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[berkman] Doc Searls

Doc Searls is giving a Berkman lunch called “The Intention Economy.” [Note: I'm live-blogging, missing points, paraphrasing badly, making spellping errors, etc.

He begins by talking about some problems. E.g., "the people vs. Comcast." Customers are unhappy. "Comcast can't fix itself alone." Or, customer loyalty cards that are the Green Stamps of our time. "They leverage something that's broken about e-commerce." E.g., the Harvard Co-op gives a 10% "discount" if you join. But they make you enter a ton of personal data, the same data you enter at every other e-comm site. Or public radio: Everyone in the room listens, but only about half give. Doc would like to be able to give to support particular programs.

The problem in all these cases is Customer Relationship Management (CRM). CRM is not about relating. "The problem is that most big businesses think that the best customer is a captive one." "That's why the free market is still your choice of captor." But "we're now about three minutes into the Big Bang" when it comes to the Net. The challenge is to "prove that a free customer is more valuable than a captive one."

So, Doc has started Project VRM (vendor relationship management) to provide ways for customers to drive relationships with vendors. "With VRM, the individual is the point of integration for his or her own data" and is also the "point of origination of what's done with" that data. There have been VRM meetups across Europe and North America.

VRM is an open source project (although there are some commercial projects underway also). Doc talks briefly [too quickly for me to keep up] about some of the people involved. Likewise for projects: Personal health info. “Personal RFPs” where a customer sends a query to vendors for bids on things the customer wants to buy. The user wouldn’t give away any unnecessary info. Also: Making terms of service readable and user-focused.

Doc spends a little more time on creating a new business model for free media that isn’t advertising. Free media first means non-commercial media, but ultimately for blogs, etc. The model is temporarily named “PayChoice,” and is based on letting individuals pay how much they want when they want for what they want. The Public Radio tuner is one result. 1.3M have downloaded it into their iPhones already. It turns your iPhone into a radio tuned into public radio. It enables listeners to hold up their end of relationship. The “R” button lets a user pay for what she wants. But it’s not just for paying. It could also represent an intention to buy, and intention to sell, etc.

So, what happens when customers get real power?

- “Customers get their own pricing guns” [i.e., the "guns" that print out price labels].

- “The intention economy” will get real because it’s based on what customers really want, as opposed to the attention economy that’s based on guesses.

- “The advertising bubble will burst.” There will still be ads, but they won’t be the “communications method of first resort.”

- “Cluetrain will finally be right.”

Q: What about eBay?
A: There are lots of sites that do this, but why should we only have sites? Your eBay reputation is only inside eBay. Why should it be stuck there? We want service portability.

Q: What will be the method conveying your desires to companies? A third party service? A non-profit?
A: On the public radio tuner, the “listen log” keeps track of what you’ve listened to. Ideally that would sit on our own computers in encrypted form. Some of that we’re solving with Ian Henderson’s personal data store, some with Lukas’ The Mine. But let’s say we have that solved. Right now, we use “third parties,” which generally live on the vendor’s side. We see a fourth party business, driven by users. E.g., with music, it’d be good to be able to set a price on the music you stream. Some fourth party business will pull that money together. We’re working on a chapter-based association for user-driven services.

Q: So you create sort of a DNS service…?
A: One model is RSS. It’d be good to be able to advertise your needs, possibly through RSS. Maybe it’s tag-based, maybe it’s anonymous.

Q: What do you envision for traditional companies dealing with this?
A: Let’s we have our own loyalty card. As customers inject more intelligence into the marketplace about what they’re willing to say about themselves, we’ll see things like fact-checking of vendors’ claims against us; it’d be cool if the customer could as a data backup. I don’t see a downside for traditional customers. More intelligence and more good will in the market will benefit everyone. It’s a fallacy to think that people only shop on price. Starbucks proves the contrary

Q: [me] Situate this in micropayments and tipjars, and identity management.
A: We’re doing micro-accounting, not micropayments. Small payments are accumulated. Micropayments haven’t worked for anyone except the phone company, and they abused it. WRT identity: I’ve been interested in that for a long time. Along the way, Andre Durand (of Jabber) once said that we have to get identity worked out. Identities are given to us by other corporations: what the DMV, the library, Visa (etc) tell us who we are. Andrew thought this was backwards. We have to reverse it. I now think that that’s important, but it’s separate from VRM. There are times when identity isn’t used at all. My wife about 15 years ago asked why we can’t take our shopping cart from one site to another. And when I was working with the ID management folks, my wife said she wants less identity, not more. Adriana Lukas’ The Mine project is intended to work independent of any identity system. The whole identity movement is a separate thing that overlaps VRM somewhat. VRM isn’t part of the identity space.

What happens on the aggregate level? A lot of CRM is about companies aggregating anonymized data and using it for recommendations, etc.
A: Companies will continue to gather intelligence about us. Companies can improve that. Amazon’s recommendations are the best, but they’re still broken. Your kids use your computers and your recos go off track. Or you buy one book and Amazon thinks you’re interested in the category. Those recos are still guesswork. And they don’t know what only you know, and what’s outside their system.

Comcast is actively providing what I don’t want because they want to sell more on-demand. Do you see VRM breaking down those monopolies?
A: Cable TV is really broken. We have Verizon FIOS. The TV is fantastic. But they only provide 20MB for Internet. For us that’s backward. I tried canceling, and they came back with an offer that reflects their real costs. But we don’t watch TV, so we still said no. I offered to pay a la carte, but nope.

Q: What are the enabling technologies for VRM? If companies still haven’t figured out how to do this, what do you have to provide?
A: Money. If there’s money left on the table…We’re doing field of dreams here.

Q: Thinking about Linked Data/RDF for putting this data out in a much richer way? It’s the rich, decentralized model you’re looking for.
A: The short answer is no, but the longer answer is sure. We’re in touch with those folks. It’s a matter of who shows up.

Q: Is this more generational?
A: I don’t know. It’s whoever shows up. We need to make stuff that benefits everyone.

Q: What about characterizing the ecosystem you’re trying to build with certification levels of VRM? Companies could advertise that they’re at different levels of VRMitude.
A: We have a draft of this, on the wiki: ProjectVRM.org We also want a list of core principles.

Q: How do you balance the explicit data sharing in advertising intent (“I’m looking for a car”) with the fact that sites are selling that data to vendors?
A: The whole VRM idea came out of one use case: car rental. The variables are never what they’re offering. E.g., I want to be able to get a car that plays MP3 CDs. As more customers can advertise their needs, it will change those businesses, and probably discourage the profligate sharing of information.

Q: What about customized fabrication, i.e., making products in response to customer desires. What does this do to branding?
A: Some companies are going to succeed by giving people what they want. We’re all different and want different things. That’s what the Net will come down to eventually.

Q: Insurance companies and lendors have competitive vendors markets. Imagine that for car rentals…
A: That’s an example of a personal RFP. It’s an example of a substitutable service.

Q: Individuals will never be on an equal basis with, say, Verizon. What about collaboration?
A: I avoided that. We don’t want to start with the collective and move to the personal. We want to start with the personal. We need lots of individuals doing VRM for it to work. We want this to be a victory for Verizon as well.

Q: It’s going to be hard to get businesses out of the captive customer mindset. Is VRM a pipe dream? Will companies fail and VRM-ish ones arise?
A: All of the above. Some leopards won’t change their stripes. They’ll also have to wake up and smell the coffee.

Q: What about the cultural domain? NGOs?
A: Huge opportunities. Britt Blaser is working on Government Relationship Management. A lot of great opportunities came out of the Obama campaign. There’s a great outfit in the UK with a site called fixmystreet.org: post photos of potholes and the local gov’t patches them. Being able to express what you’re looking for will work with any type of organization. Take Relationship Management and stick another letter in front of it. We want the demand side and supply side to get along. [Tags: ]

8 Responses to “[berkman] Doc Searls”

  1. “Q: Individuals will never be on an equal basis with, say, Verizon. What about collaboration?
    A: I avoided that. We don’t want to start with the collective and move to the personal. We want to start with the personal. We need lots of individuals doing VRM for it to work. We want this to be a victory for Verizon as well.”

    And there you have it :-(.

    One thing I have learned, and often need to remind myself so as to avoid geek arrogance – these are smart people. They know what they’re doing.

  2. Q: Insurance companies and lendors have competitive vendors markets. Imagine that for car rentals…
    A: That’s an example of a personal RFP. It’s an example of a substitutable service.

    For what I know. The insurance will goes up to 20% more due to the accident claims. Could it be their shares affected it and they find an excuse to raise the price?

    Singapore Car Rental

  3. [...] visualisation, vrm, vrmhub I was just reading David Weinberger’s excellent notes of Doc Searls’s Berkman lunch and realised what I was talking about at the VRM thing last November I’m sorry it’s [...]

  4. With vendor relationship management on the agenda of huge public and private organisations, could VRM change market dynamics?

  5. To obtain maximum value, organizations must effectively manage a wide range of relationships from transactional to strategic.

  6. That could be the reason Daegan.

  7. Q: Insurance companies and lendors have competitive vendors markets. Imagine that for car rentals…
    A: That’s an example of a personal RFP. It’s an example of a substitutable service.

    Daegan, that could be the reason.

  8. Travel industry is becoming most competitive with several new players jumping in, but ones with good offers and services shine always.

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