Welcome To The Decade Of Games

Game dynamics are fast becoming a critical currency of motivation. Their power lies not in connecting us to our friends, but in directly influencing our individual behaviour. More and more of these dynamics are being cleverly leveraged in real-world scenarios to influence your behavior. Smart companies will take this time to look at their product portfolios and community behaviors through the lens of game dynamics.

For those of you still trying to wrap your head around the meteoric rise of social networking over the past decade, this post might hurt a little bit. Because just as you and most of the world were getting a handle on it, the decade of social abruptly ended.

I don't mean that we will stop using Facebook, Twitter, YouTube and Flickr to share with our friends, colleagues and families. In fact, quite the opposite is true, our combined usage of these social networks will continue to increase. Rather, the decade of constructing the social layer is complete. The frameworks that we'll use to share socially are built, defined and controlled. Construction on the social layer ended with the launch of Facebook's Open Graph protocols over the last several months. All the interesting social stuff that will occur over the next decade (and there'll be lots, I'm sure), will exist within this predefined framework built and controlled by Facebook. In short, the decade of social is over.

What's taking its place? The decade of games.

When you hear games, you probably immediately think about things like World of WarCraft, the Nintendo Wii and Farmville. And while those are huge (and will get even bigger) I'm talking about the underlying game dynamics that are the core building blocks of those games. And in this decade of games, these game dynamics will move far beyond your computer screen and into decidedly non-game like environments, like the way we court customers, engage with others at work, discover where to hang out on Saturday nights and what, when and how we choose to purchase. More and more of these dynamics are being cleverly leveraged in real-world scenarios to influence your behavior. While the last decade was all about connections and integrating a social fabric to every facet of our digital and analog existence, this next decade is all about influence.

Game dynamics are fast becoming a critical currency of motivation. Their power lies not in connecting us to our friends, but in directly influencing our individual behavior.

The decade of games is starting now because cultural and technological shifts have led us to a perfect convergence of reach, relevance and demand. We're able to reach people anywhere at any time thanks to the powerful mobile devices that now travel everywhere we go. Facebook's Open Graph enables us to provide relevance to anyone with instant access to the social graph of connections. And there's the demand. Traditional forms of entertainment (movies, television... remember books?) are in a rapid decline. The demand for entertainment hasn't decreased, it's just shifted to a more interactive, pervasive form of entertainment. It's shifting to games.

I've been playing games for at least half of my life (granted, I'm only 21) but that's still a long time. And, I'm currently the Chief Ninja (that's the non-game company equivalent of CEO) of SCVNGR, aGoogle Ventures backed mobile gaming company. Needless to say, I tend to think of life as a giant game. A somewhat poorly designed for sure, but one big game nevertheless. I enjoy watching how game dynamics subtly, often invisibly, influence almost everything that everyone does.

At SCVNGR, we've been able to examine the statistical effects of introducing game dynamics into situations that are decidedly not games. We've seen simple game dynamics increase traffic to locations 4X over a matter of days. We've seen others extend the average amount of engaged time consumers spend at a business by upwards of 40%. This propagation of game dynamics into the real world via the social graph and mobile devices will have powerful business consequences for those who understand how to leverage them.

At SCVNGR we like to joke that with any seven game dynamics you can get anyone to do anything. So with that, I'll present three of our favorites here:

The Appointment Dynamic

The appointment dynamic is a famous game mechanic in which to succeed a "player" must return at a predefined time to take a predetermined action. It's simple and immensely powerful.

The appointment dynamic is powerful enough to alter the behavior of an entire generation — "happy hours" are appointment dynamics, as is the pervasive game "Farmville" by Zynga. But we've barely scratched the surface of what it can do. Imagine companies like Vitality leveraging this dynamic to improve the adherence rate to often less-than-pleasant medicinal regimens, or the government creating a large scale game (with financial incentives as rewards) to alter traffic patterns to decrease highway congestion in the mornings.

The Progression Dynamic

In the progression dynamic, a "player's" level of success is displayed in real-time and gradually improved through the completion of granular tasks. Somewhere deep-rooted in the human psyche we have this desire to complete any progression dynamic put in front of us as long as the steps to do so are itemized and clear. With this as a known dynamic, it's not hard to envision the ways that this can be leveraged even further in the real-world.

The canonical "game" example of the progression dynamic exists in Blizzard's World of WarCraft, the most popular immersive online game with over 11 million monthly players. In WoW players follow a well-defined progression dynamic as they level-up from a weak paladin level 1 to an unbelievably powerful paladin level 60 by completing missions and tasks.

But like most game dynamics, real-world implementations of this mechanic are not hard to find. Coffee shops regularly use this dynamic with their "buy nine cups of coffee and your 10th is free" cards. Next time you log into LinkedIn, check out how complete your profile is. If you're one of the lucky ones who's figured out how to have a complete LinkedIn profile, then you've won this specific game, but for the rest of us, you'll see a now familiar looking progression dynamic, urging us to take a couple more steps to move that blue progress bar from the left edge of the screen to the right.

Communal Discovery

Communal discovery is a mechanic which involves an entire community working together to solve a problem. The reason I've saved the communal discovery dynamic for last is that it, perhaps more than all others, presents incredible opportunities to positively influence the world as we enter this decade of games.

In an effort to illustrate the immense data-collection power of the now mature social layer (and incidentally the burgeoning game layer), DARPA launched a challenge late last year. They hid 10 red balloons at different locations all across the continental United States and offered $40,000 to the first team to correctly identify their locations. The winning team (a group from MIT) constructed a strategy that in many ways mirrored a pyramid scheme. It was a cleverly constructed waterfall of incentives that encouraged massive cooperation. Essentially everyone to give them data about any balloon's location won some portion of the prize money based on how many other people also submitted the location of that balloon. This created positive communal incentives across what rapidly became a large and self-propagating network. Their strategy managed to accurately identify all locations in less than 9 hours.

This communal discovery mechanic is immensely powerful and, as DARPA so elegantly displayed, can be used to solve immensely difficult problems in record time.

These are just three out of a myriad of game dynamics that will act as the core building blocks used to construct the game layer over the next couple years. We're right at the beginning of this decade of games and so now is the time for everyone to learn about these game dynamics and discover new ones. Smart companies will take this time to look at their product portfolios and community behaviors through the lens of game dynamics. Where could you employ progression or appointment dynamics on the existing social graph or through mobile to encourage upsells or repeat visits? The time is now to map out your game dynamic strategy. The more people that help in the construction of these frameworks, the better they will be. So, go play some games. Then start building.

Source - Harvard Business Review

LBS – Foursquare & Facebook Places

Insights from the internal, Dino Demopolous sheds some light on the differences in location based services provided by Facebook & Foursquare. Through the exploration of people and places the present and the future, Dino provides some interesting thoughts on the future of “checking in”.

I have been thinking about Facebook Places over the past couple of days. Though I have yet to try it since it has not been made available in Canada, I am interested to see how it differs from Foursquare. Or, more accurately, how I will use it differently, how brands might use it differently and how it might co exist with Foursquare.

In my mind, I find it useful to view location based services and what they offer through two distinct lenses. The first is, of course, the lens of PEOPLE that use these services. The second is the PLACES themselves, the actual locations in which we check in. Sure, it is an obvious distinction, but here is how I see some of the implications when we think of these two lenses as they apply to what is happening NOW versus what has happened in the past, or THEN. In other words, how do these services play out in how they deliver value right now, in real time, and how does that differ from how value accrues over time? And how is that different for people and places?

Here is my rudimentary chart:

I. Places, Now

This is the data that is made available in real time about what is currently popping at a given location. It is the basic role of Foursquare, as far as Places are concerned; animating the present. How many people are right here, right now at this place? Think of, say, a bar or club, and in many ways this is pretty obvious, people have been doing it with text messages or by telephone for ages. I know that as a DJ this is a behaviour that we saw evolve through the medieval ages (the 1990s, as people would rifle off text messages to their friends upon walking in the club to let them know if the party was happening.

Of course, the present is most definitely vital to location based services, but it is far from everything. Making use of the real time information that is being provided is a huge benefit for places, especially commercial places, but it is different than the long term breadth and depth of information and data that location services can provided. More on that below, but Yelp is just one starting point as an example.

2. Places, Then

I think of this as the layers of meaning attached to locations over time. Yes, much of this can be, and is, commercial in nature. Things like loyalty programs, CRM type stuff. Huge for business. But I think it is quite telling that the example used by one of the Facebook developers when Places was launched was of a beach that you were at, and discovered that this was the place where your parents had their first kiss. How sweet!

This hints at the long term project and goal that transcends the present, commercial or otherwise, and is the beginning of an underlying digital archive of information and meaning attached to physical locations, or places. I should say, it is a beginning, instead of the beginning. There is a lot of interesting work being done by the folks at Bing Maps, for instance, to develop rich layers of meaning on city maps. But given the sheer size of Facebook, this project can take off in a very natural, mass way, by making it part of the regular social stuff we share with friends.

So, in contrast to Foursquares game mechanic driven focus on what is going onnow, I think Places strength will be in building meaning over time for locations. This is a lofty goal, but as long as the behaviour of checking in becomes adopted and second nature, it will happen given the sheer size of Facebook. Here is how Augie Ray from Forrester put it,

Soon, the local restaurant or hiking trail may have as rich a personality as do the people on Facebook, not because everyone has visited but because your friends have. And in the end, isn’t that what we really care about? Not who is mayor of our local coffee shop, but what our friends did, said, and liked when they were there before us

3. People, Now

When Foursquare launched, it was described as one part social city guide, one part mobile friend finder. For users, the mobile friend finder is exactly the benefit of real time location data. Knowing that your buddies are drinking at the bar around the corner from where you are right now is compelling, and at its best, this is where Foursquare and the other services shine. It is why unlocking badges is such an important engine to the game. And though you are encouraged to leave tips or reviews for your friends or others about places, it really is one of the lesser used functions. The focus is on the now, the game and collecting badges. Indeed, the whole idea of the resetting leaderboard underscores the inherent temporal logic of Foursquare.

4. People, Then

This is where Facebook has the biggest opportunity. The goal is to make checking in and the social relevance of location on par with the many other social behaviours and interactions we already share on Facebook, like tagging each other in pictures or posting on each others wall.

This is from the Facebook Places page:

If you're already using Places, it's like you checked in yourself without having to do a thing. If you're not using Places yet, it's just like being mentioned in a status update.

Putting the check in in the wider context of social behaviours we are already familiar with will be a huge accomplishment if they can pull it off, and if we actually adopt it as users, because we will have the potential of seeing a lot of rich meaning emerge over time for how we relate with places in the real world. This can be incredibly relevant to our friends and network.

Part of this relevance will be in the now, so that we know where are friends are in real time, but in contrast to Foursquare, that relevance will also grow and emerge over time as it is woven in to the fabric of our social behaviours. Or, as the clever Facebook put it, the where joins with the who, what, when. Smart.

Thinking back to that first kiss on the beach example provided by the Facebook developer, it is worth noting that he intended it to show how Places will be meaningful twenty years down the road, as we develop the shared social history of location awareness with our friends and network.

With respect to brands and commercial applications, I think that Facebook might have got it right this time around. Instead of jamming an intrusive and strange interaction down our throat, like Beacon, it is banking on first socializing the check in among users so that it becomes second nature. I suspect that they are purposely waiting to roll out commercial applications because job one is to acclimatize Facebook users to using location features and discovering the many ways that they can deliver value, over time, in ways that go beyond just collecting loyalty points or a free latte.

Source - Chroma

10 Reasons Social Media Will Not Kill Traditional Agencies

The unprecedented growth of digital & social media has been labeled a threat to the traditional marketing model but the truth is that the two models aren’t substitutes for one another. The following article is a summary of observations by Simon Mainwaring from Cannes. As a well credited social media guy, Simon argues that traditional advertising is more relevant than ever.

I spent the week at the Cannes International Advertising Festival and came away greatly encouraged. Not only did the Festival team (led by Terry Savage and Philip Thomas) do an amazing job but I was impressed by how well the event captured the latest expression of the marketing world. With all the excitement (and, yes, hype) around social media, one might expect this bastion of traditional advertising to take a defensive posture and shun social media, or at least to be a little out of touch. The opposite was true. Not only did the work and seminars fully embrace the potential of social media, but agencies and clients demonstrated real engagement with the marriage of the two. So I thought I’d use my experience of this year’s Festival as a way to explain why traditional advertising is more relevant than ever.

1. IT’S ABOUT THE IDEA: Whether it’s an uber traditional ad spot like Nike’s World Cup spot, ‘Write the Future’, or the Cyber Grand Prix-winning Nike Chalkbot, the fact remains that it’s the idea that determines success with consumers and at the show. Social media expands the reach of great content, but ideas determine reach into hearts and minds. As such, veteran idea generators like ad agencies are very important.

2. FIRST PRINCIPLES, NEW MEDIA: Irrespective of your marketing speciality – whether it be traditional, digital, or social media – the timeless fundamentals of effective advertising apply. Work needs to be simple, emotional and consistent. As such the hard won lessons of traditional advertising agencies are more relevant than ever. They just need to be applied to all media including social media.

3. SOCIAL MEDIA IS IS NOT AN END IN ITSELF: I did not see a single piece of work celebrated at Cannes simply because it was social media. The power of social media is only unleashed when an emotional connection is made that motivates someone to share something using social tools. Brands at the Festival demonstrated a clear understanding of this and a due respect for agencies as architects of community.

4. BRAND CUSTOMERS: Clients made up almost 15% of the 8000 attendees this year according to Ad Age, and this demonstrates a recognition of two facts. One is that consumers are now reaching out directly to brands through social media, and, secondly, that brands are looking to ad agencies for guidance in how to respond. As such the client/agency dynamic is as critical as ever. In fact Terry Savage, Festival Chairman, also said he is 90% sure there will be a prize for effectiveness next year in which clients will play some role.

5. ‘GOOD’ BUSINESS: So much work demonstrated that brands and agencies realize that consumers want a better world, not just better widgets. This a new thing. Campaigns like the Millions, UNICEF Tapwater and Earth hour receiving titanium awards in recent years. What’s more this year the Festival introduced the first Grand Prix for Good indicating a further appreciation of the positive role that advertising can and must play.

6. SILO BLURRING: This year clearly demonstrated the ability of traditional ad agencies to fill new roles. For instance, Interactive Agency of the Year was Crispin, Porter & Bogusky, and Direct Agency of the Year was Abbott Mead Vickers in London. As traditional ad agencies migrate their focus and talent into emerging areas, their creative prowess will come to bear on the marketing.

7. PURPOSE AS PROFIT: One of the things I stressed in my seminar was that the future of profit is purpose. This is based on the recognition that the universal values that inform purposeful work make brands innately sharable and therefore potentially profitable. Across the board work demonstrated a recognition that consumers want to see their brands changing the world for the better. A great demonstration of this was done by the Festival itself when Jeff Goodby, Ben Stiller and Yahoo, enlisted the entire audience to raise money for Stillerstong that is building schools in Haiti.

8. TECH = SAVVY: As someone who attended last year, I was struck by how tech savvy everyone suddenly became. Eyes were permanently glued to iPhones and Blackberries, laptops served as sun reflectors and there was amble wi-fi and power throughout the Palais (which is not always the case even at tech conferences). As such the Festival did a great job of reflecting the impact of technology discussed in so many of the seminars.

9. TRIUMPH OF YOUTH: Each year the Festival does an amazing job of filling its hall with the future of the industry. It would be easy for an expensive Festival such as this to become stocked with veteran ad types (like me!) but this year I felt more old and out numbersed than ever. This is partly due to the Young Lions Zone and new efforts this year through Cannes Connect to put attendees in touch with each other and their communities.

10. THE FUTURE IS HERE: Each year the Festival does a great job of securing the thought leaders from areas that are re-shaping the industry. This year it was Mark Zuckerberg, founder of Facebook. The Debussy Room was packed to the rafters with two others rooms outside full of people as well. Beyond the understandable fascination around such successful entrepreneurs, the industry is clearly listening to those shaping their future on a daily basis.

With that said, there is still ground to be gained. I was surprised how few people were tweeting out from laptops during the seminars (if that’s any indication of the audience’s personal engagement with their own social communities). Plus I believe the private sector (represented by brands and ad agencies at forums like Cannes) can play an even more powerful role in shaping the future of marketing and society at large. No doubt next year will demonstrate an even fuller embrace of this potential in which brands, ad agencies and consumers co-create the stories that move people, sell products and change our world for the better.

How do you think traditional advertising agencies are doing? Are they sufficiently embracing social media?

Source - Simon Mainwaring

Cognitive Surplus

Clay Shirky is an extremely well respected anthropologist and writer who has some very interesting thoughts on society and culture in our digital age. He released the book “Here Comes Everybody” and has recently released a new book called the “Cognitive Surplus”. Here’s a really neat fifteen minute (but it’s all good) video that summarize his findings on the Cognitive Surplus.

Go HERE to watch the video.

Mass Media 2.0

Digital media is revered for its sniper like ability to serve up targeted, relevant content. If you are looking to speak to people aged 41 to 43 who have an interest in cross-eyed cats and claustrophobic gophers, the opportunity is there. But what happens when you forget “laser focused targeting” and take a mass approach within the digital space? It’s the 1970s all over again!

Reckitt Benckiser ("RB") made ad trade headlines last week when it announced a record-setting $40 million web video buy for 2010. What shocked everyone wasn't the dollar amount but rather that the company pretty much doesn't care where the ads run.

"This kind of strategy echoes planning/buying 101 back in 1970," said a comment on the news article in Advertising Age, "It's a senseless approach that abandons all facets of leveraging for optimization and efficiency." Spoken like a true technonut, I say. At risk of overly analyzing the move I wonder if it heralds a realistic approach to web advertising.

Say hello to mass media 2.0?

RB isn't a household name but Lysol, Woolite, Clearasil and many of its other consumer products are well-known. These are "low involvement brands," which means that consumers aren't necessarily looking to have conversations or meaningful relationships with them. They're also low cost, high frequency purchases because most of them get used often and need to be replenished.

RB is in the business of selling lots of bottles of French's mustard and Air Wick freshener sticks.

So it's not wholly surprising that it has rejected the conventional wisdom that drives most Internet marketing, which dictates that technology enables brands to target consumers with laser-like focus...and then requires companies to talk with those consumers incessantly. Experts are shocked that RB isn't interested in appearing before the high-quality eyeballs that watch videos on high-quality web sites, like Hulu, and instead is willing to put its spots just about anywhere. We're talking a difference in cost of $40/thousand pairs of eyeballs reached (or "CPMs") and $2.

RB's media buying company will have its hands full avoiding joke videos in Esperanto and snuff films with that low a placement threshold.

Worse for the new media lobby is that RB will measure ad efficacy by using reach, frequency, and gross-ratings points just like it would a TV buy. "We very much look at this as TV advertising, just on another screen," explains a company spokesman, risking excommunication from his favorite web gurus' RSS feeds.

Ad views or impressions have always been imprecise metrics; you could buy a demographic for your TV spot and presume you knew who was behind those eyeballs to witness your brilliance, but it never took into account the context that influenced that consumption:

• What else is going on in the room, on the airplane, or along the street on which the consumer you’ve paid to reach is living.

• Where else that consumer just came from/is going, which has significant impacts on how and what gets experienced when you've paid for the privilege to participate in it.

The web ad model has never really challenged this worldview even though the influences on consumption have gotten infinitely more numerous and varied. Instead, it has evolved comfortably with the presumption that some sites should charge more for reaching eyeballs that are in some way better than others. RB isn't buying this rationale and instead just wants eyeballs. Lots of them.

I don't think it evidences any return of mass media advertising as much as it's proof that it never really went away. We just started calling it something different.

Large audiences matter, at least somewhat irrespective of demographics. That's what drove TV advertising for most of the last century; it was fine-tuned and otherwise confused by claims of slicing-and-dicing which eyeballs watched what programs, yet those viewers swore undying allegiance to their favorite programs compared to the fickle and fractured commitments of online consumers. RB is betting that its target consumers will likely visit a variety of sites and that it'll catch them at one or another.

This mass media approach has always lurked behind the measurements offered up by web sites daring to aspire to profitability, and it's why the trades have said that RB's approach "...breaks the backs of publishers with onerous terms."

My opinion is that it's just further proof that mass media deserves more credit. I'm not surprised by this week's news that the TV upfronts could be very healthy. For a dinosaur the beast still seems to have a lot of kick left in it.

A couple of other quick observations about RB"s announcement:

• It's elevating the importance of content by being so broad in its buying purview; since it won't be catering to the presumed proclivities of individual site viewers (and thus engaged in creating gigantic insider jokes, which is what qualifies much of online content today) it'll have to find messages that are more fundamentally memorable and compelling. A mass media approach isn't as easy or lazy as it might seem, at least from a creative perspective.

• It'll be more interactive. It has to be. So Spot X runs on fishmatingcalls.com and there are two visitors who might be Calgon water softener customers on any given day. The execution has to be something utterly motivating...vote, register, do something that matters...or it risks getting missed altogether. Maybe this mass media approach yields lots of more meaningful direct-to-consumer dialogues? RB says that it'll look to measure interactivity as part of its buy, which means it recognizes how crucial it will be.

• It doesn't challenge the alternate model for buying space online, which is all about addressing spots to particular customers at unique moments in time with special content customized exclusively to them. Phew. This web marketing wet dream is still very valid, but when it comes to low involvement brands I still don't get how it amounts to anything more than distributing discount coupons.

So forget Mass Media 2.0. I think RB is simply saying hello to reality, and it's doing what it can to sell stuff. After all, that's probably the best metric for web advertising.

The ingrates!

Source - Jonathan Salem Baskin's Dim Bulb

The Social Media Bubble

Here’s a controversial perspective on social media. Social media is overvalued and online relationships are grossly inflated. Despite all the hoopla around social media, we aren’t nearly as connected as we think we are. The following is a cultural examination on our perceived value of social media and highlights a lot of the things we are doing wrong. The debate continues. Read & discuss.

I'd like to advance a hypothesis: Despite all the excitement surrounding social media, the Internet isn't connecting us as much as we think it is. It's largely home to weak, artificial connections, what I call thin relationships.

During the subprime bubble, banks and brokers sold one another bad debt — debt that couldn't be made good on. Today, "social" media is trading in low-quality connections — linkages that are unlikely to yield meaningful, lasting relationships.

Call it relationship inflation. Nominally, you have a lot more relationships — but in reality, few, if any, are actually valuable. Just as currency inflation debases money, so social inflation debases relationships. The very word "relationship" is being cheapened. It used to mean someone you could count on. Today, it means someone you can swap bits with.

Thin relationships are the illusion of real relationships. Real relationships are patterns of mutual investment. I invest in you, you invest in me. Parents, kids, spouses — all are multiple digit investments, of time, money, knowledge, and attention. The "relationships" at the heart of the social bubble aren't real because they're not marked by mutual investment . At most, they're marked by a tiny chunk of information or attention here or there.

Here's what lends support to my hypothesis.

Trust. If we take social media at face value, the number of friends in the world has gone up a hundredfold. But have we seen an accompanying rise in trust? I'd argue no. Now, perhaps it will take time for gains to be visibly felt. But social networks have already been around for half a decade, and society seems to be little better off.

Disempowerment. If social tools were creating real economic gains, we'd expect to see a substitution effect. They'd replace — disintermediate — yesterday's gatekeepers. Yet, increasingly, they are empowering gatekeepers. Your favorite social networks aren't disintermediating PR agencies, recruiters, and other kinds of brokers. They're creating legions of new ones. The internet itself isn't disempowering government by giving voices to the traditionally voiceless; it's empowering authoritarian states to limit and circumscribe freedom by radically lowering the costs of surveillance and enforcement. So much for direct, unmediated relationships.

Hate. There's this old trope: the Internet runs on love. Equally, though, it's full of hate: irrational lashing-out at the nearest person, place, or thing that's just a little bit different. Read any newspaper web comments sections lately? Usually, they're giant puddles of bile and venom. Check out these emails to Floyd Norris. Far from fueling meaningful conversation, today's "social" web is a world full of the linguistic equivalent of drive-by shootings.

Exclusion. Hate happens, at least in part, because of homophily: birds of a feather flock together. The result is that people self-organize into groups of like for like. But rarely are the gaps between differences bridged. Yet, that's where the most valuable relationships begin. To be "friends" with 1000 people who are also obsessed with vintage 1960s glasses isn't friendship — it's just a single, solitary shared interest.

Value. The ultimate proof's in the pudding. If the "relationships" created on today's Internet were valuable, perhaps people (or advertisers) might pay for the opportunity to enjoy them. Yet, few, if any, do — anywhere, ever. Conversely, because those "relationships" aren't valuable, companies are, it is said, forced to try and monetize them in extractive, ethically questionable ways. That's because there's no there there. I can swap bits with pseudo-strangers at any number of sites. "Friends" like that are a commodity — not a valuable, unique good.

What are the wages of relationship inflation? Three cancers eating away at the vitality of today's web. First, attention isn't allocated efficiently; people discover less what they value than what everyone else likes, right this second. Second, people invest in low-quality content. Farmville ain't exactly Casablanca. Third, and most damaging, is the ongoing weakening of the Internet as a force for good. Not only is Farmville not Casablanca, it's not Kiva either. One of the seminal examples of the promise of social media, Kiva allocates micro-credit more meaningfully. By contrast, Farmville is largely socially useless. It doesn't make kids tangibly better off; it just makes advertisers better off.

Let's summarize. On the demand side, relationship inflation creates beauty contest effects, where, just as every judge votes for the contestant they think the others will like the best, people transmit what they think others want. On the supply side, relationship inflation creates popularity contest effects, where people (and artists) strive for immediate, visceral attention-grabs — instead of making awesome stuff.

The social isn't about beauty contests and popularity contests. They're a distortion, a caricature of the real thing. It's about trust, connection, and community. That's what there's too little of in today's mediascape, despite all the hoopla surrounding social tools. The promise of the Internet wasn't merely to inflate relationships, without adding depth, resonance, and meaning. It was to fundamentally rewire people, communities, civil society, business, and the state — through thicker, stronger, more meaningful relationships. That's where the future of media lies.

Now, this is just a hypothesis. Feel free to disagree with me, challenge me — or to extend and elaborate upon it. Next time, I'll discuss what we can do about it.

Source - Harvard Business Report

The Internet Of Things

Objects are invading the Internet! It may sound a little ridiculous to have Big Ben or a Barbie doll communicate online like a living, breathing person however it’s a trend that will continue to grow as technologies such as radio frequency identification (RFID) become mainstream. The outcome is a whole new realm for advertisers as interactions between people and objects become a whole lot smarter. Here are a few examples of brands getting a head start on this trend.

Big Ben has been steadily keeping time in London with its distinctive "bong" for over 150 years. But unless you were in the famous clock's proximity, you most likely remained unaware. That is, until late last year, when Big Ben joined and now keeps time virtually for nearly 50,000 people through Twitter's API.

While we can all have a bit of a laugh at Big Ben's presence on Twitter, our newfound ability to communicate with what were previously inanimate objects is no joke. Advances in a host of technologies like radio frequency identification (RFID), near field communications (NFC), electronic product codes (EPC) and, most importantly, Twitter and its API are enabling an array of smart interactions and connections between objects and people.

Not too long ago, unless you knew how to write code, the primary way that we communicated with objects was decidedly one way -- beep -- a simple signal for us to pay attention. AOL ingeniously took a step to humanize the beep in the '90s by alerting us to an incoming e-mail with a chipper "You've Got Mail." But since then we haven't made much progress.

Twitter is helping to change all of that by allowing developers to add intelligence to devices and inanimate objects in a surprisingly warm and human manner. We saw some of this with early experiments like BakerTweet, a system made by U.K. agency Poke that allows bakers to dynamically send out tweets to customers alerting them when a fresh batch of buns have emerged from the oven, and Botanicalls, which uses networked open source hardware and software to allow plants to communicate with people in human terms (e.g. "water me please") by either using the telephone, text message or Twitter.

Sometimes called "The Internet of Things" or "Web 3.0," the possibility of smarter interactions between people and objects is opening up whole new realms for advertisers and product developers alike. Here's a look at some of the more noteworthy attempts.

NIKE+ and the HumanAPI
Athletes are notoriously data-focused so it makes sense that one of the first entrants into the space was the combo of Nike and Apple. Nike Plus is a clever piece of technology that allows people to transform their iPhones and iPods into personal trainers, collecting real-time workout data, allowing them to react in real time and letting them track their performance on their PCs. Taking the concept a step further, independent developer Nikolai Onken has created an iPhone app prototype for the HumanAPI that collects heart rate data and transmits it via Bluetooth to an application for real-time visualization. You can view a series of videos here.

Sony
The interplay between physical space or location and online events is ripe with possibilities. For the Sony Hopper Invasion campaign in the UK, Dare Digital and Tinker.it demonstrated how physical objects could become a real-time visualization tool for an online event. The team built a grid that allows 49 Space Hoppers (colorful balloons, really) to be inflated dynamically through the use of hashtags on Twitter and through the Sony website. You can view a video of the campaign event here.

Mattel and Barbie
Can a product speak? Taking a much more analog approach, Mattel decided to give their iconic doll an online persona for her 50th anniversary. The company created a presence on Facebook, Twitter and YouTube for Barbie and even gave her a voice, sort of. While consumers couldn't actually hear Barbie speak, they could certainly read her tweets which, in today's culture, might just be about the same thing.

Blue Dot
Location-based services are becoming mainstream, but surfacing the information in real time is not. Blu Dot, a small but stylish Minneapolis-based furniture maker, scattered 25 of its chairs across the streets of Manhattan for its Real Good Experiment campaign.The company enlisted a creative shop called Mono, camera crews and GPS devices to track the chairs' travels. Real-time updates were provided on Twitter at bludotnews and realgoodchairs and on a map at realgood.bludot.com. Better yet, Blu Dot even made a touching documentary about its efforts.

FedEx
FedEx is clearly a leader in using real-time data to allow people to track their packages throughout the world, but the company is taking it further with its SenseAware. Using an in-package sensing device (about the size of a drink coaster) with a web-based information platform, the company can now let users know if a package has been opened or exposed to light, its exact location via GPS coordinates and even if it is too warm or cold. FedEx hasn't set up the service to broadcast package whereabouts or comfort via Twitter yet, but it certainly could.

Guinness
Talk about a human API. Guinness continues to expand upon its groundbreaking use of RFID technology with its Ireland rugby team sponsorship. The company just launched Area 22, a site that hosts data on the rugby team and its players performance, an iPhone app and even a Facebook page. The site boasts in-depth data with excellent visualizations on the key areas like kicking, possession, penalties ("Sin Bin") defense and performance. In preparation for the run-up to the Rugby World Cup in 2011, Guinness has even launched a new TV spot that highlights a futuristic -- a la "Minority Report" -- playing field.

Clearly it's still early days for "The Internet of Things" but the possibilities continue to grow as the technologies are becoming cheaper and more accessible. It's also becoming easier to find all sorts of connected consumer devices now, like the dog collar that tweets locations or the Wi-Fi-enabled scale that provides progress updates via Twitter.

Pachube, a company that provides a web service that enables developers to both virtually and physically tag and share real-time sensor data from objects, devices, buildings and environments. Another is Violet, which makes Mir:ror, an RFID reader USB-attached mirror that enables any PC to react to the presence of an object. The company also makes Nabaztag, a very cute connected device that delivers all sorts of audio and visual and information, including readings of your e-mail or RSS feeds.

Source - AdAge

TMI

Strategists love data for the simple reason that it generates insights based on fact. Despite being a creative industry, marketers root their strategies on very objective elements. The digital era has provided marketers access to a level of information never imaginable only a few years ago. Managed well, the data can be used to unlock new sources of economic value, provide fresh insights into human behaviour and hold governments to account but what happens when there’s just too way much? The following is a look at the macro and micro changes resulting from data overload.

When the Sloan Digital Sky Survey started work in 2000, its telescope in New Mexico collected more data in its first few weeks than had been amassed in the entire history of astronomy. Now, a decade later, its archive contains a whopping 140 terabytes of information. A successor, the Large Synoptic Survey Telescope, due to come on stream in Chile in 2016, will acquire that quantity of data every five days.

Such astronomical amounts of information can be found closer to Earth too. Wal-Mart, a retail giant, handles more than 1m customer transactions every hour, feeding databases estimated at more than 2.5 petabytes—the equivalent of 167 times the books in America’s Library of Congress (see article for an explanation of how data are quantified). Facebook, a social-networking website, is home to 40 billion photos. And decoding the human genome involves analysing 3 billion base pairs—which took ten years the first time it was done, in 2003, but can now be achieved in one week.

All these examples tell the same story: that the world contains an unimaginably vast amount of digital information which is getting ever vaster ever more rapidly. This makes it possible to do many things that previously could not be done: spot business trends, prevent diseases, combat crime and so on. Managed well, the data can be used to unlock new sources of economic value, provide fresh insights into science and hold governments to account.

But they are also creating a host of new problems. Despite the abundance of tools to capture, process and share all this information—sensors, computers, mobile phones and the like—it already exceeds the available storage space (see chart 1). Moreover, ensuring data security and protecting privacy is becoming harder as the information multiplies and is shared ever more widely around the world.

Alex Szalay, an astrophysicist at Johns Hopkins University, notes that the proliferation of data is making them increasingly inaccessible. “How to make sense of all these data? People should be worried about how we train the next generation, not just of scientists, but people in government and industry,” he says.

“We are at a different period because of so much information,” says James Cortada of IBM, who has written a couple of dozen books on the history of information in society. Joe Hellerstein, a computer scientist at the University of California in Berkeley, calls it “the industrial revolution of data”. The effect is being felt everywhere, from business to science, from government to the arts. Scientists and computer engineers have coined a new term for the phenomenon: “big data”.

Epistemologically speaking, information is made up of a collection of data and knowledge is made up of different strands of information. But this special report uses “data” and “information” interchangeably because, as it will argue, the two are increasingly difficult to tell apart. Given enough raw data, today’s algorithms and powerful computers can reveal new insights that would previously have remained hidden.

The business of information management—helping organisations to make sense of their proliferating data—is growing by leaps and bounds. In recent years Oracle, IBM, Microsoft and SAP between them have spent more than $15 billion on buying software firms specialising in data management and analytics. This industry is estimated to be worth more than $100 billion and growing at almost 10% a year, roughly twice as fast as the software business as a whole.

Chief information officers (CIOs) have become somewhat more prominent in the executive suite, and a new kind of professional has emerged, the data scientist, who combines the skills of software programmer, statistician and storyteller/artist to extract the nuggets of gold hidden under mountains of data. Hal Varian, Google’s chief economist, predicts that the job of statistician will become the “sexiest” around. Data, he explains, are widely available; what is scarce is the ability to extract wisdom from them.

More of everything

There are many reasons for the information explosion. The most obvious one is technology. As the capabilities of digital devices soar and prices plummet, sensors and gadgets are digitising lots of information that was previously unavailable. And many more people have access to far more powerful tools. For example, there are 4.6 billion mobile-phone subscriptions worldwide (though many people have more than one, so the world’s 6.8 billion people are not quite as well supplied as these figures suggest), and 1 billion-2 billion people use the internet.

Moreover, there are now many more people who interact with information. Between 1990 and 2005 more than 1 billion people worldwide entered the middle class. As they get richer they become more literate, which fuels information growth, notes Mr Cortada. The results are showing up in politics, economics and the law as well. “Revolutions in science have often been preceded by revolutions in measurement,” says Sinan Aral, a business professor at New York University. Just as the microscope transformed biology by exposing germs, and the electron microscope changed physics, all these data are turning the social sciences upside down, he explains. Researchers are now able to understand human behaviour at the population level rather than the individual level.

The amount of digital information increases tenfold every five years. Moore’s law, which the computer industry now takes for granted, says that the processing power and storage capacity of computer chips double or their prices halve roughly every 18 months. The software programs are getting better too. Edward Felten, a computer scientist at Princeton University, reckons that the improvements in the algorithms driving computer applications have played as important a part as Moore’s law for decades.

A vast amount of that information is shared. By 2013 the amount of traffic flowing over the internet annually will reach 667 exabytes, according to Cisco, a maker of communications gear. And the quantity of data continues to grow faster than the ability of the network to carry it all.

People have long groused that they were swamped by information. Back in 1917 the manager of a Connecticut manufacturing firm complained about the effects of the telephone: “Time is lost, confusion results and money is spent.” Yet what is happening now goes way beyond incremental growth. The quantitative change has begun to make a qualitative difference.

This shift from information scarcity to surfeit has broad effects. “What we are seeing is the ability to have economies form around the data—and that to me is the big change at a societal and even macroeconomic level,” says Craig Mundie, head of research and strategy at Microsoft. Data are becoming the new raw material of business: an economic input almost on a par with capital and labour. “Every day I wake up and ask, ‘how can I flow data better, manage data better, analyse data better?” says Rollin Ford, the CIO of Wal-Mart.

Sophisticated quantitative analysis is being applied to many aspects of life, not just missile trajectories or financial hedging strategies, as in the past. For example, Farecast, a part of Microsoft’s search engine Bing, can advise customers whether to buy an airline ticket now or wait for the price to come down by examining 225 billion flight and price records. The same idea is being extended to hotel rooms, cars and similar items. Personal-finance websites and banks are aggregating their customer data to show up macroeconomic trends, which may develop into ancillary businesses in their own right. Number-crunchers have even uncovered match-fixing in Japanese sumo wrestling.

Dross into gold

“Data exhaust”—the trail of clicks that internet users leave behind from which value can be extracted—is becoming a mainstay of the internet economy. One example is Google’s search engine, which is partly guided by the number of clicks on an item to help determine its relevance to a search query. If the eighth listing for a search term is the one most people go to, the algorithm puts it higher up.

As the world is becoming increasingly digital, aggregating and analysing data is likely to bring huge benefits in other fields as well. For example, Mr Mundie of Microsoft and Eric Schmidt, the boss of Google, sit on a presidential task force to reform American health care. “Early on in this process Eric and I both said: ‘Look, if you really want to transform health care, you basically build a sort of health-care economy around the data that relate to people’,” Mr Mundie explains. “You would not just think of data as the ‘exhaust’ of providing health services, but rather they become a central asset in trying to figure out how you would improve every aspect of health care. It’s a bit of an inversion.”

To be sure, digital records should make life easier for doctors, bring down costs for providers and patients and improve the quality of care. But in aggregate the data can also be mined to spot unwanted drug interactions, identify the most effective treatments and predict the onset of disease before symptoms emerge. Computers already attempt to do these things, but need to be explicitly programmed for them. In a world of big data the correlations surface almost by themselves.

Sometimes those data reveal more than was intended. For example, the city of Oakland, California, releases information on where and when arrests were made, which is put out on a private website, Oakland Crimespotting. At one point a few clicks revealed that police swept the whole of a busy street for prostitution every evening except on Wednesdays, a tactic they probably meant to keep to themselves.

But big data can have far more serious consequences than that. During the recent financial crisis it became clear that banks and rating agencies had been relying on models which, although they required a vast amount of information to be fed in, failed to reflect financial risk in the real world. This was the first crisis to be sparked by big data—and there will be more.

The way that information is managed touches all areas of life. At the turn of the 20th century new flows of information through channels such as the telegraph and telephone supported mass production. Today the availability of abundant data enables companies to cater to small niche markets anywhere in the world. Economic production used to be based in the factory, where managers pored over every machine and process to make it more efficient. Now statisticians mine the information output of the business for new ideas.

“The data-centred economy is just nascent,” admits Mr Mundie of Microsoft. “You can see the outlines of it, but the technical, infrastructural and even business-model implications are not well understood right now.” This special report will point to where it is beginning to surface.

Source - The Economist

Texting Is So Last Year

A weird side effect of our fast accelerating culture of technology is the development of “micro-generations”, where people two or three years apart are having completely different experiences with technology. This observation can have a profound effect for youth marketers and their campaign targeting. Do you believe this observation is news or have micro-generations always been a part of being a kid?

My 11-year-old son, like all 11-year-old sons, thinks his Dad is incredibly, risibly out-of-touch. He mocks me for using words like "video" when I mean "DVD", for preferring CDs to free downloads, for watching TV on the television instead of on the laptop, and for wearing my shirt with one top button undone when obviously it should be two.

But what the poor boy doesn't yet realise is that the last laugh will be on me. Whereas it took me three decades to become the embarrassing fuddy-duddy I am now, he and his nine-year-old sister are going to be past their best in less than 10 years. Such is the weird side-effect of our fast-accelerating technology: you're past it by the time you hit 20.

This phenomenon of the micro-generation gap – where 16 year-olds sneer at 19 year-olds for being oh-so-square, Daddy-O – came to light six months ago, in a widely publicised report written by a teenager on work experience at Morgan Stanley. Teenagers, revealed Matthew Robson (then 15), in a report named How Teenagers Consume Media, use their laptops as radios (streaming music from, say, Last FM so as to avoid adverts and DJ prattle), get round high cinema prices by watching pirated DVDs, prefer Facebook to Bebo, and never use Twitter, which they consider a hobby for old people like Stephen Fry.

The last two points came as an especial surprise to us oldsters, who imagined that teenagers Tweeted at least as regularly as we did, and that Facebook was more of a student-age thing while people of Robson's age preferred MySpace. But we can hardly be blamed for failing to keep up with each tiny micro-trend: not when a new one seems to turn up every couple of years.

"People two, three or four years apart are having completely different experiences of technology," Lee Rainie, director of the Pew Research Center's Internet and American Life Project told The New York Times last week. "College students scratch their heads at what their high school siblings are doing, and they scratch their heads at their younger siblings. It has sped up generational differences."

I've noticed this even in the tiny gap – exactly two years – between my younger children. Girl (9) is totally smitten with her Nintendo DS, as are most of her schoolfriends. Boy (11) considers that particular games console so impossibly uncool he won't even borrow it. For him the only device worth having is an Apple iTouch, just like all his friends have got. This, I get the impression, has less to do with the joy of playing the games themselves than the matchless pleasure of running up huge and pointless bills downloading new apps from iTunes.

Before Boy and Girl came along I used to get all my techno advice from my stepson, Jim. But at 23, Jim is starting to seem dangerously passé. The other day we were playing on our new joint Christmas present to ourselves – Call of Duty: Modern Warfare 2 – on his Xbox, and wondering why the gameplay seemed to end after so few levels. After further inquiry Jim found the answer. "Hey, things have changed," he said. "Nobody plays games on their own any more. They fight other people. On the internet."

This is confirmed by research from Pew. Teenagers are much more likely to play online games than are twentysomethings (78 per cent versus 50 per cent), and also more likely to send instant messages (68 per cent versus 59 per cent). Which makes Jim as much a prisoner of his generation as I am of mine. Like so many kids of his era, he takes enormous pride in his ability to write text messages at high speed, because that's what people born in the mid-Eighties trained themselves to do. When they hit their early teens and got their first mobiles, texts were the affordable alternative to phone calls, as well as the best way of communicating without being overheard by your parents.

For teenagers now, though, texting has been largely superseded by instant messaging – as Stephanie Lipman, a 17-year-old Londoner, explains. "I did text for a while, but instant messaging is so much better – like a constant stream-of-consciousness. You don't have to bother with 'Hello. How are you?' or any of that. You just have this series of conversations with your friends which you can add on to when you're in the mood."

As Stephanie says, she just happened to be the right age for the right trend. Like most of her friends she subscribes to BlackBerry Messenger. When she was younger, BlackBerries were things that only businessmen had, but she came of age just in time to catch the tipping point for their transformation into the must-have teen accessory.

And what of the even-younger generations? According to Mizuku Ito, of the University of California Humanities Research Institute, they'll make less distinction between online friends and real friends, and will be more discerning about what they choose to take from popular culture. And according to Larry Rosen, a California professor, they'll be better at multi-tasking: his research has shown that 16 to 18 year-olds can perform seven tasks on average in their free time (texting, checking Facebook, watching TV, etc), whereas people in their early 20s can only handle six, while those in their 30s perform about five and a half.

My own prediction, from watching my 9 and my 11 year-old in action, is that kids will give up on conventional television. Boy and Girl now watch all their programmes via the internet on laptops, so that they can see exactly what they want when they want: Girl goes for Horrible Histories or cookery programmes on BBC iPlayer; Boy downloads the latest episodes of The Simpsons from the US. No one showed them how to do this, and they're not especially techno-minded: they just intuited it in that scary way children do.

Will they all abandon printed books and start reading everything on Kindle? Or will it be the next micro-generation that does that? And will there be some kind of retro backlash where, in a statement of difference, kids start gravitating back to books and old-fashioned texting, or even vinyl LPs for their superior, warm, analogue sound?

The truth is we just don't know, and anyone who claims otherwise is talking nonsense. As The Spectator's techno guru Rory Sutherland, aka Wiki Man, points out, there's not even consistency among age groups around the world. "For example, US kids were much earlier adopters of instant messaging than British kids, except in odd pockets like Cleveland, Ohio – where texting was huge. And in Japan eBay isn't big, but Yahoo is colossal. And in Poland, they don't Tweet, they Gadu Gadu, while in India and Brazil they prefer Orkut to Facebook."

All we can say with confidence about future technologies is that they're not going to be the disaster we Luddite oldies instinctively fear. (Remember the fuss about how texting was going to wipe out a generation's literacy, thanks to abbreviations like gr8? These were largely an urban myth: hardly anyone used them, and those who did were shown by research to be children with the higher reading ages.) And that, in another couple of years, we're going to find ourselves more passé than we could ever have imagined.

Source - TelegraphUK

The Year's Best Marketing

This is not a list of successful marketing campaigns from 2009. It is however a summary of the underlying traits and consistencies found in home run marketing programs. As the article reveals, all campaigns worthy of recognition exhibit the six C’s of success. Thinking about your work over the last year, are you proud of your efforts? What did you learn this year that you will apply in the near future? We’d love to hear your feedback. Hit us up on Twitter at @_Fire_Starter_ or email us.

Great branding and marketing happened all the time in 2009, only it often occurred in some less noticed and most unlikely places.

In fact, I'm not sure we possess the right criteria or language to agree on what "great" even means. So many things have changed − from our channels to our expectations − that much of what was celebrated in the media (and promptly resold to other clients) just left me flat. I had this sneaking suspicion that we were missing something all year long.

A shared idea of purpose. Criteria for success.

A program.

I wrote a number of Dim Bulb essays during the year on what I thought were home runs that you'd otherwise miss; when I reviewed them for my new book, I discovered an underlying consistency across all of them. A pattern of design and execution that I believe drove all of the successes, whether large or small. The best campaigns all exhibited novel thinking in one or more of what I've concluded are the six categories, or Six C's of Success, which are:

1. Channel. "New" shouldn't be a synonym for "digital" when it comes to media for reaching consumers. The truly inventive campaigns used new ways to communicate, like incorporating heaters in bus stops with ads, or newspapers that were written differently, not just reformatted to look like web pages. Every communications channel is "new" unless you choose to use it in old ways.
2. Creativity. I'm a sucker for a good fart joke just like the next guy, but the really creative content in 2009 wasn't focused on making people laugh as much as inventing new ways to talk about products and services. Who would have ever thought of giving life insurance as a gift, for instance? Successful campaigns redefined the mandate for creativity and put it against finding ways to engage with consumers thatwere relevant, meaningful, and had some utility beyond eliciting a chuckle.
3. Competitiveness. Some marketers rejected the babble of talking about "enhancements" or selling imaginary benefits, and got back to talking about real differences with competing offers, sometimes going so far as to invent their own competition to crowd a market. "Why we're different/better" proved to be a far better basis for social conversations than whether folks thought an ad was good or not.
4. Content. Home run messages had meaning and relevance, not just entertainment value. One of the key winning ideas was to pull campaigns back to the old-fashioned idea of sampling, which helped make a beer message very compelling.
5. Clarity. The best ideas weren't focused exclusively on marketing communications, but the business behind it. 2009 gave us examples of clients linking marketing efforts to results (holding agencies accountable for results...gasp!), which the media interpreted as punitive. It wasn't. Could selling be emerging as the new marketing idea? It would be laughable if it weren't possible.
6. Call to Action. This was perhaps the most important quality of all. Home runs have objectively real actions attached to them, so they're memorable for what happened (and not for what people thought about them). So, for instance, an emotional attachment was less important than the offer to "try our toilet paper." Beyond all the babble about conversation for the sake of conversation, the most successful campaigns provided something after the talk.

The Six C's cut across the more common criteria by which brand and marketing strategies are discussed; I think that one of the biggest risks we run is when we try to do "a digital campaign," or look at a business challenge in terms of the marketing tools available to us. Home runs go above and beyond those common vendor definitions, and are assembled by sometimes unlikely (or unexpected) elements.

They can also be nothing more than scrappy singles, to push the baseball analogy perhaps too far. I'm convinced that some of the best strategies in 2009 were mistaken for tactics; doing "little" things really well was perhaps one of the year's "big" ideas.

So you've got my recipe for success. Want to know which campaigns I thought were the home runs of 2009?

Source - Baskin Dim Bulb

Location Location Location

Social media has drastically changed how we interact and communicate online but its impact on the offline world has been comparatively small. As social media continues to evolve, you should anticipate greater correlation between online and offline communication. As the following article explains, location is the missing link between the two worlds. Although location based services are far from gaining widespread acceptance, they will surely be prevalent in the coming years.

Imagine a world where you sit at your computer and you never go outside. Where you never see another human being. This is the world that sites like Google and Facebook want you to live in.

Though they’d never admit to such a thing, the reasoning should be obvious: The longer you’re at your computer, the more time you’re spending on their sites. The more time your spending on their sites, the more ads you’re being served. The more ads being served, the more money they are earning. No matter why these sites originally started, or what features they add, that is, quite literally, the bottom line. They’d have us strapped to a chair with our eyes taped open like Alex in A Clockwork Orange, if they could. The only difference is that we’d have a contraption on our arms to allow us to click on the ads being shown every so often.

Thankfully, we don’t quite live in that world yet. And there are a couple factors pushing us the opposite way from that. Mobile devices are the biggest one. But even that is still just a screen. You may not be chained to a desk using it, but as plenty of people with an iPhone will tell you, you may end staring at this screen even more than you do a desktop or laptop monitor throughout a day. But there’s another up and coming factor working against our screen slavery: Location.

Social networking has been perhaps the most popular trend on the Internet over the past several years. At first the term was ironic. “Social networking” was anything but social in the traditional sense. But over time, we’ve grown accustomed to the idea that you can do social activities such as play games, collaborate on work, and talk, online. And in fact, many times it’s even more convenient than doing it in person. It’s social, but it’s a different kind of social.

Ever since the term was born, countless people have debated the implications of taking social interactions virtual. At one point or another I’m sure that it has been said that it would be both the downfall of mankind, and the thing that would bring the planet together. The truth is that social networking, while great in many respects, does not fulfill a fundamental human desire: To be in the actual presence of other people.

If you’ll allow me to be embarrassingly obvious for a second: Sitting in a chat room all day, even if all of your friends are in it as well, is not the same as being in the same physical room with them. Even if you all are having great discussions in the chat room, and not saying a word when you’re hanging out with one another, there is just something that’s different. Something that social networking will never be able to replace.

That’s where location comes in. It has the power to be the bridge between social networking and actual social interaction. We’re already seeing the very early signs of this with services like Foursquare, Gowalla, Loopt, Brightkite, and Google Latitude, to varying degrees.

To the masses, most of these services still either don’t make sense, or are way too creepy. Social networks used to be thought of in the same way. This will change.

The people who do use these services likely have at least one story about a situation where a friend saw where they were, or where they planned to be, and showed up to meet up. Some have many of these stories. And for some of us in cities where these services are popular, this happens just about everyday. And it’s really quite amazing.

Is it annoying if a friend shows up if you want to be alone or don’t want to see them? Of course. But that’s why it’s important that you’re in control of what location information you are sending out. Is it creepy if a stranger shows up to meet you somewhere? Of course, but that’s why privacy settings are so important.

Make no mistake, there are hurdles to location-based services gaining widespread acceptance. But the upside of it far outweighs the downside. And with that the case, these types of services are ripe to take off.

At the core level, using a social network to facilitate actual social interaction just seems to make sense. Though I poked fun at them in the intro of this post, don’t think that Facebook doesn’t recognize this. In some ways they already do this through their popular events offering. But anything they do with location — which it should be no surprise, they are working on — will go far beyond this. When you have a social graph with over 300 million users and you add a realtime location component into the mix, it’s going to change things.

I remember the first time I used sites like Facebook, MySpace, and Friendster (back in the day) to find people that I went to high school with who I hadn’t talked to in years. It was a little weird, but also in some ways exciting. Imagine that transfered into the real world. Maybe you’re in a city with a person you went to high school with, but hadn’t talked to in years. It’s unlikely that the two of you were ever run into each other randomly, but maybe you can get pinged by Facebook location when they’re nearby. Maybe neither of you want to meet, and that’s fine. But maybe you do.

The word we keep hearing over and over again for such situations is “serendipity,” but really it’s not. None of this needs to be left up to chance. It’s simply an extension of social networking into the real world.

Another social network, Twitter, is already in hot pursuit of such functionality. Any day now, the service will turn on its geolocation service which will both allow you to send tweets with your location tacked on, and allow you to pass in location information from other services, like Foursquare. As a service with tens of millions of users, Twitter will be the first massive test of location as an extension of social networking.

It may be a while before users start truly taking advantage of it since it is an opt-in feature. But eventually, I believe we’ll see more and more users opt-in to be able to use third-party clients like Birdfeed which let them choose which tweets to attach their location to and let people know where they are.

And beyond individual user data, this location data will be very interesting as an aggregate. Undoubtedly people will use things like Twitter’s geolocation APIs to make services that can show where people are flocking to in realtime. This is the next step for what services like SocialGreat are doing with location data, showing hot spots in towns. And we already know that Twitter is planning to use the data to tailor its trending topics to show the hot things being tweeted about in specific places.

Social networking up until this point has been great. But it’s also really a bit odd. The core concept is still to gather your friends in a virtual construct, while the companies behind these constructs convince you to hang out in them as much as possible. Instead, they should be using the interesting social data they have to help you connect in other places as well. That’s what makes Facebook Connect is so powerful. But that doesn’t extend to the real world yet. But with location, it could. And that’s exciting.

Source - Tech Crunch