An ethical bargain

Transparency, relationships and other things corporations could learn from a small bookstore.

bookstore by loranger, on FlickrThe Readers’ Forum is a small independent bookstore in Wayne, Pa. and I’ve been buying books from Al, the proprietor, since the mid ’90s. It’s ironic to me that while the one-two punch of Barnes & Noble and Amazon have been killing his business (and impoverishing him in the process) Al does with ease what every analytically-minded well-funded retailer has been trying to do: He gives me great recommendations that result in a very high marginal sales rate. I probably buy at least half of the books that he recommends.

I wander in, usually on my way up the street to grab a bite to eat, and we chat for a bit. Then he says “oh, I have something for you” and he makes his way to the counter and digs into a pile. “I remember you went to Mumbai after the attacks. You might find this interesting.” And I did find it interesting, if not more than a little bit painful to read.

It looks so simple. He remembers what I buy, engages me in conversation, and sometimes in the process finds out more about me. Then he suggests things that he thinks I’ll like. Or maybe he just suggests things he likes. I don’t know, but it works. His recommendations aren’t “like” the other things I’ve read in the typical clustering algorithm sense, and maybe that’s exactly why they work. Anyone can suggest the next volume of Harry Potter, but his suggestions regularly stretch my notion of “the kinds of books I like.”

I should clarify something. He doesn’t engage me in conversation with the express purpose of feeding his algorithms, or at least I don’t think he does. Over the years we have become friends. Maybe not hang out on the weekend friends, but friends in context. I look forward to stopping in for our chats and he enjoys the break. As a side benefit his algorithms get what they need and I get good reads. And that’s the thing that retailers everywhere could learn from him. He isn’t just trying to build a machine-embedded model of my behaviors and profit off it, he is engaging in a two-way interaction that is a pleasure in its own right. And as a result it’s not the least bit creepy when he hits me with an uncannily good recommendation.

It’s not like I was buying books there for years and then one day some guy pops out of the basement where I realize he’s been watching me through the skylights and says “I think you’ll like this book!”

“Uh, why do you think that?”

“Well, I have compiled a detailed dossier on your buying habits, including the things you picked up but didn’t buy. You shouldn’t put as many back down by the way. I imagine you think you have interesting taste but really, you can be a bit pedestrian in your picks. Also, sometimes my friends in other basements will let me know where you travel, how much money you make, and who you date in exchange for me telling them what you read. Anyway, based on all that I think you’ll like this book, you should buy it!”

Nope, Al and I are engaging in an ethical bargain. For starters, it is completely obvious and transparent. I never imagine that I’m buying anonymously there. And I get more out of the bargain than I give up because his algorithm is incredibly data efficient. Also because I know the nature of the deal, if I happen to need another copy of “The Anarchist’s Cookbook,” I can just buy it somewhere else.

Al is a sole proprietor, so when I buy from Readers’ Forum I’m buying from a person. Despite the root meaning of “corporate,” a corporation will never be able to be the simple embodiment of a single actor. However, I think they can still learn from Al.

The way corporate retailers do this stuff is often quite different. Too often their approach gives weight to the argument that corporations are fundamentally sociopathic. Here’s one simple example: I went into a Meijer’s near South Bend, Ind. to buy a six pack of beer a few months ago. At the self check out lane I scanned my Guinness and the machine asked me for my birthday. I was like “screw that, I’m not entering my birth date.” So I canceled the transaction and got in line at a register that had a real live human cashier. She asked for ID to prove my age and when I handed it to her she started to key in my birthday. I stopped her and asked what she was doing. “I need your birthday to prove you are 21.”

“Well, just look at it. You don’t need to key it into the machine to know that I’m over 21.”

“Sir, I’m required to.” That’s the point where I muttered “bull” under my breath, asked for my ID back, and walked out.

That’s a sociopath at work. “Let’s use the age limit for beer as an excuse to harvest customer birth dates. We can use that data to correlate them with data we are buying from marketing services providers and then when we fill our customers’ mailboxes with pulped Brazilian forests we will have a 0.3% better chance of drawing them back into the store where our HFCS-loaded end caps will grab them. If a customer complains we’ll just hide behind ‘the process’ and let our cashier deal with the awkward moment.”

Perhaps that sounds a bit harsh, but that was my reaction and I haven’t returned to one of their stores since. It’s not just the sanctity of a bit of my PII that was a big deal, it was the dishonesty of an opaque and misrepresented bargain that got me so irritated. That is not the kind of thing Al would do.

OSCON Data 2011, being held July 25-27 in Portland, Ore., is a gathering for developers who are hands-on, doing the systems work and evolving architectures and tools to manage data. (This event is co-located with OSCON.)

Save 20% on registration with the code OS11RAD

As an aside, while people have been fascinated and disturbed by the news that Columbian drug cartels are building submarines, I’m wondering when they’ll start building Hadoop clusters. Just wait till your corner dealer is entering profile data into his smart phone at the point of sale. “Sir, can I get your zip code and the last four of your social? Ah, I see you are a loyal customer. You should really join our loyalty program. I can offer you a free bag of orange kush if you sign up today.”

By the way, if it seems like I might be drawing a comparison between a 100,000 square-foot HFCS pusher and a Columbian drug cartel …

Okay … Let me just ask this: If you are involved in data capture, analytics, or customer marketing in your company, would you be embarrassed to admit to your neighbor what about them you capture, store and analyze? Would you be willing to send them a zip file with all of it to let them see it? If the answer is “no,” why not? If I might hazard a guess at the answer, it would be because real relationships aren’t built on asymmetry, and you know that. But rather than eliminate that awkward source of asymmetry, you hide it.

The reason I’ve been thinking about all of this is because of my new job. From 2003 until January I was a defense contractor. I worked for a company that built large-scale training simulations and did command-and-control system integration. I also worked on a lot of systems strategy and planning. I know for some people that makes me suspect, but while the bureaucracy, waste, and general inanity of the federal government sometimes drove me nuts, I never felt wrong about what I was doing. But in January I took on the challenge of building a data management practice focused on Hadoop and while it has been fascinating work, it has given me the creeps more than a few times.

I think what’s interesting is that you can’t help but get caught up in the moment. “If we could just join this stuff with that stuff, and then get this additional attribute, we could build a really sweet model. I’m sure that would get you some prospecting lift.” And then we all look at each other for a moment and go “wow, and that would be kinda creepy, too.” Thankfully I’m not the only one reflecting on the ethics of all this.

Ft. Meade in Maryland is that state’s single biggest consumer of electricity, and no small amount of it is being consumed by Hadoop (or similar) clusters that, as it turns out, are probably surveilling you. That is a troublesome thought, but only about half as troublesome to me as the the even more thorough, broad, and pervasive corporate surveillance we are unleashing on ourselves. The only thing that keeps me sleeping is that the competitive dimension will slow the rate that these pools of data coalesce.

Jeff Hammerbacher is concerned that the best minds of our generation are wasting their talents on advertising. I agree with him, vigorously, but to me the even bigger issue is that the kind of advertising we are doing now depends on pervasive surveillance and the reduction of who we are to mere behavioral models. In fact, I find it the height of sad irony that Jeff, and many good meaning people like him, have become the de facto arms dealers of the surveillance state. Of course that isn’t their intent, and they may not work inside the beltway, but they are no less arms dealers than Boeing is. “Would you like a Dreamliner Hadoop cluster, or the F/A-18 kind? Never mind, they are exactly the same.”

When Apple got pie on its face with that location data hubbabaloo the only real surprise as far as I was concerned was that it was a surprise at all. But that’s the point, really. The fact that people were surprised speaks to the asymmetry of the bargains they are party to. The Jeff Jonases of the world certainly understand what data is being collected on all of us, but the average consumer doesn’t. And why don’t they? Are they stupid? Nope. Do they not care? Apparently at least some of them do care.

No, I think it’s because our online relationships aren’t at all like my real-world relationship with Al. The full nature of the transaction isn’t obvious, visible, and transparent and there is little chance a corporation will think like my friend. Most of the relationships you build with corporations are like icebergs and essentially hidden from view, and corporations like it that way. We don’t really want people asking questions about stuff we think they won’t understand. As corporations we may be sociopathic, but even a sociopath knows that awkward questions aren’t just uncomfortable, they’re bad for business.

So, assuming there could be a more human corporation, that could build symmetric ethically-grounded relationships with you, what would that relationship look like? Would transparency and choice be enough to make it symmetric? Could a relationship with a corporation feel at all like the one I have with Al? Could it be obvious, transparent, and a pleasure in its own right? Or, what if instead of asking ourselves “what data do we need and how could we get lift from it?” we asked “what is the value to our customer when we store and use this data and how do we make both the value and our stewardship of the data obvious and transparent?”

Photo: bookstore by loranger, on Flickr


tags: , , ,