Intention Economy

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A concept proposed by Doc Searls, editor-in-chief of Linux Journal.

More at http://www.linuxjournal.com/node/1000035

See also the relate article about the Pull Economies


Description

Doc Searls on the Intention Economy

"The Intention Economy grows around buyers, not sellers. It leverages the simple fact that buyers are the first source of money, and that they come ready-made. You don't need advertising to make them.

The Intention Economy is about markets, not marketing. You don't need marketing to make Intention Markets.

The Intention Economy is built around truly open markets, not a collection of silos. In The Intention Economy, customers don't have to fly from silo to silo, like a bees from flower to flower, collecting deal info (and unavoidable hype) like so much pollen. In The Intention Economy, the buyer notifies the market of the intent to buy, and sellers compete for the buyer's purchase. Simple as that.

The Intention Economy is built around more than transactions. Conversations matter. So do relationships. So do reputation, authority and respect. Those virtues, however, are earned by sellers (as well as buyers) and not just "branded" by sellers on the minds of buyers like the symbols of ranchers burned on the hides of cattle.

The Intention Economy is about buyers finding sellers, not sellers finding (or "capturing") buyers.

In The Intention Economy, a car rental customer should be able to say to the car rental market, "I'll be skiing in Park City from March 20-25. I want to rent a 4-wheel drive SUV. I belong to Avis Wizard, Budget FastBreak and Hertz 1 Club. I don't want to pay up front for gas or get any insurance. What can any of you companies do for me?" — and have the sellers compete for the buyer's business.

This car rental use case is one I've used to illustrate what would be made possible by "user-centric" or "independent" identity, which was also the subject of the cover story in last October's Linux Journal, plus this piece a year earlier, and various keynotes I've given at Digital Identity World, going back to 2002. It is also the use case against which the new open source Higgins project was framed.

Even though I've been thinking out loud about Independent Identity for years, I didn't have a one-word adjective for the kind of market economy it would yield, or where it would thrive. Now, thanks to all the unclear talk at eTech about attention, intentional is that adjective, because intent is the noun that matters most in any economy that gives full respect to what only customers can do, which is buy." (http://www.linuxjournal.com/node/1000035)


Examples

From Trendwatching.com :

"Real Estate in Finland:

http://www.igglo.fi/

Finnish real estate site Igglo lets potential buyers 'pre-order' houses that aren't on the market. Igglo has photographed every building in Helsinki and several other Finnish cities, and combines these photographs with satellite images and maps. Every property is listed, not just those that are currently on the market. (Their tagline is: "Your house is already on Igglo.") Potential buyers can earmark a building, street or neighborhood they're interested in, and post offers online. This lets potential sellers find out how desirable their property is, even if they weren't actively considering selling. Buyers also receive an alert when a property in their earmarked building or area comes up for sale. If demand and supply meet, Igglo handles the transaction for a lower fee than is charged by regular real estate agents (less than 2%). Lower fees are made possible by the fact the Igglo agents don't get involved until buyers and sellers have found each other. Consumers like it: the site attracts more than 50,000 visitors a week, and the company is now working on European expansion; a recent EUR12.5 million (USD 15.7 million) first venture round led by Benchmark Capital Europe will certainly help.

Similar sites: http://www.blockhunter.com/, http://www.elkhuistekoop.nl/


Events

http://eventful.com/

enables users to find and post local events anywhere in the world, but also lets them demand events and performances in their town and spread the word to make them happen. At last count, there were more than 126,000 demanded events on Eventful.


Aggregating Intentions

Teambuying in China

http://020.teambuy.com.cn/english

Of particular interest is the tuangou ('team purchase') phenomenon, which involves strangers organizing themselves around a specific product or service. Think electronics, home furnishings, cars and so on. These likeminded then meet up in real-world shops and showrooms on a coordinated date and time, literally mobbing the seller, negotiating a group discount on the spot. Popular Chinese sites that are enabling the crowds to first group online, then plan for actual real world shopmobbing, are TeamBuy, Taobao and Liba,

Combined, these sites now boast hundreds of thousands of registered members, making money from ads and/or commissions from suppliers who are actually happy to have the mobs choose their store over a competitor's.

Similar sites: http://www.taobao.com/vertical/groupbuy, http://www.liba.com/


Taggable Coupon sites in India

http://www.offersforshoppers.com/

Offers For Shoppers is an online coupon site, dipping its toes in the CROWD CLOUT pond by letting customers tag any interesting offer, and thereby revealing their intentions. When the number of potential buyers reaches a pre-determined total (a number that vendors consider a bulk buy), customers are notified and offered a take it or leave it bulk price. Clearly one to be copied by the social shopping sites that are now mushrooming in the US. Offers For Shoppers is an online coupon site, dipping its toes in the CROWD CLOUT pond by letting customers tag any interesting offer, and thereby revealing their intentions. When the number of potential buyers reaches a pre-determined total (a number that vendors consider a bulk buy), customers are notified and offered a take it or leave it bulk price. Clearly one to be copied by the social shopping sites that are now mushrooming in the US."


Discussion

Esther Dyson on the Intention Economy

"I think you'll see a fundamental shift in the balance of power towards individuals. Individuals will declare what kinds of vendors they want sponsoring their content, and then those vendors will have the privilege of appearing, discreetly, around the user's content. There will be much less "advertising" and much more communication to interested customers. Advertisers will have to learn to listen, not just to track and segment customers.

So the message to marketers is: If you can't sell your product (assuming it's already in the market), fix the product! Don't try to change the situation by advertising.

Consumers will publish wish lists for marketers to scan. Also, their choices will be influenced by their friends' comments much more than by marketers' messages.

On the other hand, it will be much harder for consumers to get free content anonymously, because advertisers will want to know more about the people they are paying to reach. In many cases, whether email or ads, users may even get a share of the marketer's payments. (See AttentionTrust.org or my op-ed on Goodmail or my post on Release 1.06.)

This makes sense from advertisers' point of view, but it has a social downside: People who buy Porsches can earn more from marketers than people who buy used cars. People without money will find it harder and harder to get free content -- which means a role for nonprofits in funding access to content for all." (http://www.attentiontrust.org/node/184)


Esther Dyson on how the attention economy differs from the intention economy

"There's a lot of, er, attention being paid right now to the so-called "attention economy." Indeed, O'Reilly [Media Inc.] subtitled its recent (March) Web 2.0 conference "The attention economy." It even featured author Michael Goldhaber, who wrote about the concept some 14 years ago for my newsletter Release 1.0.

But people are generally missing the point; Mr. Goldhaber has trouble getting attention for the mirror he is holding up. Most commentators see the attention economy as the intention economy, where attention = intention (to buy). That version of the attention economy is all about sales leads and monetization of attention, and radical ideas include the notion of users getting paid for their attention, as I mentioned earlier, whether in the form of surfing behavior or a willingness to read email.

But Mr. Goldhaber's thesis is far more radical, and people aren't really paying ... attention yet. It's that attention has its own intrinsic value, independent of money. People go on the Web in search of attention; they don't want to give it as much as get it. People judge their own worth by their number of friends (Friendster) or fans (MySpace) or business contacts (LinkedIn). They may tell you that they're seeking business success, but oftentimes they seem to value contact lists in the thousands for their own sake.

While adults worry about privacy, kids seek attention. They post poetry, photos, exaggerated tales of personal exploits, music in order to create an online presence that garners attention.

Doesn't this all come down to money in the end? you might ask. Don't kids buy things in order to get attention? Sure. And in the same way, the new financial-industrial economy all came down to food and shelter as we made the transition from an agrarian, feudal economy. But there are new dynamics worth noting. Most users are not trying to turn attention into anything else. They are seeking it for itself.

For sure, the attention economy will not replace the financial economy. But it is more than just a subset of the financial economy we know and love." (http://www.attentiontrust.org/node/184)


John Batelle on Scale in the Intention Economy

Summarized by Social Computing Magazine:

"Not every expression of intent is valuable - Those expressions of intent which do correlate to purchase intent or some other monetizable transaction are extremely valuable and can form the foundation of a multi-billion dollar business (monetizable intent is the foundation of AdWords and AdSense). Doing so, however, both requires being able to capture intent and the ability to connect interested parties with people who can fulfill their needs. That is no small task nor is it easy to pull off at scale.

You need a lot of intentions across a wide variety of interests to build a service that's useful to a wide variety of advertisers - Being a database of intentions or musings or whatever requires scale. And it's not web 2.0 scale (millions) but Internet scale (tens or hundreds of millions) in terms of users. Twitter has a long way to go to achieve Internet scale usage - Facebook and MySpace are there already there and it appears to cost a lot of money to get there." (http://www.socialcomputingmagazine.com/viewcolumn.cfm?colid=701)

More Information

  1. Podcast with Doc Searls on the Intention Economy
  2. A special issue of Trendwatching.com on group buying power, or "Crowd Clout", at http://trendwatching.com/trends/crowdclout.htm
  3. Compare with the concepts of the Attention Economy and the Ethical Economy
  4. Doc Searls Vendor Relationship Management project is an example of putting the Intention Economy in practice