scarcity to demographic developments. Forecasting the economic development over the next two decades, he predicted redefined notions and metrics of both societal progress and individual success, and heralded “true value accounting” that would ultimately “decouple consumption from growth.” In ten years, he argued, easy and seamless sustainable choices would have become the norm, as would have “smarter systems.” Wilenius identified four key consumer trends, all to be filed under Consumer Empowerment: Downshifting (simplicity -> value for money, price sensitivity, discounts); Transparency (clarity -> open communicatons, clear essence); Selfness (control -> self-governance, tangibility); and Age of Less (substance -> long-term thinking, lightness). Despite the daunting challenges in these times of crisis, his outlook remained optimistic: “Material scarcity always creates an abundance of ideas.” If that is true, we can look forward to innovative times in which creativity will not only become a crucial skill but an existential means of survival.

Dr. Christine Woesler de Panafieu, founder of CoSight, an international trend research and marketing consulting firm in Paris, picked up the ball and described how the macro-trends Wilenius had pinpointed would alter the lives of consumers. She argued that we were moving from "post- to ultra-modernity," resulting in a renaissance of the renaissance: “the man as measure of all things.” This neo-humanistic mindset would bear a new spiritual quest – “an individual, open path seeking direct resonance with the sacred,” as she put it. The number of pilgrimages is indeed on the rise, as is the number of new religions (and meta-religions such as the recent Charter of Compassion or the portal Beliefnet). “The 21st century will be spiritual or it won’t be at all,” Dr. Woesler de Panafieu quoted a French philosopher. Morality is in high demand, but doing good is shifting from convention to conviction, from a humanitarian to an empowerment approach. For brands, this means they need to become the “right thing to do.” And one only has to look as far as Foursquare to see that converting social currency into real value will the business model of the future.

Nils Müller, founder and CEO of TrendONE, a trend research firm, finally took the audience on a riveting tour de force through much buzzed-about emerging tech trends, envisioning the future in 2020 as a seamless blend between the real and virtual worlds, dominated by location-based, real-time, and social computing applications that turn the Internet into an "Outernet" and “every interface into a surface” – from printed electronics to face recognition to augmented social shopping. He depicted an evolution from “lean back” to “move forward” to “jump in” to “always-on” to “plug in” media. And he showed tons of videos: the "Siftables" - see picture above; the inevitable Microsoft Natal clip; a demo of brainwave-based voiceless communications (theaudeo.com), and a clip on augmented vision enabled by eye chips (tat.se). Their common thread: Technology in disguise, with front-ends that are becoming touchable, intuitive, and human-centric. Mueller coined the term “Shytech” for this phenomenon: technology that can afford to be non-intrusive because it is fully immersive.

In the concluding panel discussion, Dr. Woesler de Panafieu was asked what’s left to do for designers when everything was immersive and one great computing cloud. “Designers’ task will be to make the invisible visible,” she said, “creating the new interaction codes of our societies.” That again alluded to the big mega-trend of Good Computing – without Computers. Designers are the ones who can translate data (and meta-data) into meaning and make morality tangible amidst a flood of information. As they visualize the dematerialization of products and services, how long will it take before the dematerialized world becomes the ideal one?