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21 posts from September 2013

September 30, 2013

Do You Know Who Your "Influentials" Are?

"Online influentials who provide sole or 'exclusive' influence over consumers are the most valuable to companies," reports Robert Berkman. ["Valuing Influentials Means More than Just Counting Connections," MIT Sloan Management Review, 10 July 2013] Berkman makes that assertion based on "the finding from research conducted by Zsolt Katona, [an] assistant professor at the Haas School of Business, UC Berkeley." Berkman continues:

Building-relations-with-influencers-e1367246422392"Conventional wisdom, reflected by influence-ranking sites such as Klout, is primarily to count the number of a person's connections to assess his or her ability to influence others. But Katona's research has discovered that determining the value of a particular influencer is more complex, and that finding the value of an influencer depends on several underlying factors in the network structure of that individual with the target set of consumers."

The study's results sound similar to Malcolm Gladwell's conclusion that "the success of any kind of social epidemic is heavily dependent on the involvement of people with a particular and rare set of social gifts." He calls this "the Law of the Few." [The Tipping Point] Duncan Watts, a network-theory scientist, disagrees with Gladwell's conclusion about the Law of the Few. Watts insists that influentials play "no special role in trends at all." ["Is the Tipping Point Toast?" by Clive Thompson, Fast Company, February 2008] Mark Borden describes the debate this way:

"There has long been debate about what, precisely, defines influence. Dale Carnegie, author of How to Win Friends and Influence People, described it as the ability to arouse enthusiasm in others to change their behavior. Tipping Point author Malcolm Gladwell says it derives from identifying new trends and sharing them through connected networks. Network theory scientist Duncan Watts says targeting influencers is wasted effort, that starting a trend is essentially a random act." ["The New Faces of Social Media," Fast Company, 25 October 2010]

So who is correct? The folks at Crowdtap believe that Watts is the "knockout" winner. They "found that when it comes to purchasing decisions, the most influential recommendations come from people we actually know, either through the web or in person." ["Who Are the Real Online Influencers?" by Josh Catone, Mashable, 13 June 2012] Catone's article was accompanied by the following Crowdtap infographic.

Influencers

Katona's study, which is entitled Competing for Influencers in a Social Network, concluded, "The most valuable person influences consumers who are not influenced by any other influentials online. A company that wants to invest time or resources in cultivating an influential person online should focus on those where the target consumers are being influenced in that product/service arena only by that person and not by anyone else." Do such influencers really exist? The study concedes, "Often, though, an influencer does not have an exclusive relationship with a set of target consumers. In these 'non exclusive' relationships, influencers who are most valuable are those where the sought after consumer/set of consumers has a very small set of additional competing influencers." Berkman reports that there was an interesting twist discovered during the study. "The next most valuable influentials are those who influence target consumers who have a very high number of additional competing influencers. ... The reason: if the target consumer has a high degree of additional competing influencers, a company will not need to invest as much money or resources to reach those consumers because they already have so many incoming connections informing them about all the options and they will buy the product that is best for them regardless of the firm’s efforts."

Berkman reports that those with "a middle range of additional competing influencers" were the least influential. Katona told Berkman that high, medium, and small were relative terms that "depended on the specific parameters set up by his model." Berkman then asks the $64,000 question: "What, then, are the practical implications of this study for social media marketers?" He concludes:

"The most important one is that firms should not just look at the number of connections an influential has when determining how many resources to devote to that person. Instead, they need to find out what the target consumer market's relationship is to the influential by taking into account their connections with any other competing influencers. Although widely available customer-influence network analyses sites and services like Klout do not take into account competing influencers and this overall network structures of influentials, Katona says that some telecom firms are now analyzing the connections between their customers and their competitor's customers on their own, and he says that it won't be long until other firms begin doing these analyses as well."

Jose Capelo is one pundit who believes in the power of influentials. He writes, "Social media influencers are fundamental to drive awareness and popularity for brands." He defines an influential as "a person or group of people, usually experts in a particular subject, which have gained recognition and credibility through their actions on Social Media. These actions include: frequent posts and of good quality, say what they think, and overall exerting personal persuasion. The influence is achieved by adding a personal brand, trust and experience." ["Importance of Social Media Influencers," Marketing Query, 18 July 2013] Russ Henneberry is another author who believes that some people have more online influence than others. He reports, "A study from Forrester Research confirms that 13.4% of U.S. adults online create 80% of the content that influences people. And 6.2% of these web users are responsible for 80% of the influence in social media." ["How to Find Influential People With Social Media," Social Media Examiner, 17 October 2012] Of course, not everyone who is in the 6.2% group of influencers is going to have influence in the same area. So, for any one industry or market, that number is considerably smaller. Henneberry asserts that "there are tools and processes to help you reduce the amount of noise in social media. You can use these to concentrate on the key influencers who can move the needle for your business. The goal is to find these key influencers and create a filter that allows you to communicate with them. This helps you develop a positive relationship with the influencers, which can grow your business."

Clearly, some consumers are influenced by "trusted strangers" they follow online. Although I tend to agree with Watts that the closer a consumer is to an influencer (e.g., a family member, friend, or associate) the greater the influence that person has on the consumer.

September 27, 2013

Cities from the Ground Up

Every designer dreams of seeing something go from the drawing board to reality – that is, designing and building something from the ground up. This is just as true for urban designers as it is for any other kind of designer. As I've noted in past posts, around the world there are several cities being designed and built from the ground up that have been designed to incorporate the latest technologies and whose aim is to make urban life more attractive and sustainable. The Economist calls these cities "urban dreamscapes" and reports that "building the city of the future is costly and hard." ["Starting from scratch," 7 September 2013] The article in The Economist was accompanied by the following graphic showing where these urban dreamscapes are being built.

Smart Cities The Economist

The first city discussed in the article is Masdar City. Plans for Masdar City were announced in 2006. I wrote my first post about the project in 2009 [Abu Dhabi's Masdar Plan]. Back then, I wrote:

"The Masdar Initiative, if nothing else, is ambitious. If anyone can pull off ambitious plans, however, it is UAE leaders — as any visitor to the country can readily observe. ... The Masdar Initiative is following a strategy that has been used successfully by many universities. It is going to establish a research institute to develop environmental technologies and a complementary 'investment arm' to implement and exploit them. The unique twist added by the Masdar Initiative is the 'eco-city' that will be home to these organizations. Masdar's managers want to create an academic institution that rivals the Massachusetts Institute of Technology (MIT) and then surround it with 'a global manufacturing hub for technologies such as solar power and desalination, and a city of 40,000 people with no greenhouse-gas emissions and no waste — all while turning a profit.' Although the government of Abu Dhabi is putting up $15 billion in venture capital, it expects the investment arm and the city to be profitable."

The following year I wrote a follow-up story on the Masdar plan [Update on Masdar City]. In that post, I wrote:

"Despite the global recession (which hit Dubai particularly hard), Abu Dhabi pressed forward with the planned city. The recession has, however, had an impact. The project is being scaled back and will no longer begin life as a carbon-neutral city."

The Economist now reports:

"More than six years later the future looks a bit less fantastic. Most of Masdar, designed under the aegis of Norman Foster, a British architect, will not sit on a podium; though models of the self-driving pods may find a place in a museum, the pods themselves are off the menu. Conventional cars, or at best electric ones, will roam the streets instead. When there are streets to roam, that is: the city was supposed to be completed by 2016, but the date has been pushed back to between 2020 and 2025."

Eric Jaffe reports that the Masdar Institute of Science and Technology, the university that was supposed to rival MIT, "right now [has] only a hundred or so students enrolled." ["How Are Those Cities of the Future Coming Along?" The Atlantic Cities, 11 September 2013] The Economist reports that Masdar City isn't the only project facing challenges. "Other much-hyped 'smart-from-the-start' cities," the article states, "are showing similarly scant signs of success." The next city it discusses is Songdo, a ground up city being built near Seoul, South Korea. The article reports: "Songdo ... boasts flats and offices packed with built-in electronic hardware — in particular videoconferencing systems — but not people; few want to move there." Back in 2010, Greg Lindsay called "New Songdo ... the most ambitious instant city since Brasília 50 years ago." ["Cisco's Big Bet on New Songdo: Creating Cities from Scratch," Fast Company, February 2010] He also noted that Brasilia "was an instant disaster: grandiose, monstrously overscale, and immediately encircled by slums."

The next project discussed by The Economist was PlanIT Valley in Portugal. The article notes that PlanIT Valley "promises to be a wonder stuffed with sophisticated sensors. But though mooted since 2009, construction has yet to begin." Jaffe describes the project this way:

"PlanIT Valley, situated outside Porto, Portugal, will be nothing if not a smart city. It was conceived by the Living PlanIT company, a developer of intelligent urban infrastructure, as a testing grounds for data-sensor technology. About 100 million real-time sensors will send information to a patented Urban Operating System designed to keep the whole built environment as efficient as possible."

Last year, Will Doig dubbed PlanIT Valley "the perfect city." ["Science fiction no more: The perfect city is under construction," Salon, 28 April 2012] Doig concluded:

"This isn't just hippie-dippie idealism — it's a better model. The city with 100 million sensors will cost $19 billion. Citizens engaged voluntarily? Free of charge. And how far this cool $19 billion will go is anybody's guess — it's impossible to predict whether today’s sentient cities will be responsive to tomorrow's unforeseen urban problems."

Although Konza Techno City is highlighted on The Economist's map shown above, the article doesn't mention it. Jaffe, on the hand, provides this update:

"Dubbed 'Silicon Savannah,' Konza Techno City hopes to develop some 5,000 acres of land into a new home for the technology industry. Konza wants to attract software developers, data centers, and business process outsourcing, among other sectors. The city, which will be situated about 40 miles from Nairobi, expects to have 30,000 residents by the time it complete phase one in 2017. When all four phases are complete, by 2030, Konza Techno City plans to have a central business district, a college campus, and enough people to fill 200,000 jobs. Development has already hit a few hurdles. Konza officials want to keep an undeveloped 10-mile buffer zone around the city out of fear that private construction could interfere with the plans for the city. Progress was halted in June to converse with regional land-owners, and last month the Kenyan news site Mwakilishi reported that two counties have laid competing ownership claims to the city. The city's official website strikes a more optimistic tone. A recent press release said construction was 'on course' to begin by the end of the year."

In his article, Doig makes a very interesting point about cities. Each city has its own unique ambiance and how it develops its character is a bit of mystery. He writes:

"There's a great little poem by D.H. Lawrence called 'The Third Thing':

Water is H20, hydrogen two parts, oxygen one,
But there is also a third thing, that makes it water
And nobody knows what that is.

"Cities are more than the sum of their parts because it's not their parts that make them great. It's the thing in between those parts — if you live in a city, you know what I'm talking about. 'Cities built from scratch have generally failed because they don't become cities that people evolve through,' says [Mark Shepard, an architect and the author of 'Sentient City: Ubiquitous Computing, Architecture, and the Future of Urban Space.'] 'Quite often, it's the productive friction these places produce that make them dynamic.'"

Great cities are magical places that attract people and bring out the best (and worst) in them. Whether smart-from-the-start cities can create that kind of magic remains to be seen.

September 26, 2013

Getting a Handle on Returned Merchandise

Retailers and manufacturers never like to see products returned; but, it happens. Evan Schuman contends, "One of the worst parts about managing retail businesses is dealing with unknown future returns." ["Can Some Returns Be Predicted And The Associated Inventory/Revenue Impact Flagged?" Storefront Backtalk, 29 February 2012] The editorial staff at SupplyChainBrain adds, "Returns are a headache for any company that has to deal with them." ["How to Improve ROI on Product Returns," 15 December 2011] There are two principal reasons that products are returned: first, they are broken or defective; second, the customer changes his/her mind.

Return to senderConcerning the first type of returned merchandise, the SCB staff writes, "Determining the fate of broken, defective or obsolete items while attending to the accompanying paperwork can be a costly and time-consuming process." Linda Olster explains why this so. She writes, "Throw in replacements, repairs, sending empty boxes for the return, getting the return back from the customer (to the right location), processing any credits, keeping track of where your inventory is … and all of sudden, you realize the process is not so simple or straightforward." ["Managing Returns: How a Transportation Management System Can Streamline the Process for You and Your Customers," Logistics Viewpoints, 2 February 2012] She goes on to explain how a good "Transportation Management System (TMS) can help to streamline the process and help you gain some unexpected 'returns' along the way." Pun intended, I'm sure.

Concerning the second type of return, Schuman believes that Big Data analysis can help predict which products will likely be returned with greater accuracy and confidence. For example, he writes that "a customer who purchases three of the identical shoe, but each one in a slightly different size" can be predicted, with a high degree of accuracy, to return at least two of the pair of shoes. He also believes "that any purchases from a customer who has a history of high returns" will likely be returned.

According to Associated Press reporter Jennifer C. Kerr, "Each year, consumers return about $264 billion worth of merchandise, or almost 9 percent of total sales, according to industry estimates. Many buyers aren't aware that some returns, with and without receipts, are being monitored at stores that outsource that information to a third-party company, which creates a 'return profile' that catalogs and analyzes the customer's returns at the store." ["Serial returners, beware: Retailers are tracking you," Today Money, 12 August 2013] As noted above, dealing with returns can be a costly and complex challenge. Kerr reports that tracking returns helps stores keep prices down for the majority of consumers by identifying "chronic returners or gangs of thieves trying to make off with high-end products that are returned later for store credit." Kerr also reports, "consumer advocates don't like it" (i.e., they don't like the fact that return histories are tracked).

The editorial staff at Consumer Reports ShopSmart magazine report that retailers track return data "to stop folks who steal, use, or wear items and then bring them back." ["What's the deal with ... The returns blacklist," July 2013] This kind of abusive and illegal behavior cost retailers "an estimated $8.9 billion in losses last year, according to the National Retail Federation." In addition to tracking returns, the magazine reports that "some stores now require identification for returns as a theft deterrent." The Federation claims that "62 per cent of U.S. retailers have a similar policy." ["Beware serial returners! How retailers are joining forces to catch out shoppers who bring back too many purchases," The Daily Mail, 21 November 2012]

The biggest player in the returns tracking field is a company called The Retail Equation. Kerr explains how the tracking process works by describing a Best Buy use case:

"—A consumer buys an item at Best Buy and later returns it. Even if the shopper has the original receipt and is within the time frame when returns are permitted, store policy requires that Smith provide a photo ID, such as a driver's license. Other stores, such as Home Depot, only require the ID if there's no receipt or if the item was purchased with a store credit.

"—The ID is swiped and then some information from the transaction is sent by the store to The Retail Equation. The company says the information captured from the ID typically includes the identification number, name, address, date of birth and expiration date.

"—The Retail Equation catalogs return activity by the shopper and creates a 'return activity report' on him with his returns at the store. If The Retail Equation determines that there's a pattern of questionable returns that suggests potential fraud, it would notify Best Buy, which could then deny returns by that shopper at the store for a period of time.

"The threshold for too many returns is determined by each retailer. The Retail Equation says the vast majority of returns — about 99 percent — are accepted."

SmartShop reports that The Retail Equation "doesn't aggregate information across retailers, report to credit bureaus, or accuse customers of theft or fraud." According to Kit Yarrow, a professor of psychology and marketing at Golden Gate University in San Francisco, even though retailers are seeing an increase in returns — "up 19 percent from 2007" — not all of the increase can be accounted for by fraud or serial returners. She claims that consumers are becoming "pickier shoppers" and are making more impulsive "purchases [of] tempting bargains. That means more returns." ["The Why Behind the Buy," Psychology Today, 4 September 2012] Nevertheless, Yarrow notes that returns are becoming an increasing problem for merchants. "For every dollar spent today, nine cents is returned. Consumers have a bolder mentality and higher expectations when it comes to returns."

According to Yarrow, the challenge of how to deal with returns has placed merchants in a conundrum. She explains:

"New procedures and policies [for dealing with returns] can feel confusing, even maddening, to shoppers. Authenticity, transparency and 'living up to promises' are important values to consumers. Retailers use imagery, emotion and symbolism to craft an enticing image — which becomes the personality of the store. That image is an unspoken promise of a particular type of shopping experience. It's the retailer’s job to ensure that every consumer touchpoint lives up to the promise of a store's image. The return — that moment when the customer effectively tells the store their sales transaction was a failure, that they found something better, or a better price — is an authenticity test. And according to my research, one that retailers often fail. When that happens, shoppers feel tricked."

It's easy to see how retailers must walk a fine line between trying to foster customer loyalty and protect themselves from fraud. A blogger calling herself Jeannieinabottle, provides a pretty good account of why stores dislike chronic returners. She writes:

"If you return items to the same store more than twice a month, you are a chronic returner. No one likes a chronic returner. First of all, it ruins the sales tracking system. If you make a major return and do not buy something to replace it, the numbers take a huge tumble in the system. That looks horrible for the sales associates and managers working at that time. Even if you do an exchange, imagine all the effort that went into the whole transaction just to break even? It is a frustrating process for everyone involved. I can't imagine why customers want to constantly take part in this process on a regular basis. If you are a compulsive shopper and feel guilty as soon as you get your purchases home, then seek some help. The endless cycle of shopping and returning is not helping you or the stores where you shop. If you never try the clothes on at the store, but instead take them home, you need to find a way to either A) successfully evaluate your size, or B) start using the dressing rooms. Also, it helps to make sure you want the product. Don't just make the purchase thinking you can just take it back if you change your mind. You should not be so indecisive that you are making returns constantly. I do understand that we all have to return items here and there. I just had to return a vacuum that broke after using it only two months. I know these things happen. Most managers and sales associates fully understand that. Even if a return is time consuming, it is still a necessary retail evil. However, when customers abuse the system and return items all the time, that is a real nuisance." ["Are You an Annoying Customer?" HubPages, 10 May 2013]

There are no silver bullet solutions to the returns problem. Both merchants and consumers have a role to play if returns policies are to remain reasonable and fair. With billions of dollars at stake, you know that retailers are going to protect themselves as much as they can from fraud and abuse.

September 25, 2013

Are Space and Time Real?

"Physicists have discovered a jewel-like geometric object that dramatically simplifies calculations of particle interactions and challenges the notion that space and time are fundamental components of reality," writes Natalie Wolchover. ["A Jewel at the Heart of Quantum Physics," Quanta Magazine, 17 September 2013] Although that sounds far-fetched to the average person, there are few things about the wacky world of quantum physics that don't boggle the mind. The jewel-like shape at the heart of this new revelation is called an "amplituhedron" and it may be the key to unifying theories at the macro and micro levels. Wolchover continues:

"The revelation that particle interactions, the most basic events in nature, may be consequences of geometry significantly advances a decades-long effort to reformulate quantum field theory, the body of laws describing elementary particles and their interactions. Interactions that were previously calculated with mathematical formulas thousands of terms long can now be described by computing the volume of the corresponding jewel-like 'amplituhedron,' which yields an equivalent one-term expression."

This subject caught my eye because I recently read James Gleick's wonderful biography of Richard Feynman entitled Genius. By anyone's definition, Feynman, a Nobel Prize laureate, was a mathematical genius with a particular gift for being able to visualize the quantum world. Gleick called him "the most brilliant, iconoclastic, and influential physicist of modern times." One of the challenges with which Feynman wrestled was the paradox that particles simultaneously behave as particles and waves. That makes any attempt to determine where a particular particle is at a particular time very problematic. Gleick's narrative about Feynman's contribution to the subject at hand also explains why the new geometric shape is called an amplituhedron:

"[Feynman] developed an alternative formulation of quantum mechanics to add to the pair of formulations produced two decades before by [Erwin] Schrödinger and [Werner] Heisenberg. He defined the notion of a probability amplitude for a space-time path. In the classical world one could merely add probabilities: a batter's on-base percentage is the 30 percent probability of a base hit plus the 10 percent probability of a base on balls plus the 5 percent probability of an error ... In the quantum world probabilities were expressed as complex numbers, numbers with both a quantity and a phase, and these so-called amplitudes were squared to produce a probability. This was the mathematical procedure necessary to capture the wavelike aspects of particle behavior. ... Probability amplitudes were normally associated with the likelihood of a particle's arriving at a certain place at a certain time. Feynman said he would associate the probability amplitude 'with an entire motion of a particle' — with a path. He stated the central principle of his quantum mechanics: The probability of an event which can happen in several different ways is the absolute square of the sum of complex contributions, one from each alternative way. These complex numbers, these amplitudes, were written in terms of classical action; he showed how to calculate the action for each path as a certain integral. And he established that this peculiar approach was mathematically equivalent to the standard Schrödinger wave function, so different in spirit. ... [Using Feynman's ideas,] Polish mathematician Mark Kac ... created a new formula, the Feynman-Kac Formula, that became one of the most ubiquitous of mathematical tools, linking the applications of probability and quantum mechanics. ... Feynman's path-integral view of nature, his vision of a 'sum over histories,' was also the principle of least action, the principle of least time, reborn."

Commenting on the discovery of the amplituhedron, Robert T. Gonzalez writes, "In the past, Feynman diagrams (which are themselves very powerful and elegant simplifying tools) didn't help us in understanding some specific particle interactions because the number of terms that needed to be calculated were so huge that even our most powerful supercomputers couldn't crack a solution." [See "Comments" at the end of his post entitled "This physical breakthrough could change our understanding of spacetime," io9, 20 September 2013] I suspect Feynman would have been thrilled with the new discovery. Wolchover's article in Quanta Magazine was accompanied by artist Andy Gilmore's rendition of what the amplituhedron looks like.

Amplutihedron_span

Continuing her superb article about why the discovery of the amplituhedron is so important, Wolchover writes:

"The new geometric version of quantum field theory could also facilitate the search for a theory of quantum gravity that would seamlessly connect the large- and small-scale pictures of the universe. Attempts thus far to incorporate gravity into the laws of physics at the quantum scale have run up against nonsensical infinities and deep paradoxes. The amplituhedron, or a similar geometric object, could help by removing two deeply rooted principles of physics: locality and unitarity. ... Locality is the notion that particles can interact only from adjoining positions in space and time. And unitarity holds that the probabilities of all possible outcomes of a quantum mechanical interaction must add up to one. The concepts are the central pillars of quantum field theory in its original form, but in certain situations involving gravity, both break down, suggesting neither is a fundamental aspect of nature. In keeping with this idea, the new geometric approach to particle interactions removes locality and unitarity from its starting assumptions. The amplituhedron is not built out of space-time and probabilities; these properties merely arise as consequences of the jewel’s geometry. The usual picture of space and time, and particles moving around in them, is a construct."

Scott Aaronson, a theoretical computer scientist and faculty member in the Electrical Engineering and Computer Science department at the Massachusetts Institute of Technology, suspects that there will be a lot of skeptics about the claim that the amplituhedron will "be a 'jewel' that unlocks all of physics, or a death-knell for spacetime, locality, and unitarity." After all, he notes, it applies to a "restricted class of theories." Aaronson himself may be a skeptic; nevertheless, he asserts tongue in cheek and writes, "If anything, the popular articles have understated the revolutionary importance of the amplituhedron. And the reason I can tell you that with such certainty is that, for several years, my colleagues and I have been investigating a mathematical structure that contains the amplituhedron, yet is even richer and more remarkable. I call this structure the 'unitarihedron'." ["The Unitarihedron: The Jewel at the Heart of Quantum Computing," Shtetl-Optimized, 20 September 2013] Aaronson goes on to explain:

"The unitarihedron encompasses, within a single abstract 'jewel,' all the computations that can ever be feasibly performed by means of unitary transformations, the central operation in quantum mechanics (hence the name). Mathematically, the unitarihedron is an infinite discrete space: more precisely, it's an infinite collection of infinite sets, which collection can be organized (as can every set that it contains!) in a recursive, fractal structure. Remarkably, each and every specific problem that quantum computers can solve — such as factoring large integers, discrete logarithms, and more — occurs as just a single element, or 'facet' if you will, of this vast infinite jewel. By studying these facets, my colleagues and I have slowly pieced together a tentative picture of the elusive unitarihedron itself. One of our greatest discoveries has been that the unitarihedron exhibits an astonishing degree of uniqueness. At first glance, different ways of building quantum computers — such as gate-based QC, adiabatic QC, topological QC, and measurement-based QC — might seem totally disconnected from each other. But today we know that all of those ways, and many others, are merely different 'projections' of the same mysterious unitarihedron."

Aaronson good humoredly reports that he is "awestruck" by "mathematical elegance and power" of the unitarihedron. He continues:

"But I haven’t even told you the most spectacular part of the story yet. While, to my knowledge, this hasn’t yet been rigorously proved, many lines of evidence support the hypothesis that the unitarihedron must encompass the amplituhedron as a special case. If so, then the amplituhedron could be seen as just a single sparkle on an infinitely greater jewel. Now, in the interest of full disclosure, I should tell you that the unitarihedron is what used to be known as the complexity class BQP (Bounded-Error Quantum Polynomial-Time). However, just like the Chinese gooseberry was successfully rebranded in the 1950s as the kiwifruit, and the Patagonian toothfish as the Chilean sea bass, so with this post, I'm hereby rebranding BQP as the unitarihedron. For I've realized that, when it comes to bowling over laypeople, inscrutable complexity class acronyms are death — but the suffix '-hedron' is golden."

In addition to his intellect, Aaronson obviously possesses a good sense of humor. Luboš Motl, however, isn't amused. "The amplituhedron exists," he writes, "while the diaperhedron or any other computer-science-based objects Aaronson talks about don't exist as objects." ["Diaperhedron can't match amplituhedron," The Reference Frame, 21 September 2013] Wolchover concludes her article by writing:

"Beyond making calculations easier or possibly leading the way to quantum gravity, the discovery of the amplituhedron could cause an even more profound shift, [Nima Arkani-Hamed, a professor at the Institute for Advanced Study,] said. That is, giving up space and time as fundamental constituents of nature and figuring out how the Big Bang and cosmological evolution of the universe arose out of pure geometry. 'In a sense, we would see that change arises from the structure of the object,' he said. 'But it's not from the object changing. The object is basically timeless.' While more work is needed, many theoretical physicists are paying close attention to the new ideas."

Admittedly the subject of quantum physics is difficult to grasp. Wolchover does a remarkable job of making it accessible to everyone. I highly recommend that you read her entire article.

September 24, 2013

Big Data Continues to Raise Privacy Concerns

"Every step in the big data pipeline is raising concerns," writes Cynthia Dwork, Principal Researcher at Microsoft Research, and Deirdre K. Mulligan, an is Assistant Professor of School of Information at Berkeley Law. ["It's Not Privacy, and It's Not Fair," Stanford Law Review, 3 September 2013] Those concerns include: "The privacy implications of amassing, connecting, and using personal information, the implicit and explicit biases embedded in both datasets and algorithms, and the individual and societal consequences of the resulting classifications and segmentation." They continue:

Privacy clear"Although the concerns are wide ranging and complex, the discussion and proposed solutions often loop back to privacy and transparency — specifically, establishing individual control over personal information, and requiring entities to provide some transparency into personal profiles and algorithms."

In the same issue of the Stanford Law Review, Jules Polonetsky, Co-Chair and Director of the Future of Privacy Forum, and Omer Tene, an Associate Professor at the College of Management Haim Striks School of Law, ask, "How should privacy risks be weighed against big data rewards?" ["Privacy and Big Data," Stanford Law Review, 3 September 2013] They continue:

"Big data creates tremendous opportunity for the world economy not only in the field of national security, but also in areas ranging from marketing and credit risk analysis to medical research and urban planning. At the same time, the extraordinary benefits of big data are tempered by concerns over privacy and data protection. Privacy advocates are concerned that the advances of the data ecosystem will upend the power relationships between government, business, and individuals, and lead to racial or other profiling, discrimination, over-criminalization, and other restricted freedoms. Finding the right balance between privacy risks and big data rewards may very well be the biggest public policy challenge of our time."

In a third article from that same issue, Joseph W. Jerome, a Legal and Policy Fellow at the Future of Privacy Forum, writes, "Big data is transforming individual privacy — and not in equal ways for all." ["Buying and Selling Privacy," Stanford Law Review, 3 September 2013] Eric Markowitz adds, "As the public grows more skeptical of data collection, digital privacy advocates finally find themselves in the spotlight — a position they've been craving for years. On the flip-side, tech companies have been dragged under their own spotlight — albeit one with a more critical hue. Now more than ever, people want to know: What, exactly, are you doing with all of their data?" ["The Data Privacy Debate Is Just Beginning," Inc., 21 June 2013] I agree with Markowitz that the data privacy debate is just beginning and that should worry a lot of companies.

Dwork and Mulligan believe that current efforts to protect consumer privacy "fail to address concerns with the classifications and segmentation produced by big data analysis." They explain:

"At worst, privacy solutions can hinder efforts to identify classifications that unintentionally produce objectionable outcomes — for example, differential treatment that tracks race or gender — by limiting the availability of data about such attributes. For example, a system that determined whether to offer individuals a discount on a purchase based on a seemingly innocuous array of variables being positive ('shops for free weights and men's shirts') would in fact routinely offer discounts to men but not women. To avoid unintentionally encoding such an outcome, one would need to know that men and women arrayed differently along this set of dimensions. Protecting against this sort of discriminatory impact is advanced by data about legally protected statuses, since the ability to both build systems to avoid it and detect systems that encode it turns on statistics. ... Rooting out biases and blind spots in big data depends on our ability to constrain, understand, and test the systems that use such data to shape information, experiences, and opportunities."

Polonetsky and Tene have different concerns. They believe "the current privacy debate methodologically explores the risks presented by big data, [but] it fails to untangle commensurate benefits, treating them as a hodgepodge of individual, business, and government interests." They go on to detail the benefits of big data across a number of domains. Jeff Bertolucci reports that the software industry shares the concerns highlighted by Polonetsky and Tene. "The Software & Information Industry Association (SIIA) wants policymakers to avoid 'broad policies' that limit the use of digital information," he writes. "While acknowledging the need to address privacy concerns, the software trade group says that stringent regulations in this area might slow the growth of the 'nascent technological and economic revolution' known as big data." ["Don't Let Privacy Fears Stifle Big Data, SIIA Urges," InformationWeek, 3 June 2013] He continues:

"The SIIA argues that big data is too important to the global economy to do otherwise. It points to recent Gartner estimates that predict big data-related research will spur $34 billion in IT spending this year. Looking forward, 'data-driven innovation,' or DDI, will help create 4.4 million IT jobs globally by 2015, including 1.9 million in the United States, Gartner says. Data collection and use is at crossroads, and decisions by policymakers could have an enormous impact on American innovation, jobs and economic growth,' said SIIA president Ken Wasch in a statement. Lawmakers must address privacy concerns regarding the storage and use of data, Wasch concedes, but he adds that they should do so 'without strict regulation that stifles economic opportunity.'"

It won't be easy to find the right balance between big data and privacy hoped for by Wasch. In the end, no one is going to be happy with any policy that is enacted. The SIIA believes that "policymakers should recognize that 'socially acceptable norms of privacy' are changing with technology. These changes should influence policy decisions pertaining to DDI." There is evidence that privacy norms are changing, especially among younger generations (but, that's the topic of another post). Nevertheless, even younger generations have concerns about privacy.

Some pundits believe that we are engaging in the privacy debate too late. They insist that privacy rights were abrogated years ago. For example, Rob Norman, Chief Digital Officer, GroupM Global, told conference participants in New Delhi that we now live in an Orwellian world. In the future, he told the audience, "Privacy will be redundant." ["The ‘privacy’ threat is real, digital marketers be aware," by Noor Fathima Warsia, Digital Market Asia, 30 May 2013] Warsia reports, "Norman was echoing Sun Microsystems, Chief Executive, Scott McNealy's words, famously said way back in 1999, during a product launch, 'You have zero privacy anyway, get over it.'"

Most analysts, however, don't seem to think that it's too late to address privacy issues surrounding big data. For example, Jerome concludes:

"If we intend for our economic and legal frameworks to shift from data collection to use, it is essential to begin the conversation about what sort of uses we want to take off the table. Certain instances of price discrimination or adverse employment decisions are an easy place to start, but we ought to also focus on how data uses will impact different social classes. Our big data economy needs to be developed such that it promotes not only a sphere of privacy, but also the rules of civility that are essential for social cohesion and broad-based equality. If the practical challenges facing average people are not considered, big data will push against efforts to promote social equality. Instead, we will be categorized and classified every which way, and only the highest high value of those categories will experience the best benefits that data can provide."

Markowitz adds, "Big Data may be hot — but it only works so long as consumers decide to cooperate and share their data freely. I'm not convinced that proposition is guaranteed in the future." There is a lot riding on the success of big data. That's why it remains critical that some accommodation be reached between use and privacy.

September 23, 2013

Teaching STEM Subjects Using a Mission to Mars

In a recent two-part series entitled "Getting Kids Hooked on STEM Subjects" [Part 1 and Part 2], I discussed how important it is to get children involved in science, technology, engineering, and math (STEM) subjects as early as possible and examined some recommendations about how STEM education can be improved. In the latter of those posts, Alan I. Leshner, Chief executive officer of the American Association for the Advancement of Science, stated that STEM education must start early. He also believes you can't teach what you don't know. For that reason, he recommends that "the educational community needs to exploit the scientific community's desire to help. There are many, many retired scientists and engineers who'd love to go into the schools and use their knowledge and experience to assist the regular teachers." Personally, I wouldn't limit the search for help to retired individuals. I know from personal experience that actively employed scientists and engineers are just as eager to help.

In that same post, Paulo Blikstein, an education Professor at Stanford University, stated:

STEM NFS 02"We want kids in school to have that experience of seeing how science and math lead to making things. In a controlled study conducted in our lab we found a statistically significant increase of 25 percent in performance when open-ended exploration came before text or video study rather than after it. We'd like kids to learn how to solve hard problems and what it takes to pull off a complex endeavor, how to plan, collaborate, fail and not give up. In other words, we want them to see what science and math can do when they are used by a creative mind."

That's really the philosophy behind an approach that I've been supporting at my daughter's middle school — the Newtown Friends School (NFS). The NFS STEM initiative combines real-world challenges with a space exploration in a "Lift Off to Mars" program. The program will involve classroom study, lectures by subject matter experts, experiments assisted by world-class scientists, and exciting field trips. The initiative is being organized by a new non-profit organization called The Project for STEM Competitiveness and is being supported by local business leaders and scientists. In addition to my company, Enterra Solutions, other supporting organizations include Lockheed Martin and the U.S. Department of Energy's Princeton Plasma Physics Laboratory. The immediate goals of the initiative include:

  • Learning and using science and engineering process skills.

  • Understanding and using mathematical skills and concepts, such as proportions and ratios, graphing data, multi-digit computation, functions.

  • Applying knowledge of science concepts, such as speed and power, motion and stability, forces and interactions, and environmental sustainability.

  • Understanding concepts such as systems, patterns, structure and function, and logical thinking.

  • Understanding the role of troubleshooting, invention and innovation, and experimentation in problem solving.

  • Planning and managing activities to develop a solution or complete a project.

  • Demonstrating creative thinking and constructing knowledge using technology.

  • Using digital media and environments to communicate and work collaboratively.

The long-term goals of the project, which are in line with STEM education goals identified by the National Research Council of the National Academies, include:

  • Growing community partnerships that provide middle school students with mentors, opportunities, and real-world experiences in STEM disciplines.

  • Expanding the number of students who ultimately pursue advanced degrees and careers in STEM fields and broaden the participation of women and minorities in those fields.

  • Expanding the STEM-capable workforce and broaden the participation of women and minorities in that workforce.

  • Increasing STEM-literacy for all students, including those who do not pursue STEM-related careers or additional study in the STEM disciplines.

The NFS initiative hopes to change student perceptions of STEM subjects being boring. We hope to stir up their creative juices at the same time. In addition to traditional classroom learning, each supporting organization will bring something to the table.

Enterra Solutions, LLC will provide students access to its Cognitive Computing environment which will perform artificial intelligence-based computational analytics on the Mars program – modeling and simulating the real-world aspects of the mission.

Representatives from Lockheed Martin will provide students with an exciting look at its Orion Program. Engineers from the program are building the Orion Multi-Purpose Crew Vehicle, NASA’s first spacecraft designed for long-duration, human-rated, deep space exploration. Orion will transport humans to interplanetary destinations beyond low Earth orbit, such as asteroids, the moon, and eventually Mars, and return them safely back to Earth. Michael Bradshaw, CIO of Lockheed Martin’s Mission Systems and Training business, described the corporation’s interest in the Lift Off to Mars Program: “Advancing STEM education is a critical focus of Lockheed Martin. Anytime we have the chance to inspire students with real-life, exciting examples of opportunities in the STEM field, we eagerly participate.”

The Princeton Plasma Physics Laboratory (PPPL) will mentor the program from its long experience in STEM education and will make its world-class research and scientists available to students throughout the project. PPPL is instrumental in supporting the creation of the curriculum, integrating other governmental agencies, such as NASA, and providing experimentation structure, guidance and support for the program.

Andrew Zwicker, Head of Science Education at PPPL, explained his organization's interest: “The best way for students to learn science is to do science. This new program is a unique opportunity through its project-based learning approach to begin to develop the skills needed to be a part of the 21st century scientific workforce.”

Phys.org, a leading European web-based science, research and technology news service, wrote in a recent article, "In a high-tech and rapidly globalising economy, science and mathematics education is more important than ever. ... At the same time, high levels of creativity and innovation, often and mistakenly seen as the antitheses of science and mathematics, represent equally important assets." ["Science, mathematics, creativity and innovation, when it counts most," 6 September 2013] The article goes on to assert, "The place to start is in early childhood education." The more creative we can become in teaching STEM subjects (and the earlier that teaching begins) the greater the likelihood that we will get more of our children excited about careers in science, technology, engineering, and mathematics. It's not just their future that is at stake, it is the future of our country, and our planet. The challenges that society now faces are going to require new solutions and approaches and those solutions must be founded in good science.

To learn more about the launch of the Liftoff to Mars program, read the following local articles: "Newtown Friends to pilot STEM education program," by Crissa Shoemaker DeBree, phillyBurbs.com, 24 September 2013; "STEM pilot program lifts off at Newtown Friends School," by Regina Young, Bucks County Herald, 3 October 2013; and "Newtown Friends School, Lockheed Martin, US Dept. of Energy thinking about life on Mars," by Cary Beavers, The Advance, 3 October 2013.

September 20, 2013

CPG Executives Identify Two Industry Megatrends

MegatrendsEarlier this year "more than 200 executives from leading consumer goods and retail organizations" came "together to focus on how, through a set of collaborative initiatives, the industry can continue to bring benefits to consumers." ["Consumer Goods Forum Identifies Two Megatrends," Consumer Goods Technology, 3 July 2013] Participants identified two key megatrends that are "likely to have the greatest impact on the consumer goods and retail industry in the coming five to 20 years." Those trends are: The challenge of today's digital world; and, the ongoing fight for resources. The article reports that discussions at the Consumer Goods Forum "led to the selection of three initiatives that address these megatrends and highlight the need for swift action." I'll discuss those initiatives later in this post. First, I would like to discuss the megatrends in a little more detail.

Today's Digital World

There are number of topics that fit under the "Digital World" tent. For consumer packaged goods (CPG) executives, the two most important topics are probably the consumer's digital path to purchase and how Big Data analytics can be used to inform business decisions and marketing.

Digital Path to Purchase

A report sponsored earlier this year by the Grocery Manufacturers Association (GMA) and PwC US, entitled Growth Strategies: Unlocking the Power of the Consumer, concluded, "in the age of the digital consumer, leading CPG companies and retailers benefit from responding to the speed of the connected consumer and balancing operational quality with innovation." ["Report: CPG Companies, Retailers Shift Focus to 'New Rules of Consumer Engagement'," SupplyChainBrain, 24 June 2013] The article continues:

"Top-performing companies see success by identifying their consumers, engaging with them and focusing on innovation that directly reach their customers. The report explores how numerous digital channels, accelerated mobile adoption and direct-to-consumer approach are rewriting the rules of retailing and CPG manufacturing. The report also examines how companies can seize new opportunities by creating lasting brand value. In 2013, more than 40 percent of CPG companies expect to sell products directly to consumers, up from 24 percent in 2012. According to the report, direct-to-consumer is a potent vehicle for testing new products and reaching out to new consumers faster and more effectively than ever before, making the retail store aisle no longer the last mile in the purchase journey. Flexibility will be essential, as companies will also need to manage a new set of risks and security concerns."

Although retail store aisles may not be the only "last mile" in the path to purchase, they will certainly play that role in many developed countries. In emerging markets, however, the digital path to purchase (almost exclusively pursued using mobile technology) will be a common last mile traveled. The article provides a good segue into the second topic – Big Data analytics. It states, "The report further delves into how companies can gain greater understanding of their customers, as it highlights best-practices for developing loyalists, determining appropriate social media channels that align with business goals, along with successfully identifying target segments within their organization."

Big Data Analytics

Big Data analytics are useful both internally (e.g., to help improve supply chain visibility and foster corporate alignment) and externally (e.g., to gain better market insights and to understand customer behavior). Maria Deutscher asserts, "Forward-thinking retailers are tapping into Big Data to streamline operations and gain a competitive edge over rivals." ["Three Ways Big Data has Changed Retail Analytics Forever," Silicon Angle, 2 May 2013] The same thing could be said about any CPG firm. Deutscher, however, focuses on three ways that Big Data analytics have changed retailing as retailers reap "the rewards of Big Data analytics by applying intelligence to new areas." The areas she goes on to discuss are: price optimization, product placement analysis, and staffing. Manufacturers have different challenges. Puneet Saxena, Vice President of Manufacturing Industry Strategy at JDA, identifies some of those challenges. He writes:

"The manufacturing network has become more complex and geographically disparate. To start with, manufacturers have more channels available to reach their end customers: direct enterprises, retailers, distributors and online. Demand across these channels has become increasingly volatile as customers have become more demanding and unpredictable. Across a diverse range of automotive, consumer electronics, consumer packaged goods, chemicals and pharmaceutical companies, manufacturers have been forced to introduce more new products to retain and grow market share. This unprecedented pace of new product introductions has strained alignment between the sales, engineering, manufacturing, marketing and finance departments internally, as well as with key suppliers externally." ["Five Core Tenets of Achieving Supply Chain Excellence in Manufacturing," SupplyChainBrain, 19 June 2013]

Saxena asserts, "Success will come to those companies that can drive business agility through customer-centric, segmented supply chains, end-to-end synchronization and advanced optimization." All of those tenets rely on mastering Big Data analytics.

Ongoing Fight for Resources

I think the CPG executives who identified this megatrend made a mistake labeling it as an "ongoing fight." They would have been better served (and opened up more innovative thinking) if they would have labeled this megatrend something like: The Search for Sustainable Resources. Perspective can make all the difference when it comes to finding innovative solutions. Steve Hall argues that procurement professionals are going to lead the fight (or champion the innovations) that marry business and sustainability strategies. ["Sustainable Sourcing: Procurement can be where sustainability and strategy meet," Procurement Leaders, 22 September 2011] Hall supports the arguments of Eric Lowitt, a frequent author on the topic of sustainable strategy, who believes "that you shouldn't have a sustainability strategy because it doesn’t naturally integrate with the overall business strategy. Which isn't to say that a business shouldn't have sustainable goals, but that there needs to be top level commitment to integrating them into a competitive strategy." I've consistently argued that the only sustainability efforts that are going to succeed are those based on sound business decisions. If CPG executives truly believe that the "fight for resources" is a game-changing megatrend, then they need to take the subject of sustainability much more seriously. As Hall puts it, "Procurement is placed to play a vital part in connecting sustainability strategies with results and value that stakeholders can see."

CPG Initiatives

As promised above, I want to end this post with a discussion of the "three initiatives that address these megatrends" identified by CPG executives during the Consumer Goods Forum. They are:

  • "Consumer Engagement Protocol: This initiative is designed to address the changes being witnessed in consumer behavior. The potential power of user-generated and social media technology platforms to disrupt established institutions and the associated brand equity is undeniable. However, there are opportunities to connect directly with consumers as shoppers look for improved transparency in digital channels. At the same time, there is an inherent need to mitigate risks from privacy invasion. Increasingly, companies recognize the requirement to be proactive vs. being regulated in this area, but currently there is no voluntary global commitment concerning this in the consumer goods and retail industry. The project is focused on establishing guidelines for digital engagement with consumers.

  • "Next-Generation Product Identification: Today, in a world of rapidly expanding online commerce solutions, barcodes are unable to provide companies and consumers with the rich digital product information they seek. Consumer barcodes do not uniquely identify product or package variations that carry the same product identifier, meaning minor product variations cannot be accurately disclosed. This initiative focuses on connecting the dots to improve supply chain transparency, efficiency and traceability. The goal is to provide the industry and the consumer with accurate product information by using new technology capabilities for product identification to replace the current barcode.

  • "Sustainable Packaging Coalition: This potential initiative is designed to establish a coalition of companies to work together on non-competitive topics to improve the sustainability of packaging across the different value chain stages. The focus of potential activities will be around the three R’s of packaging and packaging components: Redefine, Reduce and Reuse."
Peter Florenz, corporate vice president & global head of governmental relations and public affairs, Henkel AG & Co KGaA, and co-chair of The Consumer Goods Forum's Emerging Trends Steering Committee, stated, "This is a historic moment. ... The next 10 years will mark a radical change in how products are sourced and purchased." Sabine Ritter, executive vice president, strategy, industry initiatives, strategic alliances at The Consumer Goods Forum, added, "The industry is at a critical tipping point and must ensure its future by implementing these initiatives to drive innovation. Success is hard to quantify but we must focus on collaboration and non-competitive improvements that will protect consumers and the vital components that will create one of the most innovative and forward-thinking sectors." Obviously, CPG companies will continue to look for innovations that will provide them an edge over their competitors; however, it is a bit disappointing that none of the identified initiatives really addressed how to deal with the resource challenge.

September 19, 2013

Sensing Food: The Role of Color

Back in the fall of 2000, three researchers, Lawrence L. Garber, Jr., Eva M. Hyatt, and Richard G. Starr, Jr., conducted a study on "The Effects of Food Color on Perceived Flavor." [Journal of Marketing, Fall 2000] Their conclusion was, "Food color's principal use is for flavor identification, not for strategic marketing communication purposes." They went on to write:

Colorful_food"There has been surprisingly little color research in marketing, and the impact of food color has been completely neglected outside of the food sciences; unfortunate, because marketers understand so little of the powerful yet complex effects of color at the point of purchase. Though food scientists have empirically examined aspects of the effects of food color, research on the topic remains sparse, is not theory-based, and, as a body, is limited."

Frankly, that statement surprised me. Food coloring has been around for a long, long time. Peggy Trowbridge Filippone reports:

"Ancient Romans used saffron and other spices to put a rich yellow color into various foods. Other natural foods such as carrots, pomegranates, grapes, mulberries, spinach, beets, parsley, and flowers were also used as food coloring agents. Our ancestors also used minerals and ores, such as azure (copper carbonate), gold leaf, and silver leaf, some of which were downright poisonous if used improperly. Elise Fleming researched cookbooks dating as far back as 1390 A.D., and has compiled an interesting list of food additives used hundreds of years ago with charming quotes in Olde English from sources in her informative treatise on the food coloring of yesteryear." ["Food Coloring History," About.com]

Certainly there is plenty of anecdotal evidence that food color affects taste. For a quick, but interesting report on the subject, click on this link to watch a short ABC story on the subject. During a study conducted a few years ago, "researchers found that color was more of an influence on how taste was perceived than quality or price information." ["More Than Meets The Tongue: Color Of A Drink Can Fool The Taste Buds Into Thinking It Is Sweeter," Science Daily, 16 February 2007] The article claims that JoAndrea Hoegg, from University of British Columbia, and Joseph W. Alba, from the University of Florida, "are the first to look at how individual attributes — such as color, price, or brand — can affect which products we prefer." The article continues:

"The researchers manipulated orange juice by changing color (with food coloring), sweetness (with sugar), or by labeling the cups with brand and quality information. They found that though brand name influenced people's preferences for one cup of juice over another, labeling one cup a premium brand and the other an inexpensive store brand had no effect on perceptions of taste. In contrast, the tint of the orange juice had a huge effect on the taster's perceptions of taste. As the authors put it: 'Color dominated taste.'"

An article on the Konica Minolta website states, "While many of us like to believe that we are not easily deceived, our sense of taste is often fooled by our sense of sight. This is because humans have certain expectations of how food should look. When a food's color is off or is different than what we expect, our brain tells us that it tastes different too. Long supported by scientific studies, we use visual cues from color to identify and judge the quality and taste of what we eat." The article goes to report on the results of an experiment conducted some 40 years ago:

"Published in Fast Food Nation, a more extreme study dating back to the early 1970s offers some insight into how color affects our appetite and perception of food. Subjects in the experiment were served what appeared to be a normal looking plate of steak and french fries. The room, however, was installed with specialty lighting that changed how the color of the food looked. Under this lighting effect, the participants thought the steak and fries tasted fine. Once the effects were turned off and lighting was returned to normal, it was revealed that the steak was dyed a blue color and the french fries were dyed a green color. Upon seeing this, many of the subjects lost their appetite and some became ill."

Another group of researchers, Charles Spence, Carmel Levitan, Maya U. Shankar, and Massimiliano Zampini, believe that there are "two qualitatively distinct research questions" involved in how color affects the taste of food. ["Does food color influence taste and flavor perception in humans?," Selected Works of Carmel Levitan, 2010] They explain:

"The first concerns the role that food coloring plays in the perception of the intensity of a particular flavor (e.g., strawberry, banana, etc.) or taste attribute (e.g., sweetness, saltiness, etc.). The second concerns the role that food coloring plays in the perception of flavor identity."

Some new age chefs are making a good living playing around with people senses by making food look like one thing and taste like another. However, as the ABC story highlighted, the most significant effect that color has on food is the perception it makes on taste attributes. An article from Techdirt reports, "There's one argument, which says that if you're eating food that needs to be colored, you're not eating food." Proponents of that argument point to so-called junk food to support their case. An experiment using uncolored Cheetos, which are naturally gray in color, found that consumers who ate them claimed that "their brains did not register much cheese flavor."

It's not just the color of food that changes our perception of taste or preferability; the color of dinnerware and packaging can also have an effect. Jessica Hullinger reports, "New research from the Journal of Sensory Studies says different colored cups can affect the perceived flavor of beverages. 'The color of the container where food and drink are served can enhance some attributes like taste and aroma,' said study co-author Betina Piqueras-Fiszman, a researcher at the Universitat Politècnica de València in Spain and the University of Oxford in the United Kingdom." ["How Your Cup's Color Changes the Taste of Your Drink," mental_floss, 7 January 2013] And the editorial staff at FoodBusinessNews, report, "It turns out the source of Hillshire Brands’ packaged lunchmeat problems was the product’s clear lid. By switching from the clear lid to a more pronounced red cap, the company has managed to start to turn the business around." ["Hillshire learns red means go," 12 August 2013] Sean Connolly, Hillshire's chief executive officer, told a group of financial analysts, "While consumers consistently articulated a preference for the clear lid in numerous quantitative tests, their actual purchase behavior noticeably changed when we made the switch. As we dug into the disconnect between what consumers were saying and what they were doing, it became clear there was a positive benefit to the red lid that the consumer could not articulate.”

Because we are sometimes unable to articulate why we behave differently than we think we do, I believe that Big Data analytics has a significant role to play in the world of sensory services. There is an interplay between all of our senses that affects how we perceive the world around us and how we enjoy the products we use. To learn more about how the senses affect taste, read my post entitled Enjoying Food: Taste, and Our Other Senses.

September 18, 2013

Understanding Quantum Computing

Let's face it quantum computing is not an easy subject. Understanding, for example, that a qubit can simultaneously represent both a 0 and 1 and that it would only take 300 qubits to hold all of the data that has ever been created since the big bang takes a little mind bending. In previous posts about quantum computing, I've noted that scientists have argued about whether the computer designed and marketed by D-Wave is a quantum computer. You would think that such a thing would be easy to determine; but you would be wrong. Erica Klarreich explains:

Qubit"In early May, news reports gushed that a quantum computation device had for the first time outperformed classical computers, solving certain problems thousands of times faster. The media coverage sent ripples of excitement through the technology community. A full-on quantum computer, if ever built, would revolutionize large swaths of computer science, running many algorithms dramatically faster, including one that could crack most encryption protocols in use today. Over the following weeks, however, a vigorous controversy surfaced among quantum computation researchers. Experts argued over whether the device, created by D-Wave Systems, in Burnaby, British Columbia, really offers the claimed speedups, whether it works the way the company thinks it does, and even whether it is really harnessing the counterintuitive weirdness of quantum physics, which governs the world of elementary particles such as electrons and photons. Most researchers have no access to D-Wave's proprietary system, so they can't simply examine its specifications to verify the company's claims. But even if they could look under its hood, how would they know it's the real thing? Verifying the processes of an ordinary computer is easy, in principle: At each step of a computation, you can examine its internal state — some series of 0s and 1s — to make sure it is carrying out the steps it claims. A quantum computer's internal state, however, is made of 'qubits' — a mixture (or 'superposition') of 0 and 1 at the same time, like Schrödinger’s fabled quantum mechanical cat, which is simultaneously alive and dead. Writing down the internal state of a large quantum computer would require an impossibly large number of parameters. The state of a system containing 1,000 qubits, for example, could need more parameters than the estimated number of particles in the universe. And there's an even more fundamental obstacle: Measuring a quantum system 'collapses' it into a single classical state instead of a superposition of many states." ["Is That Quantum Computer for Real? There May Finally Be a Test," Wired, 23 August 2013]

Before continuing the discussion about the difficulty of determining whether a machine is a quantum computer or not, you should watch the following video. As Mike James reports, "This animation ... might give you some idea as to why quantum computers are more powerful - or potentially more powerful - than a classical computer." ["Quantum Computers Animated," I Programmer, 25 August 2013] As terrific as the animation is, James warns that you are still likely "to be mystified. Quantum computers are difficult to understand because they rely on the mathematics of quantum mechanics and most people don't understand the math."

If you watched the video, then it will be easier for you understand what James writes next:

"It is too easy to say that the reason a quantum computer is more powerful is that a qubit, or quantum bit, can represent a zero and a one at the same time. This seems like a powerful idea, but it doesn't really give you much that is new in terms of computation. It is only when you allow a set of qubits to be entangled do you get really new behavior. When qubits are entangled the result of one measurement affects another and you can use it for encryption and computation. The big problem is that entangled states are corrupted by any interactions with the outside world - a problem known as decoherence. So far this has made building quantum computers with more than a small number of qubits difficult."

Eric Limer adds, "Someday, somehow, quantum computing is going to change the world as we know it. Even the lamest quantum computer is orders of magnitude more powerful than anything we could ever make today. But figuring out how to program one is ridiculously hard." ["Why Programming a Quantum Computer Is So Damn Hard," Gizmodo, 23 August 2013] Jeremy O'Brien, a professor at the University of Bristol, agrees with Limer about how difficult it is to code for a quantum computer. "A quantum computer can do things faster for you, but someone has to program it," he states, "and at the moment there are only a handful of people around the world who would be qualified." If that situation remains, he and colleagues know that it will mean that there will be "a dearth of skilled coders when the expected quantum revolution finally arrives." To remedy that situation, they are making available to "anyone with a web browser" a quantum chip capable running basic algorithms over the internet. ["Quantum chip connected to internet is yours to command," NewScientist, 6 September 2013]

Limer's claim that quantum computing is "going to change the world" leaves the impression that there is something magical about a quantum computer. James reminds us, however:

"A quantum computer cannot compute anything that a classical computer cannot. Indeed the operation of a quantum computer can be simulated by a classical computer, but it might take longer than the lifetime of the universe to complete the job. Quantum computers promise fast solutions nothing more."

That's really the point. Quantum computers will allow us to make computations that, for all practical purposes, are currently impossible. Will this change the world? Possibly. James points out that D-Wave's machine is "a quantum annealing device which can be used to solve specific optimization problems. It is more like a quantum analog computer than anything else." That's been part of the controversy and brings us back to Klarreich's article about trying to figure out if a computer is really quantum computer. She writes:

"It turns out ... that there is a way to probe the rich inner life of a quantum computer using only classical measurements, if the computer has two separate 'entangled' components. In the April 25 issue of the journal Nature, [Umesh Vazirani of the University of California, Berkeley], together with Ben Reichardt of the University of Southern California in Los Angeles and Falk Unger of Knight Capital Group Inc. in Santa Clara, showed how to establish the precise inner state of such a computer using a favorite tactic from TV police shows: Interrogate the two components in separate rooms, so to speak, and check whether their stories are consistent. If the two halves of the computer answer a particular series of questions successfully, the interrogator can not only figure out their internal state and the measurements they are doing, but also issue instructions that will force the two halves to jointly carry out any quantum computation she wishes. 'It's a huge achievement,' said Stefano Pironio, of the Université Libre de Bruxelles in Belgium. The finding will not shed light on the D-Wave computer, which is constructed along very different principles, and it may be decades before a computer along the lines of the Nature paper — or indeed any fully quantum computer — can be built. But the result is an important proof of principle, said Thomas Vidick, who recently completed his post-doctoral research at the Massachusetts Institute of Technology. 'It’s a big conceptual step.'"

Klarreich's article contains a lot more interesting information about the quirkiness of quantum physics and you should check it out. Researchers are continuing to make breakthroughs in the area of quantum computing; but, no one has any idea when a true quantum computer (i.e., one that can be confirmed by the interrogation test) will be built.

September 17, 2013

Digital Consumers and Their Path to Purchase

A recent study by GroupMNext and Compete indicates that "there are six distinct segments of consumers who exhibit similar behaviors and intent." The thread that ties these similar behaviors together is that they are all completed online. In other words, these segments all represent digital consumers (i.e., "consumers who utilized digital at least once in their purchase pathway"). ["The 6 Types of Digital Consumers and Their Paths to Purchase," by Tyson Goodridge, Compete Pulse, 30 May 2013] The six types of digital consumers are:

  • "Basic Digital Consumers: These are not highly digital users. They are comfortable with Internet shopping and research, but they are not mobile or social and have the second-highest likelihood of buying offline.

  • "Retail Scouts: These consumers have short journeys and prefer retail sites to brand sites. They use mobile, but are twice as likely to use it in the home as out. They are comfortable buying online but did not express a preference between online and offline.

  • "Brand Scouts: Brand Scouts are the spiritual partner to the Retail Scouts except instead of having a favorite retailer, they have a favorite brand. When asked, 72% said they start their journey with a brand in mind.

  • "Digitally Driven Segment: They use every digital tool at their disposal. They use social and mobile more than any other segment in the study, value convenience above all else and they do everything in their power to avoid physically going to a store. The Digitally Driven exist in good numbers already, but within five years this will be the dominant segment of consumers.

  • "Calculated Shoppers: These shoppers seem to know they are going to make a purchase, but they are deciding which brand to choose. They are similar to the Digitally Driven Segment, but have no urgency to their purchase and they’re willing to take the time to get the best deal.

  • "External Shoppers: These are non-mobile shoppers. They want the answers to, 'Should I buy?', 'What do I buy?' and 'What brand do I buy?' – all at the same time. These shoppers have no urgency to make a purchase and they do their research on desktop and laptop computers."

Just from reading those descriptions you should realize that there is no single path to purchase for the digital consumer. In fact, the study concluded that for External Shoppers there can be as many as three dozen steps involved in their path to purchase (see the image below).

The-six-segments-and-their-pathsThe important thing for manufacturers and retailers to understand is that the digital consumer can jump on and off the path to purchase at any point. That means that they must provide a good touchpoint (i.e., a good experience) at every one of the jump on/jump off locations. Aaron Baar explains, "Omnichannel marketing is making the path to purchase so complicated the linear funnel model is obsolete. Today's consumer journey is more like an infinite loop, where shoppers are always discovering, considering and buying via multiple channels. So keeping them engaged is an ongoing process." ["The Funnel is Dead, Long Live the Loop?" Digiday, 25 July 2013]

Simon Van Wyk believes that the best way to ensure that consumers have a good experience all along their digital path purchase is to think like a customer. ["Thinking like a customer: the value of customer journey mapping," Marketing, 26 August 2013] He writes:

"Customer journey mapping and experience design are among the most powerful tools marketers can use for innovating and meeting customer expectations – allowing diagnosis of customer experience issues and formulation of innovative and differentiated brand experiences – but retailers are failing to come to grips with the modern shopper's path to purchase."

One mistake that Van Wyk believes too many companies make is lumping "mobile" technology marketing into a single category. He notes that recent reports indicate that consumers use smartphones and tablets for different reasons and in different contexts. That means that marketers need to design their approaches for those platforms differently. There is one way in which smartphone and tablet users are similar – they both prefer using their devices at home. Van Wyk explains:

"According to Nielsen, more than two-thirds of US smartphone shoppers and four out of five tablet shoppers use their devices most frequently in the home, often with one eye on the TV. So even though smartphones and tablets offer the convenience of shopping on the go, it seems like the vast majority of tablet and smartphone shoppers who make a purchase with their device prefer the comfort of their couch while they shop."

The big difference between smartphone and tablet users, Van Wyk reports, is that users of tablets are more likely to make purchases than users of smartphones. He writes:

"When it comes to actual purchasing, eMarketer says there's a stark contrast between the behaviour of smartphone owners and their tablet owning counterparts. Nearly 71 million tablet owners will make purchases via their device this year, compared with 53 million buyers using smartphones. This distinction is critically important and highlights why marketers need to think like a customer."

Yaakov Kimelfeld, Chief Research Officer at Compete, agrees with Van Wyk that mapping the consumer's path to purchase is important. "The explosion of digital channels," he writes, "the always-on media ecosystem, and the increasingly mobile consumer challenge even the savviest of digital marketers with the simple question: how can I reach the right consumer, at the right time, in the right place, and with the right message to influence his or her purchase decision? There is a way, and this time, it's the marketers (not the consumers) making the crucial decisions along the consumer path to purchase." ["Marketers Can Map the Consumer’s Journey To Purchase," Compete Pulse, 8 May 2013] Like Baar, Kimelfeld believes today's digital path to purchase is best represented by an eternal loop. "Consumers are all over the place," he writes. "It only takes a click to embark on a journey away from the brand – but it also only takes a single click to come back. Consumers can come 99% of the way towards the conversion, but then regress back to researching, simply because it’s easy to do." He concludes his article with three recommendations about how to map a consumer's digital path to purchase:

  • "Start from the lowest common denominator – an individual consumer's path to purchase – and build from the bottom up. Each individual path is different, but the combinations are not infinite. A deep, hard look into the data trail consumers leave behind and a meaningful summarization can and should be attempted by any company interested in how their consumers really arrive at the purchase decision.

  • "Cluster around behavioral variables. Ad exposure, search queries, visits to the brand website, visits to competitors, repeat visits, reading reviews, visits to aggregator stores, and purchase reviews are all typical touch points that consumers encounter on the way to purchase.

  • "Extract the commonalities found in individual paths and identify a manageable number of distinct behavioral patterns. Every brand is different, but in our experience three to seven paths are sufficient to describe consumers in their progress towards the conversion and easy enough for a marketer to craft separate messaging strategies. This helps to engage consumers with the right message and impact the decision process at the right time. Keep a close eye on marketing costs and isolate the digital paths that are driving the most ROI for the business – then steer consumers towards them.

"This data mining approach allows marketers to extract prevailing path characteristics of their consumers and brands, and by revising their marketing strategies, influence consumers' actual journeys toward the purchase."

Understanding the digital consumer's path to purchase will become even more important as billions of new consumers in emerging markets begin shopping online. For most them, smartphones will be their primary access to online purchases. For more on that topic, read my post entitled The Growing Power of the Digital Path to Purchase.