If you re-read the first few chapters of The Innovator’s Dilemma and you insert “Apple” every time Clayton Christensen mentions “a company,” a certain picture emerges: Apple is a company on the verge of being disrupted, and the next great idea in tech and consumer electronics will not materialize from within the walls of its Cupertino spaceship.
The Innovator’s Dilemma, of course, is about the trap that successful companies fall into time and time again. They’re well managed, they’re responsive to their customers, and they’re market leaders. And yet, despite doing everything right, they fail to see the next wave of innovation coming, they get disrupted, and they ultimately fail.
In the case of Apple, the company is trapped by its success, and that success is spelled “iPhone.”
Take, for example, Christensen’s description of the principles of good management that inevitably lead to the downfall of successful companies: “that you should always listen to and respond to the needs of your best customers, and that you should focus investments on those innovations that promise the highest returns.”
Molly Wood (@mollywood) is an Ideas contributor at WIRED and the host and senior editor of Marketplace Tech, a daily national radio broadcast covering the business of technology. She has covered the tech industry at CNET, The New York Times, and in various print, television, digital and audio formats for nearly 20 years. (Ouch.)
Then think about the iPhone, which, despite some consumer-unfriendly advances like the lost headphone jack and ever-changing charging ports, has also been adjusted and tweaked and frozen by what customers want: bigger screens, great cameras, ease of use, and a consistent interface. And the bulk of Apple’s investment since 2007, when the iPhone came out, has been about maintaining, developing, and selling this one device.
In the last quarter of 2018, the iPhone accounted for $51 billion of Apple’s $84 billion in revenue. Its success, the economic halo around it, and its seeming invincibility since its launch have propelled Apple to heights few companies have ever imagined. But the device will also be its undoing.
Here’s what happens when you have a product that successful: You get comfortable. More accurately, you get protective. You don’t want to try anything new. The new things you do try have to be justified in the context of that precious jewel—the “core product.”
So even something like Apple’s Services segment—the brightest non-iPhone spot in its earnings lately—mostly consists of services that benefit the iPhone. It’s Apple Music, iTunes, iCloud—and although Apple doesn’t break out its numbers, the best estimate is that a third or more of its Services revenue is driven by the 30 percent cut it takes from … yep, apps downloaded from the App Store.
The other bright spot in the company’s latest earnings report is its Wearables, Home, and Accessories category. Here again, Apple doesn’t break out the numbers, but the wearables part of that segment is where all the growth is, and that means Apple Watches. And you know what’s still tied nice and tight to the iPhone? Apple Watches.
Even Apple’s best-selling accessories are most likely AirPods, which had a meme-tastic holiday season and are, safe to say, used mostly in conjunction with iPhones. (I’d bet the rest of the accessories dollars are coming from dongles and hubs, since there’s nary a port to be found on any of its new MacBooks.) As for stand-alones, its smart speakers are reportedly great, but they’re not putting a dent in Amazon or Google, by latest count. Apple TV, sure. Fine. But Roku shouldn’t have been embedded in a TV before Apple was.
And none of these efforts count as a serious attempt at diversification.
You may be tempted to argue that Apple is, in fact, working on other projects. The Apple acquisition rumors never cease; nor do the confident statements that the company definitely, absolutely, certainly has a magical innovation in the works that will spring full grown like Athena from the forehead of Zeus any day now. I’m here to say, I don’t think there’s a nascent warrior goddess hiding in there.
Witness Apple’s tottering half-steps into new markets that are unrelated to the iPhone: It was early with a voice assistant but has stalled behind Amazon and even Google Assistant. It wasn’t until last year that the company hired a bona fide machine-learning expert in John Giannandrea, former head of search and AI at Google—and he didn’t get put on the executive team until December 2018. That’s late.
But even if the streaming service actually arrives, can it really compete against YouTube, PlayStation, Sling, DirecTV, Hulu, and just plain old Netflix? Apple’s original programming is also apparently “not coming as soon as you think.” Analysts are, at this point, outright begging Apple to buy a studio or other original content provider, just to have something to show against Netflix and Amazon originals.
Of course, lots of companies innovate through acquisition, and everyone loves to speculate about what companies Apple might buy. Rumors have ranged from GoPro to BlackBerry to Tesla to the chipmaker ARM. Maybe Netflix. Maybe Tesla. Maybe Disney. Maybe Wired. (Apple News is a hugely successful product … mostly on iPhones, of course.) But at every turn, Apple has declined to move, other than its $3 billion Beats buy in 2014 (which it appears to be abandoning, or cannibalizing, these days).
Now, let me be clear, once again. None of this is to suggest that Apple is doing anything wrong. Indeed, according to Christensen, one of the hallmarks of the innovator’s dilemma is the company’s success, smooth operations, great products, and happy customers. That’s one of the things that makes it a dilemma: A company doesn’t realize anything’s wrong, because, well, nothing is. Smartphone sales may be slowing, but Apple is still a beloved brand, its products are excellent, its history and cachet are unmatched. But that doesn’t mean it has a plan to survive the ongoing decline in global smartphones sales.
The Innovator’s Dilemma does say an entrenched company can sometimes pull out of the quicksand by setting up a small, autonomous spinoff that has the power to move fast, pursue markets that are too small to move the needle for a company making $84 billion a quarter, and innovate before someone else gets there first.
Well, Apple has no autonomous innovation divisions that I know of, and the guys in charge are the same guys who have been in charge for decades: Tim Cook, Eddy Cue, Phil Schiller, Craig Federighi, Jony Ive—all have been associated with Apple since the late ’80s or ’90s. (I mean, has there ever really been a time without Jony Ive?)
You see what I’m saying here: brilliant team with a long record of execution and unparalleled success. Possibly not a lot of fresh ideas.
And then there’s the final option for innovation, one that Apple has availed itself of many times in the past. As Steve Jobs often said, quoting Picasso: “Good artists copy; great artists steal.” The iPod was born of existing MP3 players; the iPhone improved on clunky, ugly smartphones already on the market. The MacOS and the computer mouse were developed to maturity (yes, with permission) after being invented at Xerox PARC.
So maybe Apple will find the hottest thing in tech that’s still slightly unknown and come out with a better version. But is there such a thing as a way-sexier cloud computing business?
I guess it’s possible that the rumored virtual- and augmented-reality headset that Apple is supposed to release in 2020 will take the world by storm and popularize VR in a way that no one imagined, and like AirPods, will take a look that’s painfully dorky on the surface and turn it into a not-quite-ironic must-have statement of affluence and cool. It’s happened before. But this time, I think the company will get beaten to that punch—or whatever punch is next. Apple will be around for a long time. But the next Apple just isn’t Apple.
Wouldn’t it be a different world if everybody thought the way you did? If everybody spontaneously conformed to your every wish, your every thought, your every feeling? Since life doesn’t work that way, you would do well to become skilled at the art of negotiation.
In negotiation, after all, neither party holds all the aces. Instead, negotiation proceeds (or should proceed) on a rather level playing field. Since both parties want to win, what is the best way to proceed? Here are five steps.
1. Establish the relationship
The wise negotiator establishes the relationship before proceeding further. Doing so allows you to get a feeling for the person with whom you are dealing, and vice versa. Though often ignored, „feeling“ itself is an essential part of negotiation. So, always be open and sincere. Honesty, integrity and dignity are palpable qualities, and the foundation upon which constructive negotiations are built.
You are best positioned to negotiate when the other party respects you, not only as a businessperson, but as a human being. Trust, which is gained through that respect, is the key to successful negotiation.
2. Choose ‚honey over vinegar.‘
You’ll do better with honey than with vinegar — but the honey must be genuine. Never underestimate the natural ability of other people to sense who you really are. Disingenuous, manipulative and secretive are feelings that simply cannot be hidden.
When negotiating, you too can sense if the other party’s values are subpar or lack integrity altogether. No greater red flag exists in the entire arena of negotiation.
Win-wins are the only way to go. If you approach a negotiation thinking only of yourself, you are a terrible negotiator. Understanding what all parties need, and working for all concerned is vital. Keep in mind that seeing things in only black and white (win-lose) creates limited thinking; creativity is essential to good negotiation.
Ultimately, all people involved should find themselves on the same side of the fence. You want to be a player, not a pain. Keep your eye on the big picture and don’t get caught up in the small stuff. Stay out of the weeds.
4. Embody your inner adult.
Never forget that everyone has an inner adult and an inner child. It is remarkable to witness how even high-level business deals break down because someone at the table starts thinking childishly, instigating that behavior in others. When you see this happening, keep in mind that everyone goes out of balance.
Be the stable anchor, the respectful adult at the table. Helping people come back into balance is often best done by example. Take the high road, embodying your inner adult. Don’t argue; instead, understand.
5. Respect the rhythm of the relationship.
Always remember that there is a rhythm to everything. Don’t push it. Oftentimes, it is best to say nothing. Never forget that silent pauses can be a very powerful tool. Give yourself and others the time and space to reflect upon everything that has been said.
Don’t rush it. Try to sense the natural and appropriate rhythm of all the people at the table, including yourself.
By implementing these five points, you will be well on your way to mastering the art of negotiation. Negotiation is all about relationships. By cultivating and maintaining a good rapport with everyone at the table, every player can win. You’re not just creating an agreement, you are cultivating a long-term relationship as well as a reputation.
By mastering the subtle art of negotiation, you establish yourself as a top-rank business person, and that in itself may lead to even greater opportunities in the future.
Desperate for data on its competitors, Facebook has been secretly paying people to install a “Facebook Research” VPN that lets the company suck in all of a user’s phone and web activity, similar to Facebook’s Onavo Protect app that Apple banned in June and that was removed in August. Facebook sidesteps the App Store and rewards teenagers and adults to download the Research app and give it root access to network traffic in what may be a violation of Apple policy so the social network can decrypt and analyze their phone activity, a TechCrunch investigation confirms.
Facebook admitted to TechCrunch it was running the Research program to gather data on usage habits.
Since 2016, Facebook has been paying users ages 13 to 35 up to $20 per month plus referral fees to sell their privacy by installing the iOS or Android “Facebook Research” app. Facebook even asked users to screenshot their Amazon order history page. The program is administered through beta testing services Applause, BetaBound and uTest to cloak Facebook’s involvement, and is referred to in some documentation as “Project Atlas” — a fitting name for Facebook’s effort to map new trends and rivals around the globe.
An Apple spokesperson provided this statement. “We designed our Enterprise Developer Program solely for the internal distribution of apps within an organization. Facebook has been using their membership to distribute a data-collecting app to consumers, which is a clear breach of their agreement with Apple. Any developer using their enterprise certificates to distribute apps to consumers will have their certificates revoked, which is what we did in this case to protect our users and their data.”
Facebook’s Research program will continue to run on Android.
Facebook’s Research app requires users to ‘Trust’ it with extensive access to their dataWe asked Guardian Mobile Firewall’s security expert Will Strafach to dig into the Facebook Research app, and he told us that “If Facebook makes full use of the level of access they are given by asking users to install the Certificate, they will have the ability to continuously collect the following types of data: private messages in social media apps, chats from in instant messaging apps – including photos/videos sent to others, emails, web searches, web browsing activity, and even ongoing location information by tapping into the feeds of any location tracking apps you may have installed.” It’s unclear exactly what data Facebook is concerned with, but it gets nearly limitless access to a user’s device once they install the app.
The strategy shows how far Facebook is willing to go and how much it’s willing to pay to protect its dominance — even at the risk of breaking the rules of Apple’s iOS platform on which it depends. Apple may have asked Facebook to discontinue distributing its Research app.
A more stringent punishment would be to revoke Facebook’s permission to offer employee-only apps. The situation could further chill relations between the tech giants. Apple’s Tim Cook has repeatedly criticized Facebook’s data collection practices. Facebook disobeying iOS policies to slurp up more information could become a new talking point.
Facebook’s Research program is referred to as Project Atlas on sign-up sites that don’t mention Facebook’s involvement
“The fairly technical sounding ‘install our Root Certificate’ step is appalling,” Strafach tells us. “This hands Facebook continuous access to the most sensitive data about you, and most users are going to be unable to reasonably consent to this regardless of any agreement they sign, because there is no good way to articulate just how much power is handed to Facebook when you do this.”
Facebook’s surveillance app
Facebook first got into the data-sniffing business when it acquired Onavo for around $120 million in 2014. The VPN app helped users track and minimize their mobile data plan usage, but also gave Facebook deep analytics about what other apps they were using. Internal documents acquired by Charlie Warzel and Ryan Mac of BuzzFeed News reveal that Facebook was able to leverage Onavo to learn that WhatsApp was sending more than twice as many messages per day as Facebook Messenger. Onavo allowed Facebook to spot WhatsApp’s meteoric rise and justify paying $19 billion to buy the chat startup in 2014. WhatsApp has since tripled its user base, demonstrating the power of Onavo’s foresight.
Over the years since, Onavo clued Facebook in to what apps to copy, features to build and flops to avoid. By 2018, Facebook was promoting the Onavo app in a Protect bookmark of the main Facebook app in hopes of scoring more users to snoop on. Facebook also launched the Onavo Bolt app that let you lock apps behind a passcode or fingerprint while it surveils you, but Facebook shut down the app the day it was discovered following privacy criticism. Onavo’s main app remains available on Google Play and has been installed more than 10 million times.
The backlash heated up after security expert Strafach detailed in March how Onavo Protect was reporting to Facebook when a user’s screen was on or off, and its Wi-Fi and cellular data usage in bytes even when the VPN was turned off. In June, Apple updated its developer policies to ban collecting data about usage of other apps or data that’s not necessary for an app to function. Apple proceeded to inform Facebook in August that Onavo Protect violated those data collection policies and that the social network needed to remove it from the App Store, which it did, Deepa Seetharaman of the WSJ reported.
But that didn’t stop Facebook’s data collection.
TechCrunch recently received a tip that despite Onavo Protect being banished by Apple, Facebook was paying users to sideload a similar VPN app under the Facebook Research moniker from outside of the App Store. We investigated, and learned Facebook was working with three app beta testing services to distribute the Facebook Research app: BetaBound, uTest and Applause. Facebook began distributing the Research VPN app in 2016. It has been referred to as Project Atlas since at least mid-2018, around when backlash to Onavo Protect magnified and Apple instituted its new rules that prohibited Onavo. Previously, a similar program was called Project Kodiak. Facebook didn’t want to stop collecting data on people’s phone usage and so the Research program continued, in disregard for Apple banning Onavo Protect.
Facebook’s Research App on iOS
Ads (shown below) for the program run by uTest on Instagram and Snapchat sought teens 13-17 years old for a “paid social media research study.” The sign-up page for the Facebook Research program administered by Applause doesn’t mention Facebook, but seeks users “Age: 13-35 (parental consent required for ages 13-17).” If minors try to sign-up, they’re asked to get their parents’ permission with a form that reveal’s Facebook’s involvement and says “There are no known risks associated with the project, however you acknowledge that the inherent nature of the project involves the tracking of personal information via your child’s use of apps. You will be compensated by Applause for your child’s participation.” For kids short on cash, the payments could coerce them to sell their privacy to Facebook.
The Applause site explains what data could be collected by the Facebook Research app (emphasis mine):
“By installing the software, you’re giving our client permission to collect data from your phone that will help them understand how you browse the internet, and how you use the features in the apps you’ve installed . . . This means you’re letting our client collect information such as which apps are on your phone, how and when you use them, data about your activities and content within those apps, as well as how other people interact with you or your content within those apps. You are also letting our client collect information about your internet browsing activity (including the websites you visit and data that is exchanged between your device and those websites) and your use of other online services. There are some instances when our client will collect this information even where the app uses encryption, or from within secure browser sessions.”
Meanwhile, the BetaBound sign-up page with a URL ending in “Atlas” explains that “For $20 per month (via e-gift cards), you will install an app on your phone and let it run in the background.” It also offers $20 per friend you refer. That site also doesn’t initially mention Facebook, but the instruction manual for installing Facebook Research reveals the company’s involvement.
Facebook’s intermediary uTest ran ads on Snapchat and Instagram, luring teens to the Research program with the promise of money
Facebook seems to have purposefully avoided TestFlight, Apple’s official beta testing system, which requires apps to be reviewed by Apple and is limited to 10,000 participants. Instead, the instruction manual reveals that users download the app from r.facebook-program.com and are told to install an Enterprise Developer Certificate and VPN and “Trust” Facebook with root access to the data their phone transmits. Apple requires that developers agree to only use this certificate system for distributing internal corporate apps to their own employees. Randomly recruiting testers and paying them a monthly fee appears to violate the spirit of that rule.
Security expert Will Strafach found Facebook’s Research app contains lots of code from Onavo Protect, the Facebook-owned app Apple banned last year
Once installed, users just had to keep the VPN running and sending data to Facebook to get paid. The Applause-administered program requested that users screenshot their Amazon orders page. This data could potentially help Facebook tie browsing habits and usage of other apps with purchase preferences and behavior. That information could be harnessed to pinpoint ad targeting and understand which types of users buy what.
TechCrunch commissioned Strafach to analyze the Facebook Research app and find out where it was sending data. He confirmed that data is routed to “vpn-sjc1.v.facebook-program.com” that is associated with Onavo’s IP address, and that the facebook-program.com domain is registered to Facebook, according to MarkMonitor. The app can update itself without interacting with the App Store, and is linked to the email address PeopleJourney@fb.com. He also discovered that the Enterprise Certificate first acquired in 2016 indicates Facebook renewed it on June 27th, 2018 — weeks after Apple announced its new rules that prohibited the similar Onavo Protect app.
“It is tricky to know what data Facebook is actually saving (without access to their servers). The only information that is knowable here is what access Facebook is capable of based on the code in the app. And it paints a very worrisome picture,” Strafach explains. “They might respond and claim to only actually retain/save very specific limited data, and that could be true, it really boils down to how much you trust Facebook’s word on it. The most charitable narrative of this situation would be that Facebook did not think too hard about the level of access they were granting to themselves . . . which is a startling level of carelessness in itself if that is the case.”
In response to TechCrunch’s inquiry, a Facebook spokesperson confirmed it’s running the program to learn how people use their phones and other services. The spokesperson told us “Like many companies, we invite people to participate in research that helps us identify things we can be doing better. Since this research is aimed at helping Facebook understand how people use their mobile devices, we’ve provided extensive information about the type of data we collect and how they can participate. We don’t share this information with others and people can stop participating at any time.”
Facebook’s Research app requires Root Certificate access, which Facebook gather almost any piece of data transmitted by your phone
Facebook’s spokesperson claimed that the Facebook Research app was in line with Apple’s Enterprise Certificate program, but didn’t explain how in the face of evidence to the contrary. They said Facebook first launched its Research app program in 2016. They tried to liken the program to a focus group and said Nielsen and comScore run similar programs, yet neither of those ask people to install a VPN or provide root access to the network. The spokesperson confirmed the Facebook Research program does recruit teens but also other age groups from around the world. They claimed that Onavo and Facebook Research are separate programs, but admitted the same team supports both as an explanation for why their code was so similar.
Facebook’s Research program requested users screenshot their Amazon order history to provide it with purchase data
However, Facebook’s claim that it doesn’t violate Apple’s Enterprise Certificate policy is directly contradicted by the terms of that policy. Those include that developers “Distribute Provisioning Profiles only to Your Employees and only in conjunction with Your Internal Use Applications for the purpose of developing and testing”. The policy also states that “You may not use, distribute or otherwise make Your Internal Use Applications available to Your Customers” unless under direct supervision of employees or on company premises. Given Facebook’s customers are using the Enterprise Certificate-powered app without supervision, it appears Facebook is in violation.
Seven hours after this report was first published, Facebook updated its position and told TechCrunch that it would shut down the iOS Research app. Facebook noted that the Research app was started in 2016 and was therefore not a replacement for Onavo Protect. However, they do share similar code and could be seen as twins running in parallel. A Facebook spokesperson also provided this additional statement:
“Key facts about this market research program are being ignored. Despite early reports, there was nothing ‘secret’ about this; it was literally called the Facebook Research App. It wasn’t ‘spying’ as all of the people who signed up to participate went through a clear on-boarding process asking for their permission and were paid to participate. Finally, less than 5 percent of the people who chose to participate in this market research program were teens. All of them with signed parental consent forms.”
Facebook did not publicly promote the Research VPN itself and used intermediaries that often didn’t disclose Facebook’s involvement until users had begun the signup process. While users were given clear instructions and warnings, the program never stresses nor mentions the full extent of the data Facebook can collect through the VPN. A small fraction of the users paid may have been teens, but we stand by the newsworthiness of its choice not to exclude minors from this data collection initiative.
Facebook disobeying Apple so directly and then pulling the app could hurt their relationship. “The code in this iOS app strongly indicates that it is simply a poorly re-branded build of the banned Onavo app, now using an Enterprise Certificate owned by Facebook in direct violation of Apple’s rules, allowing Facebook to distribute this app without Apple review to as many users as they want,” Strafach tells us. ONV prefixes and mentions of graph.onavo.com, “onavoApp://” and “onavoProtect://” custom URL schemes litter the app. “This is an egregious violation on many fronts, and I hope that Apple will act expeditiously in revoking the signing certificate to render the app inoperable.”
Facebook is particularly interested in what teens do on their phones as the demographic has increasingly abandoned the social network in favor of Snapchat, YouTube and Facebook’s acquisition Instagram.Insights into how popular with teens is Chinese video music app TikTok and meme sharing led Facebook to launch a clone called Lasso and begin developing a meme-browsing feature called LOL, TechCrunch first reported. But Facebook’s desire for data about teens riles critics at a time when the company has been battered in the press. Analysts on tomorrow’s Facebook earnings call should inquire about what other ways the company has to collect competitive intelligence now that it’s ceased to run the Research program on iOS.
Last year when Tim Cook was asked what he’d do in Mark Zuckerberg’s position in the wake of the Cambridge Analytica scandal, he said “I wouldn’t be in this situation . . . The truth is we could make a ton of money if we monetized our customer, if our customer was our product. We’ve elected not to do that.” Zuckerberg told Ezra Klein that he felt Cook’s comment was “extremely glib.”
Now it’s clear that even after Apple’s warnings and the removal of Onavo Protect, Facebook was still aggressively collecting data on its competitors via Apple’s iOS platform. “I have never seen such open and flagrant defiance of Apple’s rules by an App Store developer,” Strafach concluded. Now that Facebook has ceased the program on iOS and its Android future is uncertain, it may either have to invent new ways to surveil our behavior amidst a climate of privacy scrutiny, or be left in the dark.
Additional reporting by Zack Whittaker. Updated with comment from Facebook, and on Wednesday with a statement from Apple.
It’s onto me, anyway. I am merely one anecdata point among billions, but I’m sure I’m not the only Facebook user who has found herself shying away from the very public, often performative, and even tiring habit of posting regular updates to Facebook and Instagram. Over the past year I’ve found myself thinking not about quitting social networks, but about redefining them. For me, that process has involved a lot more private messaging.
Facebook, it seems, has noticed. Last week, The New York Times reported that Facebook chief executive Mark Zuckerberg plans to unify Facebook Messenger, WhatsApp, and Instagram messaging on the backend of the services. This would make it possible for people relying on different flavors of Facebook apps to all gorge at the same messaging table. On the one hand, the move is truly Facebookian—just try to extricate yourself from Facebook, and it will try every which way to pull you back in. On the other hand, it makes sense for Facebook for a few reasons.
My personal relationship with Facebook is multi-faceted. I have a personal account and a journalist’s page. I also use Instagram and WhatsApp. But last year, I let my professional page languish. I stopped posting to my personal feed as frequently. Instead I turned to private messaging.
During a trip to Europe last fall, I shared everything I felt compelled to share with a small group of people on Apple Messages. The excursion to see one of the largest waves ever surfed by a human? I shared the photo in a private Slack message with coworkers, instead of posting on Facebook. Wedding photos no longer go up on Instagram. During the holidays, I happily embrace my role as halfway-decent photographer, but when I share the photos with friends and family, it’s only through Messages, WhatsApp, or private photo albums.
These tools have become my preferred method of communicating. It’s not some big revelation, or even anything that’s new; peer-to-peer messaging, or at least the guise of “private” messaging, is as old as the consumer internet itself. When our worlds expand in a way that feels unmanageable, our instinct is sometimes to shrink them until we’re comfortable again, for better or worse. Remember Path, the social network limited to just your closest circle? That didn’t work out, but the entire app was built upon the Dunbar theory that our species can’t handle more than 150 close friends. There just might have been something to that.
“I think a lot of people experience this,” says Margaret Morris, a clinical psychologist and author of Left to Our Own Devices. “When you post something in such a public way, the question is: What are the motivations? But when it’s in a private thread, it’s: Why am I sharing this? Oh, it’s because I think you’ll like this. I think we’ll connect over this. The altruistic motivations can be far more clear in private messaging.”
Of course, “altruism” in this case only applies to the friends exchanging messages and not the messaging service providers. Facebook’s efforts to unify its messaging platforms are at least partly rooted in a desire to monetize our activity, whether that’s by keeping us engaged in an outward-facing News Feed or within a little chat box. And there’s a major distinction between so-called private messages and what Morris calls “Privacy with a capital P.”
“There’s one kind of privacy, which is: what does my cousin know, or what does my co-worker know,” Morris says, “And then there’s the kind of privacy that’s about the data Facebook has.” Facebook’s plan is reportedly to offer end-to-end encryption on all of its messaging apps once the backend systems have been merged. As my WIRED colleague Lily Newman writes, cryptographers and privacy advocates already see obvious hurdles in making this work.
That’s why I often use Apple’s Messages and even iCloud photo sharing. There’s an explicit agreement that exists between the service provider and user: Buy our ridiculously expensive hardware, and we won’t sell your data. (While iCloud has been hacked before, Apple swears by the end-to-end encryption between iPhone users and says it doesn’t share Messages data with third-party apps). But just using Messages isn’t realistic, either. The platform is only functional between two iPhones. Not everyone can afford Apple products, and in other parts of the world, such as China or India, apps like WeChat and WhatsApp dominate private messaging. That means you’re going to end up using other apps if you plan to communicate outside of a bubble of iPhone lovers.
But beyond privacy with a capital P—which is, for many people, the most important consideration when it comes to social media—there’s the psychology of privacy when it comes to sharing updates about our personal lives, and connecting with other humans. Social networks have made human connections infinitely more possible and also turned the whole notion upside down on its head.
Morris, for example, sees posting something publicly to a Facebook feed as a yearning for interconnectedness, while a private messaging thread is a quest for what she calls attunement, a way to strengthen a bond between two people. But, she notes, some people take a screenshot from a private message and then, having failed in their quest for attunement, publish an identity-stripped version of it to their feed. Guilty as charged. Social networking is no longer just a feed or an app or a chat box or SMS, but some amalgamation of it all.
Posting private messages publicly is not something I plan to make a habit of, but there is still the urge sometimes to share. I’m still on Twitter. I’ll likely still post to Facebook and Instagram from time to time. At some point I may be looking for a sense of community that exists beyond my own small private messaging groups, for a tantalizing blend of familiarity and anonymity in a Facebook group of like-minded hobbyists. For some people, larger social networking communities are lifelines as they struggle with health, with family, with job worries, with life.
But right now, “private” messages are the way to share my life with the people who matter most, an attempt to splinter off my social interactions into something more satisfying—especially when posting to Facebook has never seemed less appealing.
Apple on Wednesday warned investors that its revenue for the last three months of 2018 would not live up to previous estimates, or even come particularly close. The main culprit appears to be China, where the trade war and a broader economic slowdown contributed to plummeting iPhone sales. But CEO Tim Cook’s letter to investors pointed to a secondary thread as well, one that Apple customers, environmentalists, and even the company itself should view not as a liability but an asset: People are holding onto their iPhones longer.
That’s not just in China. Cook noted that iPhone upgrades were “not as strong as we thought they would be” in developed markets as well, citing “macroeconomic conditions,” a shift in how carriers price smartphones, a strong US dollar, and temporarily discounted battery replacements. He neglected to mention the simple fact that an iPhone can perform capably for years—and consumers are finally getting wise.
As recently as 2015, smartphone users on average upgraded their phone roughly every 24 months, says Cliff Maldonado, founder of BayStreet Research, which tracks the mobile industry. As of the fourth quarter of last year, that had jumped to at least 35 months. “You’re looking at people holding onto their devices an extra year,” Maldonado says. “It’s been considerable.”
A few factors contribute to the trend, chief among them the shift from buying phones on a two-year contract—heavily subsidized by the carriers—to installment plans in which the customer pays full freight. T-Mobile introduced the practice in the US in 2014, and by 2015 it had become the norm. The full effects, though, have only kicked in more recently. People still generally pay for their smartphone over two years; once they’re paid off, though, their monthly bill suddenly drops by, say, $25.
The shift has also caused a sharp drop-off in carrier incentives. They turn out not to be worth it. “They’re actually encouraging that dynamic of holding your smartphone longer. It’s in their best interest,” Maldonado says. “It actually costs them to get you into a new phone, to do those promotions, to run the transaction and put it on their books and finance it.”
Bottom line: If your service is reliable and your iPhone still works fine, why go through the hassle?
“There’s not as many subsidies as there used to be from a carrier point of view,” Cook told CNBC Wednesday. “And where that didn’t all happen yesterday, if you’ve been out of the market for two or three years and you come back, it looks like that to you.”
Meanwhile, older iPhones work better, for longer, thanks to Apple itself. When Apple vice president Craig Federighi introduced iOS 12 in June at Apple’s Worldwide Developers Conference, he emphasized how much it improved the performance of older devices. Among the numbers he cited: The 2014 iPhone 6 Plus opens apps 40 percent faster with iOS 12 than it had with iOS 11, and its keyboard appears up to 50 percent faster than before. And while Apple’s battery scandal of a year ago was a black mark for the company, it at least reminded Apple owners that they didn’t necessarily need a new iPhone. Eligible iPhone owners found that a $29 battery replacement—it normally costs $79—made their iPhone 6 feel something close to new.
“There definitely has been a major shift in customer perception, after all the controversy,” says Kyle Wiens, founder of online repair community iFixit. “What it really did more than anything else was remind you that the battery on your phone really can be replaced. Apple successfully brainwashing the public into thinking the battery was something they never needed to think about led people to prematurely buy these devices.”
Combine all of that with the fact that new model iPhones—and Android phones for that matter—have lacked a killer feature, much less one that would inspire someone to spend $1,000 or more if they didn’t absolutely have to. “Phones used to be toys, and shiny objects,” Maldonado says. “Now they’re utilities. You’ve got to have it, and the joy of getting a new one is pretty minor. Facebook and email looks the same; the camera’s still great.”
In the near term, these dynamics aren’t ideal for Apple; its stock dropped more than 7 percent in after-hours trading following Wednesday’s news. But it’s terrific news for consumers, who have apparently realized that a smartphone does not have a two-year expiration date. That saves money in the long run. And pulling the throttle back on iPhone sales may turn out to be equally welcome news for the planet.
According to Apple’s most recent sustainability report, the manufacture of each Apple device generates on average 90 pounds of carbon emissions. Wiens suggests that the creation of each iPhone requires hundreds of pounds of raw materials.
Manufacturing electronics is environmentally intense, Wiens says. “We can’t live in a world where we’re making 3 billion new smartphones a year. We don’t have the resources for it. We have to reduce how many overall devices we’re making. There are lots of ways to do it, but it gets down to demand, and how many we’re buying. That’s not what Apple wants, but it’s what the environment needs.”
Which raises a question: Why does Apple bother extending the lives of older iPhones? The altruistic answer comes from Lisa Jackson, who oversees the company’s environmental efforts.
“We also make sure to design and build durable products that last as long as possible,” Jackson said at Apple’s September hardware event. “Because they last longer, you can keep using them. And keeping using them is the best thing for the planet.”
Given a long enough horizon, Apple may see a financial benefit from less frequent upgrades as well. An iPhone that lasts longer keeps customers in the iOS ecosystem longer. That becomes even more important as the company places greater emphasis not on hardware but on services like Apple Music. It also offers an important point of differentiation from Android, whose fragmented ecosystem means even flagship devices rarely continue to be fully supported beyond two years.
“In reality, the big picture is still very good for Apple,” Maldonado says. Compared with Android, “Apple’s in a better spot, because the phones last longer.”
That’s cold comfort today and doesn’t help a whit with China. But news that people are holding onto their iPhones longer should be taken for what it really is: A sign of progress and a win for everyone. Even Apple.
Andrew Pole had just started working as a statistician for Target in 2002, when two colleagues from the marketing department stopped by his desk to ask an odd question: “If we wanted to figure out if a customer is pregnant, even if she didn’t want us to know, can you do that? ”
Pole has a master’s degree in statistics and another in economics, and has been obsessed with the intersection of data and human behavior most of his life. His parents were teachers in North Dakota, and while other kids were going to 4-H, Pole was doing algebra and writing computer programs. “The stereotype of a math nerd is true,” he told me when I spoke with him last year. “I kind of like going out and evangelizing analytics.”
As the marketers explained to Pole — and as Pole later explained to me, back when we were still speaking and before Target told him to stop — new parents are a retailer’s holy grail. Most shoppers don’t buy everything they need at one store. Instead, they buy groceries at the grocery store and toys at the toy store, and they visit Target only when they need certain items they associate with Target — cleaning supplies, say, or new socks or a six-month supply of toilet paper. But Target sells everything from milk to stuffed animals to lawn furniture to electronics, so one of the company’s primary goals is convincing customers that the only store they need is Target. But it’s a tough message to get across, even with the most ingenious ad campaigns, because once consumers’ shopping habits are ingrained, it’s incredibly difficult to change them.
There are, however, some brief periods in a person’s life when old routines fall apart and buying habits are suddenly in flux. One of those moments — the moment, really — is right around the birth of a child, when parents are exhausted and overwhelmed and their shopping patterns and brand loyalties are up for grabs. But as Target’s marketers explained to Pole, timing is everything. Because birth records are usually public, the moment a couple have a new baby, they are almost instantaneously barraged with offers and incentives and advertisements from all sorts of companies. Which means that the key is to reach them earlier, before any other retailers know a baby is on the way. Specifically, the marketers said they wanted to send specially designed ads to women in their second trimester, which is when most expectant mothers begin buying all sorts of new things, like prenatal vitamins and maternity clothing. “Can you give us a list?” the marketers asked.
“We knew that if we could identify them in their second trimester, there’s a good chance we could capture them for years,” Pole told me. “As soon as we get them buying diapers from us, they’re going to start buying everything else too. If you’re rushing through the store, looking for bottles, and you pass orange juice, you’ll grab a carton. Oh, and there’s that new DVD I want. Soon, you’ll be buying cereal and paper towels from us, and keep coming back.”
The desire to collect information on customers is not new for Target or any other large retailer, of course. For decades, Target has collected vast amounts of data on every person who regularly walks into one of its stores. Whenever possible, Target assigns each shopper a unique code — known internally as the Guest ID number — that keeps tabs on everything they buy. “If you use a credit card or a coupon, or fill out a survey, or mail in a refund, or call the customer help line, or open an e-mail we’ve sent you or visit our Web site, we’ll record it and link it to your Guest ID,” Pole said. “We want to know everything we can.”
Also linked to your Guest ID is demographic information like your age, whether you are married and have kids, which part of town you live in, how long it takes you to drive to the store, your estimated salary, whether you’ve moved recently, what credit cards you carry in your wallet and what Web sites you visit. Target can buy data about your ethnicity, job history, the magazines you read, if you’ve ever declared bankruptcy or got divorced, the year you bought (or lost) your house, where you went to college, what kinds of topics you talk about online, whether you prefer certain brands of coffee, paper towels, cereal or applesauce, your political leanings, reading habits, charitable giving and the number of cars you own. (In a statement, Target declined to identify what demographic information it collects or purchases.) All that information is meaningless, however, without someone to analyze and make sense of it. That’s where Andrew Pole and the dozens of other members of Target’s Guest Marketing Analytics department come in.
Almost every major retailer, from grocery chains to investmentbanks to the U.S. Postal Service, has a “predictive analytics” department devoted to understanding not just consumers’ shopping habits but also their personal habits, so as to more efficiently market to them. “But Target has always been one of the smartest at this,” says Eric Siegel, a consultant and the chairman of a conference called Predictive Analytics World. “We’re living through a golden age of behavioral research. It’s amazing how much we can figure out about how people think now.”
The reason Target can snoop on our shopping habits is that, over the past two decades, the science of habit formation has become a major field of research in neurology and psychology departments at hundreds of major medical centers and universities, as well as inside extremely well financed corporate labs. “It’s like an arms race to hire statisticians nowadays,” said Andreas Weigend, the former chief scientist at Amazon.com. “Mathematicians are suddenly sexy.” As the ability to analyze data has grown more and more fine-grained, the push to understand how daily habits influence our decisions has become one of the most exciting topics in clinical research, even though most of us are hardly aware those patterns exist. One study from Duke University estimated that habits, rather than conscious decision-making, shape 45 percent of the choices we make every day, and recent discoveries have begun to change everything from the way we think about dieting to how doctors conceive treatments for anxiety, depression and addictions.
This research is also transforming our understanding of how habits function across organizations and societies. A football coach named Tony Dungy propelled one of the worst teams in the N.F.L. to the Super Bowl by focusing on how his players habitually reacted to on-field cues. Before he became Treasury secretary, Paul O’Neill overhauled a stumbling conglomerate, Alcoa, and turned it into a top performer in the Dow Jones by relentlessly attacking one habit — a specific approach to worker safety — which in turn caused a companywide transformation. The Obama campaign has hired a habit specialist as its “chief scientist” to figure out how to trigger new voting patterns among different constituencies.
Researchers have figured out how to stop people from habitually overeating and biting their nails. They can explain why some of us automatically go for a jog every morning and are more productive at work, while others oversleep and procrastinate. There is a calculus, it turns out, for mastering our subconscious urges. For companies like Target, the exhaustive rendering of our conscious and unconscious patterns into data sets and algorithms has revolutionized what they know about us and, therefore, how precisely they can sell.
Inside the brain-and-cognitive-sciences department of the Massachusetts Institute of Technology are what, to the casual observer, look like dollhouse versions of surgical theaters. There are rooms with tiny scalpels, small drills and miniature saws. Even the operating tables are petite, as if prepared for 7-year-old surgeons. Inside those shrunken O.R.’s, neurologists cut into the skulls of anesthetized rats, implanting tiny sensors that record the smallest changes in the activity of their brains.
An M.I.T. neuroscientist named Ann Graybiel told me that she and her colleagues began exploring habits more than a decade ago by putting their wired rats into a T-shaped maze with chocolate at one end. The maze was structured so that each animal was positioned behind a barrier that opened after a loud click. The first time a rat was placed in the maze, it would usually wander slowly up and down the center aisle after the barrier slid away, sniffing in corners and scratching at walls. It appeared to smell the chocolate but couldn’t figure out how to find it. There was no discernible pattern in the rat’s meanderings and no indication it was working hard to find the treat.
The probes in the rats’ heads, however, told a different story. While each animal wandered through the maze, its brain was working furiously. Every time a rat sniffed the air or scratched a wall, the neurosensors inside the animal’s head exploded with activity. As the scientists repeated the experiment, again and again, the rats eventually stopped sniffing corners and making wrong turns and began to zip through the maze with more and more speed. And within their brains, something unexpected occurred: as each rat learned how to complete the maze more quickly, its mental activity decreased. As the path became more and more automatic — as it became a habit — the rats started thinking less and less.
This process, in which the brain converts a sequence of actions into an automatic routine, is called “chunking.” There are dozens, if not hundreds, of behavioral chunks we rely on every day. Some are simple: you automatically put toothpaste on your toothbrush before sticking it in your mouth. Some, like making the kids’ lunch, are a little more complex. Still others are so complicated that it’s remarkable to realize that a habit could have emerged at all.
Take backing your car out of the driveway. When you first learned to drive, that act required a major dose of concentration, and for good reason: it involves peering into the rearview and side mirrors and checking for obstacles, putting your foot on the brake, moving the gearshift into reverse, removing your foot from the brake, estimating the distance between the garage and the street while keeping the wheels aligned, calculating how images in the mirrors translate into actual distances, all while applying differing amounts of pressure to the gas pedal and brake.
Now, you perform that series of actions every time you pull into the street without thinking very much. Your brain has chunked large parts of it. Left to its own devices, the brain will try to make almost any repeated behavior into a habit, because habits allow our minds to conserve effort. But conserving mental energy is tricky, because if our brains power down at the wrong moment, we might fail to notice something important, like a child riding her bike down the sidewalk or a speeding car coming down the street. So we’ve devised a clever system to determine when to let a habit take over. It’s something that happens whenever a chunk of behavior starts or ends — and it helps to explain why habits are so difficult to change once they’re formed, despite our best intentions.
To understand this a little more clearly, consider again the chocolate-seeking rats. What Graybiel and her colleagues found was that, as the ability to navigate the maze became habitual, there were two spikes in the rats’ brain activity — once at the beginning of the maze, when the rat heard the click right before the barrier slid away, and once at the end, when the rat found the chocolate. Those spikes show when the rats’ brains were fully engaged, and the dip in neural activity between the spikes showed when the habit took over. From behind the partition, the rat wasn’t sure what waited on the other side, until it heard the click, which it had come to associate with the maze. Once it heard that sound, it knew to use the “maze habit,” and its brain activity decreased. Then at the end of the routine, when the reward appeared, the brain shook itself awake again and the chocolate signaled to the rat that this particular habit was worth remembering, and the neurological pathway was carved that much deeper.
The process within our brains that creates habits is a three-step loop. First, there is a cue, a trigger that tells your brain to go into automatic mode and which habit to use. Then there is the routine, which can be physical or mental or emotional. Finally, there is a reward, which helps your brain figure out if this particular loop is worth remembering for the future. Over time, this loop — cue, routine, reward; cue, routine, reward — becomes more and more automatic. The cue and reward become neurologically intertwined until a sense of craving emerges. What’s unique about cues and rewards, however, is how subtle they can be. Neurological studies like the ones in Graybiel’s lab have revealed that some cues span just milliseconds. And rewards can range from the obvious (like the sugar rush that a morning doughnut habit provides) to the infinitesimal (like the barely noticeable — but measurable — sense of relief the brain experiences after successfully navigating the driveway). Most cues and rewards, in fact, happen so quickly and are so slight that we are hardly aware of them at all. But our neural systems notice and use them to build automatic behaviors.
Habits aren’t destiny — they can be ignored, changed or replaced. But it’s also true that once the loop is established and a habit emerges, your brain stops fully participating in decision-making. So unless you deliberately fight a habit — unless you find new cues and rewards — the old pattern will unfold automatically.
“We’ve done experiments where we trained rats to run down a maze until it was a habit, and then we extinguished the habit by changing the placement of the reward,” Graybiel told me. “Then one day, we’ll put the reward in the old place and put in the rat and, by golly, the old habit will re-emerge right away. Habits never really disappear.”
Luckily, simply understanding how habits work makes them easier to control. Take, for instance, a series of studies conducted a few years ago at Columbia University and the University of Alberta. Researchers wanted to understand how exercise habits emerge. In one project, 256 members of a health-insurance plan were invited to classes stressing the importance of exercise. Half the participants received an extra lesson on the theories of habit formation (the structure of the habit loop) and were asked to identify cues and rewards that might help them develop exercise routines.
The results were dramatic. Over the next four months, those participants who deliberately identified cues and rewards spent twice as much time exercising as their peers. Other studies have yielded similar results. According to another recent paper, if you want to start running in the morning, it’s essential that you choose a simple cue (like always putting on your sneakers before breakfast or leaving your running clothes next to your bed) and a clear reward (like a midday treat or even the sense of accomplishment that comes from ritually recording your miles in a log book). After a while, your brain will start anticipating that reward — craving the treat or the feeling of accomplishment — and there will be a measurable neurological impulse to lace up your jogging shoes each morning.
Our relationship to e-mail operates on the same principle. When a computer chimes or a smartphone vibrates with a new message, the brain starts anticipating the neurological “pleasure” (even if we don’t recognize it as such) that clicking on the e-mail and reading it provides. That expectation, if unsatisfied, can build until you find yourself moved to distraction by the thought of an e-mail sitting there unread — even if you know, rationally, it’s most likely not important. On the other hand, once you remove the cue by disabling the buzzing of your phone or the chiming of your computer, the craving is never triggered, and you’ll find, over time, that you’re able to work productively for long stretches without checking your in-box.
Some of the most ambitious habit experiments have been conducted by corporate America. To understand why executives are so entranced by this science, consider how one of the world’s largest companies, Procter & Gamble, used habit insights to turn a failing product into one of its biggest sellers. P.& G. is the corporate behemoth behind a whole range of products, from Downy fabric softener to Bounty paper towels to Duracell batteries and dozens of other household brands. In the mid-1990s, P.& G.’s executives began a secret project to create a new product that could eradicate bad smells. P.& G. spent millions developing a colorless, cheap-to-manufacture liquid that could be sprayed on a smoky blouse, stinky couch, old jacket or stained car interior and make it odorless. In order to market the product — Febreze — the company formed a team that included a former Wall Street mathematician named Drake Stimson and habit specialists, whose job was to make sure the television commercials, which they tested in Phoenix, Salt Lake City and Boise, Idaho, accentuated the product’s cues and rewards just right.
The first ad showed a woman complaining about the smoking section of a restaurant. Whenever she eats there, she says, her jacket smells like smoke. A friend tells her that if she uses Febreze, it will eliminate the odor. The cue in the ad is clear: the harsh smell of cigarette smoke. The reward: odor eliminated from clothes. The second ad featured a woman worrying about her dog, Sophie, who always sits on the couch. “Sophie will always smell like Sophie,” she says, but with Febreze, “now my furniture doesn’t have to.” The ads were put in heavy rotation. Then the marketers sat back, anticipating how they would spend their bonuses. A week passed. Then two. A month. Two months. Sales started small and got smaller. Febreze was a dud.
The panicked marketing team canvassed consumers and conducted in-depth interviews to figure out what was going wrong, Stimson recalled. Their first inkling came when they visited a woman’s home outside Phoenix. The house was clean and organized. She was something of a neat freak, the woman explained. But when P.& G.’s scientists walked into her living room, where her nine cats spent most of their time, the scent was so overpowering that one of them gagged.
According to Stimson, who led the Febreze team, a researcher asked the woman, “What do you do about the cat smell?”
“No,” she said. “Isn’t it wonderful? They hardly smell at all!”
A similar scene played out in dozens of other smelly homes. The reason Febreze wasn’t selling, the marketers realized, was that people couldn’t detect most of the bad smells in their lives. If you live with nine cats, you become desensitized to their scents. If you smoke cigarettes, eventually you don’t smell smoke anymore. Even the strongest odors fade with constant exposure. That’s why Febreze was a failure. The product’s cue — the bad smells that were supposed to trigger daily use — was hidden from the people who needed it the most. And Febreze’s reward (an odorless home) was meaningless to someone who couldn’t smell offensive scents in the first place.
P.& G. employed a Harvard Business School professor to analyze Febreze’s ad campaigns. They collected hours of footage of people cleaning their homes and watched tape after tape, looking for clues that might help them connect Febreze to people’s daily habits. When that didn’t reveal anything, they went into the field and conducted more interviews. A breakthrough came when they visited a woman in a suburb near Scottsdale, Ariz., who was in her 40s with four children. Her house was clean, though not compulsively tidy, and didn’t appear to have any odor problems; there were no pets or smokers. To the surprise of everyone, she loved Febreze.
“I use it every day,” she said.
“What smells are you trying to get rid of?” a researcher asked.
“I don’t really use it for specific smells,” the woman said. “I use it for normal cleaning — a couple of sprays when I’m done in a room.”
The researchers followed her around as she tidied the house. In the bedroom, she made her bed, tightened the sheet’s corners, then sprayed the comforter with Febreze. In the living room, she vacuumed, picked up the children’s shoes, straightened the coffee table, then sprayed Febreze on the freshly cleaned carpet.
“It’s nice, you know?” she said. “Spraying feels like a little minicelebration when I’m done with a room.” At the rate she was going, the team estimated, she would empty a bottle of Febreze every two weeks.
When they got back to P.& G.’s headquarters, the researchers watched their videotapes again. Now they knew what to look for and saw their mistake in scene after scene. Cleaning has its own habit loops that already exist. In one video, when a woman walked into a dirty room (cue), she started sweeping and picking up toys (routine), then she examined the room and smiled when she was done (reward). In another, a woman scowled at her unmade bed (cue), proceeded to straighten the blankets and comforter (routine) and then sighed as she ran her hands over the freshly plumped pillows (reward). P.& G. had been trying to create a whole new habit with Febreze, but what they really needed to do was piggyback on habit loops that were already in place. The marketers needed to position Febreze as something that came at the end of the cleaning ritual, the reward, rather than as a whole new cleaning routine.
The company printed new ads showing open windows and gusts of fresh air. More perfume was added to the Febreze formula, so that instead of merely neutralizing odors, the spray had its own distinct scent. Television commercials were filmed of women, having finished their cleaning routine, using Febreze to spritz freshly made beds and just-laundered clothing. Each ad was designed to appeal to the habit loop: when you see a freshly cleaned room (cue), pull out Febreze (routine) and enjoy a smell that says you’ve done a great job (reward). When you finish making a bed (cue), spritz Febreze (routine) and breathe a sweet, contented sigh (reward). Febreze, the ads implied, was a pleasant treat, not a reminder that your home stinks.
And so Febreze, a product originally conceived as a revolutionary way to destroy odors, became an air freshener used once things are already clean. The Febreze revamp occurred in the summer of 1998. Within two months, sales doubled. A year later, the product brought in $230 million. Since then Febreze has spawned dozens of spinoffs — air fresheners, candles and laundry detergents — that now account for sales of more than $1 billion a year. Eventually, P.& G. began mentioning to customers that, in addition to smelling sweet, Febreze can actually kill bad odors. Today it’s one of the top-selling products in the world.
Andrew Pole was hired by Target to use the same kinds of insights into consumers’ habits to expand Target’s sales. His assignment was to analyze all the cue-routine-reward loops among shoppers and help the company figure out how to exploit them. Much of his department’s work was straightforward: find the customers who have children and send them catalogs that feature toys before Christmas. Look for shoppers who habitually purchase swimsuits in April and send them coupons for sunscreen in July and diet books in December. But Pole’s most important assignment was to identify those unique moments in consumers’ lives when their shopping habits become particularly flexible and the right advertisement or coupon would cause them to begin spending in new ways.
In the 1980s, a team of researchers led by a U.C.L.A. professor named Alan Andreasen undertook a study of peoples’ most mundane purchases, like soap, toothpaste, trash bags and toilet paper. They learned that most shoppers paid almost no attention to how they bought these products, that the purchases occurred habitually, without any complex decision-making. Which meant it was hard for marketers, despite their displays and coupons and product promotions, to persuade shoppers to change.
But when some customers were going through a major life event, like graduating from college or getting a new job or moving to a new town, their shopping habits became flexible in ways that were both predictable and potential gold mines for retailers. The study found that when someone marries, he or she is more likely to start buying a new type of coffee. When a couple move into a new house, they’re more apt to purchase a different kind of cereal. When they divorce, there’s an increased chance they’ll start buying different brands of beer.
Consumers going through major life events often don’t notice, or care, that their shopping habits have shifted, but retailers notice, and they care quite a bit. At those unique moments, Andreasen wrote, customers are “vulnerable to intervention by marketers.” In other words, a precisely timed advertisement, sent to a recent divorcee or new homebuyer, can change someone’s shopping patterns for years.
And among life events, none are more important than the arrival of a baby. At that moment, new parents’ habits are more flexible than at almost any other time in their adult lives. If companies can identify pregnant shoppers, they can earn millions.
The only problem is that identifying pregnant customers is harder than it sounds. Target has a baby-shower registry, and Pole started there, observing how shopping habits changed as a woman approached her due date, which women on the registry had willingly disclosed. He ran test after test, analyzing the data, and before long some useful patterns emerged. Lotions, for example. Lots of people buy lotion, but one of Pole’s colleagues noticed that women on the baby registry were buying larger quantities of unscented lotion around the beginning of their second trimester. Another analyst noted that sometime in the first 20 weeks, pregnant women loaded up on supplements like calcium, magnesium and zinc. Many shoppers purchase soap and cotton balls, but when someone suddenly starts buying lots of scent-free soap and extra-big bags of cotton balls, in addition to hand sanitizers and washcloths, it signals they could be getting close to their delivery date.
As Pole’s computers crawled through the data, he was able to identify about 25 products that, when analyzed together, allowed him to assign each shopper a “pregnancy prediction” score. More important, he could also estimate her due date to within a small window, so Target could send coupons timed to very specific stages of her pregnancy.
One Target employee I spoke to provided a hypothetical example. Take a fictional Target shopper named Jenny Ward, who is 23, lives in Atlanta and in March bought cocoa-butter lotion, a purse large enough to double as a diaper bag, zinc and magnesium supplements and a bright blue rug. There’s, say, an 87 percent chance that she’s pregnant and that her delivery date is sometime in late August. What’s more, because of the data attached to her Guest ID number, Target knows how to trigger Jenny’s habits. They know that if she receives a coupon via e-mail, it will most likely cue her to buy online. They know that if she receives an ad in the mail on Friday, she frequently uses it on a weekend trip to the store. And they know that if they reward her with a printed receipt that entitles her to a free cup of Starbucks coffee, she’ll use it when she comes back again.
In the past, that knowledge had limited value. After all, Jenny purchased only cleaning supplies at Target, and there were only so many psychological buttons the company could push. But now that she is pregnant, everything is up for grabs. In addition to triggering Jenny’s habits to buy more cleaning products, they can also start including offers for an array of products, some more obvious than others, that a woman at her stage of pregnancy might need.
Pole applied his program to every regular female shopper in Target’s national database and soon had a list of tens of thousands of women who were most likely pregnant. If they could entice those women or their husbands to visit Target and buy baby-related products, the company’s cue-routine-reward calculators could kick in and start pushing them to buy groceries, bathing suits, toys and clothing, as well. When Pole shared his list with the marketers, he said, they were ecstatic. Soon, Pole was getting invited to meetings above his paygrade. Eventually his paygrade went up.
At which point someone asked an important question: How are women going to react when they figure out how much Target knows?
“If we send someone a catalog and say, ‘Congratulations on your first child!’ and they’ve never told us they’re pregnant, that’s going to make some people uncomfortable,” Pole told me. “We are very conservative about compliance with all privacy laws. But even if you’re following the law, you can do things where people get queasy.”
About a year after Pole created his pregnancy-prediction model, a man walked into a Target outside Minneapolis and demanded to see the manager. He was clutching coupons that had been sent to his daughter, and he was angry, according to an employee who participated in the conversation.
“My daughter got this in the mail!” he said. “She’s still in high school, and you’re sending her coupons for baby clothes and cribs? Are you trying to encourage her to get pregnant?”
The manager didn’t have any idea what the man was talking about. He looked at the mailer. Sure enough, it was addressed to the man’s daughter and contained advertisements for maternity clothing, nursery furniture and pictures of smiling infants. The manager apologized and then called a few days later to apologize again.
On the phone, though, the father was somewhat abashed. “I had a talk with my daughter,” he said. “It turns out there’s been some activities in my house I haven’t been completely aware of. She’s due in August. I owe you an apology.”
When I approached Target to discuss Pole’s work, its representatives declined to speak with me. “Our mission is to make Target the preferred shopping destination for our guests by delivering outstanding value, continuous innovation and exceptional guest experience,” the company wrote in a statement. “We’ve developed a number of research tools that allow us to gain insights into trends and preferences within different demographic segments of our guest population.” When I sent Target a complete summary of my reporting, the reply was more terse: “Almost all of your statements contain inaccurate information and publishing them would be misleading to the public. We do not intend to address each statement point by point.” The company declined to identify what was inaccurate. They did add, however, that Target “is in compliance with all federal and state laws, including those related to protected health information.”
When I offered to fly to Target’s headquarters to discuss its concerns, a spokeswoman e-mailed that no one would meet me. When I flew out anyway, I was told I was on a list of prohibited visitors. “I’ve been instructed not to give you access and to ask you to leave,” said a very nice security guard named Alex.
Using data to predict a woman’s pregnancy, Target realized soon after Pole perfected his model, could be a public-relations disaster. So the question became: how could they get their advertisements into expectant mothers’ hands without making it appear they were spying on them? How do you take advantage of someone’s habits without letting them know you’re studying their lives?
Before I met Andrew Pole, before I even decided to write a book about the science of habit formation, I had another goal: I wanted to lose weight.
I had got into a bad habit of going to the cafeteria every afternoon and eating a chocolate-chip cookie, which contributed to my gaining a few pounds. Eight, to be precise. I put a Post-it note on my computer reading “NO MORE COOKIES.” But every afternoon, I managed to ignore that note, wander to the cafeteria, buy a cookie and eat it while chatting with colleagues. Tomorrow, I always promised myself, I’ll muster the willpower to resist.
Tomorrow, I ate another cookie.
When I started interviewing experts in habit formation, I concluded each interview by asking what I should do. The first step, they said, was to figure out my habit loop. The routine was simple: every afternoon, I walked to the cafeteria, bought a cookie and ate it while chatting with friends.
Next came some less obvious questions: What was the cue? Hunger? Boredom? Low blood sugar? And what was the reward? The taste of the cookie itself? The temporary distraction from my work? The chance to socialize with colleagues?
Rewards are powerful because they satisfy cravings, but we’re often not conscious of the urges driving our habits in the first place. So one day, when I felt a cookie impulse, I went outside and took a walk instead. The next day, I went to the cafeteria and bought a coffee. The next, I bought an apple and ate it while chatting with friends. You get the idea. I wanted to test different theories regarding what reward I was really craving. Was it hunger? (In which case the apple should have worked.) Was it the desire for a quick burst of energy? (If so, the coffee should suffice.) Or, as turned out to be the answer, was it that after several hours spent focused on work, I wanted to socialize, to make sure I was up to speed on office gossip, and the cookie was just a convenient excuse? When I walked to a colleague’s desk and chatted for a few minutes, it turned out, my cookie urge was gone.
All that was left was identifying the cue.
Deciphering cues is hard, however. Our lives often contain too much information to figure out what is triggering a particular behavior. Do you eat breakfast at a certain time because you’re hungry? Or because the morning news is on? Or because your kids have started eating? Experiments have shown that most cues fit into one of five categories: location, time, emotional state, other people or the immediately preceding action. So to figure out the cue for my cookie habit, I wrote down five things the moment the urge hit:
Where are you? (Sitting at my desk.)
What time is it? (3:36 p.m.)
What’s your emotional state? (Bored.)
Who else is around? (No one.)
What action preceded the urge? (Answered an e-mail.)
The next day I did the same thing. And the next. Pretty soon, the cue was clear: I always felt an urge to snack around 3:30.
Once I figured out all the parts of the loop, it seemed fairly easy to change my habit. But the psychologists and neuroscientists warned me that, for my new behavior to stick, I needed to abide by the same principle that guided Procter & Gamble in selling Febreze: To shift the routine — to socialize, rather than eat a cookie — I needed to piggyback on an existing habit. So now, every day around 3:30, I stand up, look around the newsroom for someone to talk to, spend 10 minutes gossiping, then go back to my desk. The cue and reward have stayed the same. Only the routine has shifted. It doesn’t feel like a decision, any more than the M.I.T. rats made a decision to run through the maze. It’s now a habit. I’ve lost 21 pounds since then (12 of them from changing my cookie ritual).
After Andrew Pole built his pregnancy-prediction model, after he identified thousands of female shoppers who were most likely pregnant, after someone pointed out that some of those women might be a little upset if they received an advertisement making it obvious Target was studying their reproductive status, everyone decided to slow things down.
The marketing department conducted a few tests by choosing a small, random sample of women from Pole’s list and mailing them combinations of advertisements to see how they reacted.
“We have the capacity to send every customer an ad booklet, specifically designed for them, that says, ‘Here’s everything you bought last week and a coupon for it,’ ” one Target executive told me. “We do that for grocery products all the time.” But for pregnant women, Target’s goal was selling them baby items they didn’t even know they needed yet.
“With the pregnancy products, though, we learned that some women react badly,” the executive said. “Then we started mixing in all these ads for things we knew pregnant women would never buy, so the baby ads looked random. We’d put an ad for a lawn mower next to diapers. We’d put a coupon for wineglasses next to infant clothes. That way, it looked like all the products were chosen by chance.
“And we found out that as long as a pregnant woman thinks she hasn’t been spied on, she’ll use the coupons. She just assumes that everyone else on her block got the same mailer for diapers and cribs. As long as we don’t spook her, it works.”
In other words, if Target piggybacked on existing habits — the same cues and rewards they already knew got customers to buy cleaning supplies or socks — then they could insert a new routine: buying baby products, as well. There’s a cue (“Oh, a coupon for something I need!”) a routine (“Buy! Buy! Buy!”) and a reward (“I can take that off my list”). And once the shopper is inside the store, Target will hit her with cues and rewards to entice her to purchase everything she normally buys somewhere else. As long as Target camouflaged how much it knew, as long as the habit felt familiar, the new behavior took hold.
Soon after the new ad campaign began, Target’s Mom and Baby sales exploded. The company doesn’t break out figures for specific divisions, but between 2002 — when Pole was hired — and 2010, Target’s revenues grew from $44 billion to $67 billion. In 2005, the company’s president, Gregg Steinhafel, boasted to a room of investors about the company’s “heightened focus on items and categories that appeal to specific guest segments such as mom and baby.”
Pole was promoted. He has been invited to speak at conferences. “I never expected this would become such a big deal,” he told me the last time we spoke.
A few weeks before this article went to press, I flew to Minneapolis to try and speak to Andrew Pole one last time. I hadn’t talked to him in more than a year. Back when we were still friendly, I mentioned that my wife was seven months pregnant. We shop at Target, I told him, and had given the company our address so we could start receiving coupons in the mail. As my wife’s pregnancy progressed, I noticed a subtle upswing in the number of advertisements for diapers and baby clothes arriving at our house.
Pole didn’t answer my e-mails or phone calls when I visited Minneapolis. I drove to his large home in a nice suburb, but no one answered the door. On my way back to the hotel, I stopped at a Target to pick up some deodorant, then also bought some T-shirts and a fancy hair gel. On a whim, I threw in some pacifiers, to see how the computers would react. Besides, our baby is now 9 months old. You can’t have too many pacifiers.
When I paid, I didn’t receive any sudden deals on diapers or formula, to my slight disappointment. It made sense, though: I was shopping in a city I never previously visited, at 9:45 p.m. on a weeknight, buying a random assortment of items. I was using a corporate credit card, and besides the pacifiers, hadn’t purchased any of the things that a parent needs. It was clear to Target’s computers that I was on a business trip. Pole’s prediction calculator took one look at me, ran the numbers and decided to bide its time. Back home, the offers would eventually come. As Pole told me the last time we spoke: “Just wait. We’ll be sending you coupons for things you want before you even know you want them.”
Wirelessly unlocking your car is convenient, but it comes at a price. The increasing number of keyless cars on the road has led to a new kind of crime — key fob hacks! With the aid of new cheap electronic accessories and techniques, a key fob’s signal is now relatively easy for criminals to intercept or block. Imagine a thief opening your car and driving away with it without setting off any alarms!
According to the FBI, car theft numbers have been on a downward spiral since their peak in 1991. However, numbers have been steadily inching their way up again since 2015. In fact, there was a 3.8 percent increase in car theft cases in 2015, a 7.4 increase in 2016 and another 4.1 increase in the first half of 2017.
In order to fight this upward trend and prevent your car from becoming a car theft statistic itself, awareness is definitely the key.
So arm yourself against this new wave of car crimes. Here are the top keyless car hacks everyone needs to know about.
1. Relay hack
Always-on key fobs present a serious weakness in your car’s security. As long as your keys are in range, anyone can open the car and the system will think it’s you. That’s why newer car models won’t unlock until the key fob is within a foot.
However, criminals can get relatively cheap relay boxes that capture key fob signals up to 300 feet away, and then transmit them to your car.
Here’s how this works. One thief stands near your car with a relay box while an accomplice scans your house with another one. When your key fob signal is picked up, it is transmitted to the box that’s closer to your car, prompting it to open.
In other words, your keys could be in your house, and criminals could walk up to your car and open it. This isn’t just a theory either; it’s actually happening.
According to the German Automotive Club, here are the top cars that are vulnerable to key fob relay attacks:
Audi: A3, A4, A6
Hyundai: Santa Fe CRDi
Lexus: RX 450h
Nissan: Qashqai, Leaf
Range Rover: Evoque
Ssangyong: Tivoli XDi
Volkswagen: Golf GTD, Touran 5T
2. Keyless jamming
In this scenario, the crooks will block your signal so when you issue a lock command from your key fob, it won’t actually reach your car and your doors will remain unlocked. The crooks can then have free access to your vehicle.
Safety tip: To prevent this from happening to you, always manually check your car doors before stepping away. You can also install a steering wheel lock to prevent car thieves from stealing your car even if they do get inside.
3. Tire pressure sensor hijack
Here’s a novel technique, but it is happening — crooks are hijacking your tire sensors to send false tire pressure readings. Why? So they can lure you into stopping your car, creating an opportunity for them to attack you. Sounds crazy, but this scheme is out there.
Safety tip: If you have to check your tires, always pull over at a well-lit, busy public area, preferably at a gas station or a service garage so you can ask for assistance.
4. Telematics exploits
One of the current buzzwords for connected cars is something called telematics. What is telematics? Simply put, it’s a connected system that can monitor your vehicle’s behavior remotely. This data may include your car’s location, speed, mileage, tire pressure, fuel use, braking, engine/battery status, driver behavior and more.
But as usual, anything that’s connected to the internet is vulnerable to exploits and telematics is no exception. If hackers manage to intercept your connection, they can track your vehicle and even control it remotely. Quite scary!
Safety tip: Before you get a car with built-in telematics, consult with your car dealer about the cybersecurity measures they’re employing on connected cars. If you do have a connected car, make sure its software is always up-to-date.
5. Networking attacks
Aside from taking over your car via telematics, hackers can also employ old-school denial-of-service attacks to overwhelm your car and potentially shut down critical functions like airbags, anti-lock brakes, and door locks. Since some connected cars even have built-in Wi-Fi hotspot capabilities, this attack is completely feasible. As with regular home Wi-Fi networks, they can even steal your personal data if they manage to infiltrate your car’s local network.
Also, it’s a matter of physical safety. Remember, modern cars are basically run by multiple computers and Engine Control Modules (ECMs) and if hackers can shut these systems down, they can put you in grave danger.
Safety tip: Changing your car’s onboard Wi-Fi network’s password regularly is a must.
6. Onboard diagnostics (OBD) hacks
Did you know that virtually every car has an onboard diagnostics (OBD) port? This is an interface that allows mechanics to access your car’s data to read error codes, statistics and even program new keys.
It turns out, anyone can buy exploit kits that can utilize this port to replicate keys and program new ones to use them for stealing vehicles. Now, that’s something that you don’t want to be a victim of.
Safety tip: Always go to a reputable mechanic. Plus, a physical steering wheel lock can also help.
7. In-car phishing
Another old-school internet hack is also making its way to connected cars, specifically models with internet connectivity and built-in web browsers.
Yep, it’s the old phishing scheme and crooks can send you emails and messages with malicious links and attachments that can install malware on your car’s system. As usual, once malware is installed, anything’s possible. Worse yet, car systems don’t have built-in malware protections (yet), so this can be hard to spot.
Safety tip: Practice good computer safety practices even when connected to your car. Never open emails and messages nor follow links from unknown sources.
How about car insurance?
Unfortunately, this rise in car theft numbers will not only put your keyless car at increased risk, but it can also hike up your insurance rates as well.
If you have a keyless car, please check your car insurance and see if it’s covered against car hacks. Since these types of crimes are relatively new, there might be some confusion on who’s going to be liable for what — will it be the driver, the car maker or the car computer developer?
According to financial advice site MoneySupermarket, most car insurance policies currently have these in place when dealing with emerging car technologies:
Drivers have one insurance policy that covers both manual and autonomous (self-driving) car modes.
If the driver of a self-driving car inflicts injury or damage to a third party, that party can claim against that driver’s car insurer regardless of what driving mode the car was in when the accident occurred.
Now here’s the part that covers car theft due to key fob and wireless attacks. Apparently, drivers won’t be liable for faults and weaknesses in their car’s systems and they will be able to file a claim if they are injured or have suffered loss because of those faults.
With key fob relay car theft and hacks, MoneySupermarket said that insurance companies will pay out as long as the car owner has taken reasonable steps to protect their vehicle.
However, if your particular car model is a common target for keyless theft, car insurance companies may charge you with higher premiums.
Steps to stop relay attacks
But still, it’s important to have the best possible protection against these emerging car crimes.
There are a few easy ways to block key fob attacks. You can buy a signal-blocking pouch that can hold your keys, like a shielded RFID-blocking pouch.
Stick it in the fridge…
If you don’t want to spend any money, you can stick your key fob into the refrigerator or freezer. The multiple layers of metal will block your key fob’s signal. Just check with the fob’s manufacturer to make sure freezing your key fob won’t damage it.
…or even inside the microwave
If you’re not keen to freeze your key fob, you can do the same thing with your microwave oven. (Hint: Don’t turn it on.) Stick your key fob in there, and criminals won’t be able to pick up its signal. Like any seasoned criminal, they’ll just move on to an easier target.
Wrap your keyfob in foil
Since your key fob’s signal is blocked by metal, you can also wrap it up in aluminum foil. While that’s the easiest solution, it can also leak the signal if you don’t do it right. Plus, you might need to stock up on foil. You could also make a foil-lined box to put your keys in, if you’re in a crafting mood.