Well, we all survived another Black Friday. Smart Home Products factored heavily into the retail promotions of Amazon, Best Buy and others. One CyberMonday surprise was the announcement that Lowe’s has finally decided to stop being a service provider and is actively looking for a buyer for their Iris ecosystem. Lowe’s attempts to build their own ecosystem has been a struggle from the moment of launch, pigeon-holing Lowe’s to promote their solutions over all others in the fragmented Smart Home market. Even as Vivint and Comcast deepened both their relationships with users and their dominance over other providers like ADT and AT&T, Lowes frustrated users with one of the poorest performing apps of any of the service providers, even ADT. Coupled with the rapid rise of Smart Speakers like Alexa (Vivint was the first to integrate Amazon into their ecosystem) and the dominance of hero products like Nest Thermostats or Arlo cameras, Lowes was stuck with products consumers did not want, lagging features like voice integration, powered by a service that created more churn than the launch of the first iPhone. Best Buy and Home Depot avoided this trap by focusing on the hero products to drive engagement and offering logical expansion products for DIY consumers like smart switches, plugs or enticing consumers with Smart Lighting solutions. That product mix agility allowed Best Buy and Home Depot to sidestep the path of pain that Lowes experienced, take market share away from Lowes, and more importantly, learn from their buying and using public, what aspects of Smart Home were working for consumers.
Similar to Revolv customers after Google decided to shut off the services, Iris customers are now in limbo, waiting for someone else to take up their service. Their reward for investing in Iris, a home full of devices that may or may not work with other Z-Wave or Zigbee enabled platforms and services.
While Iris is the latest casualty, it is still shocking to me, for Holiday 2018, we still have such a fragmented market place. There is no single ecosystem that delivers on the entire promise of Smart Home. Most solutions still just chain together macros of actions defined by users or professional installers and lack the real intelligence promised so long ago. Amazon’s growing integration with Ring, Vivint’s Sky Intelligence and Comcast’s deepening intertwining of Xfinity Home with their other services are all getting closer to what is promised but 2018 was not the Smart Home year we all hoped for…
Here’s to 2019, may we all get even more of this opportunity right for both consumers and the companies brave enough to support this adventure!
As the sun sets, I ask Alexa to turn on the deck lights so my wife and I can enjoy some time together after we tuck our children in. When I do that, the whole sequence looks like the following:
Alexa takes my voice and digitizes it
The digitized command is sent to the Amazon Cloud
The audio is analyzed based on Amazon’s algorithms and guesses what I might have said
Amazon then checks against my personal set of commands for my smart home stored in their cloud
Once the “Turn Deck Lights On” is identified, Amazon then communicates to Wink that I have a command
Wink authenticates that Amazon is able to make that request on my behalf
Wink then sends the command to my local Wink hub over the internet
My hub authenticates the command from Wink and, over the Z-Wave mesh network, tells the switch controller to turn on the smart plug associated with Deck Lights
With a noticeable delay, the lights come on and we continue with our evening plans of drinks, sunset and relaxation. But what I don’t think about everyday is how much of this “simple” command flow takes place outside my home, of how many potentially weak links there are in that chain. Given the number of “actors” involved in making this happen, any of these actors could be compromised, allowing our family’s data to be shared with others wholes goals do not align with turning on my deck lights. As we are learning from the headlines, there are an increasing number of bad actors seeking to do just that. Additionally, companies have left open loopholes in their own development efforts, accidentally, that expose users to new constellations of ramifications. The revelation that Twitter was storing our passwords in the open before securing is tantamount to banks leaving our cash in a paper bag on counter while the teller is on break before putting it in the vault. Twitter did not do it on purpose. They are, especially with the scrutiny that Facebook is under, typically one of the good guys in this balance between utility and privacy.
What are the chances that the devices and services we pull together to protect and control are home will be compromised in the near future? Very high, mainly because the extreme reliance on cloud services increases the attack surfaces available for hackers to take advantage of. We’ve actually seen a significant jump in consumer concerns on hacking in our tracking of the Smart Home market in the past few months.
Consumer Attention on Hacking in Smart Home has jumped significantly in the past six months.
There have been a few firms working to enable more localized control of the Smart Home. Hubitat is the most recent to launch a 100% local Smart Home solution. While they do not handle video integration, they can at least keep the deck lights scenario I mentioned above all in the family. Not only does the local control all but eliminate the delay in asking Alexa to turn on the deck lights, it all happens (except for the Alexa processing of my voice) locally. Especially if I have devices from multiple manufacturers, activating a scene like ‘date night’ dims the interior lights, turns on Barry White on the “Deck Group” and locks the front door, becomes instantaneous. This is a big step towards really securing the home from bad actors, both purposeful and accidental.
If you’d like to really understand what is happening in Smart Home, cutting through the promises to the meat of consumer reality, let us know. We have the data on over a million Smart Home consumers across the entire market. I’m sure we can help make you a Smart Home hero!
I was reviewing the NPS scores for the big three Smart Home Providers, ADT, Vivint and Xfinity for Q1 2018. You might recall that ADT had some issues with a system upgrade in June of 2017 that caused a flood of frustrated users taking to the airwaves, dropping ADT’s already low NPS into the bowels of consumer hell. Checking around the holidays saw ADT start to recover, the the point of being on par with Xfinity and Vivint.
ADT recovers from their summer of misery over the holidays, only to slide down into negative NPS territory.
Notice that ADT’s NPS peaked in mid December, almost to an NPS of 25%. They actually were rated higher than Xfinity for the middle two weeks of December! Since then, ADT has fallen back into negative territory, frustrating users even as they lose them to other monitoring services or DIY solutions.
Comparing major Smart Home provides Q1 2018 NPS to Q4 2017. Xfinity shows a drop in interest but happier customers than Vivint.
While all providers saw a drop in interest after a surge in engagement over the holidays, Xfinity saw the smallest drop in interest. Vivint customers are still more vocal about their experience but Vivint’s NPS score dropped to 36% based on app reviews while Xfinity pulled ahead to an NPS of 40%. Both Vivint and Xfinity continue to threaten ADT’s prior dominance in the space even as Google, Amazon and Apple work to design DIY systems that dampen the demand of “Do It For Me” installations.
We’ve got the data, updated continuously, on the entire Smart Home market. With literally hundreds of thousands of consumer perceptions coming in every quarter, Argus Insights sees the successes and failures across the Smart Home landscape and has the tools to help you profit from the lessons others have paid for with sweat, tears and market share. Let me know if there is a question you’d like an answer too.
Just a few days ago, I receive notice from Instagram that they were accelerating the shutdown of the bulk of their API features, including posting on user’s behalf, searching for results and subscribing to updates from particular users. Ostensibly this is to cut down on using these tools for nefarious reasons as Instagram’s parent company, Facebook, continues to reel from the impact of Cambridge Analytica using FB data to target US citizens with propaganda and potentially impact the election. There have been cries from users to move off Facebook, delete their profiles, and move their peeps to another network. Most famously, Will Ferrell has deleted his account. A corporate alumni group I am a member if is considering moving to Slack. For most everyone else, it is business as usual on the world’s largest social network. Mainly because the consumer privacy frogs have been boiled to death. Most consumers do not realize that when they use Facebook or other social network accounts to log in to new websites, they are sharing their entire social graph with that site. That is how Cambridge Analytica, buying data through a Cambridge researcher and other channels, was able to capture the details of 87 million Americans. Most users do not know what they are signing up for, how their data is being used, and click through privacy updates faster than Las Vegas retirees at penny slots.
Only a few consumers have jumped out of the hot water social networks have gotten them into. Our collective frogs are being boiled.
What we see on the backend, where the social sausage is made, is that firms like Instagram and Twitter are changing what data people can get access to as the horror of what is possible is moving from the dark web to public headlines. Twitter, a few weeks ago, started shutting down so called “TweetDeckers,” accounts that build and maintain a captured set of followers to artificially amplify their message across that social network. Facebook moved their public search api behind their firewall and provided curated access through data provider Datasift a few years ago, mixing public and private in a way so that marketers could target ads more broadly but have less access to the details of who they are targeting.
What we have not yet seen from these firms is more transparency to their users as to what is going on. Twitter did not market the fake influencers on their network as Tweetdeckers, they just suspended their accounts, most only temporarily. Many of these offenders just opened new accounts, both to continue their operations as usual and to complain to their tribe of followers (mostly bots) that they were wronged by Twitter. Our own analysis at Argus Insights found that most of the content in B2B discussions on Twitter are published by compromised accounts. In the Internet of Things market alone, 75% of the content published is from accounts compromised in some way, yet we see nothing from Twitter to help sort the wheat from the chaff. Spammers use Twitter’s API to drop in latitude and longitude information to boost their discovery in local search results. (It is hilarious to see Tweets published from the geographic center of Palo Alto, evidently published from a phone located inside the concrete walls of one of the buildings there).
It’s an arms race, I know, trying to keep up with how people will leverage tools for both good and evil. By the very nature of Silicon Valley, we want to build more tools, more API’s to share even more data, because that level of transparency is good, right? If plutonium can be used to craft weapons of mass destruction, social data can be used to build and deploy weapons of mass disruption. And here’s the thing, just like arms dealers making bank selling weapons to both sides of battles in small African countries, the social networks make their quarters (fiscal and literal) by the volume of advertising running on their platforms. I do not begrudge these firms making benjamins on my eyeballs. I understand they are turning my social capital into financial capital. But as a buyer of advertising, I want to make sure I get what I pay for.
Imagine if CBS Interactive charged billboard advertisers for space for the 101 freeway in Silicon Valley based on the number of chickens making their way from LA to Napa? Chickens have eyeballs, they are the target market since they are on the freeway in Silicon Valley. Why should Chipotle or Saleforce.com cry foul if CBS Interactive charges a premium for reaching an tract 30 million eyeballs a month? This is the equivalent of the debacle we call social advertising today. I had a client whose ad campaign netted over 43,000 new followers for their account. Of those new followers, less than 200 had participated in their market in the last six months. They paid good money to reach prospects, not chickens, which is what they got instead. The social firms can maintain and grow their business if they do a better job of ensuring the quality of their networks, and provide metrics beyond fake followers and fake reach.
And tell their users how their data is being used. Make it transparent how the data is being used to target users to the mutual benefit to advertises, the platform and users. We watch TV, we know need to see ads. Heck, we watch the Superbowl because of the ads! We read the paper, we see ads, we search in Google, we see ads. We know we pay for things with our attention.
In summary….
Social networks are working behind the scenes to make it harder to misuse their data and tool but will always fall behind the arms race of nefarious actors peddling influence
Consumers have had their privacy concerns boiled out of them but still need to be made away (in simple language) the impact of their actions
Advertisers should demand higher quality targeting of people, not chickens along with better metrics of success or failure of campaigns
Someone has or will recommend that Blockchain and/or Artificial Intelligence will solve all of these problems if you just gave them enough funding…
Ahead of the news from Facebook on Cambridge Analytica abusing the data of American citizens, Twitter started suspending accounts for a practice called Tweetdecking, where accounts would solicit and at times pay for accounts to artificially boost their classic influence metrics of reach and followers. Over the weekend of 18 March, some of the Internet of Things most prolific influencers were also suspended, at least for a while. Many of them are back on the Twitter-waves, pushing content like before but the artificial amplification they received by Tweetdecking has diminished to mortal levels.
At Argus Insights, we have been doing our own analysis of the rampant pay to post shenanigans in the various B2B markets we track. I first identified the issue when we saw Brocade jump in 2015 after a product announcement. Our client at the time, HPE, was concerned about the amount of attention that Brocade was getting for their announcement of offering free Network Functional Virtualization solutions. We dug into the data, initially by hand, and found the bulk of the lift Brocade demonstrated came from two sources, their own employees (Corporate Narcississm) and what appeared to be bot accounts from Saudi Arabia, tweets from people that had no interest in the telecom space, based on their past social engagements. In short, someone, maybe Brocade, maybe their agency, or someone else, was paying to push their message out, inflate their metrics and give the perception that the whole market cared about their announcement. Turns out the market didn’t care. Without the bots and employees boosting the interest, the chatter around Brocade died down to normal levels almost the next day.
We had a client looking to boost their followers (the boss challenged them to beat his follower count in a few weeks) and ignored our advice to build their following organically. They instead spent money on Twitter ads and saw their followers go from 92 to over 40,ooo in just a few weeks. The boss cried foul and asked them to prove these were real followers. They came back to Argus Insights, hat in hand, and asked if we could help. By looking at which of their followers had actively participated in the market (NFV) in the last six months, we could say which of their 40k followers were likely to be real. It was only 271. Of over 40k followers they had grabbed with their ad campaign, less than 1% mattered to their business. The client started managing to their True Followers metric instead and saw their authentic influence grow, even as their overall follower count dropped.
But not everyone that participates in a market is part of that market. In November of 2017, after being frustrated with the amount of poor content that was topping the charts of our analysis within IoT, I developed some metrics to gauge whether an account fit into a few different categories. Were they a brand, pushing out content mostly from a single domain with a good level of active dialogue with the rest of market? Were they a broadcaster, just sharing content from others? We also identified content farms, accounts that tend to talk about themselves a lot and retweet content of their clients. The most nefarious type were the compromised accounts. These accounts are basically owned by content farms and seek only to artificially boost their ‘influence’ in the marketplace.
Once we had applied this account types, we found that over 75% of all IoT content was published by the compromised accounts. This means that 3 out of 4 tweets about a multi-billion dollar market are not authentic and serve only to misguide and misdirect the 25% of the content that is more likely legitimate.
It gets worse. One of the most prolific IoT influencers pushed out almost 700 tweets, over 10% were self promotion, a clear sign of a content farm. More nefarious is that of his thousands of retweets, 85%, eighty-five percent, came from the aforementioned compromised accounts. This means that only 15% of his “influence” is legitimate. This means his clients that rely on his reach to bolster their own market awareness are paying to push content to compromised accounts. Not customers, not influencers, not thought leaders, but accounts owned by others whose sole purpose is to buy and sell attention from others.
B2B marketing on Twitter is broken. Broken by those that would game the system and misrepresent their own influence. Broken by those firms that pay for influence rather than earning it. Broken for those who see Twitter as a source of what is happening in their market. Broken for those looking to see what trends are driving their markets. Broken for you…
