Wednesday 2 April 2014

Crowd Analysis


Web 2.0

The term web 2.0 gained currency after the bursting of the dot-com bubble in 2001 (Wedomarketing.com, 2011). According to O’Reilly (2005) many people concluded that the web was overhyped, when in fact bubbles and consequent shakeouts appear to be a common feature of all technological revolutions. However, it was believed that the crash signalled the end of the first phase of the Internet and more exciting stuff was yet to come, they called this new phase web 2.0 (Wedomarketing.com, 2011). Web 2.0 is the term used to describe a variety of web sites and applications that allow anyone to create and share online information or material they have created (Unimelb.edu.au, 2008). A key element of web 2.0 is that it allows people to create, share, collaborate and communicate (Unimelb.edu.au, 2008). This can be referred to as participatory culture as respected industry scholar Henry Jenkins explains it as a world where everyone participates, where we take media in our own hands and where we have the capacity to produce media (Edutopia.org, 2013). From this, a defining feature of participatory culture is the level of social involvement and interaction (Larabie, 2011). Web 2.0 plays an important role in today’s society as it has made it easy for people to create content, publish and communicate their work to the world. There exist a multitude of web 2.0 technologies that facilitate social media and user-generated-content (UGC) (Dooley et al, 2012). Firstly, social media are the web-based discussions between users, which include sharing opinions, experiences and knowledge (Dooley et al, 2012). Secondly, UGC is content created online by a web 2.0 user instead of the traditional journalists and reporters (Khan, 2013). Other categories of web 2.0 technologies are sites such as, blogs, wikis, social networking and file sharing, which allows users to interact, participate, express themselves and build communities online. The phase of web 2.0 has truly turned online users to contributors instead of meagre viewers (Innovativeden.com, 2010). This increased user interaction and participation gives rise to data that can be converted into collective intelligence (Alag, 2009). This indicates a need to understand what collective intelligence is.

Collective Intelligence

 
The French philosopher Pierre Levy originally coined the term collective intelligence in 1994 to describe the impact of Internet technologies on the cultural production and consumption of knowledge (Cameron, 2012). Jenkins (2008) defines collective intelligence as “the kind of knowledge and understanding that emerges from large groups of people”. By this definition, collective intelligence has existed for a very long time. Families, companies, countries and armies are all groups of individuals doing things collectively that, at least sometimes, seem intelligent (Malone et al, 2009). Twitter, Facebook, Wikipedia, Google and Yahoo are all modern day examples of collective intelligence and how large groups of people can work together electronically in remarkably effective ways. According to Tapscott and Williams, in order for collective intelligence to take shape, and thereby drive civilization, a mass collaboration system containing four principles needs to exist (Beer, 2011).






Firstly, there must be openness as in the case of Twitter and Faebook, where people learn about one another and share experiences (Garza, 2010). Secondly, there must be peering where users are free to modify and change documents, as done with Wikipedia (Garza, 2010). Thirdly, there must be sharing of information, which Google and Yahoo have allowed (Garza, 2010). Finally, there must be the ability to act globally where individuals and companies are able to communicate across boarders
(Warren & Finch, 2010). Given the immense global growth of online activity and its increasing importance, few companies can risk not playing in this new channel (Hazan, 2013). The Internet has indeed been an advantage for companies to gather user data to improve their decision-making and successfully divine market desires and create exactly what is needed to satisfy consumers. The industry of collecting, aggregating and brokering personal data is known as database marketing (Marwick, 2014). Database markerketing is a systematic approach to the gathering, consolidating and processing of consumer data that is maintained in a company’s database (Rouse, 2007). This data is being used for companies to learn more about customers activity online, select target markets and deliver more specialised offerings for customers (Rouse, 2007). Understanding the target audience is key to success for companies thus, it is crucial to analyse the collective actions, feedback of people, finding patterns and trends in order to aid understanding and guide actions (Makhija, 2013). Accordingly, companies and change makers are using collective intelligence to analyse opinions, behaviours, identify patterns, trends and recommend actions or inspire change (Makhija, 2013).


Collective Intelligence in Advertising

The Internet’s increasing importance to the advertising industry is its unique role as a gold mine of customer intelligence (
Hazan, 2013). In a short amount of time, the Internet has moved from an occasional tool to one of the principal ways to communicate, enterntain ourselves and do work (Nilsen, 2013). Consumers spend hours every day on the Internet and leaving behind large amounts of information about who they are and what they seek (Hazan, 2013). According to Hazan (2013) consumers daily Internet journey expose their online interest, the content of their communications and the purchases they make. While these consumer actions are similar to what goes on in the “real” world, on the Internet this vast amount of information consumers leave behind can be collected, recorded and analysed (Hazan, 2013). With the collective intelligence aspect of web 2.0 it has become crucial in the field of advertising to gather consumer data as it provides timely, actionable information about customers, allows for better targeting and personalise content successfully (Bruckhaus, 2010). This can be referred to as online behavioural advertising (OBA), which describes a broad set of activities companies engage in to collect information about consumer’s online activity (Truste.com, n.d). This in turn translates into great opportunities for advertisers as they have the chance to dig into this pool of user-generated content, find relevant information for their products/services, improve their creativity and innovation capabilities and turn it into corporate intelligence to develop their operations or find new ideas to move forward (Steve, 2012). There is no doubt that new technologies, devices and media consumption patterns are altering the trajectory of the advertising industry’s growth and expansion (O’Halloran et al, 2010).

Consumer Engagement and Advertising

The proliferation of platforms, technologies and media channels has given rise to a hyper-connected consumer (Carraway, 2013). The flow of information about a company is almost entirely in the hands of the consumer (Montgomery, 2008). As consumers today have access to a wide variety of outlets for product information, including traditional media and new media (Monga & John, 2008). These outlets have provided firms with new opportunities for advertising companies to promote their products and services, nevertheless it have made it more difficult to restrict negative publicity about their product and services (Monga & John, 2008). For instance, if a company offers a bad quality product or service the likelihood for a consumer to light up with indignation on social networking sites is high, which can result in bad reputation (Montgomery, 2008). However, the smartest companies are embracing this openness and involve the consumer as never before (Montgomery, 2008). McDonald’s new campaign ‘our food, your questions’ is a great example of how a company is involving consumers as never before. The campaign is aimed to encourage customers to have a hones online conversation with McDonald’s through a social platform in order to dispel the myths surrounding its food (Ricki, 2013). The image below represents some of the questions that are being asked and McDonald’s answer every food questions.

 



McDonald’s is trying to be more transparent by allowing consumers to find out where its food comes from and how it is made (Harris, 2012). Consumers asked everything from calorie counts of certain menu items to why McDonald’s burgers and fries do not rot when left out for a long period of time (Harris, 2012). However, users have to log in with Facebook in order to authenticate the question. The chief marketing officer at McDonald’s stated that “the program exceeded all our expectations and we have learned from customer feedback that this is an important opportunity for us to continue and evolve the dialogue with our customers” (Harris, 2012). The campaign truly reflects how a company effectively use web 2.0 by introducing a social platform where consumers could post their questions about the company’s food (Infomart.com, 2012). In response, users received personalised replies in text, photos and video formats (Infomart.com, 2012). The campaign received an impressive 5,000 questions and over 2 million interactions, with users averaging nearly five minutes engaging with the site, which exceeds the engagement times of Google+ (Tribalworldwide.com, 2012). These findings are in agreement with Nayyar’s (2013) findings, which found that when companies collaborate with consumers companies have a greater chance to increase the level of the engagement. In today’s society, advertising agencies have numerous opportunities to engage audiences with rich formats across channels, such as Facebook and Twitter. Grey Poupon a brand of Dijon mustard is another great example of how a brand successfully engaged users by creating a campaign on Facebook called ‘society of good taste’ (Thenextweb.com, 2014). This society is a private club committed to only have applicants with the most discerning tastes and those whose applications are denied will have their ‘Like’ rescinded (Thenextweb.com, 2014). The 'society of good taste' campaign can be seen in the video below.





The society of good taste campaign will screen all applicants user profile first to see if they were ‘good enough’ to be fans of the brand (Thenextweb.com, 2014). Grey Poupon took a more reserved approach, as it was not about the quantity of ‘Likes’ but the quality (Thenextweb.com, 2014). Those users who want to become a fan of Grey Poupon’s Facebook page will have to apply for membership and users would be scored based on number of friends, check-ins and their use of grammar (Thenextweb.com, 2014). Access was granted only to the top users who were given exclusive content and rewards. Consequently, those who were not deemed to be worthy has their ‘Likes’ rescinded and were asked to work on improving their profiles before applying again (Thenextweb.com, 2014). Whether or not people actually care enough about mustard to jump through hoops to ‘Like’ it, it helped to show how creativity can work phenomenal for a campaign and secure Grey Poupon coverage in the likes of the New York Times (Thenextweb.com, 2014). The brand truly demonstrated the potential there is to be innovative with social media technology. As seen in the examples above it is indeed important for companies to be creative and take advantage of web 2.0 technologies in order to keep its competitive edge and harness consumer data of those who have visited the website to build new and useful advertising strategies. This is evident according to a recent report from the McKinsey Global Institute (MGI), who found that consumer data is the next frontier for innovation, competitive advantage and productivity (Hemsley, 2014).

Risk and opportunities for collective intelligence

 
With the growing impact of the Internet there is no doubt that it has been more of an advantage for the advertising industry as it gives them extraordinary power to collect, store and analyse user data. In other words, companies are now able to learn a great deal about web surfers who visit their websites. Using tracking devices known as “cookies”, companies are able to track purchases and gather personal data (Globalization101.org, 2014). This vast amount of intelligence is being used to improve targeting efforts at individual consumer or group of consumers (Globalization101.org, 2014). However, consumers are increasingly aware that businesses use the growing volume of individual data they leave behind for corporate gain. Thus, a concern about privacy and data security is growing phenomenal (Overby, 2013). Companies are looking at web 2.0 applications for several reasons, one being that social networking sites is an easy way for individuals to share information about themselves (Herold, 2008). However, this information can also expose consumers to privacy issues including spam, data tracking and malware (Boundless.com, 2013). Indeed, it is plausible to argue that it is a marketing strategy to give the consumer what he or she wants thus the consumer is just being targeted because he or she has already shown interest in the product or service. Yet other evidence suggests that there is no privacy statement that the information is used for targeted advertising (Jegatheesan, n.d). According to Jegatheesan (n.d) it is the right of the users to know how the information collected is used and how securely it is handled. In the example of McDonalds and Grey Poupon it seems clear that both companies required users to log into their Facebook account if users wanted to take part in their campaign. This big data of user profiles can be brought together and analysed to discern pattern and make better decisions for future strategies (McGuire, Manyika & Chul, 2012). A recent report from the McKinsey Global Institute (MGI), shows how is has become economically relevant for companies to gather mass volume of data and use it for insights (McGuire, Manyika & Chul, 2012). Big data can indeed help to build new growth opportunities and completely new categories of companies, such as those that collect and analyse industry data (McGuire, Manyika & Chul, 2012). A vital competency for data-driven companies in the future will be the ability to create compelling value propositions for consumers. Thus, collective intelligence is truly beneficial for the advertising industry as it allows them to understand user behaviour, which can result in a way of providing a better value and user experience for consumers, as the content is more personalised. Consequently, collective intelligence will therefore become a very important part of any web project (Netreturnconsulting.com.au, 2013).

References

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