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Comment by spaetzleesser | Hacker News Reader

I always wonder if they really get much value out of all this surveillance or if they just hope to get value.

It seems that a lot of companies are these days are trying to hack their customers instead of treating them right. In the long run I don't this will work. I already am getting a very bad taste dealing with a lot of companies because they seem to view me, the customer, as something to extract money from instead of a customer to be respected. You notice that for example with a lot of search results where the company places stuff they want to sell in the results instead of allowing me to search for what I need.

Either we are going into a very dark future or there will be massive pushback. Not sure which way it will go.

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Even companies like Google seem incapable of using all the information they gather in a very helpful way.

There are some small ml cases that seem to work ok, like suggestions for message responses.

But YouTube video suggestions for example seem so facile. If I click a few videos about today's news, then every video suggestion quickly becomes similar content. Even though I am subscribed to a dozen niche channels and may have watched a bunch of science and engineering videos, I don't get any suggestions related to that unless I directly seek them out. After which, all my suggestions turn to engineering videos.

A few weeks ago I started getting youtube video suggestions for religious Thai videos, which I have never shown any interest in. I ignored it. And it kept happening! I spend most of my time watching educational/tech review content, so I was worried my account got compromised. Changed passwords, and still the Thai videos kept getting recommended.

After a while I finally realized what happened: I would keep an ISS live-feed running in the background while I did housework. It was nice to just see where it was. Turns out that video was being hosted by a channel connected to several of these other Thai channels, and youtube assumed I would enjoy the content.

They still come up occasionally, but I've clicked "Not Interested" enough times that I think they got the idea.

I wonder if those Thai religious videos were spending a lot of money trying to get your specific demographic, so youtube showed it to you even though it was evident you had zero interest.

This,

there's some kind of mob rule going on suggestion wise that's pretty annoying. What are some gem sci/engr channels you've discovered if you don't mind sharing.

Isn't this what they are optimizing for though? I don't work at Google so I don't know and I block ads so I am not engaging with their revenue generation (at least in the most direct sense) but the idea seems to be if you are watching X content you then want to see more of X and it drives total engagement time. I think it sucks and is part of general trend of not being able to find diverse and cool content on the web..but hey Google

Didnt Orbitz (or one of the travel sites) get caught charging customers more money per ticket if they were on a Macbook vs any other computer? [1] This type of data collection is the start of individual pricing based on what stores believe you will pay.

[1] https://www.cnet.com/news/mac-users-pay-more-than-pc-users-s...

I don’t believe they were offering the same hotel room at different prices but rather more pricier options to different users. From the WSJ article that is the source of the CNET one:

“ Orbitz executives confirmed that the company is experimenting with showing different hotel offers to Mac and PC visitors, but said the company isn't showing the same room to different users at different prices. They also pointed out that users can opt to rank results by price.”

https://archive.is/tQQrY

Stuff like this annoys the hell out of me. They should offer the same things at the same prices to all people. Same in Us healthcare. A procedure will has a several hundred percent price variation depending on insurance and other factors of the patient.

> It seems that a lot of companies are these days are trying to hack their customers instead of treating them right.

This is true, and frankly really well put. But I think it has its limits. Rite Aid and similar stores have an extremely tenuous "relationship" with their customers already. The pharmacy in the back might, but the overwhelming bulk of their revenue comes from the snacks and sundries they sell to people walking by, and frankly those people don't care any more about the store than it does about them.

I mean, it's cynical, but there's social value in having Just Another Faceless Junk Store on every corner. We don't want to be "treated right" as an independent variable, we want the drink cooler and sunscreen to be trivially available and we'll walk into whatever door we see.

In that world, "hacking your customers" is the only feasible path to growth. I share the upthread concern as to whether this is effective, I just don't see a way for these stores to avoid going down that path if it does work.

There's something horrific about running a society in such a way that the Just Another Faceless Junk Store on every corner is so worried about chasing growth that it decides to "hack its customers instead of treating them right".

"Hacking your customers" may not be a feasible path to growth if the customers don't like, especially they already lack any kind of loyalty to the business. I used to pop in there now and again because there's a location next to my house, but I won't be going back.

> In that world, "hacking your customers" is the only feasible path to growth. I share the upthread concern as to whether this is effective, I just don't see a way for these stores to avoid going down that path if it does work.

Maybe this is a reason to reorient our economy to focus on the well-being of its citizens as opposed to efficiency improvements in their monetization. If growth in sales/revenue/whatever wasn’t the goal, then the economy could focus on providing necessary services instead of “hacking” customers in order to sell more junk. The economy would be focused around giving people what they need as opposed to maximizing consumption.

==I always wonder if they really get much value out of all this surveillance or if they just hope to get value.==

The continued investment implies that the market has spoken: Your data has value.

The largest companies in the world exist to make money and their investments exist to further that goal.

>The continued investment implies that the market has spoken: Your data has value.

>Your data has value.

Does it. Harbor Freight already knows it's customers are cheapskates and Whole Foods already knows it's customers barely look at the prices? Backing that up with data is nice but how much value does it really have?

FOMO is a big thing at the corporate management level. A million here, a million there to run pilot programs and do partial roll-outs seems like cheap insurance against getting blindsided by something you wrote off as a fad.

>Your data has value.

> Does it. Harbor Freight already knows it's customers are cheapskates

Actually, that's a great example of a company that strategically prices items differently for different customers. Some of their customers are cheapskates and hit up hfqpdb.com and do the math to find the best coupon for every item they buy. Some just use the coupons in the flyer they get in the mail. Some of their customers pay the shelf price. The price essentially adjust to how cheap that particular customer is based on how much time they're willing to spend looking for coupons. Customers who don't care pay an inflated price.

I would bet a large portion of their profit comes from the people in the middle -- who were lured into the store with a coupon and end up buying a bunch of other stuff at inflated prices. I could totally see them being very interested at identifying who those customers are and how to lure them into the store.

==Harbor Freight already knows it's customers are cheapskates and Whole Foods already knows it's customers barely look at the prices?==

If this is how you think pricing decisions are made, I don't know what to say.

On the one hand, we have the lived experience of increasing surveillance and targeting, an investigative article discussing it, and long, documented history of data investments from large corporations.

On the other hand, we have speculation that it's all FOMO.

You don't run pilot programs and eight-year roll-outs of things you aren't taking seriously.

I hear this all the time.

"All the smart guys are spending money on it, it must be valuable!"

You could use this logic to invest in real estate in 2007. Or you would've been eager to invest in WeWork had their IPO not been fucked. You would also believe self-driving cars are a good idea, but I'd bet my life savings against it knowing what I know.

Don't assume you're playing the same game as them when you can't actually provide any data that what they do works. Where is the actual "X dollars of surveillance turns into Y dollars return" data points? You're just providing speculation no better than the person you're arguing with, and honestly your argument is less compelling.

How much is the potential of loss prevention anyways? I've seen tangible effects in store where certain products are behind glass shelves and you must get permission to purchase one and then it goes in this funky plastic box you take with you to checkout, sometimes right around the corner by the glass cage. I'm assuming theft is growing to have responses like that enacted which are incredibly inconveniencing especially when there's no affiliate nearby.

Knowing I'll burn up a bunch of time waiting for one of those lockdowns to be opened I usually order online and pickup in store those items I know are locked up.

It’s probably more helpful to think about it at the margin: starting from some current point equilibrium for some spend $X what is the incremental lift $Y? Because that lens probably more accurately reflects a real purchase decision.

Harbor frieght sells the same shit for years at a time. Their sales are always rotating. As a customer I basically have enough info from 3 months of their ads that I have 0 fomo anymore and also I have a good idea of what the price on an item should be. So essentialy all of their targeting taught me how to maximize them.

Also due to any lack of slack in their product line, I don't have anything I'm missing out on.

So basically, sell me latex gloves for <$7 or I'm not coming in. Magnetic screw trays for $.99 or the bigger ones for $1.99 or not coming in. I can wait literal years for that motorcycle lift to drop to $250 instead of $475.

in other words, they've successfully segmented you and created a loyal customer, with a bonus of inventory management reliability.

there's nothing wrong with that--i do it with my local grocery/big box stores too.

I guess that depends on how you define loyal. If I need a consumable tool I'll check there and amazon. Other than that I never go there. So loyal I guess?

yes, loyal doesn't mean exclusive, just that it's on your short list, which is immensely better for a business than not being on the short list (exclusivity is an unrealstic expectation anyway).

> The continued investment implies that the market has spoken: Your data has value.

That's a dangerous assumption to make, even irresponsible post-2008.

It's also a fallacy which gets used by scammers often.

For example, some in the spam industry relied on that fallacy to sell malvertising schemes to rubes. Because somebody must be making money off spam, right? But the scam is selling the scheme/software to enough spammers to extract a nice living before each of them predictably jumps ship. So the answer could be, "no, they aren't making money," or, "maybe, but you won't be," and the incentive to sell the systems is still there.

Data may have value, but continued investment in it is certainly not enough on its own to elucidate what that value is.

Grocery stores can sell client data to their suppliers and use it to negotiate with suppliers. They also monetize it by sending you (supposedly) well-timed coupons.

this is a huge money stream, and for retail they don't have many other options-- amazon and online delivery is eating their lunch.

Having worked on customer-tracking systems for several companies and seen executive strategy first hand and compiled reports to assess the effectiveness of these types of programs I have witnessed clear evidence that what you are saying is NOT true. Yes, there could theoretically be value to this type of data but trying to explain this to VPs is pearls before swine.

"They wouldn't do it if it didn't work" should be added to lists of logical fallacies. People do dumb stuff and make mistakes all the time, but groups of people are collectively about as clever as a slime mold.

To assume unquestioningly the intelligence of our rulers during the Trump era is just, wow. I don't know what world you live in, but in mine, the worst people on the planet are the ones at the wheel.

> "They wouldn't do it if it didn't work" should be added to lists of logical fallacies.

Exactly. Other reasons for doing something include:

- Thinking that it works, when it doesn't - in particular, reality is messy, and you can often get away believing in bullshit, as long as your peers believe in the same bullshit too.

- It not working for the company in general, but working for them individually to scam their own employer or boost their careers (related: CV-driven development in software).

- It not working, but the profit is made off making you believe they do it because it works.

speaking of fallacies, surely there's a middle ground where our "rulers" are not all geniuses (plutocracy vs meritocracy), but that on average companies pursue things that work over things that don't (survivorship bias).

and groups of people can be smart crowds or dumb (slime) mobs, depending on the systemic conditions.

The correctness of that conjecture depends on what you're averaging over. For example, racism and sexism. Those apparently can persist in the workplace, on average, despite the drag on profits. However, I'd agree that for the average topic, the market does a pretty good job of optimizing behavior.

that's more of a frame of reference issue though. in cases like racism/sexism, available profits on average do accrue to the people wielding power for that purpose, whether it's good for profits overall.

==To assume unquestioningly the intelligence of our rulers during the Trump era is just, wow.==

Who did this? I laid out the case that modern large corporations (no need to bring politics into it) are some of the most effective moneymaking machines in history. We can observe them investing heavily into customer surveillance/tracking. We can also observe the primary players in this industry thriving from a revenue and market cap perspective (Google, Facebook, Amazon).

The hypothesis is that both main street (through revenues) and wall street (through outrageous P/E ratios) are signaling that the data being collected does, in fact, have value.

At first I wasn't going to reply because you are clearly not discussing in good faith (you neglected to address my evidence to the contrary or the flaw in your reasoning but instead focused on my random afterthought.) But others might read this so I decided to elaborate a bit.

I was once misinformed with the belief that business' primary goal is to make money. But when you have the experience of explaining data to a CEO that clearly shows that their customer surveillance has a negative ROI and that the conclusions they are drawing from the data are not warranted. (For example, if you want to claim that your initiative increased sales, you need to compare an equivalent data point before and after the initiative, not just afterward.) If you say this and then look into the cold, dead eyes of a sociopath you'll know how foolish you were to ever assume the point of tracking customer data is to make money.

I felt dumb ever believing that business leaders care directly about money. I knew that to be false in high school when they made me read 1984. The lesson that O'Brien teaches Winston is one that we clearly have not learned.

> The object of persecution is persecution. The object of torture is torture. The object of power is power.

We can add to that list "The object of unrelenting invasive surveillance is unrelenting invasive surveillance."

I think you are misunderstanding my point, so apologies for being unclear. I am not questioning the actual validity of the data collection or ROI of the projects themselves. I am saying that the market can award value to companies who just signal they are making efforts to "digitally transform" or "invest in data assets" or "monetize data". It doesn't matter if they accomplish them tomorrow, the market is giving value today.

Thanks for sharing your CEO experience, that is not a data point I have encountered. I do think money and power are closely linked, although maybe not as closely as I assumed.

==I felt dumb ever believing that business leaders care directly about money.==

Today, what do you believe they care directly about? Power? Ego?

> We can add to that list "The object of unrelenting invasive surveillance is unrelenting invasive surveillance."

yes, and/or that unrelenting invasive surveillance is an enabler and an aspect of persecution, torture, and power.

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