The CSR Newsletters are a freely-available resource generated as a dynamic complement to the textbook, Strategic Corporate Social Responsibility: Sustainable Value Creation.

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Wednesday, September 16, 2015

Strategic CSR - Addictions

The article in the url below is an interesting reflection on our relationship with the internet, in general, and the electronic devices that allow us to access the internet, in particular. As the author notes, we are connected online today in ways that would have been unimaginable only a few years ago:
 
"It is reckoned that four-fifths of smartphone owners check their devices within 15 minutes of waking up, and that the typical user does so 150 times a day."
 
The core issue in the article is the extent to which the manufacturers of these devices are aware of our growing addiction and deliberately design their products to take advantage of it. Their intention, it is suggested, is to increase our dependence:
 
"Internet entrepreneurs devote a lot of thought to getting people hooked on their products. How else can they survive in a world in which hundreds of new ones are launched every day? And smartphones and tablets have helped greatly: what could be more habit-forming than devices that are always evolving, always there and always buzzing with fresh diversions?"
 
As the tobacco companies realized a long time ago, of course, the advantage of an addictive product is that it is very good at generating loyal consumers and, therefore, predictable revenues:
 
"Habit-forming products help companies squeeze more money or information out of their customers. Some video-game makers get players hooked and then charge them for virtual products. … Google specialises in useful apps, from Gmail to Google Maps, that gently squeeze data from users, the better to serve them ads. … Getting started on Twitter or Facebook is simple; but the more you tweet, the better and more popular your Twitter account becomes, and the more you search for friends and family on Facebook the more useful it is."
 
Ultimately, however, the author has a more specific point that he wants to make:
 
"Should the makers of habit-forming products be praised as innovative entrepreneurs? Or shunned as the immoral equivalents of drug pushers?"
 
Taken to the extreme, the line seems fine between meeting consumers' needs and taking over our lives:
 
"As smartphones become loaded with ever more sensors, and with software that can interpret their users' emotional states, the scope for manipulating minds is growing. The world is also on the cusp of a wearable revolution which will fix Google Glasses to people's skulls and put smart T-shirts onto their torsos: the irresistible, all-knowing machines will be ever more ubiquitous. And the trouble with insatiable desires is that the struggle to sate them leaves everyone as exhausted as they are unfulfilled."
 
Defenders of the industry note that the distinction between habit and addiction is valid and important:
 
"Creating a habit-forming product is in fact very hard. There have been plenty of digital products, such as Farmville, that were crazes for a while but went out of fashion. There is an important distinction between a habit and an addiction: only about 1% of people who regularly play slot machines, one of the most habit-forming technologies ever created, can reasonably be described as addicted. The proportion is surely lower for Twitter and the like."
 
I don't know about you but, even if the 1% number is true (and I suspect it is higher), 1% of a 300 million active users (Twitter) or 1.2 billion active users (Facebook) seems quite a lot of people.
 
Take care
David
 
David Chandler & Bill Werther
 
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Getting hooked
By Schumpeter
January 3, 2015
The Economist
Late Edition – Final
53