Time for an inflection point in consumer social?

I first came across this line of thinking way back in 2015, when I read Peter Jon Lindberg’s prophetic piece, The Brooklynization of the World. The basic theme was simple: why the hell does every bar, coffee shop, retail shop, and so on look exactly the same regardless of whether you’re in Portland, Williamsburg, or Istanbul. Then, it hit me again when David Perell swore off algorithmic recommendations in 2019 with The Algorithmic Trap. Most recently, Ezra Klein’s interview with Kyle Chayka, How to Discover Your Own Taste, hit the same note.  

The central message is the same: as our opinions, tastes, and preferences have become increasingly shaped by the algorithms that govern our sources of information & culture, we have become predictable & boring. Amongst our identity in-group, we are a shocking monoculture. And it sucks. I often respond to people who are worried about “Facebook listening to your conversations,” with “nope, you’re just predictable & boring.”

As I highlighted above, this call has been going on since 2015, but has recently reached a fever pitch. It’s my opinion that stated and revealed consumer preferences are finally merging. People have hated being “ruled by the algorithm” for almost a decade — but they’re finally ready to change their habits. And, with that, we’ll have the next wave of consumer social innovation.

So, how did we get here?

FRACTURE & CONSOLIDATE

As the podcast episode does a great job of highlighting, there’s an apparent contradiction at play.

• On the one hand, social media algorithms actually create many different identity groups. They fracture society into a series of independent, mutually exclusive realities of the world — on both information (what is true) or culture (what is cool).

• Once this fracture is complete, they consolidate each group’s preferences into a single set of beliefs or dogma — you either have those beliefs or tastes, or you are out of the group.

Both things are simultaneously true: algorithms break us up into thousands of groups. And, at the same time, they create an impenetrable monoculture within each of those groups. Of course, groups (or tribes) are constantly warring with one another. And, at the same time, members of the same group who diverge from the monoculture are deemed heretics and quickly expelled from that group.

This fracture & consolidate phenomenon has been covered at length in the news & information space — but much less so in the culture space. That’s what I found so interesting about Ezra & Kyle’s discussion. The reason that every coffee shop has subway tiles, ceramic mugs, and succulents regardless of whether you’re in San Francisco, Brooklyn, Mexico City, or Tokyo is because – I hate to break it to you – you are a clear part of a certain tribe, and it has been decreed that, for your tribe, that’s what is good and you should like.

Human beings are fundamentally social creatures, so we’ve always been prone to this phenomenon — it’s just happening at a pace & scale that anthropology can’t keep up with. At some level, it’s nice to have a cool coffee shop that makes a killer flat white in every major city in the world… it’s only after several dozen cycles of this that it starts to get old…

I MISS THE OLD KANYE

The data on whether we’re truly ready for a change is mixed. With the exception of Twitter, whose usage has seemed to plateau and dip per their own internal data, usage on algorithmically driven feeds such as TikTok & Instagram is still up & to the right. That said, cultures around the world are embracing “the death of the algorithm.” The best example: China limits TikTok usage to just one hour per day for children, and online game play to just three hours per week.

While certainly far from dead (Marvel movies were 2 of the top 5 by global box office in 2023), even the most recent Marvel movies have been widely considered somewhat of a letdown, or as Entertainment Strategy Guy calls it, a Marvel-cession. Yet another sign that consumers are finally ready for some variety.

So, the data is mostly in the eye of the beholder at this point. It can either tell the narrative that consumer preference is pushing back against the algorithmic-driven monoculture — or, the opposite.

Yet, if one were to take a non-scientific finger to the wind, they’d inevitably come back with the same conclusion: people are ready for a change. The smartest cultural critics all seem to converge around a rejection of same-ness (at least within their corner of the world).

In their opinion, we’ve lost that unique touch of a great artist, who constantly reinvents themselves, who is uninfluenced or even oblivious to the audience’s reaction to their latest work.

Note: I’m fully aware of the irony of using an AI answer generation machine to discuss the topic of developing our own answers ;)

THE TECHNO-OPTIMISTIC TAKE

I wouldn’t call myself a techno-optimist, strictly speaking, though I tend to bias in that direction. However, I am unequivocally a techno-inevitablist. That is, I believe that human curiosity & discovery, and all of the technologies that follow from that pursuit, is absolutely inevitable. If it isn’t [Mark Zuckerberg], it will be someone else. The rapid development of new technologies cannot be stopped; and hardly slowed. It is completely intertwined with the existence of humanity and, therefore, the lack of technological progress is directly correlated to the lack of existence of humans. There are times when I am optimistic, there are times where I am pessimistic, but I never waste time on suggesting that we put technologies back in the bottle. That’ll happen when humans go extinct. See also: technological determinism, a term coined in the mid 20th century, which posits that technological development drives all societal & cultural changes.

Why is this important to this essay? Because, if you buy this point of view on the world, it’s pretty hard to think that we’ll just put algorithms back in the bottle; that we’ll just agree, as a society: nope, we didn’t like that phase, let’s take a mulligan.

So, what’s the techno-inevitablist way out of this mess? A couple ideas on where this could go:

1. Algorithms are, more or less, a series of “If This, Then That” steps with pre-programmed logic. They are made up of a set of features that facilitate this logic (e.g. if you liked posts from this account, show more posts from accounts that tweet about similar subjects). What if we added spontaneity as a feature and increased the reward for that type of content? Result: more people seeing more things that break out of the monoculture. Those who posts those types of things to their network seeing more impressions of their posts and, thus, posting more of that type of thing. In other words, you’re using the same mechanism but inserting a circuit breaker to stir things up.

   1. Others have posited this idea long before me, quite eloquently, I might add.

   2. The best part… this is already happening: LLMs have a “temperature” setting. A higher temperature value typically makes the output more creative but also increases the chances of erroneous ones. In essence, you can tune the LLM to be more spontaneous.

2. Much has been made about how this is all business model driven. They make money by showing you ads. Ads require scale. Scale requires engagement of any sort. These algorithms are the best hammer in the history of the world for that nail. And so the story goes. Again, we can use the same mechanisms that got us here to get us somewhere else. What if users could opt into an algorithm-free feed, or a spontaneous algorithm feed, or one of another dozen options? I’l admit, the problem with this approach in today’s world, is that these companies are so damn good at monetizing our attention via advertising that any make-whole subscription fee is exorbitant.

   1. Facebook makes $40 per user per quarter in the US. Is anyone really willing to offset that costs by paying anywhere close to $40/3 = $13 per month? Probably only a small handful of people.

      1. At the same time, these types of changes always start with early adopters. I already pay $20 / month for ChatGPT and I sure as hell would pay $20 / month to break out of my own group’s monoculture. And, if I’m right on this, and usage starts to decline as consumer preferences reject algorithmically driven information & culture, the tradeoff (and the subscription fee) will come down rapidly. If there’s one thing you can bet on in technology, it’s that, when something is working, costs find a way to come down dramatically such that a larger population can access it.

      2. Further, the EU is already trying to force this change via regulation. At the EU’s behest, Facebook launched an ad-free subscription tier in Europe. With a governing body behind this shift, there will be tremendous pressure for it to work. This may mean forcing features to encourage the users to subscribe, either by improving the ad-free tier, or degrading the ad supported one (think a governing body can’t get involved in feature selection? Read up on the Microsoft story in the 2000s).

So, no, I don’t think we’re going to put the genie in the bottle, nor should we aspire to. But I do think change is coming, and I think we can use the same technology that got us here, to deliver us into a more joyous, serendipitous world. Of course, it’s really important that we break out of our monoculture when it comes to news & information — but it’s really important we do so when it comes to culture too. It’s time to learn to develop our own tastes again.

PS: Ironically, a huge, billionaire-owned, 100-year time horizon roadmap, no external stakeholders, pivoting-to-subscriptions, consumer social app is the absolute perfect candidate to pull this vision off…

END GAME

Just as the dust settles and most things in consumer tech seem “boring” I am really excited about the next ten years of consumer social once again. There’s obviously massive market demand for information & culture centers that aren’t governed by the same engagement-seeking algorithms. There are two central challenges:

1. Stated vs. revealed preferences: This all sounds great but right after I hit publish, I’ll go surf Twitter & Instagram. I don’t want to be a boring monoculture but, damn, it’s easy to be.

2. Algorithms work for growth: The reason algorithms dominate our information & culture is that they work via the most effective viral growth loop the world has ever seen (in the form of the like & share buttons). It seems almost insurmountable that someone would be able to reach a competitive scale without that trick in their back pocket.

Nevertheless, consumer preferences, en masse, are a wonderful thing. Just as the calls for regulation reach a fever pitch, and as these businesses seem more impenetrable than ever, I think there will be a renaissance of attempts to displace them — and I think one of those shots on goals just might be able to thread the needle between that tailwind (consumer demand) and headwind (no growth hack) — and then we’ll do it all over again.