Commentary

Negative Options Rule In The Internet Of Things

In addition to so many other transformations, the Internet of Things is going to convert the consumer’s daily world to one of negative options.

Technology will allow marketers to create messaging and advertising well in advance of a consumer realizing they need such information or persuasion.

People most know negative options from the age-old credit card feature that will regularly bill you for something until you consciously and actively tell them to stop.

The Internet of Things is all about the negative option.

Rather than the consumer deciding to do or request something, that activity will be decided for them.

An early and rudimentary form of negative option marketing is the new feature in the Domino’s Pizza app, where simply opening the app triggers a pizza order, which can be canceled within 10 seconds, if so desired.

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The presumption is that if a consumer is opening the Domino’s pizza ordering app, they likely want a pizza.

With IoT sensors and technology everywhere, marketers will have access to a virtual flood of real-time behavioral data with tons of location factors.

As context, with the Internet, consumers could finally search for whatever they were looking for on their own timeframe.

With mobile, the elements of time and location were added to the equation.

In each of those cases, the search or desire to find something originated with the consumer.

The Internet of Things changes the equation yet again.

Rather than the consumer deciding what to ask for based on their current location and situation, sophisticated marketers will be back in the driver’s seat, predicting and affecting the outcome.

Presented with highly likely consumer scenarios, messages, advertising and recommendations can be crafted and delivered to consumers by default.

This essentially means consumer behavior will transition from requesting information based on what they know, to a process of continual, real-time opt out to information they didn't yet realize they needed.

IoT marketing is about making a decision for the consumer before they even know there's a decision to be made.

The washing machine will automatically order supplies when they get low and the printer will order ink just ahead of when needed.  Of course, the consumer will have the option of stopping each activity, but why?

From a messaging standpoint, just before an order is scheduled, a consumer may receive a message suggesting that their next order of detergent was switched from Tide to Cheer, since there’s a special promotion on Cheer this week and the switch saves the consumer 20%.

The negative option will become the default marketing of the Internet of Things.

This is a major and fundamental shift in marketing driven by the world of the Internet of Everything.

12 comments about "Negative Options Rule In The Internet Of Things".
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  1. Paula Lynn from Who Else Unlimited, April 11, 2016 at 9:20 a.m.

    SO the decision of ordering Domino's must be made before within 10 seconds before one decides what one wants ? What a great reason to delete the app and go local.

  2. Steve Baldwin from Didit, April 11, 2016 at 9:22 a.m.

    Excellent points. The power of defaults and implied opt-ins will be magnified by iOT. OEMs can make these presets difficult to change for those lacking engineering degrees. It is likely that the FTC will be the point agency responsible for addressing these issues.

  3. Chuck Martin from Chuck Martin replied, April 11, 2016 at 10:23 a.m.

    Thank you, Steve. Much of the opting will be driven by the value offered, which better be good.

  4. Rick Monihan from None, April 11, 2016 at 9:57 a.m.

    There will be some early, expensive, and painful learnings early in this process.  I tend to think this works in a positive fashion, though.

    The Domino's example is good one to use - if this actually works, and people like it, then it will become adopted.  It seems to me that this concept will fail, however.  I've opened apps by accident from time to time.  Having to cancel a pizza order within 10 seconds, particularly if I lose my connectivity or some other distraction takes place, may lead to a consumer backlash after hundreds of thousands of unwanted pizzas go unpurchased or contested by their purchaser.

    As you point out, I already have this option in my life with subscriptions.  But each month I review what I pay, and in some cases I've cancelled subscriptions I no longer use.  I admit, I check my credit card statement more than once a week, but it's saved me trouble when fraud has, in fact, taken place.  A bit of vigilance is not a bad thing.

    In addition, most of my bills are already on a set schedule.  I can cancel them whenever I want, but why bother?  From time to time, these bills are over- or under-paid (in cases where I have a set figure paid for a variable payment), but generally that's not a bad thing.  They either balance out over time or when I review my payments, I can make adjustments.

    I'm not sure that negative options are a horrible approach.  It requires the consumer to be more aware of their own behaviors, and that's actually a good thing.  If the these options provide value, they will be adopted and embraced.  If they lead to negative outcomes, they will be rejected.



  5. Paula Lynn from Who Else Unlimited replied, April 11, 2016 at 8:40 p.m.

    Most people are not as good as you are and do what they should do. They don't check what they bought and paid for against their monthly credit card bills or even doctor/hospital bills/automated deductions. Ask the under 50 crowd what a debit and credit is. And Steve is right. There is going to be many legal challenges to such activity. Domino's will lose.

  6. Chuck Martin from Chuck Martin, April 11, 2016 at 10:25 a.m.

    That's exactly the key, Rick, "if these options provide value."

  7. Doug Garnett from Atomic Direct, April 11, 2016 at 5:01 p.m.

    Agreed with your comment, Chuck (and the article). And with that, the place IoT makers are really struggling is with the "IF these options provide value".

    I remember the Housewares Show in 2000 when refrigerators were going to tell us what we needed at the store...except it never really made sense. They CAN tell us we're out of milk. They can't tell me I need eggs unless my scarce refrigerator space is wasted putting everything in specific positions and i spent a lot of time putting things away "just so". At the same show, dishwashers were going to be connected because...they could be...seemed to be the only reason. Really? I need my diswashwer on the IoT.

    FitBit (et. al.) are very useful. Connected home has..some useful things. But past a few things, there's a lot of connected home (so far) searching for reasons to exist. IoT really needs some brilliant marketing thinking. Because so far what we're seeing is a lot of stuff built "because we can"...except it doesn't provide value.

    There IS good potential value. But we have to start digging far deeper into what matters before IoT delivers serious value.

  8. Chuck Martin from Chuck Martin, April 11, 2016 at 5:25 p.m.

    Very well said Doug. I also recall those ealry connected refrigerators and even included them in one of my early book (Net Future), way back when. The logical first phase of such appliances is for self-diagnostics, since repair time/efficiency can dropp direclty to the bottom line. Letting yu know eggs are low? Not so much.

  9. Chuck Lantz from 2007ac.com, 2017ac.com network, April 11, 2016 at 9:26 p.m.

    This all reminds me of the bible sales scam used by the character Ryan O'Neal played in Paper Moon.  After checking the recent obits in the local newspaper, the scammer would arrive at the widow's or widower's door, delivering a personally engraved bible "ordered" by the deceased prior to their demise. All that was still due was postage and handling, of course. 

    In short, which button do I need to push to totally opt-out of the Internet of Things?

  10. Chuck Martin from Chuck Martin, April 12, 2016 at 10:03 a.m.

    That's the fundamental challenge, Chuck, to provide value enough to stop you from hitting that 'out' button.

  11. Larry Smith from Live Idea, April 12, 2016 at 11:02 a.m.

    IoT is going to require many platform plays a la Uber and AirBnB as a central authority matching buyers and sellers. Retailers like Amazon are perfectly positioned with the Echo front ends for voice ordering. Point solutions from individual brands are just not going to work given the volume of data they need to process, and consumers are going to be bombarded with messages and offers that will quickly sap their attention. Forget beacons tracking and shouting out at me; instead I'll tap my watch, choosing the icon for Entertain, Coupon, Buy, More Information.

  12. Chuck Martin from Chuck Martin, April 12, 2016 at 11:36 a.m.

    Good points, Larry, especiall about the positioning of the Amazons of the space. Or that watch-tap will become automatic, based on your location and pre-stated preferences.

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