Should Google and Facebook Be Considered Media Companies?

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Facebook and Google are making conscious efforts to distinguish themselves as technology companies rather than media companies. This distinction is important to define considering their vast reach and power to shape the future news landscape.

Examining their roles becomes even more noteworthy as major news organizations around the world seek to curb the power of this duopoly. This is in part to preserve the integrity of traditional journalism and to loosen the platforms’ grip on the global ad market.

In the US, major news publishers are seeking collective bargaining rights against the Facebook-Google duopoly. The effort is spearheaded by the News Media Alliance, an organization whose members include The New York Times, the Washington Post, and The Wall Street Journal, as well as numerous regional newspapers in the US.

Similar actions are being taken in Britain. The News Media Association, representing 1,100 British newspapers, wrote a letter to Parliament calling for the regulation of the two companies for their dominance over the ad market and the massive role they play in distributing information.

Why it’s important

In 2016 Google serviced over 9 billion searches and Facebook’s user base continues a steady upward climb, reaching up to 2 billion worldwide users.

The ubiquity of these platforms and their ability to spread information to users makes them highly influential sources for news. Even more, their global reach makes them attractive platforms for publishers to use as primary hosts for originally produced content.

In a recent paper published by peer-reviewed journal First Monday, authors Philip M. Napoli and Robyn Caplan counter Google and Facebook’s resistance to the “media company” label.

In their analysis, the characterization of these companies is integral to their role in disseminating information and shaping public opinion. It also could influence the regulatory and policy rules that govern them.

What is a ‘media company’

In simple terms, a media company can be defined as an entity that deals in the mass distribution of content. According to Napoli and Caplan, there are three main criteria essential to the function of a “media company,” although they are not mutually exclusive.

  1. The production of content; original material created by users or, in this case, news outlets.
  2. Distribution of content by moving it from producers to consumers.
  3. Exhibition, or the process of providing content directly to audiences.

The move toward digital news media, however, has disrupted the traditional relationship between publisher and consumer. In fact, the ease in which users or outlets can generate content and then distribute it via web-based platforms has significantly changed the media landscape.

Curation vs. creation of content

One of the central arguments tech companies use to differentiate themselves from media companies is that they do not generate content. Instead, they provide a platform for users to disseminate their own or third-party content.

For example, Eric Schmidt, the chairman of Google’s parent company Alphabet, explained, “we don’t do our own content, we get you to someone else’s content faster.” Schmidt acknowledges Google’s role in the distribution and exhibition of content, both of which are key functions of a media company as discussed above.

At a 2016 Q & A session at Rome’s Luiss University, Facebook founder Mark Zuckerberg elaborated on this view regarding his social network platform:

“We are a tech company, not a media company. When you think about a media company, you know, people are producing content, people are editing content, and that’s not us. We’re a technology company. We build tools.”

Some of these tools include Facebook Live and Facebook Instant Articles which allows users, including news publishers, to directly host content on the platform.

In refuting this argument, Napoli and Caplan claim that the lack of creation/ownership of content does not exempt a company from its role in distributing and exhibiting media content. As an example, they point to the fact that cable and satellite companies are often under the same regulatory authority as the content producers they serve. This is true even if they are not involved in the content creation process.

Human vs. algorithmic editing

A less explicit argument from Facebook and Google is that their lack of human editorial processes separates them from traditional media companies that rely on human decision-making to choose content.

However, the “gatekeeping” duty usually assigned to human editors is still being carried out, albeit in a different matter. With more media companies trying to incorporate artificial intelligence into editorial and writing processes, the argument that relying on algorithms over human editors indicates the practices of a tech rather than media company begins to hold less weight.

Can a media company be run by computer scientists?

Another argument these companies use is that the makeup of their employees distinguishes them from media companies. For example, Eric Schmidt claims that Google is a technology company “because it is run by three computer scientists”.

In debunking this argument, Napoli and Caplan comparatively look at the symbiotic evolution of media and technology over time. They state,  “Technological advancements—and the associated technical expertise—have been fundamental to the media sector since at least the advent of the printing press.”

Therefore the view that the tech backgrounds of a company’s staff separates it from the media industry does not hold up based on precedent. Historically, media companies have a track record of embracing new technologies to minimize costs, increase distribution, and aid in content creation.

Duopoly pushing traditional media out of ad market

Finally, competition for ad revenue between online platforms and traditional media outlets implies that they operate within the same business sector.

According to a report by Axios, Google and Facebook are dominating the global market with about 50% of all global ad-spending going to the two companies.

In comparison with traditional media like print and radio, Google’s ad revenue alone matches that of all print media outlets globally and Facebook’s ad revenue out-earns all global ad revenue generated by radio.

Preserving high-quality journalism

Important players in the news industry are catching on to the potential negative effects of underestimating Facebook and Google’s dominance in the digital media ecosystem.

In 2016, both Facebook and Google came under harsh scrutiny for their alleged role in the spread of “fake news” during the US presidential election.  As the New York Times’ Jim Rutenberg puts it, “The maneuvering is about more than the fight for digital territory. It’s about the endurance of quality journalism.”

Do Facebook and Google primarily deal in the curation of content? Yes. But with the increasingly important role these companies have in spreading news media stories, perhaps it is time for them to take responsibility for their role in affecting the quality of journalism in the future of digital news.

Developing the political policies that will drive a prosperous future for jobs

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I recently was interviewed on ABC News about the future of jobs, in a panel dicussion with policy advisor Terry Barnes.

You can see a video of the interview below.


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Why Indian Publishers Should Be Wary Despite Growing Newspaper Circulation

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For years, the Indian newspaper industry has been the envy of the rest of the world. It has grown consistently since India’s economic reforms in 1990, and advertising revenues have occasionally hit double-digit growth rates, while the industry declined steadily in much of the western world.

According to a recent report released by India’s Audit Bureau of Circulations (ABC), a non-profit organization founded in 1948, newspaper circulation of its 967 member publications grew 60% between 2006 and 2016, reflecting an annual growth rate of 4.9%.

Total daily circulation for these newspapers audited by the ABC reached 62.8 million, meaning on average each newspaper boasted a daily circulation of about 65,000.

Commentators justifiably took pride in the steady growth of print newspapers, and news outlets like CNN reported on how these figures demonstrated the country’s “thriving” print media industry.

However, this positive coverage glosses over a bout of newsroom buyouts, layoffs, and shutdowns in India, notably by the English-language press and including one of the only four listed newspaper companies in the country. Few, if any, have gone beyond the headline numbers and therein lies the proverbial glass half empty.

The bigger picture

For a comprehensive picture of print media in the country, here are some other numbers to consider:
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    • Between 2006 and 2016, average daily print circulation of the 967 publications audited by the ABC grew by 23.7 million. In the same period, India’s population grew 160 million, meaning incremental penetration of newspapers was less than 15% despite youth literacy sharply rising to 90%.

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    • The combined annual revenues of India’s print industry declined marginally from $13.6 billion in 2013 to $13.4 billion in 2016, according to the German statistical research firm Statista.

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  • GroupM estimates print advertising in India will grow by 4.5% in 2017, just above the previous year’s 4%, but barely above the inflation rate of nearly 4%.

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The first bullet point indicates that a majority of youth (50% of India’s population is below the age of 25) may not buy into print, and may instead embrace digital news sources. The second suggests a flattening of print revenues, or even a decline in real terms, despite rising circulation.

Lastly, the third suggests near-flat advertising revenues. If these interpretations are right, India’s print industry may have hit a peak and must prepare for the slide, perhaps by embracing digital with a little more enthusiasm.

Blinded by revenue

Historically, newspapers thrived in a monopolistic position–one in which readers and advertisers had few choices. However, the Internet has broken down both walls, as we have known since at least the turn of the century. Yet the ripple effects are just beginning to show themselves in the Indian market.

In fact, the shift to digital could conceivably play out at a faster pace than it did in other countries, notably the US, for several reasons. After all, technology and newsonomics know no boundaries.

By 2020, India’s Internet users are projected to rise 60% to 730 million and smartphone users are expected to more than double to 702 million, according to a joint study by Internet technology firm Akamai and Indian software industry group Nasscom. Such rapid adoption will likely accelerate already changing reading habits.

So far, Indian print publishers, with only a few exceptions, have made only a feeble push into digital. Perhaps this seemed to make business sense because they were making money hand over fist from print, but no longer.

Most newspapers run a token website with an editorial staff that works in isolation from its print counterparts. Consequently, there is little collaboration, experimentation, or innovation in newsrooms or in marketing departments. Most publishers earn less than 10% of their revenue from online, compared to about 25% for American publishers.

Digital startups with a head start

On the other hand, a range of pure digital news media companies has emerged to tap into the fast-growing online readership overlooked by print publishers. These digital startups are also targeting the fast-growing digital advertising market, which is expected to double its share of the advertising pie by claiming 24% in 2020.
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Since digital news media does not face restrictions on foreign ownership, it has allowed many global companies to throw their hats into the ring. They include New York-headquartered IBT Media and the venture-funded Scroll.in, based in Boston.
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UC Web, the Chinese media company owned by Alibaba, is also in the process of setting up massive news media operations in multiple Indian languages is In addition, the British Broadcasting Corporation is in an advanced stage of adding more languages to its mix of news websites in India. Billionaire Mukesh Ambani-owned Network 18, through its ETV subsidiary, is similarly planning to start news websites in a dozen Indian languages.
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Some of the pure digital startups deliver quality news stories with several multimedia elements. One, The Wire, is a nonprofit initiative. However, some are simple aggregators or rewriting shops and already have stolen a march over many print publishers’ digital offerings.
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In fact, some rank among the most trafficked news websites in India, according to the web traffic-monitoring firm SimilarWeb. They include IBTimes India and Oneindia, which is venture-funded and publishes in multiple Indian languages.
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India’s print publishers still have a lot going for them. They have corporate advertising support (40% vs. low teens in many other countries, according to The Economist), and generous advertising support from the federal and state governments. But they risk losing print audiences as well as digital ones, if they don’t act soon.
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First step is building quantum computers, next step is scaling them

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It was a great pleasure to get a tour of the University of New South Wales’ Centre for Quantum Computation today from Prof Andrea Morello.

The Centre was last year awarded A$70 million in funding from private and public sectors with the aim of achieving ‘10 qubits in 5 years’.
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Overcoming Fake News and Echo Chambers in the Age of Social Media

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Online news sources have grown significantly in recent years. With this increase, more people are relying on social media sites to discover and share news stories.

According to the Reuters Institute Digital News Report of 2016, 51% of a global sample said they use social media as a source of news every week, and about 1 in 10 use social media as a main source of news.

Along with this emerging trend, access to free online platforms as well as tools that simplify the creation of websites have contributed to the spread of unverified stories. Together these factors influence the way news is discovered, consumed, and published.

This article aims to define two important media trends that have sprung up as a result: the proliferation of “fake news” and “echo chambers.” It will also provide insight into the actions of leading media companies to adapt to this changing framework and develop a new model for the future of journalism.

Defining ‘fake news’

Throughout 2016 and 2017, “fake news” was used to label misinformation campaigns that used social media and automated bots to intentionally spread false information. It has since evolved to become a toxic media brand used to describe inaccurate news.

To the alarm of many news professionals, politicians have also started using the term to undermine the credibility of unfavorable media outlets. For the sake of this article, the term “fake news” will be used to address any news stories that are simply false or purposely misleading.

According to the Reuters Institute’s 2017 trends and predictions report, by the end of the 2016 US Presidential election, there was actually higher engagement with fake news stories on Facebook than with accurate journalism (see below).

Due to the ease of sharing on social networks, untrue or exaggerated articles can spread quickly. Also, as the accepted definition of “fake news” remains ambiguous, these stories may be difficult to identify.

For these reasons, it has become increasingly important for news publishers to ensure their credibility with audiences in order to maintain a high level of integrity for their readers and to avoid being labeled as fake.

Fact-checking and data-based journalism to combat fake news

According to a 2017 report from Harvard’s Shorenstein Center on Media, Politics and Policy, the issue of fake news can addressed by three primary methods: prioritizing fact-checking, promoting bipartisan discussion, and fostering a collaborative research environment. We have already seen shifts in influential media companies to meet these goals.

At its 2017 F8 conference, Facebook announced plans to outsource fact checking to third parties like Politifact and Snopes in order to provide analysis of claims being made by news outlets online. This year, the Google Digital News Initiative (DNI) also awarded funding to projects such as the British prototype: Fact-checking Automation and Claims Tracking System (FACTS). This platform seeks to be the first to fact-check claims automatically using statistical analysis.

The same report claims, “we should seek stronger future collaborations between researchers and the media.” In addition to reducing the cost of data-based journalism, some publishers are pursuing “open-data” based platforms that focus on shared use of data, research, and user collaboration.

In 2017, Wikipedia founder Jimmy Wales announced the launch of WikiTribune. “Articles are authored, fact-checked, and verified by professional journalists and community members working side by side as equals,” states the website. The project aims to produce “evidence-based” journalism that is founded on data, research, and user collaboration.

News aggregation and user-interaction to break echo chambers

When it comes to self-tailored media, or “echo chambers,” the main causes are twofold. The first is that many people share and interact with news stories they agree with or of which they approve. In addition, social media users are free to select which media outlets to follow, and which ones to block.

The result is a potential bubble of information that may discourage engagement with challenging viewpoints.

Even more, if the view or information reinforced by these media choices are inaccurate, it may lead to a personalized information trap of unreliable sources. This has created concern among readers who don’t want to miss challenging viewpoints.

To address this issue, some consumers are turning to news aggregators. In fact, according to the Reuters Digital News Report, 57% of respondents said they prefer news aggregators in order to access a variety of sources.

News aggregators like Google News and Yahoo Japan are already quite popular with people whom prefer to receive news from multiple sources.

In China a new app called Bingdu combines news aggregation, user-driven advertisements, and Facebook-style recommendation algorithms to attract around 10 million active users.

Another Google DNI funded initiative comes from Europa Press Comunicación via a news platform that aims to “facilitate the use of open-data both as a source of news and as a fact validation instrument.”

Solutions require collaboration and innovation 

The problems of fake news and echo chambers will not be solved overnight. We have already seen a shift in news production by leading media companies to ensure credibility in this changing media ecosystem. Innovative emerging publishers should continue to foster a strong relationship between publishers, readers, and researchers. This is an essential first step in building a more positive media landscape for the future.

 

Image sources: Reuters Institute’s 2017 trends and predictions report, Reuters Digital News Report,

Phase transition: I am launching a new group of companies

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I am delighted to announce a massive transition in my work and life: launching a new group of companies with other amazing founders that expands and accelerates my vision.

It is now over 20 years since I left employment and started building the Advanced Human Technologies group of companies, which spanned professional services, publishing, events, apps and software development. We had many landmarks and successes along the way.

The reason to bring these ventures into a new group is simply to enact the same vision I have long had on a larger stage and scale. Read more →

The Changing Role of Public Relations: 5 Insights from the Global Communications Report 2017

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In-house PR professionals, agency PR professionals and client-side marketers are known for their differences of opinion about the future of public relations. Key points that these stakeholders disagree and agree on are outlined in the Global Communications Report 2017, compiled by the USC Center for Public Relations and the Association of National Advertisers in consultation with their partner organizations. Here are five important insights drawn from the report and its associated research on The Evolution of Public Relations.

1. PR is becoming more important to marketing, even as both disciplines continue to converge

Client-side marketers plan to increase both internal staffing and overall spending on public relations over the next five years, according to ANA’s 2017 survey of U.S. marketers.


Increased spending suggests that public relations is “becoming more important to marketers”, said ANA’s Group EVP Bill Duggan, citing the crucial role for PR in managing digital communication and feedback loops.

At the same time, a majority of surveyed marketers (61%) believed that PR will become more closely aligned with marketing, while 20% went so far as to say that PR will become a subset of marketing.

The global and U.S. PR professionals surveyed, however, were more hesitant about the convergence of PR and marketing. PR agency leaders indicated that they report most frequently into corporate communications (39%), which is more than into marketing (21%) or brand management (12%), but this gap is narrowing as client solutions become increasingly integrated.

Meanwhile, 18% of corporate communications departments were reporting into marketing. This proportion could grow if more organizations follow the example of Procter & Gamble, Virgin America and other well known companies by restructuring their marketing functions to include PR.

Whether convergence will expand or diminish the role of the PR professional is hotly contested. What does seem likely is that a broader skill set will be required to navigate the fluidity of marketing and PR in a digital world.

2. Declining revenues from earned media will put the spotlight on paid, shared and owned media – and the skills required to profit from them

PR agencies and in-house PR teams alike expect declining revenues from earned media over the next five years, prompting more spending on paid, shared and owned media.


Supporting this shift, over 60% of surveyed PR executives believed that branded content and influencer marketing, which are both primarily paid, will be important trends over the next five years.

Paid content, however, has long been the domain of advertising. PR professionals in a changing media landscape may benefit from mastering media buying, the report suggests, but this currently ranks last on the list of skills PR professionals consider important for future growth.

Meanwhile, more than half of the PR executives in the study believed that the consumer of the future will not distinguish between paid and earned media. Another one-third disagreed. The answer to this debate could have significant implications for all stakeholders.

3. PR professionals must harness social listening, digital storytelling, and social purpose

Digital can improve the quality of public relations by enabling instant outbound communication and inbound feedback. In this dynamic environment, PR professionals believe the most important trends impacting the future of the PR will be digital storytelling (88%), social listening (82%), social purpose (71%), and big data (70%).

Marketing professionals showed some consensus with PR professionals about these trends, but prioritized social listening (88%) over digital storytelling (80%), and real-time marketing (69%), influencer marketing (68%) and branded content (67%) over big data (63%).


Both groups agree on the importance of social purpose, which can be vital to the direction, cohesion and outcomes of the other top trends.

4. More clients will hire agencies to provide strategy, expertise, and creative thinking

The rising emphasis on strategy and creative in the client/agency relationship is a clear theme in both the 2016 and 2017 editions of the Global Communications Report.

For the in-house marketing professionals surveyed in 2017, the top reasons for working with PR agencies were strategic insights (67%), creative thinking (64%), specific practice areas (63%), media relations (62%), digital and social media (60%), and measurement and evaluation (60%).

For in-house PR professionals, the top reasons for working with PR agencies were similar: strategic insights (69%), creative thinking (69%), specific practice areas (62%), and digital and social media (61%). However, there was less emphasis on measurement and evaluation (50%) and media relations (49%).


The growing strategic and creative input of PR agencies needs to be reflected in compensation models, says Fred Cook, Director of the USC Center for Public Relations, who suggests focusing more on value delivered than hours spent.

5. The value of PR will depend on achieving measurable business objectives

The vast majority of surveyed PR and marketing professionals believed that PR can best increase its value by demonstrating how PR programs achieve measurable business objectives.


However, improving measurement of results itself was a lower priority for PR in the eyes of PR professionals than marketing professionals, who, in turn, were less preoccupied about PR’s ability to address the wants and needs of all stakeholders. These disparities in stakeholder expectations can be reduced by establishing clear goals from the outset, as the report recommends.

The report also highlights the growing demand for PR to develop sophisticated ways to measure less-tangible variables like brand reputation, purchase intent, leadership, and creativity.

Repositioning PR to maximize relevance and talent

The five key insights above provide some clues as to how PR might reposition itself as an aspirational career choice – something which less than one-third of PR executives believe the industry is doing well. Given that recruiting and retaining the right talent remains a big challenge for PR, it will be interesting to see how the growing demand for strategic thinking – ranked in the study as the most important skill for today’s PR professionals – will shape PR in the years to come.

Table: The Evolution of Public Relations report by ANA and the USC Annenberg Center for Public Relations
Graphs and charts: the Global Communications Report 2017, presented by The Holmes Report and USC Annenberg Center for Public Relations

6 Key Strategies Media Companies Need to Prosper in the Future News Industry

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One of the most striking trends in 21st century innovation is the significant potential for media to create value on a global scale.

Media, in all its forms, is fuelling economic growth, structural change, and technological advances like never before. As society debates the role and influence of media in a “post-truth” world, it is increasingly apparent that the future of media is crucial to shaping the future of humanity.

Media futurist Ross Dawson shared useful insights on how to create a vibrant future for media organizations in his keynote at the #SchibstedNext 2016 event held by Schibsted Media Group. You can see the video of the full keynote below.

Despite the widespread changes impacting the global media industry, Dawson pointed to the enduring and insatiable human appetite for information in a multichannel media world.

“Arguably the entire economy is becoming based on media, the creation of messages, the flow of messages, and where they are going,” Dawson said.

Here are six key ways in which media organizations can empower themselves to create their own future, drawn from Dawson’s talk at #SchibstedNext.

1. Create a compelling vision

“The best way to predict the future of media is to create it,” Dawson told the media leaders assembled in Oslo. For today’s media organizations, achieving a successful transition to tomorrow hinges on understanding “who it is we can be, who it is we want to be, moving forward”.

Forging a compelling vision for your media organization and communicating it effectively is vital for staff to adapt to the merging of technology and humanity, Dawson said, in an era when “technology is more and more capable, taking more and more of who we are”.

Without a clear strategic vision, companies are more likely to be blinded by past successes and overpowered by technological change. As the report of the 2020 group for the New York Times recently put it:

“To do nothing, or to be timid in imagining the future, would mean being left behind.”

2. Translate experimentation into value creation

Today, in the space of a day, you can test an idea, see how people respond, and develop it further. This has become a fundamental capability of every organization in the entire media industry.

“Revenue is highly uncertain, so you need to be able to experiment,” said Dawson. “For every experiment you should know what you want to learn, and when you learn that, you will be able to design the next experiment.”

Dawson referred to a basic test-and-learn model favored by entrepreneurs and outlined in The Lean Startup by Eric Ries: come up with an idea, put it into action, learn from that, iterate, and turn it into a result. “You can learn from others, absolutely, but you need to be able to create your own guidebook,” Dawson added.

Part of converting experimentation into value creation is a focus on community: “Being able to connect people, define what it is that’s common between them…to be able to create media which is relevant to all of those people, and to be able to filter that…to the individual…across many news or media organizations.”

3. Make the most of human and machine intelligence

Alongside advances in algorithms and the proliferation of convenient, high-tech user interfaces, robots and amateurs are now making music, art, video, and journalism in ways that were once limited to professionals. Dawson offered advice on how media organizations must respond:

“I believe that in the last 20 years, one of the most important things is how technology has enabled our creativity. If we are looking for the best media, we must bring together the professionals—who have the expertise and the context—with the amateurs, with all of us, with the many that are enabled by technology to create new possibilities.”

Optimizing both human and machine intelligence will become increasingly critical to value creation as organizations collect ever more data and achieve new milestones in consumer knowledge and engagement.

4. Ensure a clear and dynamic platform strategy

As existing and emerging media platforms vie for our attention, a solid understanding of platforms and their relationship to value creation is essential to steer media towards a positive future.

The best platform strategies, in Dawson’s view, are dynamic and user driven: “How is it you create value for participants? That’s the fundamental aspect of a platform,” he said. “Designing value for the participants in ways that they can create that together.”

In order to maximize value for participants across platforms, Dawson highlighted the role of data analysis, signal monitoring, user feedback loops, and collaboration with both internal and external platform creators.

5. Build on your existing capabilities and transcend their boundaries

A focus on transcending the boundaries has underpinned recent innovations in the media world, including the immersive virtual reality smartphone app available from the New York Times.

Media organizations must continue to think beyond the boundaries—such as print, broadcast, and even digital—if they are to create more compelling experiences for the audiences of tomorrow. Dawson elaborated:

“You need to be able to say, what are our capabilities today? What are we great at? What are we distinct at? What are we world-class at? What is it that we are going to build on? As organizations and individuals you need to be able to map your path and capability development moving forward.”

In order to transcend the boundaries and promote innovation, media brands are learning “to actually live what they are doing so that the messages that flow outside represent who they are,” said Dawson. This involves building the flow of communication and transparency internally in ways that mirror the external values and perceptions of a brand.

 

6. Foster bold and agile leadership to create your own future

Even as user participation in media continues to flourish, Dawson reminded the Schibsted audience that strong leadership remains crucial, because the future of media “is not a spectator sport.” As the Law of Requisite Variety makes clear, only those organizations that are as flexible as their environment will have the power to be able to create the future.

Therefore, leaders’ ability to put a bold vision into action, to push out the boundaries and set new standards for media will be crucial to success in the industry going forward. This is especially important because, at its core, the future of media “is an experiment,” Dawson believes.

“There is no roadmap to be able to say, this is exactly where the future of media is going. You need to create that. For your individual organization, it is going to be a different answer.”

Expanding Customer Engagement: Case Studies of VR as Storyteller and Skill Builder

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As virtual reality technologies improve and become more accessible, organizations are finding increasingly meaningful ways to use VR to educate and engage their customers. When an exciting VR experience is carefully built around an immersive brand story and useful content, VR can take customer engagement to the next level. Here’s how two very different companies are each using VR to unify storytelling and skill development.

Lowe’s Holoroom How To: Immersing customers in home improvement learning

U.S. hardware chain Lowe’s is one of the first retailers to use VR to teach customers practical home improvement skills. Since 2014, Lowe’s Holoroom How To experience has gradually transitioned from a tool for customers to visualize what a bathroom or kitchen renovation could look like, to a platform for DIY skills training. The focus is on exploring real-life applications of VR “to directly help our customers solve everyday problems”, according to Kyle Nel, Executive Director of Lowe’s Innovation Labs.

In 2017, the six-month pilot of the Holoroom How To skills clinic is available to customers at two Lowe’s stores in the U.S. (Framingham, MA and Burlington, ON) and one RONA store in Canada (Beloeil, Québec). Wearing a VR headset, customers act on instructions from a video to practice skills such as installing shelves, painting a fence or tiling a shower. Tactile responses on the handheld equipment give customers the sensation of actually holding a drill or other hardware tool. The immersive nature of the technology makes it a valuable experiential learning platform and a source of useful insights into customer knowledge, recall and motivation.

Lowe’s asserts that people who participate in the Holoroom How To demonstrate increased motivation to take on DIY projects and better recall of the steps involved. “We believe innovations like Holoroom How To will soon enable instantaneous learning moments and massively scalable training opportunities that empower both customers and employees around the world,” says Nel.

CommBank’s Start Smart VR pilot: Fostering financial education

In a different take on customer education, the Commonwealth Bank of Australia is incorporating VR for school children into its Start Smart corporate responsibility program. CommBank partnered with Australian author Ursula Dubosarsky to create a picture book, Sammy the Space Koala, that teaches children about financial decision-making, saving and investing. The book is made interactive by a VR headset, ‘The Teleporter’, developed by M&C Saatchi’s innovation lab Tricky Jigsaw.

The picture books and VR headsets were distributed to around 1500 students from 24 Australian primary schools during late 2016. The students were encouraged to take the VR experience home to revisit key concepts about financial literacy with their parents or carers, who were asked to provide feedback on the experience. According to Stuart Tucker, GM of brand, sponsorship and marketing operations at CommBank, one parent reported their child learned more in a 10-minute VR journey in outer space than they had in five years on Earth.

Using VR “teleports” kids into a “richer learning experience”, says Michael Canning, M&C Saatchi Australia’s Executive Creative Director. “VR is everywhere at the moment, but the reason that VR is relevant is because it becomes an active decision-making tool – if you’re just reading the book you can’t choose the items you buy. It’s hard to do that in a passive medium but VR turned it into immersive storytelling.”

Making the most of VR in PR

One of the key advantages that VR has over other mediums is that there are no distractions for the customer. This has significant implications for PR, as Alex Halls observes in a blog post for Wolfstar consultancy:

“The best PR campaigns have the power to grip the consumer but the weaker campaigns are often filtered out among the many news stories we see day to day. VR’s advantage is once the headset is on, you are completely immersed in the media, you choose where you look and what to focus on. Every part of it, every turn of the head, can be intricately planned for the best results and the biggest impact.”

Nonetheless, an effective use of VR must be closely connected to brand narrative and customer engagement to avoid “the gimmick factor” and ensure “that it’s still story first and technology second”, says Ian Shying, UX and Design Director at Edelman Australia. The way forward for PR, then, is to use VR as a strategic tool for meaningful storytelling and customer education.

#DeleteUber: How much will activism shape the on-demand economy?

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I was recently interviewed for a News Corp article on the Australian response to the global backlash on Uber.

I told the journalist in our interview that while I know a number of Australians who have deleted Uber, most Australians focus on the utility of the service. I was quoted:
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