The Algorithmic Influence On Brands

AUSTIN, TEXAS -- I just left my first session at SXSW Interactive here, titled “Trust Me, I’m an Algorithm.” Intriguing? It should be, and honestly, even with my career in data sciences aside, I think this is an interesting concept for all. Where does trust originate, and how can brands earn this?

Martin Harrison, Head of Strategy at Huge, London, walked us through some of his thoughts on how brands earn trust, and how algorithms can both hinder and help these efforts. While trust seems rather elusive, it really comes down to consistency and reliability. Humans are relatively simple, and by seeing something happen again and again, we feel comfortable in predicting the future.

I loved Harrison’s quote stating: “A consumer constructs a brand as a bird constructs a nest – from small scraps collected here and there.” In other words, a brand cannot earn levels of respect and trust simply by stating value propositions, but rather they are earned through time by consistently providing positive experiences with its product or services.



It’s often quoted that humans make an average of 35,000 decisions each day. While I’ve yet to hear the methodology surrounding that estimate, I don’t think any of us would argue that decision making is a key function of our every day, and can sometimes be overwhelming. Step foot into any large retailer, and you’ll instantly feel overcome by the vast amount of choices you face. Not only will you need to decide which of the 72 varieties of toothpaste will best serve your needs, but then must navigate through aisles and aisles of options, and ultimately evaluate checkout lines based on staffing, queue and average number of items per shopper.

As humans, we do our best to lessen this mental exhaustion by reducing the number of decisions we are required to make in our every day, and algorithms are helping. To Harrison’s point, it truly is interesting how comfortable we are being watched if there is a perceived benefit. One example that comes to mind is digital couponing in the grocery segment. While I think we were all intrigued by the coupon extremists who meticulously collected and redeemed stacks and stacks of paper coupons in exchange for cartloads of free – but arguably impractical – items, digital couponing has allowed consumers to save money on the things they actually want to buy. Through time, these algorithms learn your purchase behaviors and provide incentives for the items that were already on your list. As a result, consumer trust and respect increases as overall spend decreases, a big win for consumers, and brands that earn loyalty as a result.

Harrison went on to explain that there are really two types of algorithmic assistance:

  1. Closed Algorithms: help humans decide

  2. Open Algorithms: help humans discover

There are obvious advantages and disadvantages to both types of algorithms, and brands are frantically pursuing how to succeed in this relatively new paradigm.

Overall, a brand is defined by its broader set of values, behaviors and, ultimately, products. A successful brand is designed with empathy and, ultimately, designed for humans. While algorithms have helped consumers navigate the vast amount of choice in our every day, they still have a ways to go to earn full trust and replace a successful brand. It is the responsibility of brands alone to navigate these new routes to market. The most successful will allow decision making to be enjoyable, not overwhelming.
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