Doc Searls’ post on The Intention Economy in 2006 talked about how we might be transitioning to a very different sort of market.
This post is just a collection of thoughts about the Intention Economy and the remnants of the advertising economy. It’s online only i.e. it ignores TV and Print and other mediums that are dominated by advertising and where we all are ‘told’ implicitly and explicitly what we should buy.
To best understand the new Intention Economy we must start by understanding the current Advertising Economy outside of the Internet.
Anti-Intention Economy – Harvesting People like Cattle
The current Advertising Economy is the product of companies getting exceptionally good at creating a need and convincing people that their product fulfils that very need.
The Anti-Intention Economy - Part 1 is creating an artificial need or highlighting a real one
It’s hard to sell things to happy people. That means the first critical aspect of the Anti-Intention economy is to create a need or stress an actual one.
- It’s why fashion magazines have air-brushed models.
- It’s why you have ads for wonder diet pills and get rich quick programs.
- It’s also why most products link themselves to sex.
The Anti-Intention Economy – Part 2 is promising Product X will fill that need.
After you’ve created a need (or reminded people of a real need) the next step is to promise that your product will fulfill that need.
- Shiny, happy people next to the product.
- Miserable people with a competitor’s product.
Pretty much anything that creates a link between your product and the fulfilment of the need.
People don’t want to admit they’re ‘influencable’
What makes all of this beautifully powerful is that people don’t want to admit that they can be influenced i.e. very few people ever admit
- That they’re way likelier to buy a $199.99 gadget than a $200 gadget.
- That reading a fashion magazine makes them miserable (although research shows this to be true). They think it makes them more fashionable.
The Anti-Intention economy works so well because admitting it works is hard and painful.
Instead of thinking of advertising as ‘manipulative’ we tend to think of it as ‘necessary’.
The Anti-Intention Economy breaks down online
The Internet is free of control (at least until one company takes over) and that means people choose their own path.
People decide where they go and what they notice
There is no TV schedule, no commercials, and there’s basically banner blindness. People on the Internet don’t even notice ads unless they are tricked into thinking they’re not ads.
You can’t really create a need or stress an existing one if people are ignoring you.
Why then are people still trying to make money off of advertising?
They’re mistaking Google’s success as proof that online advertising works.
Google Ads are just shortcuts
Consider the direction in which Google is taking all its advertising – they’re text ads that resemble content, they’re more and more relevant, there’s quality screening.
It’s almost as if Google understand the Intention Economy and only want to show users ‘ads’ that take them where users already intend to go.
Here’s a longer post talking about how Ads only work when they are shortcuts.
Advertising just doesn’t work as well on the Internet
Almost every company other than Google has been struggling with advertising.
- Advertising requires, amongst other things, that people be somewhat ignorant, be gullible and trusting, and be a captive audience.
- The Internet kills all of this.
There are also a lot more ethical people and entities online.
The culture and beginnings of the Internet results in lots of sites and blogs and services that are not primarily focused on profits.
- It’s much harder for a single person to rationalize profit over the good of other people.
- A company can hide behind concepts like profitability and growth.
- Companies can also minimize the risk of punishment for being unethical.
Advertising loses a lot of its power if there are alternate companies and sites that do not advertise.
Most Internet companies founded with VC money or as for-profits continue to think they can ‘convince’ people to do things they have no intention of doing.
Sellers can only fight the Intention Economy to a certain point
We get this really interesting contest -
- Customers are getting smarter and smarter. They’re well-informed, they understand what they want, they ignore advertisements.
- Companies are trying harder and harder to sell people things they don’t need. They’re using more and more user information and more and more manipulation.
Sellers want customers to be ignorant, have limited options, and they want to create artificial scarcity and various other illusions.
The Internet strips all of this away.
To keep ‘selling’ companies have to keep evolving and coming up with better ways to fool people who are getting smarter and better informed. It’s a losing proposition.
Companies that embrace the Intention Economy have a HUGE advantage
Perhaps the biggest negative against Advertising Economy companies is that there are companies online (like Newegg, Amazon) that work with the Intention Economy.
- While Advertising Economy companies are trying to manipulate people, Intention Economy companies are educating people.
- While Advertising Economy companies are adding on costs and reducing long-term customer satisfaction, Intention economy companies are creating loyalty and cutting costs.
- Working off of Intention means you’re filling an existing need – none of the costs associated with creating and maintaining the illusion that a need for your product exists.
A company that gives customers what they already want will always have an advantage over a company that is trying to sell customers something they don’t really want.
Note: People who forsake profits entirely are not as useful as for-profit companies that are ethical. The latter have more resources to compete against unethical for-profit companies.
The Intention Economy – What Really Works Online
To better understand this it’s worth looking at some key qualities of the Intention Economy.
It’s very hard to trick people
In the new intention economy you’d probably need a ton of PhDs to sit down and spend years together to figure out how to fool people.
It’s only companies that are absolute masters of human psychology or manipulation that can succeed long-term. They also have to constantly improve their tricks and also keep hiding their past manipulations.
It’s so much effort it almost makes more sense to help people instead.
Tricking people has very high costs
Not only is it very hard to trick people the costs of discovery are immense.
If a company does something dishonest the whole world gets to know very, very quickly. The damage to reputation is huge and often irreparable.
Needs and Desires are much better understood
People have a much better understand of the distinction between -
- Things that are good for them.
- Things they want.
- Things they need.
- Things that are bad for them.
- Various combinations of the above.
It’s no longer impressionable minds being flashed images of popcorn and soda every 20 seconds.
Helping People replaces Selling People
We’re left with a void -
If we can no longer ‘sell’ things to people what role do we have left?
What can companies do when people already have intentions and work off of them.
Here are a few things and they’re all centered around helping people -
- Help people get clarity.
- Help people make a better decision.
- Help people be better informed.
- Help people save money and/or time.
It’s the ultimate win-win – you help people decide what’s best for them and then help them get it. In return they help you.
The really smart companies are already doing this (in addition to product pages they have search, bestseller lists, comparisons, reviews, shopping guides, tips, and more).
The Intention Economy is hard to understand because it’s so simple and so contrary to what we are used to
Most companies are completely stuck in a world of -
- Really complicated processes i.e. market research, advertising, selling, explicit and implicit manipulation.
- Customers needing to be told what to buy.
- Information asymmetry where buyers know a lot less than sellers.
The Intention Economy is so simple that it confuses people – You mean to tell me people already know what they want to buy and are ready to buy it and all we have to do is help them?
One of the best ways to work with the Intention Economy
Simply help people make a better decision and get what best fits their intentions.
- This means increasing customer knowledge not reducing it.
- It means working with customers’ actual needs not creating artificial ones.
- It means increasing clarity on what a product does and how it fits customers’ needs.
You’re making customers more and more powerful and giving them more and more freedom. Most importantly, you are getting customers exactly what they want.
It’s so painfully simple that most companies don’t get it. It’s true that in a system like this a manipulative company would have a competitive advantage – However, that competitive advantage can only exist for uninformed customers.
For every empowered customer, a company that works with the Intention Economy will be the natural choice.
Filed under: thoughts Tagged: | ethics, intention economy
